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4 Hour Strategy (MACD)

  • #14,721
  • May 13, 2008 1:38am May 13, 2008 1:38am
Quoting Phillip Nel
EurUsd has hit 89sma resistance. It looks like that TL is still there as well with a testing of it and bounced away. i will wait for a break of the 89sma and look on the 1H for a possible pull back to 89sma and bullish move away bar to enter. But it have to be very obvious and strong candles otherwise I will go to the beach. (This is close to looking for a reason to trade. We made some pips yesterday so lets wait till the market tells us what to do.)

GbpUsd
Might give a TC or BOZ on next candle.
It seems that I am again so aggressive.
Plan your trades and trade your plans
  • #14,722
  • May 13, 2008 1:38am May 13, 2008 1:38am
Pound looks quite interesting, I'm waiting for news to see clear direction.
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  • #14,723
  • May 13, 2008 1:59am May 13, 2008 1:59am
Hi all,

Took SHORT on GU at 7.00 BST as price had closed below and then retraced to 8ema in previous two candles and trend was down..... Only placed one trade, so when price moved in right direction, I moved stop to guarantee 25 pips and let the trade run, but a mini spike at 7.35 hit SL. Anyhow, I am pleased with 25 pips today......as it is, after the event I spotted an earlier support line which I now extend and see a better target would have been 1.95.
Still learning.....much distance to go!
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  • #14,724
  • Edited 4:26am May 13, 2008 2:08am | Edited 4:26am
While sitting here this morning this just jumped into my mind. It is a better way of managing the entry especially when stopped out without any gain.

1. You will gain 25pips less on the second lot as when you enter both at the same time.
2. You will lose 35-45 pips less when stopped out as the second lot wont be in.
3. If you are right lets say 6times out of 10 it means for 6 times you will lose 25pips(150)pips and when you are wrong 4 times it means 4 times you will not lose about 40(the second lot not in) that is 160 pips. It will about even out. It will however help you in the beginning till you reach a 6 out of 10 wins.

Tell me what you think.

Edit
Have a look at this comment as it ia very valid and make your own decision as to this concept.

Originally Posted by islandtrader http://www.forexfactory.com/images/buttons/viewpost.gif
why not just leave the 1st position open after 25 pips gain and move the s/l to BE, that way we save the spread in not closing out the 1st position and not opening the second, but with same result.

You are right. The only benefit will be to have a second lot set to -25 stoploss to give it some room.

That can be usefull to sometimes as I use that often to give my position some room to move yet get out BE if taken out.
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  • #14,725
  • May 13, 2008 2:24am May 13, 2008 2:24am
Quoting attictrader
Hi all,

Took SHORT on GU at 7.00 BST as price had closed below and then retraced to 8ema in previous two candles and trend was down..... Only placed one trade, so when price moved in right direction, I moved stop to guarantee 25 pips and let the trade run, but a mini spike at 7.35 hit SL. Anyhow, I am pleased with 25 pips today......as it is, after the event I spotted an earlier support line which I now extend and see a better target would have been 1.95.
Still learning.....much distance to go!

Ballsy trade that one then!. I had a trendline on mine also but took the trade anyway to see what would happen. However, following it on my 5 mins i didnt like the volatility so bailed for +1, which doesnt bother me partic. This is the problem i find, for me anyway, with the GBP is there are times, like this, when its too volatile for my liking for whatever gain. Theoretically the trade was on, supported by the fact the 4-8am bar was also an inside bar. Yet the action was still very very messy. The support line was a good target i feel. So, reasons for me not wanting to take the trade were.......big positive day yesterday, lots of news later, known volatility, and the trendline. Those things increased the risk for me. In this case i feel the trade was evenly balanced between being on and not worth it, you pays your money and takes your choice! Nice trade though............ if you can stand it!.
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  • #14,726
  • May 13, 2008 2:29am May 13, 2008 2:29am
I think the GBP just made my point, it would have taken out your stops there. I am a beleiver in setting targets and taking your pips...........!
  • #14,727
  • May 13, 2008 2:34am May 13, 2008 2:34am
Quoting Phillip Nel
While sitting here this morning this just jumped into my mind. It is a better way of managing the entry especially when stopped out without any gain.

1. you will gain 25pips less on the second lot
2. You will lose 35-45 pips less when stopped out.
3. If you are right lets say 6times out of 10 it means for 6 times you will lose 25pips(150)pips and when you are wrong 4 times it means 4 times about 40 that is 160 pips. It will about even out. It will however help you in the beginning till you reach a 6 out of 10 wins.

Tell me what you think.
It sounds good, especially for people with small accounts.
I have other strategy:

1.When I enter 4H trade I take a look in 5 min charts waiting for entries in retracements and get some extra pips.
2.When I'm not involved with 4H trades I take 2 positions with 5 min system. First one with 10-15 pips as target (if I'm lucky I'm able get even more) and with second one I set stop at BE after 6 pips profit and let it run (usually it closes at BE but I catch some big moves sometimes).
  • #14,728
  • May 13, 2008 3:19am May 13, 2008 3:19am
Quoting Phillip Nel
While sitting here this morning this just jumped into my mind. It is a better way of managing the entry especially when stopped out without any gain.

1. You will gain 25pips less on the second lot as when you enter both at the same time.
2. You will lose 35-45 pips less when stopped out as the second lot wont be in.
3. If you are right lets say 6times out of 10 it means for 6 times you will lose 25pips(150)pips and when you are wrong 4 times it means 4 times you will not lose about 40(the second lot not in) that is 160 pips. It will about even out. It will however help you in the beginning till you reach a 6 out of 10 wins.

Tell me what you think.

Philip:
Could you please clearify point No 2 on the image.
THE DIFFERENCE BETWEEN GOOD AND EXCELLENT IS ATTENTION TO DETAILS.
  • #14,729
  • May 13, 2008 3:23am May 13, 2008 3:23am
Quoting ejiexe
Philip:
Could you please clearify point No 2 on the image.

If the price turns before the 25gain is reached and takes out your stoploss ar -30-45 pips the second lot order would not be triggered at +25 so you will only be stopped out on one lot as where we currently entered 2 lots and take 50%(one lot) profit at +25 but hte other lot is also in so if the price then turned around before the 25gain is reached for the first lot to be closed for a 25pips gain it means that both lots are closed out for a 30-45 loss
  • #14,730
  • May 13, 2008 3:52am May 13, 2008 3:52am
" (RTTNews) - UK annual inflation shot up in April and stood well above expectations. Tuesday, a report from the Office for National Statistics showed that the consume price index annual inflation accelerated to 3% in April from 2.5% in March. Economists had expected the annual rate to edge up to 2.6% in April. Annual inflation continued to stay well above the central bank''s target of 2%. Month-on-month, consumer prices rose 0.8% in April, higher than the 0.5% expected by analysts. The core annual inflation for April came in at 1.4%, slightly above 1.3% forecast.For comments and feedback: contact 2008 RealTimeTraders.com, Inc. All Rights Reserved"

Might see some downmove according to me. Maybe someone can give some insight on the figures released. I am not an expert on fundamentals

Edit
1Hour tail indicating down move. Shorter timeframe might give you nice entry points.
  • #14,731
  • May 13, 2008 4:10am May 13, 2008 4:10am
Quoting Phillip Nel
While sitting here this morning this just jumped into my mind. It is a better way of managing the entry especially when stopped out without any gain.

1. You will gain 25pips less on the second lot as when you enter both at the same time.
2. You will lose 35-45 pips less when stopped out as the second lot wont be in.
3. If you are right lets say 6times out of 10 it means for 6 times you will lose 25pips(150)pips and when you are wrong 4 times it means 4 times you will not lose about 40(the second lot not in) that is 160 pips. It will about even out. It will however help you in the beginning till you reach a 6 out of 10 wins.

Tell me what you think.
why not just leave the 1st position open after 25 pips gain and move the s/l to BE, that way we save the spread in not closing out the 1st position and not opening the second, but with same result.
  • #14,732
  • May 13, 2008 4:13am May 13, 2008 4:13am
Quoting Phillip Nel
While sitting here this morning this just jumped into my mind. It is a better way of managing the entry especially when stopped out without any gain.

1. You will gain 25pips less on the second lot as when you enter both at the same time.
2. You will lose 35-45 pips less when stopped out as the second lot wont be in.
3. If you are right lets say 6times out of 10 it means for 6 times you will lose 25pips(150)pips and when you are wrong 4 times it means 4 times you will not lose about 40(the second lot not in) that is 160 pips. It will about even out. It will however help you in the beginning till you reach a 6 out of 10 wins.

Tell me what you think.
It make sense - example:

Trade 1. Enter manually EUR long @ 1.5500 with 1 lot, SL @ 1.5475 and TP @ 1.5525.

Trade 2. At the same time set a enter order for another long @ 1.5525 with 1 lot, SL @ 1.5500 and TP and next resistance level (?with trailing SL).

Scenario 1:
If the market immediately turns against you, you'll lose 25pips.

Scenario 2:
If trade 1 goes according to plan, your TP will be triggered for 25pips profit and immediatley your enter order for the second lot will also be triggered.

Scenario 3:
If the market continue upwards, you manage the 2nd lot as your trade and take profit at next resistance level or take profit as per trailing SL. Therefore the outcome would be = inital 25pips profit + xxpips gained on second lot.

Scenario 4:
If the market turns against you just after your TP on the 1st lot and 2nd lot activation (@1.5525) and your SL is triggered (@1.5500)- you'll lose the 25pips (you have already 25pips profit gained on the 1st lot) and come out BE for that setup.

That is how I understand it. You will benefit in scenario 1 because you will only lose half of your original trade now.

I hope I am on the right track.
Willem Forex recipe for success = Patience, discipline & hard work.
  • #14,733
  • Edited 4:37am May 13, 2008 4:19am | Edited 4:37am
Quoting islandtrader
why not just leave the 1st position open after 25 pips gain and move the s/l to BE, that way we save the spread in not closing out the 1st position and not opening the second, but with same result.
You are right. The only benefit will be to have a second lot set to -25 stoploss to give it some room.

That can be usefull to sometimes as I use that often to give my position some room to move yet get out BE if taken out.

Edit
See the orignal post for the comments added regarding this. post 14725
  • #14,734
  • Edited 4:35am May 13, 2008 4:25am | Edited 4:35am
Yeah, but the problem with the way Golfer explained it, if he is right, is that you also lose the +25 you would have made entering two lots at the start of the trade. If the 4hr system works well, as i beleive it does, that is the exact moment to capitalise on your gains. You have to decide whether the risk of losing possibly -50 from the two lots opened at the beginning, is worth it. If you beleive the system works then that risk is academic. It is an interesting puzzle though, perhaps there are differant strategies that might suit differant peoples risk profile.

Another solution would be two open two positions as per usual and close both after +25 and enter a thrid at that time and leave it as a runner. That way you have to accept the risk of losing the stoploss on two, but have +50 in the bag and a runner.If i understand this all correctly.
  • #14,735
  • May 13, 2008 4:32am May 13, 2008 4:32am
Quoting napeharm
Yeah, but the problem with the way Golfer explained it, if he is right, is that you also lose the +25 you would have made entering two lots at the start of the trade. If the 4hr system works well, as i beleive it does, that is the exact moment to capitalise on your gains. You have to decide whether the risk of losing possibly -50 from the two lots opened at the beginning, is worth it. If you beleive the system works then that risk is academic. It is an intersesting puzzle though, perhaps there are differant strategies that might suit differant peoples risk profile.
You are absolutley correct. The reasoning behind this is to find a way where novist traders can somehow minimize losses till some stage of maturity is reached while risking real money.

When the 4H MACD system is used with confidence one can change the entry mode to more risky entry yet secure because of the success of the system.
  • #14,736
  • Edited 4:49am May 13, 2008 4:34am | Edited 4:49am
Quoting Phillip Nel
You are absolutley correct. The reasoning behind this is to find a way where novist traders can somehow minimize losses till some stage of maturity is reached while risking real money.

When the 4H MACD system is used with confidence one can change the entry mode to more secure.
Quite so. It does show there are lots of way to skin this cat, it depends on what you want or expect from the trade. I am happy at the moment with 1 lot, but then i can manage it manually for abit more it i feel its there. Perhaps some one could make a list of the permutations and we can study them all. I agree that using two lots, is riskier and if managed poorly can be a disadvantage.

(Another point for me is that i have a target, say of +25 a day from one lot and one trade. If i can do that most days of the week using the 4hr system, that is massively more consistant and more successful that most other systems. So, there might be a way to trade two lots better, but one is just fine. People need to remember they have that choice.)

There are differing answers to this puzzle though, and it would be nice to see them laid out with diagrams and we could take a look, if someone has the time. Perhaps with some kind of R:R attached with possible gains and rate them according to risk.It is a perennial issue.
  • #14,737
  • Edited 4:59am May 13, 2008 4:42am | Edited 4:59am
Hi Phil, Do you also look at EURJPY? I notice a move toward 89SMA, away from 21EMA. From my judgement, there's gonna be a reversal and a move towards 21EMA.
I am new on this thred, just trying to follow. Please correct me if I am wrong.
Thanks.
My bad! I was looking at 1H TF. 4H also has a rhythm, I think.
Attached Image
PIPS AND PIPS ONLY... + OF COURSE
  • #14,738
  • May 13, 2008 4:57am May 13, 2008 4:57am
Huge drop in both pairs after the GbpUsd news. No 4H setup to trade.
Let the market comes to you. We will see 16:00 candle.
In the meantime the mode is downwards due to the news.
  • #14,739
  • May 13, 2008 4:59am May 13, 2008 4:59am
Quoting kaka08
Hi Phil, Do you also look at EURJPY? I notice a move toward 89SMA, away from 21EMA. From my judgement, there's gonna be a reversal and a move towards 21EMA.
I am new on this thred, just trying to follow. Please correct me if I am wrong.
Thanks.
Hi. it could bounce off the 89sma or just go right through it. Lets wait and see what it tells us with the next 4H candle.

I see you have the 1H candle graph. Be carefull. Look at the 4H graph and see what it tells you.
  • #14,740
  • May 13, 2008 5:13am May 13, 2008 5:13am
Quoting Phillip Nel
Hi. it could bounce off the 89sma or just go right through it. Lets wait and see what it tells us with the next 4H candle.

I see you have the 1H candle graph. Be carefull. Look at the 4H graph and see what it tells you.
Thanks Phil, I think your system is cool. Good to know that this system also works on other pairs, cos I love EJ.
PIPS AND PIPS ONLY... + OF COURSE
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