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Jacko's Forex House of Pleasure and Pain

  • #2,941
  • Edited 9:56am Apr 17, 2008 9:55am | Edited 9:56am
Hy guys,

I am sorry when it looks like a dumb question. I have found this thread minutes ago and now I try to understand the anti hedging strategy postet in post 5.

In the description I read the following :

4. PUT AN ORDER IN AT THE EXACT SAME FIGURE AS YOUR STOP LOSS (if you were originally "short" then place a "short" order) This ensures that when the market comes back, as it invariably does, you have a DEFINATE order in place to put you back in the market where you were originally...and you are now in the same direction as the market is moving..

What I do not understand is:

When I had a short order in place and it goes through the roof and my stop loss was hit, why I should place now again a short order? My understanding is that there would be a long order the better decision......

What do I understand wrong here? Maybe some of the more expierienced traders here could explain?


thanks a lot!

Cyborg
  • #2,942
  • Apr 17, 2008 10:11am Apr 17, 2008 10:11am
Hi Cyborg,

The AH Strategy is only used for failed trades in the direction of the trend, i.e., Long. The strategy is not to be used for counter trades against the trend, i.e. short.

Hope this helps

Robert
Jacko 2nd Group
  • #2,943
  • Apr 17, 2008 10:16am Apr 17, 2008 10:16am
Hi everyone,

I've been lurking around for a bit. I just got into trading. I've been reading this thread and keeping up with it for a while. I have a quick question though, how do you calculate the 50% fib level? I've always used S&R and trend for my trades, but would like to try the 50% fib line, but never knew how to calculate it.

Thanks
  • #2,944
  • Apr 17, 2008 10:19am Apr 17, 2008 10:19am
Quoting cyborg
When I had a short order in place and it goes through the roof and my stop loss was hit, why I should place now again a short order? My understanding is that there would be a long order the better decision......

What do I understand wrong here? Maybe some of the more expierienced traders here could explain?


thanks a lot!

Cyborg
Cyborg

The Anti Hedging strategy works because you are trading in the direction of the long term trend. If you look at the eurusd on the weekly chart, you will notice a bias towards an upward trend. What this means is... if you were to buy and it happened to be a really bad entry, not to worry because the market will eventually find it's way to where you were knocked out and head higher. What this effectively does is make back your losses from that trade and hopefully make additional gains on top of that.

Keep in mind that when placing the AH order, wait for the market to pass your stop by at least 50 pips before putting the order in.


For those that are struggling to understand this concept and how to execute it, here is an example...

Lets say you entered in at 1.5600 and the market dropped to 1.5550 knocking you out. You will then wait for price to drop to at least 1.5500 before placing your order to buy at 1.5550 (where you were knocked out). Price rises, hits 1.5600 (this is where you make back your losses) and heads higher putting you into profit.

Hope this helps.


zoopy
  • #2,945
  • Apr 17, 2008 10:21am Apr 17, 2008 10:21am
  •  MPP
  • Joined Jun 2007 | Status: Be yourself, everyone else is taken | 2,734 Posts
Quoting cyborg
Hy guys,

I am sorry when it looks like a dumb question. I have found this thread minutes ago and now I try to understand the anti hedging strategy postet in post 5.

In the description I read the following :

4. PUT AN ORDER IN AT THE EXACT SAME FIGURE AS YOUR STOP LOSS (if you were originally "short" then place a "short" order) This ensures that when the market comes back, as it invariably does, you have a DEFINATE order in place to put you back in the market where you were originally...and you are now in the same direction as the market is moving..

What I do not understand is:

When I had a short order in place and it goes through the roof and my stop loss was hit, why I should place now again a short order? My understanding is that there would be a long order the better decision......

What do I understand wrong here? Maybe some of the more expierienced traders here could explain?


thanks a lot!

Cyborg
Hi Cyborg
the instructions were given as an example - first and most important is to recognise the trend.

EU is still LONG and all trades in the jacko method are taken long from areas of support, if then the trade fails we AH it from our point of exit but only after price has dropped a further 50pips.

I think reading your post you understand this, but your first trade was short and you have clearly recognised that price is long.

I would suggest you print the first few pages and read them a few times, then start a trading log to track you practices.

Best of pips

MPP
  • #2,946
  • Apr 17, 2008 10:22am Apr 17, 2008 10:22am
Trumpcard (http://www.forexfactory.com/member.php?u=4033)
Lurker Extraordinaire
Member Since Oct 2005
Posts: 346


http://www.forexfactory.com/images/icons/icon1.gif
what does a sweeping cure mean in technical analysis terms?


Hi Trumpcard,

A Sweeping Curve or Rounded Bottom as it is better known, is usually an end of trend pattern. In this bottom, it shows the sellers gradually phasing out of their positions and the buyers gradually phasing in. Don't bet the bank on it though, as with all chart patterns and technical anaysis, one will come along and do just the opposite.

Hope this helps

Robert
Jacko 2nd Group

  • #2,947
  • Apr 17, 2008 10:24am Apr 17, 2008 10:24am
Quoting rlee17
Hi everyone,

I've been lurking around for a bit. I just got into trading. I've been reading this thread and keeping up with it for a while. I have a quick question though, how do you calculate the 50% fib level? I've always used S&R and trend for my trades, but would like to try the 50% fib line, but never knew how to calculate it.

Thanks
Rlee

The 50.0% fib retracement level is determined using the fibonacci retracement tool in Metatrader or whichever charting package you're using.


zoopy
  • #2,948
  • Apr 17, 2008 10:28am Apr 17, 2008 10:28am
  •  MPP
  • Joined Jun 2007 | Status: Be yourself, everyone else is taken | 2,734 Posts
Quoting rlee17
Hi everyone,

I've been lurking around for a bit. I just got into trading. I've been reading this thread and keeping up with it for a while. I have a quick question though, how do you calculate the 50% fib level? I've always used S&R and trend for my trades, but would like to try the 50% fib line, but never knew how to calculate it.

Thanks
You chart package will calculate this for you, first you need to find you Fibanacci tool, then simply add it to the charts, each package works a little different, lets us know which platform your using and we will try to help with more details.

with MT4 the fib tool normally sits along the top tools line, click on it and then click the chart and hold as you drag the fib on to it, once done you can double click it and move the points about on the chart. If you right click over it once highlighed you can make changes to it - ie remove all fib lines except for the 0 50 100 to keep your charts clear. as with all MT4 tools click reset to restore defaults.

then just practice.
  • #2,949
  • Apr 17, 2008 10:30am Apr 17, 2008 10:30am
Hi Cyborg,
I would suggest you read this whole Journal and reread the first few posts many times, you will not regret it.

The trend at the current time is up, look at weekly, daily and 4hr charts to confirm.
When the trend is up, the anti-hedging strategy is only used on long positions.
If you went short and went against the trend then you can not use the a-h strategy, you are skydiving without a parachute.

If for example you bought at 1.5850 and the market went up to 1.5883
then you would move your stop from 1.5800 to 1.5833 (since the 50 pip stop is a trailing stop)

If the market then went against you and you were stopped out at 1.5833, then you would wait for the price to reach at least 50 pips lower 0r 1.5783 and then you would place a buy order at 1.5833(the price you were stopped out at).

When the trend resumes your order will be filled and you would start trailing the trade with a trailing stop loss.

These are just hypthetical numbers to explain the point, I hope that helps.
Camptrader
  • #2,950
  • Apr 17, 2008 10:33am Apr 17, 2008 10:33am
Quoting MPP
You chart package will calculate this for you, first you need to find you Fibanacci tool, then simply add it to the charts, each package works a little different, lets us know which platform your using and we will try to help with more details.

with MT4 the fib tool normally sits along the top tools line, click on it and then click the chart and hold as you drag the fib on to it, once done you can double click it and move the points about on the chart. If you right click over it once highlighed you can make changes to it - ie remove all fib lines except for the 0 50 100 to keep your charts clear. as with all MT4 tools click reset to restore defaults.

then just practice.
hmm anyone use GFT's software? that's the broker i use, can't find the Fibonacci tool.
  • #2,951
  • Apr 17, 2008 10:36am Apr 17, 2008 10:36am
Quoting gagiul
surprisingly, Jacko himself was bearish before the break of 1.5900, thats why I wasnt confident about the break I suppose he must be bullish right now.
I would really love if Jacko could give us some insights about his medium term view, like he used to give before.

Jacko is bullishg at this time.
  • #2,952
  • Apr 17, 2008 10:37am Apr 17, 2008 10:37am
  •  MPP
  • Joined Jun 2007 | Status: Be yourself, everyone else is taken | 2,734 Posts
Quoting rlee17
hmm anyone use GFT's software? that's the broker i use, can't find the Fibonacci tool.
has it got a live chat facility - try them if now one gets back to you here.
  • #2,953
  • Apr 17, 2008 10:46am Apr 17, 2008 10:46am
Quoting rlee17
hmm anyone use GFT's software? that's the broker i use, can't find the Fibonacci tool.
If GFT uses Metatrader, this is where the tool is located.
Attached Image
  • #2,954
  • Apr 17, 2008 10:49am Apr 17, 2008 10:49am
alright i figured it out. what's a good start and end point to use for the 4H chart? how far do you go back?
  • #2,955
  • Apr 17, 2008 10:55am Apr 17, 2008 10:55am
  •  MPP
  • Joined Jun 2007 | Status: Be yourself, everyone else is taken | 2,734 Posts
Quoting rlee17
alright i figured it out. what's a good start and end point to use for the 4H chart? how far do you go back?
easiest way to start this is to apply a Trendline channel - a supporting trendline and a resistance TL, then look point were price has touched at the top and bottom. this will get you started as you will be able to see the waves.

Attached Image (click to enlarge)
Click to Enlarge Name: eu.gif Size: 23 KB
  • #2,956
  • Apr 17, 2008 11:12am Apr 17, 2008 11:12am
FYI- Was stopped out with my 90 pip TSL at 5890. That was a 88 pip profit. Two nice trades in a row! This "patience thing" is working well.

I would have liked to re-enter at 5900 on the way back up, but I wasn't at the controls. Will be patient and evaluate the next best entry.

-Sean
  • #2,957
  • Apr 17, 2008 11:14am Apr 17, 2008 11:14am
My buy limit @ 5870 got picked up while I was asleep,and now I'm up 45 pips. What a great way to wake up . I hope everyone is having a great trading day!
Live From Los Angeles
  • #2,958
  • Apr 17, 2008 11:40am Apr 17, 2008 11:40am
Quoting gagiul
I also got filled at 1.5900 Then Euro reached 5975 but I moved my stop right below the spike at 5895. So im risking 5 pips now. Looking forward to 1.6000
i lost my 5 pips and apparently i cannot AH them since the market just did a quick spike down. Oh well... I got filled with another lower buy order at 5860 which is the 50% retracement of the latest wave up.

I think that we hold above 5900 today, we should see 1.6000 soon. Getting ready to open the champagne.
We leave no soldier behind.
  • #2,959
  • Apr 17, 2008 11:47am Apr 17, 2008 11:47am
thanks everyone for your replies. i had a buy limit that initially missed by 1 pip (ibfx feed) then hit while i was away and iv'e reurned to find it stopped out at a 50 pip loss. at least it was only a demo trade! what are the ramifications of moving into a period of increased uncertainty and volatility? Still favour euro longs at round numbers and 50 fibs with 50 fib stop losses? is i time to automatically set a 100 stoploss given current market uncertainty?

i would really appreciate some ORIGINAL Jacko followers (or turtles or whatever you guys call yourselves) give analysis on trades and or your opinions of the market. I am in Jacko's second group and plan going live in June but want to have the reassurance I'm ot trading blinldly.

for those who have entered at levels other than xx50 or xx00 (round numbers) can you explain why u entered at the price u did?
  • #2,960
  • Apr 17, 2008 11:48am Apr 17, 2008 11:48am
Quoting gagiul
i lost my 5 pips and apparently i cannot AH them since the market just did a quick spike down. Oh well... I got filled with another lower buy order at 5860 which is the 50% retracement of the latest wave up.

I think that we hold above 5900 today, we should see 1.6000 soon. Getting ready to open the champagne.

Nice bargain price, I think we may see 1.6 today also, London sat around the 1.595 area for pretty much the whole session, so we just may see it...
Live From Los Angeles
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