Thexder's journey to(ward?) freedom

Three Strikes
Forward Test Week 1
---------------------
Wins 2 : +161 + 65 = 226
Losses (0): -58 (from a stupid mistake, not counted)
Total (2): +226


Yesterday I had a gain of 65 and today I took a short that got knocked out on a spike for a loss of 58, so not bad overall. I think I could have prevented that loss because I analyzed the setup wrong. I made a mistake in looking at the setup during the bar that had broken out (while it was forming and before it broke out) rather than looking at the pre-break out and previous bars that have all closed...so looking at the proper setup, I now see 3 strikes against the trade. It's part of the learning as I forward test and get used to evaluating the setups in real time. If I were back testing that setup I'd have caught it because I'd see which bar broke out and then I'd only look at those before it. Oh well at least I'm in profit still.

I've also been revamping the system and posting the updated PDFs here and in the public thread I started. I'll post the charts out in the other thread for the trading method and just keep track in here for a while.

Three Strikes
Forward Test Week 1
---------------------
Wins (2) : +161 + 65 = 226
Losses (0)
Total (2): +226


This is Good Friday and the news page is almost blank, cable is flat, I doubt I'll be finding or trading a setup today so I'll finalize my opinion of the performance of Three Strikes week 1.

In all the noise I only see those 2 good trade setups and it still puts the weekly average way up there over 200, avoiding whipsaws and catching trends. I hope it works that way in the long run and not just a coincidence, but that month of back testing plus one extra week now makes 5 weeks of good performance. Although I've tweaked the guidelines and discretions 5 or 6 times I don't think I've system-hopped it and messed up the testing counter productively because if anything the tweaks put tighter constraints, not different constraints on the evaluation, so I stand by the test results. Now that I'm constantly looking at the hourly bars and running down the checklist it's becoming more instinctual and I don't have to read the checklist as often when considering the formations. Things just stand out like the trend line is engulfed and the tunnel is going the wrong way, looks overall non distinct, yesterday closed within 2 days ago price range, no good - time to watch TV for an hour and try again.

I'm not going to count that one loss I took in the official records because it was just my own failure to think straight. It wasn't the method's fault. Here's the trade I'm talking about. I evaluated it during the formation of the break out bar rather than the pre break out, so for one thing I had no way to know what the final outcome of that bar formation would even be. But the reason I went with the trade is I saw that the engulfed trend line had been cleared (and it stayed clear by the close of that bar) but the previous bars were the ones that counted and those were engulfing the trend line for three strikes:

Strike 1: Engulfed trend line
Strike 2: Price line biased long to neutral, not short
Strike 2.5 and 3.0: Irregular tunnel very square on top and round on bottom wall, and recently geting wider

Should not trade.

I'm all over the place lately, but in a collimating fashion. In working on 3 strikes I've somehow been inspired to go back to the roots, the original 2007 version of the cable hourly scalp with the fixed stop and fixed conservative TP (34% non standard fib extensions).

I'm going to consider doing some more back testing on that brute force full time method since Oct and Nov (ranging and trending) both produced good returns despite the trading conditions and the very small TP levels (sometimes taking only 10 pips out of a 100+ move). With all the early March ranging I'm wondering how it would have done.

And the most recent fib scalp with M1 stops and no break out direction bias, I'm seeing a relationship between this and 3 strikes. When a 3 strikes setup is good but the initial stop is too far away (because a bar would have to move more volatile than recent bars to break out from its current location), I notice that pulling an unbiased fib across the most recent swing wave and taking the break in the 3 strikes direction with a 38.2% extension TP provides a way of getting into the trade with a better stop and easy to achieve TP. I want to test that further.

Another way to use fib with 3 strikes is when the method can't catch a sudden big move that blasts out of nowhere without a setup into a big multi volatile bar trend without pulling back to give another opportunity to get in. When it is clear that a sudden big move has begun it can be roped with a fib across the last closed bar. If that bar is broken with the trend, trade it to its extension while allowing a 61.8% pull back along the bar if necessary. When it retraces more than that it's over. Either get out with a TP scalp or consider trying to stay in and catch the trend and start moving stops behind bars. This can snatch 20 to 50 scalp pips out of a runaway surge.

So I might end up using some variation of all 3 methods I've devised in the last 6 months.

Today's trade to kick start the morning:
+40 using the new V-M Hybrid Scalp.


As I pointed out earlier I'm all over the place lately, not posting properly or consistently anywhere and off working on new things.
I've started the 2 new threads to expand upon system development ideas and I've come up with a few new things. The links to the forums are in the first post and I've relocated the PDFs to those respective threads to stay organized. I was maintaining duplicate copies unnecessarily.

+35 this morning from hourly V-M Hybrid Scalp short.

In the last 2 days there was a potential
+40 (V-M) Yesterday
+30 (H4 Volatile) Yesterday
+40 (3 Strikes) Yesterday
+35 (V-M) Today

+145 Two Day Total

But I only got +40 +35 out of it due to time away from the screen while working on the methods and testing.

Some time in the next few days I should have a new PDF.
3 Strikes renamed 3 Modes.

After all that scalping work the past 2 weeks, which was a detour from the longer term method development (I got inspired and sidetracked) I am now re-inspired with the 4 hour time frame and I've made progress over the weekend.

Now I'm on the daily time frames. That's where all the inspirations are coming from so that's what I'm going with right now. I'm finding that at least for the way I'm perceiving the charts, I'm not coming up with universal trading methods, I'm tailoring methods to what I see and finding what works on that chart. I would be wise therefore to back test as much as possible to be sure of what I'm developing. Maybe the methods will work on a specific chart they were created with but I'd like to verify if they "always" work on those specific charts or if things completely change over time - a method works not only for one chart but for one stretch of time also, then expires and a new system needs to be invented. I'll have to answer that for myself soon. Either way as long as I am capable of adapting and creating something that works for a while each time, then I should survive.

Right now I have been coming up with something that works on daily cable and I've back tested for one year with good results. I then tried using this perspective with a daily E/J chart and it was a complete failure. But within 15 minutes of staring blankly at E/J daily, things began to stand out in that chart's personality and I might already have some preliminary ideas to look more into. That's what I'm hoping I can do over time if proven things begin to fail.

So having that experience, I think I will look at more cable back testing, even if I just pick a random month here and there in the past and try out the "current" methods. If I see success in random months over the last several years I'll feel much better. Even the one year I already tested makes me feel stable about it. I can re-invent myself once a year. I only really started hardcore working at this nonstop when I landed on this site 6 months ago and now I've created between 5 and 10 systems in that time, and it keeps getting easier and clearer. If I had a year of constant trading and started to notice things change I think I could figure out what to do.

Is this what finding the grail is? Being able to look at the chart and figure out what it is telling me at the time, and go with it? I would rather be able to do that than to just come up with some mechanical process that works on all charts all the time and I don't even know why. I would fear having that universal rule fail and being stuck then.

Thexder. What you are describing appears to me to be a philosophy of trading. IMHO having that is the 'grail'.

In a few months we shall see if I have found what I have sought.

At least it's inspiring that yesterday I put faith in my efforts and set a pending order on daily cable with a fixed target and stop, woke up today and saw +100 in my account (live). The biggest thing about this is it never even affected me - no joy, no emotion. Just business. I expected the trade to work and it did so I couldn't really be surprised.

I just went back in the historical chart data and visually skimmed a few months - it holds true, I think I've discovered a loophole in cable's personality I can capitalize on.

The worst month I've encountered so far is March 2007 where I had a win, loss, win, loss, and so overall the result I think was slightly negative for the month, but the following month was +400, so the average is 200 a month for those 2, and 200 a month is what my all time goal has been for whatever methods I use, as long as I can pull that in I'm satisfied.

The emotionless -- business like -- aspect of trading, is spoken of by Dr. Alexander Elder in Trading for a Living (currently re reading it) as a trait to strive for.

The trade I took and exited on cable daily yesterday so far seems like the right decision. Right now I could be up another 50 on top of the 100 I took, and next week the trend could take off in that direction and I'll miss out, but I got my 100 and that's all I was shooting for right now.

I never thought I'd live to see the day I'm using a daily chart and my account growing simultaneously (without me depositing funds)

Still working on the daily chart stuff behind the scenes and also working on some other dormant session break outs. I'm currently trying to develop a way to time shift a long term trade entry so that instead of set and forget at 5pm EST when a new bar opens for me, I can set and forget near midnight when I'll have a higher probability of always being at home and able to manage the trades.

I waited for something to start moving with momentum since it's the start of the week and I saw some downside strength so I took a short with a fib 50% target and it was just barely hit for +12.

When it turned around equally strong I took the high break and got +17 from a trailing stop. The 50% target wasn't immediately hit like on the short so I was able to intercept and manage it.

Some things that are going on in my head lately...

NZDUSD pseudo pin

AUDUSD pin off a trend line

EURGBP
Pin off fib retracement and recent support

EURUSD
Merged pin off retracement and recent support. Might roll back now but it's already hit profit enough.

Around +100.

Around +80 and counting.

This week's first trade is based on a pin that showed up both on the weekly and on the daily, took a long.
Currently sitting slightly above break even by managing on the 4 hour s/r areas.