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Set & Forget on Cable help here

  • #1
  • First Post: Feb 9, 2007 1:46pm Feb 9, 2007 1:46pm
Hi all

I'm thinking about getting rid of the "cesarnc factor" in my trades...

What about doing this: place a position at Frankfurt open, at the direction the market is appearing to go - just an educated guess

TP 80 pips

Stop & Reverse 30 pips, new TP 50-80? And go on checking during the day.

Don't know about the close in case TP is not reached...... Maybe on US open + 2 hours, or reversal indication, whatever.

Still unsure on this SAR positioning though. I mean, there's the chance of triggering this SAR and then boucing back. In this case it would be nice to have another order @ market open price in the same direction of the 1st position....

Best case scenario is 80 pips profit straight shot.

Doing this is that correct to affirm that the maximum loss will be locked at 29 pips? I do worse than that when I'm overtrading trying to catch up the direction

I'm thinking about this based on the usual 100+pips daily on Cable.

Collateral effect is getting rid of fibos, RSI, EMAs, geess....

Comments & suggestion highly appreciated. Thanks

César
  • #2
  • Feb 12, 2007 4:29am Feb 12, 2007 4:29am
I've back tested this strategy and it has shown a good winner/looser ratio based on Jan and Feb 1hr chart.

Strategy for today:

1)- Short (Which was the one I've choosen)

Short @ Fra open - 9555
TP 9475
SAR 9585 (-30), new TP 9605

London didn't got back to Frankfurt open and target was reached by 9:30 GMT, boosted by news. Total 80 pips in 2,5 hours.

2)- Long (If I've choosen to long from Fra open)
Long at 9555
TP 9635
SAR 9525 (-30), new TP 9475.
This trade would have profited 20 pips by 9:30. Actually not that bad since I would have traded the wrong direction.

Overall, this strategy seems to have

-high probability of small profit or breakeven IF YOU CHOOSE the wrong daily direction
- small probability of small losses
- tiny probability of big losses

I'm now considering to place Stop at -20 and Reverse at -30, due to the volatility of this pair. That would reduce even more the probability of small / big losses.

The advantage of this strategy is being able to catch almost the whole daily range. That's why it can be highly profitabe and at the same time to allow losses recovery during the same day.

It also relieves you from the pressure of depending on US market to profit, since US has been a no-show for quite a while...

Still awaiting comments here. Thanks
  • #3
  • Feb 12, 2007 5:33am Feb 12, 2007 5:33am
Is there a max loss per day or do you keep going until you make a profitable trade? A 30-50pip ranging market around those levels may hurt you eventually if you keep trading it, which hasn't happened recently but does happen.

Your system is pretty much banking on large movements starting during Fra Open and headed through Lon session - which if the current characteristics cotinue should perform nicely. Whenever you know a big move is to occur during a shortened period of time, a system of this sort will work well as time is against multiple whipsaws, however, when it does begin to happen - how you adapt will be key.

As for entry, I believe an edge can be worked in to help avoid whipsaws - pick the direction of least resistance and only enter if near support or resistance(taken off the dailys) in opposite direction, this should help to stretch the sl a bit. Maybee not even this idea but an edge should be worked in to produce the best entry opportunity.

Secondly, since the key to your system is a large price range during a particular session(within a compact time frame), I would monitor at least the ATR during all the sessions and pay attention to how it trends or detrends to determine the optimal session to trade it with. It may be London Session now, but who is to say that will not change or that you cannot adapt your system to other timeframes.

Lastly, I would try to work something in as well for open positions during highly volatile news announcements as it may be difficult to get a broker to honor certain stop and reverse orders without significant slippage.

Overall a simple and effective strategy if one can get that edge in predicting times where large price movements will occur(other than just highly volatile news times).
Man who scratches ass should not bite fingernails
  • #4
  • Feb 12, 2007 6:41am Feb 12, 2007 6:41am
Quoting Leugimp
Is there a max loss per day or do you keep going until you make a profitable trade? A 30-50pip ranging market around those levels may hurt you eventually if you keep trading it, which hasn't happened recently but does happen.

Your system is pretty much banking on large movements starting during Fra Open and headed through Lon session - which if the current characteristics cotinue should perform nicely. Whenever you know a big move is to occur during a shortened period of time, a system of this sort will work well as time is against multiple whipsaws, however, when it does begin to happen - how you adapt will be key.

As for entry, I believe an edge can be worked in to help avoid whipsaws - pick the direction of least resistance and only enter if near support or resistance(taken off the dailys) in opposite direction, this should help to stretch the sl a bit. Maybee not even this idea but an edge should be worked in to produce the best entry opportunity.

Secondly, since the key to your system is a large price range during a particular session(within a compact time frame), I would monitor at least the ATR during all the sessions and pay attention to how it trends or detrends to determine the optimal session to trade it with. It may be London Session now, but who is to say that will not change or that you cannot adapt your system to other timeframes.

Lastly, I would try to work something in as well for open positions during highly volatile news announcements as it may be difficult to get a broker to honor certain stop and reverse orders without significant slippage.

Overall a simple and effective strategy if one can get that edge in predicting times where large price movements will occur(other than just highly volatile news times).

Thanks Leugimp, I (always) appreciate your comments.

This is a work in progress yet, and may go on like this for a whole month. I don't know if jan-02 up to now supplies a representative amount of information.

But on the data I studied, triggering the SAR at -30pips and reversing again has a very very little chance of happening and you still have the chance to edge at open price again to reduce loss (by that time I'll be looking for loss reduction rather than big profit).

The advantage here is that you will have just one big and quick pressure to deal with: choosing the right direction. This can be supported bt TA and fundys, it is not a raw guess, so again, the odds are in the favor of the trader.

I've noticed that I loose too many pips awaiting the market to show direction. When it shows, there are like 30-40 pips gone to the hole already and, most of the time you will make like 10-20 pips and will have to rely on the news. This is shown to be too risky and to have poor gain/loss ratio.

By getting to news time with some good 30-50 pips positive you lock profit and enjoy the ride.

We live out of probabilities here, right? But if we wait for the perfect condition to act, we never act, or act too late. Better to take a chance and make big profit. The worst case would be trading to recover not that fat loss or taking the loss, that will happen eventually.
  • #5
  • Feb 12, 2007 6:48am Feb 12, 2007 6:48am
Oh, and "Set & Forget" is surely a bad, bad name here... It demands the trader's attentio, big time. Specially at market open.

The good news is that you start trading stop orders instead of bad entries. Got too foggy? jump off with profit, instead of jumpping in in a foggy market...
  • #6
  • Feb 12, 2007 6:53am Feb 12, 2007 6:53am
Nice idea to start this thread cesarnc.

I've been thinking of implementing this idea in my trading. Since my predictions seem to suck (many times I place I trade, the order line starts to look like a Fib reversal line) I have decided to try opening above the high or below the low of the previous 4H bar.

It seems to work, it did today anyway. Let's keep experimenting and see how it goes.

By the way, I'd love to know what your prediction base is.
  • #7
  • Feb 12, 2007 7:06am Feb 12, 2007 7:06am
Quoting ssotiro
Nice idea to start this thread cesarnc.

I've been thinking of implementing this idea in my trading. Since my predictions seem to suck (many times I place I trade, the order line starts to look like a Fib reversal line) I have decided to try opening above the high or below the low of the previous 4H bar.

It seems to work, it did today anyway. Let's keep experimenting and see how it goes.

By the way, I'd love to know what your prediction base is.
Thanks for joining ssotiro. Today was an easy - almost obvious - short at Frankfurt open. But it won't be that easy most of the time. And London getting back to Frankfurt open is quite comon, and this will add some adrenalin here.

But overral, "Predicting" the direction is the main pressure. If you're right, is a set and forget. If not you have a lot of room to reduce loss or even to make a small profit, that is better than loose...

I'm not that fan of posting my positions here. But on this thread, I think it is better to do it, although it won't be a recommendation.

Better than this, we could hang out here like 15 min to Frank open until London confirmation to discuss the direction for a while. That would be helpful to everyone.
  • #8
  • Feb 12, 2007 7:11am Feb 12, 2007 7:11am
Quoting cesarnc

Better than this, we could hang out here like 15 min to Frank open until London confirmation to discuss the direction for a while. That would be helpful to everyone.
Sound nice. See you here tomorrow morning then. Happy trading in the meantime. The day is over for me with some nice profits and from what I gather, so is yours.
  • #9
  • Feb 12, 2007 9:24am Feb 12, 2007 9:24am
Greetings Cesarnc,

You might have read about the FlexiBox indicator over at this FF thread?. I mention it here as the post in that link was put up sometime yesterday as i saw a correlation between something i'd noticed a while back that is just what you have mentioned in this nice thread.

http://fx-ttdd.accrete.com/chart-pag...onsExample.gif

In the image above you can see an Olive green box that is the hour before London Open, then another box indicating the first two hours of the London session. Just for the sake of a simple visual aid, i had set the Asian/PreLondon/London box settings from the original "Sessions" indicator that's been posted here at FF and named it AsianFrankfurtLondonSessions_GMT+2 (for use on MT4 brokers with a GMT+2 feed) and AsianFrankfurtLondonSessions_GMT. If it helps visualize the trading window you are discussing cool. It has been a help to me for a while.

: ) Thom
  • #10
  • Feb 12, 2007 9:54am Feb 12, 2007 9:54am
Quoting accrete
Greetings Cesarnc,

You might have read about the FlexiBox indicator over at this FF thread?. I mention it here as the post in that link was put up sometime yesterday as i saw a correlation between something i'd noticed a while back that is just what you have mentioned in this nice thread.
Many Thanks Thom.

I've run a back test just with 7am and 8am 1hr candles (GMT), that is, Frankfurt and London open. Haven't include the Asian session because:
- Cable is poorly traded in Asian session
- For this reason, I don't consider Asian direction a good clue to European session's

However, in the back test I've mande, I noticed that London retraced to Frankfurt open price about 40-50% of the days during Jan and Feb. It doesn't AWALYS reverse the overall direction, but this danger must be kept on the table, because when it does, it is severe.

I'm still not comfortable with the strategy I've thought about exactly because I only have data from Jan 02 to study here (in my 1hr chart) So I'll go on trading this strategy with extreme attention for another month or two.

So I'd like to know if your observations have a good amount of data to support or were done with last few day's price action. The reason I'm asking is that the last few days are contamined with the rate no-hike and carry trading before G7 and may not be representative as an indicator.
  • #11
  • Feb 12, 2007 3:29pm Feb 12, 2007 3:29pm
Quoting cesarnc
...However, in the back test I've mande, I noticed that London retraced to Frankfurt open price about 40-50% of the days during Jan and Feb...

...So I'd like to know if your observations have a good amount of data to support or were done with last few day's price action...
Hello again : ) I've been trading this little time-slice off and on for nearly a year now with emphasis on what takes place primarily into the London Open, which i believe is what i'm reading in your thoughts. The dark gray box is in fact the Asian session, but my focus is on that hour before London opens that things start rockin-N-rollin'...i.e. when Japan is winding down and Europe is waking up. Now i'm still particular in that i like to see breaks out of the Asian H/L as a heads up. Look at this chart below. And if you think i'm trying to "feel good" and just pick a nice day, what i did was twirl my center-roller-mouse-button back, and i happended to "land" on November 24th 2006 :

http://fx-ttdd.accrete.com/chart-pag...FLbreakout.gif

So....while i might lean toward getting into a position that breaks away from the asian session that continues in the direction of the trend that led into that same asian session, and i will place a trend line alert in that direction above the "Asian Box", go get some tea around the change of sessions, and come back for chart time through the first two hours of London Open. My big heads up in this set up above would have been a third bounce off the lower area of the dark gray box (late Asian) in the 9140 area and heading back into the direction of the prior trend, then a break above into the F.O. To be honest, in the picture above would have entered after the closing of the Bull candle of the last 15 m of Frankfurt when London opens. Yes there could have been a "German Head Fake" as it's called...then as you stated, you win some, you lose some : ) It's that SAR thingy we're talking through here also. If we incorporate what John Carter teaches in his box play we'd have our SR at the other side of the box and be out and back in, in the new direction.

I find it pleasing that there is a resurgence of such breakout/breakaway styles being discussed as i can gleen concepts from each to meld into a style my own... that's why i'm greatful for this thread and the ideas being shared!

Cheers,
Thom
  • #12
  • Feb 12, 2007 4:42pm Feb 12, 2007 4:42pm
Quoting accrete
Hello again : ) I've been trading this little time-slice off and on for nearly a year now with emphasis on what takes place primarily into the London Open....

Cheers,
Thom
Thanks Thom,

Reading your post and reviwing my charts, I guess it makes much more sense to entry at about London open, instead of Frankfurt open. This German Head Fake may be a point of concern and may lead us to take the wrong decision to stop, if London resumes German direction after hunting some stops.

Last few days Frankfurt has show big moves, that are not a rule whatsoever. I was mislead by the recent events instead of sticking to the overall data.

Now the break of the Asian box may be our killer here. I haven't paid too much attention to it. Thanks for bringing it up and share your view.

Goddamn! Trading with more than one brain seems so much easier!
  • #13
  • Feb 13, 2007 12:27am Feb 13, 2007 12:27am
I'm still in the down side.

Asia made a high at 9502 / low at 9480, I'm looking for Frankfurt to break 9480 to go in SL @ 9510 seems ok, doesn't it?

News at 9:30 GMT, hope to have banked some pips until then.

Expecting news to be slightly GBP-negative, although I'm not confident that it will be a big mover, either way.

4hr chart is forming a pin-bar as yesteday. This candle will be closed at London open.

- César
  • #14
  • Feb 13, 2007 12:36am Feb 13, 2007 12:36am
Good morning cesarnc.
Given the previous 4H bar, I will give it 9475 for short and look for long if above 9502. Pretty much the same as you.

I guess we shall see in 35mins. Will you be going for the Frankfurt or the London open?
  • #15
  • Feb 13, 2007 12:48am Feb 13, 2007 12:48am
Quoting ssotiro
Good morning cesarnc.
Given the previous 4H bar, I will give it 9475 for short and look for long if above 9502. Pretty much the same as you.

I guess we shall see in 35mins. Will you be going for the Frankfurt or the London open?
Hey ssotiro...

9475 makes sense.

Although it is not a rule, Frankfurt is providing good pips lately. If it breaches 9480 with momentum I'll start at it. A good "indicator" is Euro, which starts moving like 10 sec. before Cable, which starts following.... This is just speculation... Better stick to price action....

Problem of awaiting London is if FRA opens like 40 pips as yesterday.
  • #16
  • Feb 13, 2007 12:54am Feb 13, 2007 12:54am
I'll wait for a few more pips down from 9480. I'll see you here in a while then.
All the best in the meantime. We'll meet in Frankfurt (or London).
  • #17
  • Feb 13, 2007 12:58am Feb 13, 2007 12:58am
Quoting ssotiro
I'll wait for a few more pips down from 9480. I'll see you here in a while then.
All the best in the meantime. We'll meet in Frankfurt (or London).
Fine... The important is to agree regarding the direction
  • #18
  • Feb 13, 2007 1:10am Feb 13, 2007 1:10am
Caught your thread and noticed you are looking at something that is very close to my set up. Extremely simple and requires little discretion.
Each evening I box the Asian session on a 15 min. chart. I use 1800 until 0200 Eastern time. If a discernable trend line can be drawn within this time frame I do so. Enter trade on break of box or trend line. I don't wait for candle close, just 1 pip break. Tonights parameters are; Long entry, 9503: Short entry 9479 from trend line drawn on 1815 and 2100 candles. This will change as time goes on. I close trade by monitoring price action and candle formation, but always no later than 0500 Eastern. I have net 226 pips this month using this. 12 trades total. 9 positive, 3 negative.
  • #19
  • Feb 13, 2007 1:13am Feb 13, 2007 1:13am
Hi there, i'm trying to follow you guys at the 9480 being the low of the Asian ? I'm showing 9460 on my SBFX-1worldFx demo feed as shown below:

http://fx-ttdd.accrete.com/chart-pag...070213a15m.gif

My box begins at 5pm eastern and is now closed at 1 hour before L.O. with the first 15m candle forming into the preLondon olive box. I'm not making a call on direction at this point as anything goes. For myself i'll get into a sell trade upon a break of either the resistance at 9480 that has also shown itself to be support in the last few hours but keep a close eye out on the 9460 area also.

: ) Thom
  • #20
  • Feb 13, 2007 1:23am Feb 13, 2007 1:23am
Yes, Asian low I show is 9458. However, trend line I described will be broken slightly under 9480.
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