Following the daily candle

I am a regular trader with starting balance of around $500 with a mini account at IBFX.

I followed, incorporated and abandoned several methods and several indicators which I came across.

But till now I am far away from the traders dream of trading for a living.
I had my own share of winnings and losses.

With the recent downfall of GBP/USD. I had my major share of loss. Of course I was far away from margin call and quite safe in that matter due to my money management.

This week end I closed all the charts and closed all my orders with negative and positive balances and decided
to do something which might convince myself.

Ultimately I came up with the following strategy:

Chart time frame : Daily

Indicators: No indicators, only daily candles.

Time zone: I trade with IBFX but follow the Oanda time for the daily candle. I trade from India. The Oanda daily candle starts at 9.30 am Indian Standard time. So it is convenient for me. The IBFX follows GMT So their daily candle starts at 4.30 or 5.30 am IST. Not so convenient for me.

Method: Enter in the direction and at the price level of previous daily candles close.If the previous daily candle is long then enter long. If it is short then enter short.If you make a profit then close trade before you open another trade.If you make a loss, then open the next trade with slightly more pip value. Depending upon the equity one may go for a martingale system.

This my new rule: The difference between two successive trades should be at least 90-100 pips. This may prevent order logging during ranging market (added on 08/21/2008)

Personally I start with 10 cents a pip. If I make a loss then my next trade(next day) will be 11 cents a pip.

I am not closing the trade with loss.It might get hedged after some days or may be will turn back to profit when the price reverses.

I intend to close all the leftover trades when the sum of all profit/losses in positive. Then start afresh again.

I will post my daily trades and the result, until and unless i find that the system does not work.

Whether this will work or not, time will tell.

I am not sure whether this method has been tried or posted previously or not.If it was posted, then I request my valuable readers to direct me to the thread.

Wishing every body happy trading (including myself)

GBP/USD Enter long at 1.8705

My main goal is consistency by striking a balance between security of equity and profitability. Reducing the screen time and also not getting heated up while trading are also other factors. Of course every trader looks for them while developing his strategy.

If time permits, then the trader may reduce the time frame to 4H or 1H.
Going in the direction of last 4H candle or 1H candle. It is completely a mechanical system. No intuition or any other external factors like overall trend or news or anything should interfere. Only the direction of the previous candle blindly.

I, till I see the strategy working, will stick to daily. (at last till I get my own PDA)

Yesterday the trade went against me approx by 70 pips at the close of the daily candle on OANDA. Today I opened another trade withe 12 cents a pip at 1.8639 short.

My two trades are:

(1) GBP/USD: 1.8705 long
(2) GBP/USD: 1.8639 Short.

The possible outcomes of the two trades may be the following for today:

(1) Th second trade may end in profit. If so I will close my second trade.
Leaving my first trade open.
(2) If the second trade goes against me, then my first trade may result in break even or in profit. If so then I will close my first trade

My new trade:

GBP/USD Long 1.8667 (13 cents a pip)


As on today my number of trades are:
GBP/USD

(1) Long: 1.8705 (11 cents a pip)
(2) Short: 1.8639 (12 cents a pip
(3) Long: 1.8667 ( 13cents a pip)

should your second trade not be 11 cents according to your rules?

Sorry for the typing error.

My first trade started with 11 cents. I rectified the post.

Enter my latest trade:

GBP/USD: Long at 1.8644

Two buys and two sells as on today. ranging market

I have added a new rule to prevent unnecessary accumulation of orders in a small ranging market. My first post has been updated accordingly.

Due to unforeseen reasons, I had to stop trading temporarily for some days.
So I will not be able to post any updates.

But perhaps my sell trades have resulted in profit today.

ill be waitin..

Hey there,

We both have similar trading style. However if I may comment on your first post I see one major problem.

You mentioned that you use Oanda daily candle to make trading decision because it suits your timing. The whole reason why Candles and technical analysis work is because traders see those setup and react to it. We need to be in sync with those people especially the ones that move the market, Bank and Institutional traders.

Hope it make sense.

Regards,
FirePips

Please annotate a few charts.

simplecoders How has your trading plan work out so far?? Chart time frame : Daily

Indicators: No indicators, only daily candles. I hope that you are doing well.

Why do you close a winning trade and open another in the same direction again. You are only giving spreads to the broker. Why don't you let the winning trade continue in the same direction?

For this strategy you don't have to depend on the candle or the chart. For the Daily trade, choose one convenient time of the day when you can regularly attend to the trade. At this given time open a position in any direction. At exactly the same time next day check your trade. If it is in plus (excess of 50 pips) close the trade and open again in the same direction. If the trade is against you by more than 50 pips let it continue and along with it open another trade with slightly more lots in the direction of this trade. Again check the trade next day at the same time and repeat the above two scenarios. If any day the pip movement has been less than 50 pips don't touch the trade and let it run till next day (this is to avoid noise and clutter).

Hi all,

I am currently getting the same idea of trading previous candle and I find this strategy. I wounder if it is works and profitable or not?

Thanks

This looks perfect for me. But on the next day you have to wait for price to retrace to the nearest support or resistance. And enter on the retracement

Hi Guys, Is anyone still using this strategy?

good day everyone, my name is Joshua Benson ceo of the Jcelerita Group and I have the solution to your Daily Candle Problem.

firstly most times there are always retracement during the start to mid of Tokyo session to either the high and low of the previous day New York session.

Golden Nougat: there are always retracements to the either the high or the low of the prev day NY session. how do you pass this manipulation phase, wait for the first 2 4HR candle to form for the present day so you get a direction. Also, candle closure is important.


EXCEPTION: The exception to the rule is that, a daily candle might desire to close as an indecision candle, meaning you will have to target less pips that day.