ATP (Advanced Trading Philosophy) - 3% Daily....From working to trading for a living.

Please note that this page, indicators, templates and rules was updated on 8/06/08. It includes any new changes that were initiated and the post that conincides with these new changes is post # 31

Trading rules are important to maintain trading discipline, but it is equally important that you use good common sense and market awareness when you are in a trade or about to make a trade as other factors may dictate what you do, when you enter and when you exit, and it is important that you listen to these other factors.

There are going to be some very similar systems located on this 1st thread based on currency pair and time frame as i believe that there is no one size fits all in forex. I am curretnly working with the following pairs and time frames.

1. eurusd M5
2. gbpusd, usdjpy, eurjpy H1

Basically my goal is 3%+ per day with a max dd of 6% per day for each system.

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EURUSD M5 System: Template and Explanation

This section was updated on 08/06/08

Setting up my charts: Most cases I set all bullish indications to Lime and bearish indications to Red for all indicators

LSMA3 - I changed the yellow color to gray so it would show up better on my charts and changed green to lime.

JMA Slope set to 34 - This will be for trend direction.

Fisher_m11 set to 34 - This will be for trend direction.

Sonic Slope set to 9 (Thanks SonicDeeJay ) which i will use for exiting the market. Change the grey color to white.

144 EMA shift 8, Median HL/2 color, dark thick blue

144 EMA Envelopes set to close, shift 8: I use these lines as reference points to help me better visualize price action and for helping me exit the markets.

1. .02% deviation color aqua dotted
2. .06% deviation color green dotted
3. .09% deviation color blue dotted
4. .15% deviation color dark orchid dotted
5. .24% deviation color chocolate dotted
6. .39% deviation color chocolate thin solid

Fib Pivot Version 3 - Used for locating daily pivot points.

Entering Trades:

1. I will only enter trades when price moves above the set-up bar for a long or below the set-up bar for a short by 1 pip. I will never place market orders.

Trade Entering Exceptions: These are very important

1. I will never trade into the daily pivot unless there is more than enough room to reach my t/p and will normally not trade into R1, R2, or R3 and S1, S2 and S3.
2. I will never take a trade if the high or low of the triger bar landed right on the 144 EMA

Take Proft, Stop Loss and MM:

Take Profit: A few thoughts on this one.....My goal for this pair is 20 - 26 pips per night. This is a high probablitity trade. The goal is to take profit off the table. I have a sound exit strategy that gets me out plenty early without losing many pips. I will be adding additional positions as the trade continues in my direction.

Knowing all this, the question do you play for the big run or do you just take small profit off the table? As i write this, 4 trades would have triggered so far tonight (8/4/08). Had I used my exit startegy I would be up around 6 pips or so. Had I used ATR x2 for my t/p I would already have my 20 pips. The other thought is that I usually only trade the London market until I have to go to work and this is usually a time when price can break out for many more pips than the ATR would have given us.

I guess for now I will use my exit strategy for trading London, but the lull between London and New York (about 4 - 6 AM CST) and all other times (asian, etc.) I should be happ with using 2x ATR for my t/p, and try to hone this part in as I move along.

Stop Loss: I will set a hard stop at 19 pips + spread, just incase of some weird spike but i never let the market get that far. I will watch my exit indicators and usually exit the market somewhere -13 pips or or less.

MM: Basically i use a 3% risk based on 13 pips.

Entrance Strategy: General Rules: Updated 08/06/08

This is a basic breakout strategy.

You should see 2 horizontal lines in with the LSMA3 indicator. One colored red and the other colored purple. If they did not come through with the template insert two horizontal lines in the same bax as the LSMA3 indicator.

You will then place the purple colored line at the most recent highest completed green segment of the LSMA3 line and the red line at the most recent completed lowest red segment of the LSMA3 line. You now have your breakout channel formed. Continue to move your red and purple colored horizontal lines each time a completed segment dictates that you do so. Now that you have your channel and you know how to maintain your breakout channel, all we are waiting for is a break of either the upper or lower horizontal channel lines.

Long Trade: If the LSMA3 line closes above your upper purple channel line and the Fisher (34) trend is green or the JMA Slope (34) is green; place a long order 1 pip above the bar that coincides with the segment that closed outside your upper channel line. If the Fisher (34) is not green at the time of the breakout, continue to move your horizontal lines and wait for the next siganl. If the bar previous to the set-up bar has a higher high then the set-up bar it may be advisable to use the parameters of that bar for your entrance point.

Short Trade: If the LSMA3 line closes below your lower red channel line and the Fisher (34) trend is red or the JMA Slope (34) is red; place a long order 1 pip below the bar that coincides with the segment that closed outside your lower channel line. If the Fisher (34) is not red at the time of the breakout, continue to move your horizontal lines and wait for the next signal. If the previous bar has a lower low than your set-up bar it may be advisable to use the parameters of that bar for your entrance point.

Adding Multiple Positions: As the trade goes in your direction, the LSMA3 will likely go to gray and will go back to going in your direction. Continue to move your horizontal lines accordingly and you will have the option to entering additional trades for additional pips. The riskier re-entry is when the LSMA3 goes back to gray in your diriction, the more conservative entry is when the LSMA3 goes back to being the color of the trade you are currently in.

Updated 08/05/08
**********************************************************Important Note ***************************************************************

Make sure that you do not have price divergence between candlesticks and the LSMA3. If you are looking to go long and you had a LSMA3 breakout signal, but price is actually lower than price was at the last completed green LSMA3 segment (or the laset swing point), chances are it is not a true breakout and in fact, may be time to take a reversal trade. Opposite is of course true for a short trade.

Exiting the Market:

Long Trade Exit: Exit the market when the Sonic Slope (9) has closed in red. You will then notice that the previous bar is now white. If the candlestick that coincides with the red bar is lower than the candlestick that coincides with the white bar exit the market 1 pip below this bar. If the candlestick that coincides with the white bar is lower then the one that coincides with the candlestick from the red bar, exit the market 1 pip below the candlestick that coincides with with white bar.

Short Trade Exit: Opposite the Long Trade Exit

Trades using this updated method start with post #40
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GBPUSD, USDJPY, EURJPY H1 System: Template and Explanation:

Attached File(s)

atp-gbpusd-lsma.tpl   7 KB | 601 downloads | Uploaded Aug 3, 2008 10:08pm

This section was updated on 08/04/08

Setting up my charts: Most cases I set all bullish indications to Lime and bearish indications to Red for all indicators

LSMA3 - I changed the yellow color to gray for clarity purposes and changed green to lime

JMA Slope set to 13 - This will be our trend indicator. We will never take a trade against the trend.

Sonic Slope set to 21 (Thanks SonicDeeJay ) - Currently I will use this for exiting the market if needed. I will be keeping an eye open at the moment. Change grey color to white.

144 EMA shift 8, Median HL/2 color, dark thick blue

144 EMA Envelopes set to close, shift 8: I use these lines as reference points to help me better visualize price action and for helping me exit the markets.

1. .13% deviation color aqua dotted
2. .34% deviation color green dotted
3. .55% deviation color blue dotted
4. .89% deviation color dark orchid dotted
5. 1.44% deviation color chocolate dotted
6. 2.33% deviation color chocolate thin solid

Fib Pivot Version 3 - To locate daily pivot points.

Entering Trades:

1. I will only enter trades when price moves above the set-up bar for a long or below the set-up bar for a short by 1 pip. I will never place market orders.

Trade Entering Exceptions: These are very important

1. I will never take a trade if the close, high or low of the trigger bar lands on the main 144 EMA.

Take Proft, Stop Loss and MM:

Take Profit: I will put a hard t/p for 150 pips, but watching your entry signals is paramount to exiting in profit. After 30 pips in profit I will most likely move to b/e +1 and continue to step up my profit for every 30 additional pips of movement in my direction.

Stop Loss: I will set a hard stop at 30 pips + spread, but will watch my indicators for the proper exit position.

MM: Basically i use a 3% risk based on 34 pips.

Entering the Trade: General Rules:

This is a basic breakout strategy.

You should see 2 horizontal lines in with the LSMA3 indicator. One colored red and the other colored purple. If they did not come through with the template insert two horizontal lines in the same bax as the LSMA3 indicator.

You will then place the purple colored line at the most recent highest completed green segment of the LSMA3 line and the red line at the most recent completed lowest red segment of the LSMA3 line. You now have your breakout channel formed. Continue to move your red and purple colored horizontal lines each time a completed segment dictates that you do so. Now that you have your channel and you know how to maintain your breakout channel, all we are waiting for is a break of either the upper or lower horizontal channel lines.

Long Trade: If the LSMA3 line closes above your upper purple channel line, place a long order 1 pip above the bar that coincides with the segment that closed outside your upper channel line. If the bar previous to the set-up bar has a higher high then the set-up bar it may be advisable to use the parameters of that bar for your entrance point.

Short Trade: If the LSMA3 line closes below your lower red channel line, place a long order 1 pip below the bar that coincides with the segment that closed outside your lower channel line. If the previous bar has a lower low than your set-up bar it may be advisable to use the parameters of that bar for your entrance point.

Updated 08/05/08
*********************************** ***********************Important Note *********************************** ****************************

Make sure that you do not have price divergence between candlesticks and the LSMA3. If you are looking to go long and you had a LSMA3 breakout signal, but price is actually lower than price was at the last completed green LSMA3 segment (or the last swing point), chances are it is not a true breakout and in fact, may be time to take a reversal trade. Opposite is of course true for a short trade.


Exiting the Market:

Exiting the market can either happen when either the JMA Sloe (13) or the Sonic Slope (21) has changed colors against your trade.

You should also watch when the LSMA 3 changes color to being against your trade two times without giving you a trade in the other direction. This should be a signal that the market may be going to move in the other direction very soon. This is riskier, because often you don't get two in a row with no opposite siganl without eating up all your profit.

Sample trades can be seen on post #34, #35 and #36
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Expert Advisor

****This is not an EA for my trading system, just one to help me enter and exit the market****


Here is an Expert Advisor that i came across that makes it easy for me to set my trades when they signal, so if i space out while trading, everything is already set. Here is the thread where you can learn how to use it. http://www.forexfactory.com/showthread.php?t=98061

Trade #1

buy eurusd 1.5702 with a t/p at 1.5711. Safety stop set at 1.5682, but will be monitoring trade for signs of reversal. I chose this trade becasue my Heiken Ahen indicator agreed with my JMA Slope Indicator. Closed out trade for -10 pips

2nd trade of the night.....

i bought eurusd at 1.5711 with a t/p at 1.5721 (this was an error and was supposed to be 1.5719

I took this trade because H.A. agreed with JMA slope and also JMA slope went from looking for short signals to moving back into agreement with the Fisher.

Take profit won of 10 pips.....waiting for the next trade.

I usually only trade from London until the time I go to work, but we had 2 very special set-ups that happend today while I was asleep.

the first was usdjpy that would have gotten us in at 107.35 and based upon my exit for this trade, we would still be in it

update...we would hve been stoped out at 106.76

and....

eurusd would have gotten us in at 1.5676 and would have gotten stopped on this trade at 1.5711

sometimes i miss them and other times i get them. got them most nights this week.

3rd & 4th trade of the night

I sold eurusd at 1.5696 and got out when price hit the 144 EMA for 6 pips. I took this trade because both the JMA Slope and Fisher were green and now were back on the same page giving me a red signal to go short

I bought usdjpy at 106.78 and took my 8 pips in profit. I took this trade because both JMA and Fisher had been red at some point and now they were both in agreement that usdjpy should go higher. This trade was almost a special trade set-up and it is possible that we should still be in this trade, but it was after a huge move for usdjpy and i was afraid of a range setting in. besides i don't want to sit here all gosh darn night. I want my 15 pips and good bye, i will catch plenty of big moves at london open.

I will try one more trade since i currently sit at 14 pips and my goal is 15 pips which is 3%. I will most likely be very careful with this next trade as my profit target is close.

this was a iffy trade for me.

on the blue vertical line you can see we had a blue HA bar, then next to the blue vertical line you can see that we had a red HA bar that joined the JMA slope.

2 things i did not like....

1. That bars close was also the low

2. This bar did not penetrate throught the 144 EMA which would have given me an entrance below the 144 EMA

I decided not to take the trade.

It amazes me to no end how much price action occurs around the 144 EMA and how price reacts to it once it hits it. and how price just always wants to head back to it.

maybe i should look into bars that close at their highest or lowest point.

maybe enter against the close on a 50% retracement of that bar with a stop back up there at the top.

sounds like good risk/reward ratio to me.

5th trade of the night.......

i bought gbpusd at 1.9894 and took my 8 pips profit. I took this trade bacause both the JMA and Fisher had been red and both changed to green and price would have been triggered above the daily pivot.

Like the usdjpy trade earlier, this was darn near a special set-up trade and may go longer, but i am happy with my 8 pips. Plus, i am still doing more studying on the special strategy later after the london open, because when it is off, it can cost you a lot of pips. I prefer the special trade at the london open and am happy to take my 8 pips any other time.

that gives me 22 pips for the day and my profit target of 3% has been reached and exceed and so I say to myself......good night.

Just wanted to make a side note regarding this trade....

the special trade is very powerful and as it turned out this trade and the usdjpy trade earlier ran on for quite a while after the 8 pips. so here is my observation of both those trades...

gbpusd



what i am thinking is that because the special trade happened and triggered above both the q44 EMA and the daily pivot i think i could have let this trade run on a little longer. I will have to watch and see if this is a persistnet event....the blue check mark is above the bar where I entered and the thumbs up is where i took my 8 pips in profit. gbpusd also has not had its move today yet.

usdjpy



the main trade i missed earlier because i was sleeping, but it traded all the way down to S3 almost in a straight downward line which is a long ways to go without a fairly substanatial retracement. because i had my special trade signal above S3, i guess there was reason to believe that this trade would have continued up a little higher as additional down moves until ny opens and us news comes out is really out of the question 99.9% of the time.

These tow trades i felt we could have stayed in longer and i wanted to evalualte maybe some reasons as to why i felt this way

Nice night of trading! Very informative!!

Great job!!

the last two days have been extremely tough because there just has not been enough movement.

Because of running into this type of market I have made a few changes to the system that allow me to get in earlier and get out earlier. I will update those on the 1st page when i get the opportunity to do so. Hopefully within the next few days.

As you can see from the chart, on this bar, the MACD had turned green, 21 MA slope had truned green and we were in the volcano (price was between all the MA's) and it was ready to erupt and spit us out.

I entered the trade 1 pip above the bar that has the blue arrow on it.

This post coincides with the 1st entry rule from the 1st post in this thread.

Incidentally....this trade allowed my to double my account balance in one day using a 3% risk with a 13 pip s/l. This type of trade is sort of rare. Lots of times you would have been out early or there would not have been this many re-entries, but when they happen full advantage must be taken because the 3% per day is enough to pay the bills and keep some compounding, but a trad like this is a trip somewhere with the family.



okay...let's go over this chart.....

1. the 1st blue arrow was a valid signal, but it was in the no trade zone above the 144 EMA and so no trade
2. the 2nd blue arrow was a continuation trade, and would have been valid except that it did not trigger and price moved back up.
3. After price closed back inside the volcano, I set my buy stop order 1 pip below the bar with the 2nd blue arrow
4. the 3rd blue arrow saw a close below the 21 Sloope MA and so an order was place 1 pip below this bar.
5. I closed these trades at the 1st blue "x" because of the daily pivot
6. The 1st blue up arrow was a valid long signal which was closed out a the 2nd blue "x" for a loss.
7. The next blue down arrow was invalid because price was below the volcano
8. After price closed back in the volcano i place a sell stop order 1 pip below the bar explained in #7 above
9. The next blue down arrow gave us another valid short entry, There was actually another one before this, but i let it go since I was not yet convinced that price was going to go.
10. The next 2 blue down arrows gave us a valid entry as they both closed below the 21 Slope MA
11 exit was at 1.5565, for lots of nice profit.

Hopefully this explains how to use the continuation trades

well....still waiting for my first trade tonight and so i will probably take a few minutes to fill in the last trade scenario.

WOw Damon those are a lot of lines to keep up with....what is the profit per mth on this
Thanks
F2

If you had enough account balance and the right month, you could potentially do a years salary in one month.

1st blue arrow is an invalid signal because price was below the volcano.

2nd blue arrow was where price closed back into the volcano

3rd blue arrow was where price closed back outside of the volcano and one pip below this bar is where we would have entered the market.

So 1 more thing to post and then i am done.

Hi, nice trading
colud you please send MACD in color like mq4
Thx

Here is a chart of my latest trade.

We had a nice entry down below the 144 EMA and price pushed nicely through it. Then we had a re-entry up near the top. I was very leary about entering this trade, but i had to take the chance. Especially already being up 7% in profit

When i place my 2nd order i place all orders to exit the market at the s/l point of the 2nd order which left me around 3% in profit for the night. A figure that i am very happy with.

the macd color is in the 1st post for you