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Part Time Wealth Building Trading System - Weekly Scalping

  • #621
  • Edited Jan 27, 2007 12:01am Jan 26, 2007 11:42pm | Edited Jan 27, 2007 12:01am
Followed original strategy 100% verbatim.

Weekly profit +137 pips, - 3x30pip stops = +47pips.
  • #622
  • Jan 26, 2007 11:49pm Jan 26, 2007 11:49pm
Quoting stunew
Followed orginal strategy 100% verbatim.

Weekly profit +137 pips, - 3x30pip stops = +47pips.

Was that trading only one pair? If so I assume it was gbp/usd correct?

I would really like to discuss trading this over 3-4 pairs. Which pairs are most suitable? Again, it's not only finding the least correlated pairs, but also about finding pairs that have trading patterns which will work with this method.

I'm more interested in this because I'll be able to risk larger portions of my account without increased risk or drawdown. Let's get the ball rolling. Matt
  • #623
  • Jan 26, 2007 11:54pm Jan 26, 2007 11:54pm
Quoting permanentjaun
Was that trading only one pair? If so I assume it was gbp/usd correct?

I would really like to discuss trading this over 3-4 pairs. Which pairs are most suitable? Again, it's not only finding the least correlated pairs, but also about finding pairs that have trading patterns which will work with this method.

I'm more interested in this because I'll be able to risk larger portions of my account without increased risk or drawdown. Let's get the ball rolling. Matt
Yes, GBP/USD pair only, for this week.
  • #624
  • Jan 26, 2007 11:57pm Jan 26, 2007 11:57pm
Congrats on your success, and courage to follow the original method verbatim. Hopefully this was in a live account.

Permanentjuan, i also would like to find additional pairs to reduce the risk by diversifying. I am thinking the eur yen might be a good option. It is less volitile than gbp yen, but still moves.
  • #625
  • Jan 27, 2007 12:06am Jan 27, 2007 12:06am
Quoting tkimble
Well said. I concur. This is why the daily scalping system was developed. You do stand a better chance of profiting within the 100 PIP straddle if you choose a direction from the opening bell. I was only doing this with the daily system but will complement it with the weekly system beginning this week.

Happy Trading,

Tkimble

I haven't come up with an answer to the following question tkimble. If we can abandon the 50 pip trigger, then can we also abandon the 20 pip difference between the SL and reverse order? If theres no need to wait for the triggers then why do we need to wait for the 20 pips on a SAR?

Is the answer to abandon that as well and just have a tight 30 pip range that is SAR with no waiting period? I am not entirely sure. Although I will say that in the following logic it makes sense to do so.

If we expect price to move away from our entry eventually then we want our 'trading zone' to be as small as possible. Adding the 20 pip buffer zone between SL and a reverse order enlargens the zone and increases the possibility of the price retracing to hit our SL, just like if we would use 100 pip straddle triggers. If we want price to move as far away from our SL as quickly as possible then we should want to enter the reverse order as soon as possible, i.e. when our original trade is stopped out.

What are your thoughts on this? In theory we could then use a SL of 5 pips, but it will most likely get stopped out many times before turning successful. I am unsure but also afraid having an immediate 30 pip SAR system will do the same. The only option I see it would be to believe the 30 SL SAR is enough or increase the SL to 35, 40, 45, or 50 pips. Or can we decrease it? Again, just some thoughts. Matt
  • #626
  • Jan 27, 2007 12:09am Jan 27, 2007 12:09am
Quoting bholiday
Congrats on your success, and courage to follow the original method verbatim. Hopefully this was in a live account.

Permanentjuan, i also would like to find additional pairs to reduce the risk by diversifying. I am thinking the eur yen might be a good option. It is less volitile than gbp yen, but still moves.
I'm not so sure we want less volatility. We want price to move as far away from our entry point as possible. Who knows? Whatever works.
  • #627
  • Jan 27, 2007 12:14am Jan 27, 2007 12:14am
Quoting stunew
Yes, GBP/USD pair only, for this week.

I would take those results as a good sign. Look at how ridiculous this week was trade wise. This week might as well have been as bad as a doji considering the large upper shadow even though the week closed down. Very volatile.

You said you stuck to the rules 100%. Does this also mean you didn't at least move your SL to B/E once you were up by 100+ pips? I think doing so might be wise. Keeping 100 pips from price to your SL is still plenty of room and you could have increased your profits by about 60-75% if you had prevented just one trade from going +100 to -30 before ending it. Just some things to consider. Matt
  • #628
  • Jan 27, 2007 12:25am Jan 27, 2007 12:25am
Quoting permanentjaun
I would take those results as a good sign. Look at how ridiculous this week was trade wise. This week might as well have been as bad as a doji considering the large upper shadow even though the week closed down. Very volatile.

You said you stuck to the rules 100%. Does this also mean you didn't at least move your SL to B/E once you were up by 100+ pips? I think doing so might be wise. Keeping 100 pips from price to your SL is still plenty of room and you could have increased your profits by about 60-75% if you had prevented just one trade from going +100 to -30 before ending it. Just some things to consider. Matt
Thanks Matt, I hadn't considered the BE stoploss move. It indeed would have given me another +30pips.
It was hard to see my early week long order hit over 120pips and then retrace to -30 SL, so the BE modification would have been wise.
  • #629
  • Jan 27, 2007 12:47am Jan 27, 2007 12:47am
Quoting stunew
Thanks Matt, I hadn't considered the BE stoploss move. It indeed would have given me another +30pips.
It was hard to see my early week long order hit over 120pips and then retrace to -30 SL, so the BE modification would have been wise.
Yea I would take the original rules with a grain of salt. I'm not saying that as a way to say tkimbles rules are wrong. Attack the system as you should any other posted system. Adapt it to your own trading style. IMO letting a +120 pip move end up -30 is a little extreme. Moving to at least B/E probably won't affect our results negatively in the long run, but they sure will improve out profits. Matt
  • #630
  • Jan 27, 2007 2:16am Jan 27, 2007 2:16am
hi..

im new in forex...but im not sure what this set is different,,from
normal procedure...

i have understod the system : that you try to guess the trend,,and like most will do. you set a SL..if your wrong you do the oposite..

have i understod i right ?

mvh lise
StopLoss is for none belivers... Trust the Gurus..
  • #631
  • Jan 27, 2007 2:19am Jan 27, 2007 2:19am
My first post! I've been lurking for a couple of weeks. After not trading for two years (a veeery long story involving divorce and going back to my day job), I went live with this system last week, but bailed out on Tuesday with 97 pips. Next week I'll stick with it!


TK - Thanks for your unselfishness.


permanentjaun - an alternate to your thoughts above:

Why not leave it running on Friday night with a 50 pip SAR? If that gets breached then put the other (reverse) order in, as per TK's original system, at Friday's closing price.
  • #632
  • Jan 27, 2007 8:58am Jan 27, 2007 8:58am
Quoting sledgehammer
Why not leave it running on Friday night with a 50 pip SAR?
I'm sorry, but what is a SAR?
  • #633
  • Jan 27, 2007 10:11am Jan 27, 2007 10:11am
Quoting G550
I'm sorry, but what is a SAR?
SAR = Stop and reverse. Essentially if you have a long trade that gets stopped out then enter a short trade immediately when you get stopped out. Stop and reverse.
  • #634
  • Jan 27, 2007 10:23am Jan 27, 2007 10:23am
Quoting sledgehammer
My first post! I've been lurking for a couple of weeks. After not trading for two years (a veeery long story involving divorce and going back to my day job), I went live with this system last week, but bailed out on Tuesday with 97 pips. Next week I'll stick with it!


TK - Thanks for your unselfishness.


permanentjaun - an alternate to your thoughts above:

Why not leave it running on Friday night with a 50 pip SAR? If that gets breached then put the other (reverse) order in, as per TK's original system, at Friday's closing price.
I've thought about letting the order run into next week. Do we add onto last weeks position in the same direction? Most likely I don't think it's worth it. There aren't too many multi week runs that won't get stopped out at least once in the beginning of the week. Might be better just to lock in profits and start again next wee. Take a look at the GBP/USD weekly chart. It was a strong uptrend yet still very choppy. I'll have to think about letting trades ride into next week some more. Matt
  • #635
  • Jan 27, 2007 10:29am Jan 27, 2007 10:29am
Matt, TK or anyone...

Please tell me if I have this right....

If I wanted to add another pair to the GBP/USD and also trade this weekly method (with all due repect to TK's earlier post suggesting this may be difficult to monitor), I would want to look for a pair that has a "negative" correlation to the GBP?? In other words if you're long GBP, you would want to be short the other pair?? Is this correct??

My confusion on what to do would be during the whipsaws, and this past week is a good example. Things can move fast, so how would you handle this making sure that you were always taking the oppsite side of the first pair (e.g. GBP/USD being the first pair)

Earlier posts suggest that the GBP/JPY pair may also be a good second pair to try this weekly method. Do you happen to know if it has a negative correlation tp the Cable, or does it move in tandem?

Thanks in advance for any enlightenment or suggestions.
  • #636
  • Jan 27, 2007 10:56am Jan 27, 2007 10:56am
You want uncorrelated pairs, not just inversely correlated. If you trade inversely correlated pairs it's still just like playing only one currency and therefore doubling your risk. Unfortunately gbp/usd and gbp/jpy are somewhat closely correlated.

Currency Correlations at - http://www.mataf.net/en/analysis-correlation.htm

If you search the forums for correlation or correlated you'll find many threads on the topic. There was a post by isotonic in one of the correlation threads, but I can't find it now. He had an easy way of picking pairs to trade with one another that wouldn't be too heavily correlated. Unfortunately gbp/usd and gbp/jpy do seem to have an above average correlation. Some possible trade baskets to use would be eur/usd, gbp/jpy, eur/gbp, and gbp/chf. If you want to use gbp/usd then you could use gbp/usd, eur/jpy, eur/gpb, and eur/chf. Although checking the site above shows strong correlation of gbp/usd to even eur/jpy over 100 days.

Not sure what to tell you about what to do in whipsaw situations. I can only suggest to place your reverse order as soon as you enter the original order. Not sure if that answers your question. Matt
  • #637
  • Jan 27, 2007 11:02am Jan 27, 2007 11:02am
Matt, it does answer my question, and thank you. I'll continue to read up and educate myself on the pairs and how they play together. Thanks for the link and I'll search for Iso's thread too.
  • #638
  • Jan 27, 2007 12:43pm Jan 27, 2007 12:43pm
Just for backtesting sake and to get a GENERAL idea of this method I used an old EA I had to simply straddle the price by 30 with a trail of 70, then a BE and lock 5 of 40. When you got stopped out It immediately straddled the price again by 30.

Here are the results, reports and EA. This EA IS NOT per the rules. Just something to play with SL,TP,Trail and straddle settings until something better comes along.

To sum it up, about 2000 pips for 2006(90%MQAlpari1HR TF), but lots of settings to play with.
Attached File(s)
File Type: mq4 Straddle_Trail.mq4   51 KB | 542 downloads
File Type: zip Scalp.zip   153 KB | 817 downloads
  • #639
  • Jan 27, 2007 3:01pm Jan 27, 2007 3:01pm
I still don't know how to use EA
I have Metatrader though. Could you be so kind to explain it to me how to use the file that you give.

Thanks
Andrey
Quoting C.E.O.
Just for backtesting sake and to get a GENERAL idea of this method I used an old EA I had to simply straddle the price by 30 with a trail of 70, then a BE and lock 5 of 40. When you got stopped out It immediately straddled the price again by 30.

Here are the results, reports and EA. This EA IS NOT per the rules. Just something to play with SL,TP,Trail and straddle settings until something better comes along.

To sum it up, about 2000 pips for 2006(90%MQAlpari1HR TF), but lots of settings to play with.
"Every battle is won before it is ever fought." - Sun-tzu, The Art of War.
  • #640
  • Jan 27, 2007 3:31pm Jan 27, 2007 3:31pm
I've been following this post for a while. I've been trading a similar system with good results. What I have found beneficial is to trade one pair (GBPUSD) as the rules suggest, and trade another pair (GBPJPY) taking profits as follows: 1/3 at 50 pips (move stop to break even) 1/3 at 100 pips and let the remaining 1/3 either stop out or close it on Friday. I have found that it keeps my equity curve smoother. Just my 2 cents.

TK: Great system, and thanks for your continued input and great attitude.
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