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4 Hour Strategy (MACD)

  • #15,661
  • Jun 23, 2008 5:34pm Jun 23, 2008 5:34pm
Hi all,
I've really enjoyed reading through this thread...the method makes sense to me, it clicked, at least so far. I made 25 pips off my first trade this morning (counter trend) on the USDJPY. Thanks for all of the hard work that has obviously gone into this, it is much appreciated.

Regarding the USDJPY, any thoughts on which way from here? Seems to be riding the upper trendline on the 4H and really riding the top of the trendline on the 1H. Will this usually indicate a reversal in trend, or will a TC take place to the downside? I was leaning toward TC down, but after looking at the 1H, I am not sure. I am going to attemp to attach my chart for review.....

Thanks!
Attached Image (click to enlarge)
Click to Enlarge Name: USDJPY_1.png Size: 17 KB
  • #15,662
  • Jun 23, 2008 6:20pm Jun 23, 2008 6:20pm
deepsouth:

Hmmm, the 4hr is above the 89 a pretty good ways so we are in a bullish mode here. However, price looks like it's still trying to get to the top of the channel here. The 1hr is forming a descending triangle which could signal a pause ( a short on the 4hr) with the longer term trend. I'd at least wait for a break (and close) below support on the 1hr before trying a short. Hard to spot a profit target on the 4hr as well. This is a tough one because it's hard to see and 'clean' rhythm on the 4hr...
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  • #15,663
  • Jun 23, 2008 7:01pm Jun 23, 2008 7:01pm
Thanks Palmer. I was looking right past the 8 and 21 EMA as support, thinking somewhere above the 89ema on the 4H for a TP, around 107.15. I think I'll hold off unless I get a good break down below the 21ema. Thanks for the analysis...

I like the blog as well by the way. Nice work. Spent about 20 hours on this over the last 3 days, very much looking forward to trading this live in due time.
Attached Image (click to enlarge)
Click to Enlarge Name: USDJPY_2.jpg Size: 157 KB
  • #15,664
  • Jun 23, 2008 7:12pm Jun 23, 2008 7:12pm
Deepsouth.
Welcome to the thread. Great to have another Yen trader!
Check out the resistance at 108.40. If it breaks through that, look out.
I'm personally waiting for the trendline break. The last eight weeks it's alternated up/down/up/down. If that holds, this is an up week.
Congrats on the pips.
Attached Image (click to enlarge)
Click to Enlarge Name: jpy trend.gif Size: 29 KB
  • #15,665
  • Jun 23, 2008 7:44pm Jun 23, 2008 7:44pm
Deepsouth.
Welcome to the thread. Great to have another Yen trader!
Check out the resistance at 108.40. If it breaks through that, look out.
I'm personally waiting for the trendline break. The last eight weeks it's alternated up/down/up/down. If that holds, this is an up week.
Congrats on the pips.


Thanks Hookem, I appreciate that. I was so "zoomed in" I did not even look at the daily chart. I have to agree with you in your analysis. Plus, it looks like I didn't get my down bar close below the 21ema, so no short. Patience! Not one of my virtues....just dyin' to put this to work as my scalpin strategy is not working right now.
  • #15,666
  • Jun 23, 2008 8:52pm Jun 23, 2008 8:52pm
Does anybody have clock indicator which shows seconds as well? I have download quite a lot but all only shows hours and minutes, no seconds. It's kinda hard for me to wait without knowing whether the next minute is ten seconds or thirty seconds away.

Thank you.
  • #15,667
  • Jun 23, 2008 9:18pm Jun 23, 2008 9:18pm
Zen,
The timer on this thread shows minutes and seconds, it may be what you want.

http://www.forexfactory.com/showthre...er#post2036871
  • #15,668
  • Jun 23, 2008 10:29pm Jun 23, 2008 10:29pm
subs
  • #15,669
  • Jun 23, 2008 11:26pm Jun 23, 2008 11:26pm
Quoting Snoop Dogg
Ok i know Phillip Said that we should wait till the end of the 4 hour candle. But if we have a look at the EU - There is a candle with a long tail just at a trend line - seems like an OK RR ratio as well. Phillip I wonder what you would think about that?
Hi Snoop Dogg,
i like your market opening indicator on right top of your chart. Where can i download it ?
Thanks
  • #15,670
  • Jun 24, 2008 1:44am Jun 24, 2008 1:44am
hi guys,

i've spent few days reading this thread. thank you very much for sharing your ideas with everybody.

may be I have a stupid question, but still I need to know. I can't find how do you choose S/L and T/P levels?

because sometimes u mension S/R lines, then Fibonacci and in some cases SMA and major price levels.

As far as I understood Risk Ratio is one of bigegst criterias where u decide to take trade or not and to calculate RR you have to know S/L and T/P levels. May be somebody could help me with that?

thanks very much!
  • #15,671
  • Jun 24, 2008 2:19am Jun 24, 2008 2:19am
Quoting svlad1983
may be I have a stupid question, but still I need to know. I can't find how do you choose S/L and T/P levels?
Hi, svlad1983.

Your question may be really not so stupid - on the contrary, besides filtering entry points, that's ability to choose correct TP and SL levels which is one of main things that makes difference between a profi and a newcomer. I have been practicing this Phillip's 4H MACD system for 3 months already on demo and still have serious problems especially with takeprofits. And earlier I was missing many trades because with my SL and TPs my R:R was bad (while more experienced members had different SL-s and TP-s and managed to get quite nice pips there).

Quote
because sometimes u mension S/R lines, then Fibonacci and in some cases SMA and major price levels.
In fact, you've mentioned the main places where SL and TPs may be placed. The only thing left is to learn when to use which one

If you might be interested in Phillip's materials devoted SL and TP placing (as these questions have been raised periodically along the thread), here they are:
Where to place SL
Where to place TP(s)
R:R calculation and maybe in general
Trading plan
  • #15,672
  • Jun 24, 2008 2:51am Jun 24, 2008 2:51am
Quoting svlad1983
hi guys,

i've spent few days reading this thread. thank you very much for sharing your ideas with everybody.

may be I have a stupid question, but still I need to know. I can't find how do you choose S/L and T/P levels?

because sometimes u mension S/R lines, then Fibonacci and in some cases SMA and major price levels.

As far as I understood Risk Ratio is one of bigegst criterias where u decide to take trade or not and to calculate RR you have to know S/L and T/P levels. May be somebody could help me with that?

thanks very much!
It depends on the trade you choose to take.
As a general rule if the price is above a support, trendline or a moving average you want to put your SL below the support, TL or MA because sometimes the price comes back to test it and you don't want to get stopped out. And the same if the price is below a TL, resistance or MA you put your stop above them. The previous candle low or high could also be used as a SL. As for the TP you look for areas where the price will probably reach or reached in the past and will test it again.

I took an example on the curent chart of the EurUsd. This is not the best setup because all the MA are together but the EurUsd is ranging latley so in this case the price level are more important.
Entry: 1.5520. The price level 1.5475 was tested many times and acted as support and resistance and the tails to it suggested that it might hold again. Candlestick pattern: hammer after a short decline. MACD: RB
SL: 1.5488 below the entry candle about 32pips OR for a tight stop below the Fib level 38.2 - 1.5498 about 22 pips.
TP1: 1.5557 200SMA for 37 pips. The R:R would be ok. Or TP1 the Fib level 50.0 is you are very patient.
TP2: Price level 1.5642 which is the same as Fib 61.8. Or you could just trail your trade.

There are many ways to see a trade. Maybe what I describe is seen different by another trader. It all depends on the trader.
Attached Image (click to enlarge)
Click to Enlarge Name: eu.gif Size: 22 KB
  • #15,673
  • Jun 24, 2008 4:12am Jun 24, 2008 4:12am
Quoting Yorik
only thing left is to learn when to use which one

If you might be interested in Phillip's materials devoted SL and TP placing (as these questions have been raised periodically along the thread), here they are:
Where to place SL
Where to place TP(s)
R:R calculation and maybe in general
Trading plan
Yorik,

I already went through your website, and its amazing thanks very much for doing this, looks amazing. its just the thing that i'm more math guy and i like precision so "may be" statements are really hard to understand for me. I guess it just comes with experience....

luckytiger, thanks very much for your example. Btw is the thread still alive and somebody posts real trades? that would be really helpful.
(i just got reading to 500 page myself... and briefly checked last pages, but seems that people already have much experience and not talking about single trades anymore)

thanks for all your replies guys, very much appreciated.
  • #15,674
  • Jun 24, 2008 4:23am Jun 24, 2008 4:23am
is it possible to code this system to a working EA or is there allready one out there? thanks for the information...
  • #15,675
  • Jun 24, 2008 5:48am Jun 24, 2008 5:48am
Quoting saka
Dear Palmer, I just want to trade a long-term trade just like what you did in this eraly year of eu. The other side is if you trade 2lots with both 20pips TP of TC trade, you will have most profit, so this is absolutely a dilemma

I remember you also said that you have meet lots of cases that you set a large sl when got some profit and think this time would be a big trend, and resulted in blow out. It seems that it is hard to use 4h strategy to trade long-term trend. And you are the only one have done this
Basically 4 step process after an awareness of a possible LT move:
1) Enter according to 4 HR MACD system (SL at about 35 pips?, TP at about 45 pips? as according to 4Hr system).
2) If your TP point is reached, move your SL to breakeven.
3) Set your new Longterm target where you plan to actually exit with a profit.
4) Do not make your stoploss wider. This is very NB. Rather be taken out. If taken out and you want to try again, start at step 1.
Attached Image
  • #15,676
  • Jun 24, 2008 6:02am Jun 24, 2008 6:02am
very thoughtful of you. i love 4hr chart. i'll give it a trial
thanks for your contribution.
  • #15,677
  • Jun 24, 2008 8:05am Jun 24, 2008 8:05am
Quoting fxfact
Basically 4 step process after an awareness of a possible LT move:
1) Enter according to 4 HR MACD system (SL at about 35 pips?, TP at about 45 pips? as according to 4Hr system).
2) If your TP point is reached, move your SL to breakeven.
3) Set your new Longterm target where you plan to actually exit with a profit.
4) Do not make your stoploss wider. This is very NB. Rather be taken out. If taken out and you want to try again, start at step 1.
Fxfact, basiclly I agree with you. I find that my problem is always set a tighten sl, not set it wider. Honestly, I think the success of 4h strategy is consquently enter and success, not gamble a big trend, just like what Phillip does.
Plan your trades and trade your plans
  • #15,678
  • Jun 24, 2008 8:14am Jun 24, 2008 8:14am
It’s difficult to be in antiphase with market. It’s money-losing therewith. It happens that you are not focused enough, not enough attentive or too optimistic after a good trade or several of them. And then you “take a try”. That’s 1st mistake. You get a loss, and you loose some money. “Okay, - you say, - I made a mistake. The main thing is to study a lesson now”. You decide to be more attentive, more selective and focused. You had a vaccination, you paid for the lesson and now you should be stronger. A setup comes and you analyze it thoroughly, you weigh all “pros” and “cons”. You see that a setup is not ideal and decide to miss it. “I won’t feel pity if it wins, - you say. – I made a decision and I will follow it”. Unhappy time… the setup wins! You missed a carriage of money. The traders you know discuss the profitable trade they have made and what they could have done to reap even bigger profit from it. “Okay, - you say. – In the end, it was a conscious decision. Nobody to blame..”. Except yourself.. You had a loss.. In fact, you have it still. And you missed a profit. Profitable trades come not so often. But, nevertheless, a trader must disengage from losses taken. “After a nice trade there can be some bad period often, so one needs to be even more patient and focused now”. A setup comes, but, again, it’s not so good. “I have no chance to take such risk now, my loss may become even bigger.. Better miss it”. WTF! It wins again! Again you stayed away from a profit. Still with a loss. But… But why did they take it? Maybe it’s the system? Maybe I have missed something, maybe I won’t be able to master it? “Okay, such thing will not happen once more! I’ll be quick, I’ll be focused. I won’t miss the next good trade”…

What is then? It depends.. But, as you guess, rather often after a good setup or two market becomes grumpy for some time. Not the best time to get in, and more losses come. It’s like climbing a ice-covered obstacle – you may get to the top by quick active moves, but only if you are trained and experienced. Otherwise the more moves, the more ice melts below your feet and you may end at the pediment.

Have you been there? I might be there just now. I had 2 losses on GBPUSD on NFP week (one on a TC just before NFP and another – on Mon the 3rd of June, on an early 1H TC, -83 pips on two). After that I had no trades on EU and GU for 2 weeks and till today (though monitoring the market all time). Powerful movements for several hundreds of pips but no signal for me.. TCs either with too big signal bars, or with entry against probable support/resistance lines.. Rather frustrating. Missed those tails on EU last week and GU on the 11th as not sure in them yet. I started backtesting EU during 2007 and also have rather/very poor results. It seems that this will need even more work than I thought at the beginning…

But in the end, I’m trying to keep even, not to be captured by emotional fluctuations . 3 months and 12 trades might not be the indicator. At least 2 months more to give myself a verdict. Will try to get in phase with market again..
  • #15,679
  • Jun 24, 2008 8:25am Jun 24, 2008 8:25am
Quoting Yorik
It’s difficult to be in antiphase with market. It’s money-losing therewith. It happens that you are not focused enough, not enough attentive or too optimistic after a good trade or several of them. And then you “take a try”. That’s 1st mistake. You get a loss, and you loose some money. “Okay, - you say, - I made a mistake. The main thing is to study a lesson now”. You decide to be more attentive, more selective and focused. You had a vaccination, you paid for the lesson and now you should be stronger. A setup comes and you analyze it thoroughly, you weigh all “pros” and “cons”. You see that a setup is not ideal and decide to miss it. “I won’t feel pity if it wins, - you say. – I made a decision and I will follow it”. Unhappy time… the setup wins! You missed a carriage of money. The traders you know discuss the profitable trade they have made and what they could have done to reap even bigger profit from it. “Okay, - you say. – In the end, it was a conscious decision. Nobody to blame..”. Except yourself.. You had a loss.. In fact, you have it still. And you missed a profit. Profitable trades come not so often. But, nevertheless, a trader must disengage from losses taken. “After a nice trade there can be some bad period often, so one needs to be even more patient and focused now”. A setup comes, but, again, it’s not so good. “I have no chance to take such risk now, my loss may become even bigger.. Better miss it”. WTF! It wins again! Again you stayed away from a profit. Still with a loss. But… But why did they take it? Maybe it’s the system? Maybe I have missed something, maybe I won’t be able to master it? “Okay, such thing will not happen once more! I’ll be quick, I’ll be focused. I won’t miss the next good trade”…

What is then? It depends.. But, as you guess, rather often after a good setup or two market becomes grumpy for some time. Not the best time to get in, and more losses come. It’s like climbing a ice-covered obstacle – you may get to the top by quick active moves, but only if you are trained and experienced. Otherwise the more moves, the more ice melts below your feet and you may end at the pediment.

Have you been there? I might be there just now. I had 2 losses on GBPUSD on NFP week (one on a TC just before NFP and another – on Mon the 3rd of June, on an early 1H TC, -83 pips on two). After that I had no trades on EU and GU for 2 weeks and till today (though monitoring the market all time). Powerful movements for several hundreds of pips but no signal for me.. TCs either with too big signal bars, or with entry against probable support/resistance lines.. Rather frustrating. Missed those tails on EU last week and GU on the 11th as not sure in them yet. I started backtesting EU during 2007 and also have rather/very poor results. It seems that this will need even more work than I thought at the beginning…

But in the end, I’m trying to keep even, not to be captured by emotional fluctuations . 3 months and 12 trades might not be the indicator. At least 2 months more to give myself a verdict. Will try to get in phase with market again..
Hi Yorik,

I seem to be in a very similar situation if not worse! I have been following this thread for over 12 months but now seem to have a sticky patch where by I talk myself out of good setups & will take a not so good setup & end up lossing money!

Forex is most clearly a business where a trader needs to grow slowly over time. There is no quick fix, or not that I know of! :-)

Just keep at it & you will be fine.

Aftab
  • #15,680
  • Jun 24, 2008 8:37am Jun 24, 2008 8:37am
Quoting Yorik
It’s difficult to be in antiphase with market. It’s money-losing therewith. It happens that you are not focused enough, not enough attentive or too optimistic after a good trade or several of them. And then you “take a try”. That’s 1st mistake. You get a loss, and you loose some money. “Okay, - you say, - I made a mistake. The main thing is to study a lesson now”. You decide to be more attentive, more selective and focused. You had a vaccination, you paid for the lesson and now you should be stronger. A setup comes and you analyze it thoroughly, you weigh all “pros” and “cons”. You see that a setup is not ideal and decide to miss it. “I won’t feel pity if it wins, - you say. – I made a decision and I will follow it”. Unhappy time… the setup wins! You missed a carriage of money. The traders you know discuss the profitable trade they have made and what they could have done to reap even bigger profit from it. “Okay, - you say. – In the end, it was a conscious decision. Nobody to blame..”. Except yourself.. You had a loss.. In fact, you have it still. And you missed a profit. Profitable trades come not so often. But, nevertheless, a trader must disengage from losses taken. “After a nice trade there can be some bad period often, so one needs to be even more patient and focused now”. A setup comes, but, again, it’s not so good. “I have no chance to take such risk now, my loss may become even bigger.. Better miss it”. WTF! It wins again! Again you stayed away from a profit. Still with a loss. But… But why did they take it? Maybe it’s the system? Maybe I have missed something, maybe I won’t be able to master it? “Okay, such thing will not happen once more! I’ll be quick, I’ll be focused. I won’t miss the next good trade”…

What is then? It depends.. But, as you guess, rather often after a good setup or two market becomes grumpy for some time. Not the best time to get in, and more losses come. It’s like climbing a ice-covered obstacle – you may get to the top by quick active moves, but only if you are trained and experienced. Otherwise the more moves, the more ice melts below your feet and you may end at the pediment.

Have you been there? I might be there just now. I had 2 losses on GBPUSD on NFP week (one on a TC just before NFP and another – on Mon the 3rd of June, on an early 1H TC, -83 pips on two). After that I had no trades on EU and GU for 2 weeks and till today (though monitoring the market all time). Powerful movements for several hundreds of pips but no signal for me.. TCs either with too big signal bars, or with entry against probable support/resistance lines.. Rather frustrating. Missed those tails on EU last week and GU on the 11th as not sure in them yet. I started backtesting EU during 2007 and also have rather/very poor results. It seems that this will need even more work than I thought at the beginning…

But in the end, I’m trying to keep even, not to be captured by emotional fluctuations . 3 months and 12 trades might not be the indicator. At least 2 months more to give myself a verdict. Will try to get in phase with market again..
Don't give up on this system. You will discover more about yourself by staying with it.
I was have some of the same problems and still do. I was finding myself having the same thoughts as you and going 2 wks without a trade. 2 wks going by can really have a bad effect on your psyche especially when the last one was a bad one. I've decided to change 2 things and I believe it is going to help. One, I no longer trade the pound... too many wild swings and tails and instead just to focus on EurUSD. Second, I'm working on my entries, specifically looking at maxsters old entries and the 5 min system. Later I will focus on my exit.
Don't get too caught up in the results. It is the process of learning that is rewarding. Once you have accomplished that the $ will come
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