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Part Time Wealth Building Trading System - Daily Scalping

  • #381
  • Feb 14, 2007 12:14pm Feb 14, 2007 12:14pm
Quoting traderone
You know, I honestly thought the real system was to reenter as many times as you are stopped out, going the reverse direction? close all trades at 23:00.

You are right. Big difference between being stopped out and hitting your TP limit order.

As you are stopped out.. then you know what to do. When you hit the TP it is a totally different issue and then you are confused what to do. You need to wait for the next opportunity for entry which is the next day.

Jim NO
  • #382
  • Feb 14, 2007 12:17pm Feb 14, 2007 12:17pm
Ah,,... OK. So reenter when stopped, but not if collecting a profit. Makes sense now. thanks for clarifying that!
Don Life is expensive, but includes a free trip around the sun.
  • #383
  • Feb 14, 2007 12:27pm Feb 14, 2007 12:27pm
Quoting sbetz
I traded the Usd/Jpy, Usd/chf, Gbp/Usd, Eur/Usd, Gbp/Jpy and Eur/Jpy. I am really pleased with the performance. I even got stopped out of the Gbp/Jpy and the Eur/Jpy and still made 400. This system really works!
Great job on the 400!

Would you please share your SL & TPs for the Usd/Jpy, Usd/chf, Eur/Usd and Eur/Jpy? I am assuming they are different since they have different volitilities.

Thanks!

Al
  • #384
  • Feb 14, 2007 12:39pm Feb 14, 2007 12:39pm
Quoting Al_Have1
Great job on the 400!

Would you please share your SL & TPs for the Usd/Jpy, Usd/chf, Eur/Usd and Eur/Jpy? I am assuming they are different since they have different volitilities.

Thanks!

Al
I place a 40 pip stop as per the rules. I do not use TP or trailing stops. I closed the trades this morning because I was comfortable with the profit and had a feeling that they were close to the highs of the day. If I close the trades early then I wait until the beggining of the new day to open new positions. Hope this answers your question.
  • #385
  • Feb 14, 2007 12:43pm Feb 14, 2007 12:43pm
Quoting grajo
I have a question regarding re-entering the daily after TP. I took +150 GU for today, which made up for many previous losses on my daily this week.

I could have had close to 180 pips, but I positioned my SL just to give it a little room without taking trhe whole 180 imediately, so I got stopped out for the 150 at 9609, and then immediately went short from there, which as I'm writing this does not look like it was the best idea.

Does anyone think I should have just quit for the day or are there people that try to re-enter the daily right away when their TP's come back to hit their stops?

Any feedback/critique would be appreciated.
Quite frankly, what we think about what you should do is not important. What is important is what you think you should do. More importantly, do what you think is right for you.

Remember, you must adapt to your trading style. This is very important. Do you want to take daily profits are "let it ride"? These are questions you need to settle in your mind before you can proceed with confidence.

Just some recommendations.

Hope this helps...

Happy Trading,

TK
  • #386
  • Feb 14, 2007 1:00pm Feb 14, 2007 1:00pm
Quoting tkimble
Quite frankly, what we think about what you should do is not important. What is important is what you think you should do. More importantly, do what you think is right for you.

Remember, you must adapt to your trading style. This is very important. Do you want to take daily profits are "let it ride"? These are questions you need to settle in your mind before you can proceed with confidence.

Just some recommendations.

Hope this helps...

Happy Trading,

TK

It does TK, and thank you. Somehow, I KNEW you were going to say that! But I think James has it right also, at least for me. His input is more closer to sticking with the (your) rules, and that's more in line with my comfort and stress level.

It's just that you threw me little with your GY 300 pips post, that's all. BTW, I have stuck with the EXACT rules on your weekly (other thread). It does test your patience.
  • #387
  • Feb 14, 2007 1:07pm Feb 14, 2007 1:07pm
Hi, guys!

One quick question for those who implemented Take Profit into this Daily scalping strategy.

Let's pretend that GBP/USD was up on previous day, so the following setup would be Long at daily open and -40 pips for Stop and Reverse with 100 pips profit target. If the stop and reverse gets activated than the Take Profit should be actually 60 pips below stop and reverse. So from daily open price if the market goes in opposite direction as you expected the target profit is 100 pips as well. Correct? I mean there is a better chance for market to reach 100 pips in each direction, rather than 100 in up run and 140 in downrun. Right?

LostFX
"All good things come to those who wait..."
  • #388
  • Feb 14, 2007 1:11pm Feb 14, 2007 1:11pm
Hi TK,

Thanks for sharing this system. It really does seem to work in the long term - from the testing I've done. Yes, you do get weeks where you have -200 pip losses, but the weeks where you have +200 or +300 pip gains outweigh them, but you have to get used to the fact that there will be losing days (and weeks for that matter).

As I mentioned in an earlier post the testing I've done is to exit the trade at 19.00 and this averages 70 pips per week (excellent - if you ask me!). This can be increased by 5 pips per week by not trading at all on Non-Farm Payroll day; and by a further 5 pips per week by exiting the trades at 15.30GMT as opposed to 19.00 GMT. It also assumes a take profit target of 100 pips net (103 pip actual target with spread).

Although, someone (sorry I forget your name) did mention that it didn't work as well in the first six months of 2006, as it did in the second six months, the data I've now got access to would suggest that it's a fairly constant system. The average only varied from 70.25 pips to 71.64 pips for 6 months compared to 12 months.

The testing I've done has assumed a maximum of 2 trades per day - if you're stopped out after that, then that's it for the day.

The tests have also included a 3 pip spread in all the figures - as that's what I have with my broker. (Anything different would alter the figures, for the better or not.)

I, for one, am really pleased with the system. Thanks for sharing this TK.
  • #389
  • Feb 14, 2007 1:11pm Feb 14, 2007 1:11pm
Quoting grajo
It does TK, and thank you. Somehow, I KNEW you were going to say that! But I think James has it right also, at least for me. His input is more closer to sticking with the (your) rules, and that's more in line with my comfort and stress level.

It's just that you threw me little with your GY 300 pips post, that's all. BTW, I have stuck with the EXACT rules on your weekly (other thread). It does test your patience.
Excellent...
  • #390
  • Feb 14, 2007 1:54pm Feb 14, 2007 1:54pm
Someone asked before about how much was needed to use this system. I can personally attest to the fact that $500 can be enough to make the daily work. I started with 500 and in one day am over $1000. Most of which came from the daily system. That was trading the 6 pairs I mentioned earlier. Now I know that this is not to be expected everytime and may not work ALL the time but it has for me. If you stick to the rules on entry and Stop Loss, you should come out ahead everytime. That is why I like to trade more than one or two pairs as it spreads the risk of losing trades. As for exit, I wouldn't worry about WHEN to exit and should you get back in. If you feel comfortable with the profit you have, take it. Never be upset that you didn't stay in and get those extra 10-30 pips. YOU MADE MONEY! BE HAPPY IT WASN'T A LOSS! Then just wait until the begining of the new day and do it all over again. I know I had a hard time with taking a profit and then watch it go on further in my favore. But then when I tried to stay in and get those extra pips........ I usually ended up with less than I would have had if I would have exited earlier. Never argue with a positive number. So what if you didn't make them all. There is tomorrow to make more. Follow the system and reap the rewards.

Just my 2 pips worth! Good luck!
  • #391
  • Feb 14, 2007 2:00pm Feb 14, 2007 2:00pm
Quoting JillyB
Hi TK,

Thanks for sharing this system. It really does seem to work in the long term - from the testing I've done. Yes, you do get weeks where you have -200 pip losses, but the weeks where you have +200 or +300 pip gains outweigh them, but you have to get used to the fact that there will be losing days (and weeks for that matter).

As I mentioned in an earlier post the testing I've done is to exit the trade at 19.00 and this averages 70 pips per week (excellent - if you ask me!). This can be increased by 5 pips per week by not trading at all on Non-Farm Payroll day; and by a further 5 pips per week by exiting the trades at 15.30GMT as opposed to 19.00 GMT. It also assumes a take profit target of 100 pips net (103 pip actual target with spread).

Although, someone (sorry I forget your name) did mention that it didn't work as well in the first six months of 2006, as it did in the second six months, the data I've now got access to would suggest that it's a fairly constant system. The average only varied from 70.25 pips to 71.64 pips for 6 months compared to 12 months.

The testing I've done has assumed a maximum of 2 trades per day - if you're stopped out after that, then that's it for the day.

The tests have also included a 3 pip spread in all the figures - as that's what I have with my broker. (Anything different would alter the figures, for the better or not.)

I, for one, am really pleased with the system. Thanks for sharing this TK.
Jilly B, why are you exiting normally at 19:00GMT, where Tkimble suggest to exit around 23:00 GMT and open new trade at 00:00GMT? Didn't you mean EST time (like 19:00 EST and modify that to 15:30 EST)?
"All good things come to those who wait..."
  • #392
  • Feb 14, 2007 2:04pm Feb 14, 2007 2:04pm
I also want to thank kimble for his system which I have been on a demo and will go live "ASAP" with full confidence in this system, thank you for paying it forward!
  • #393
  • Feb 14, 2007 2:14pm Feb 14, 2007 2:14pm
I'm not confused. I decide (just look at some indicators) if I either place a new trade in the same direction (starting from where I just existed) or I wait for the next day. It's as simple as that. TP is something that makes me feel comfortable.

Quoting james275
As you are stopped out.. then you know what to do. When you hit the TP it is a totally different issue and then you are confused what to do. You need to wait for the next opportunity for entry which is the next day.

Jim NO
Nihil Sine Deo.
  • #394
  • Feb 14, 2007 2:22pm Feb 14, 2007 2:22pm
Hi Scrat

Did you go long or short on the open this morning?
Regards
  • #395
  • Feb 14, 2007 2:30pm Feb 14, 2007 2:30pm
Quoting lostfx
Hi, guys!

One quick question for those who implemented Take Profit into this Daily scalping strategy.

Let's pretend that GBP/USD was up on previous day, so the following setup would be Long at daily open and -40 pips for Stop and Reverse with 100 pips profit target. If the stop and reverse gets activated than the Take Profit should be actually 60 pips below stop and reverse. So from daily open price if the market goes in opposite direction as you expected the target profit is 100 pips as well. Correct? I mean there is a better chance for market to reach 100 pips in each direction, rather than 100 in up run and 140 in downrun. Right?

LostFX
LFX,

I may be wrong on this, or maybe it's because I didn't understand your question, but my understanding is those traders who take profits at 100 pips, set their TP expectation for either direction, whether it reverses or not.

In your example if you went long at the beginning of the day, you would set TP at 100, but if it reversed before then and hit your SL (-40 from opening), you would take your 40 pip loss, and short it from there also with a with a TP of 100 (and you're correct, it would then be a 140 pip move from the opening for this to happen). That's my understanding.
  • #396
  • Feb 14, 2007 2:43pm Feb 14, 2007 2:43pm
But then your odds in case it goes against you are not even. I mean we have opening price and we are assuming market direction either to go 100 pips UP or 100 pips down. By stop and reverse and TP of 100 pips you are basically saying that your odds of hitting 100 pips in up direction and 140 pips in down direction are the same, which I don't believe is true. In other words if the first trade is stopped out you are risking more to get 100 pips from that stop and reverse.

LostFX
"All good things come to those who wait..."
  • #397
  • Feb 14, 2007 2:46pm Feb 14, 2007 2:46pm
Quoting grajo
LFX,

I may be wrong on this, or maybe it's because I didn't understand your question, but my understanding is those traders who take profits at 100 pips, set their TP expectation for either direction, whether it reverses or not.

In your example if you went long at the beginning of the day, you would set TP at 100, but if it reversed before then and hit your SL (-40 from opening), you would take your 40 pip loss, and short it from there also with a with a TP of 100 (and you're correct, it would then be a 140 pip move from the opening for this to happen). That's my understanding.
That is correct, it is what I am doing 100 pips PT any direction whether straight or stopped and reversed; if PT not hit, close at the end of the day or carry into next day if you want to re-enter.
Regards
  • #398
  • Feb 14, 2007 3:18pm Feb 14, 2007 3:18pm
Quoting sbetz
Someone asked before about how much was needed to use this system. I can personally attest to the fact that $500 can be enough to make the daily work. I started with 500 and in one day am over $1000. Most of which came from the daily system. That was trading the 6 pairs I mentioned earlier. Now I know that this is not to be expected everytime and may not work ALL the time but it has for me. If you stick to the rules on entry and Stop Loss, you should come out ahead everytime. That is why I like to trade more than one or two pairs as it spreads the risk of losing trades. As for exit, I wouldn't worry about WHEN to exit and should you get back in. If you feel comfortable with the profit you have, take it. Never be upset that you didn't stay in and get those extra 10-30 pips. YOU MADE MONEY! BE HAPPY IT WASN'T A LOSS! Then just wait until the begining of the new day and do it all over again. I know I had a hard time with taking a profit and then watch it go on further in my favore. But then when I tried to stay in and get those extra pips........ I usually ended up with less than I would have had if I would have exited earlier. Never argue with a positive number. So what if you didn't make them all. There is tomorrow to make more. Follow the system and reap the rewards.

Just my 2 pips worth! Good luck!
Well said....
  • #399
  • Feb 14, 2007 3:19pm Feb 14, 2007 3:19pm
Quoting lostfx
But then your odds in case it goes against you are not even. I mean we have opening price and we are assuming market direction either to go 100 pips UP or 100 pips down. By stop and reverse and TP of 100 pips you are basically saying that your odds of hitting 100 pips in up direction and 140 pips in down direction are the same, which I don't believe is true. In other words if the first trade is stopped out you are risking more to get 100 pips from that stop and reverse.

LostFX
That may very well be true. But I think if we go back to the posts early on in this method, although it's true that it can be traded with any pair, the more volatile pairs may be a better fit, and why TK has had success.

Why? Think about what we're doing...we're trying to "catch" the daily trend, in pairs that usually move a lot during the course of 24 hours. This may in fact require us to accept a few whips (-40's) along the way - this is the price we pay to catch this trend in a volatile pair such as the GU and GY, which can on many days sustain a (-40) loss or two but still end up being well worth it. Not always maybe, but enough to make it a profitable system.


That's my understanding anyway... Also, you could always lower the TP a little if it makes you feel better, to say 50 or 60 pips.
  • #400
  • Feb 14, 2007 4:04pm Feb 14, 2007 4:04pm
Quoting Scrat
I'm not confused. I decide (just look at some indicators) if I either place a new trade in the same direction (starting from where I just existed) or I wait for the next day. It's as simple as that. TP is something that makes me feel comfortable.
Thanks Scrat...Not saying you are confused.... but i sure become confused when i get out early then feel i have to get back in! Usually when i see the market continue without me! So i try to get in and usually lose ...Has been the story of my earlier life. So if one get out early, there needs to be a reason and a strategy for it. Then wait for the next complete signal as you said.

I agree with you on the TP...i have been trading without it but finding i am much more relaxed with it.....

Good trading to you..

Jim no
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