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4H 5EMA System

  • #321
  • Oct 21, 2008 1:32pm Oct 21, 2008 1:32pm
As of right now the short trade is up +450 pips or so. Here is the chart for the day and also the current orders you should have put in the market at 2PM EST. As always in the chart red arrows point to the setup bar and the blue arrow points to the reversal bar.

Trade #17 -

Stop loss - 1.7038

Potential trade #18 -

Buy stop - 1.7038

Buy stops stop loss - 1.6831

You also notice in the chart that I put a red arrow next to all the bars that were setup bars. Even the ones that did not get a proper reversal bar. This should help you identify them better and see why the trade was not take according to the rules. Again, if it does not have a blue arrow pointing to a reversal bar it was not a valid setup.
Attached Image (click to enlarge)
Click to Enlarge Name: trade #17,#18.gif Size: 54 KB
Founder of Day Trading Forex Live
  • #322
  • Edited 1:36pm Oct 21, 2008 1:35pm | Edited 1:36pm
hi guys

I am using the system on Eur Jpy as at 1800 GMT currently up by 375 pips. Great system thanks Sterling. My basis for using it on EJ is its trending nature and less votality compared to GJ.
LISTEN TO MR FUNDAMENTAL AND MR TECHNICAL
  • #323
  • Oct 21, 2008 2:54pm Oct 21, 2008 2:54pm
Quoting okehiedon
hi guys

I am using the system on Eur Jpy as at 1800 GMT currently up by 375 pips. Great system thanks Sterling. My basis for using it on EJ is its trending nature and less votality compared to GJ.
I think it would be great and not much more work to use this system on another pair or two. Anyone done backtesting or have reason to believe that E/J or any other pair is as good as G/U with the system? If volatility is a factor I wonder about using this on GBP/JPY or AUD/JPY....
Of course they probabaly all look goo over the last day or two.
  • #324
  • Oct 21, 2008 3:13pm Oct 21, 2008 3:13pm
Quoting stersuhr
Feel free to ask as many questions as you want, no problem at all! You got it right if one of these bars would have or does make a lower low they would be the new setup bar. If however they dont make lower lows or a lower high the trade is cancelled and the third bar after the original bar becomes the setup bar if it is lower than the 5 EMA by 5 pips. If this happens it does not have to make the lowest low because the other trade was cancelled, it just has to meet the basic requirements of a setup bar. Hope that makes sense.
-Sterling
Why was trade number #17 not cancelled based on above rule? (of course if we now see how trade was developed it was really good that it was not cancelled but I don't understand why). Thanks for help.
  • #325
  • Oct 21, 2008 3:48pm Oct 21, 2008 3:48pm
Quoting pokasaha
Why was trade number #17 not cancelled based on above rule? (of course if we now see how trade was developed it was really good that it was not cancelled but I don't understand why). Thanks for help.
That rule is talking about cancelling the reversal order to go long, not the current short we are in.

I have a new rule that dosent effect the basis of the system just the way profits are takin on big trades and it goes like this:

When the market is going in your favor and you have a setup bar followed by two failed reversal bars you cancel the reversal trade right? So then where do you put your stop. I have always put the stop back to the original stop loss. But then I got to thinking and realized you could loose all your profits by doing this. So for an example the current huge bar down is the setup bar and if the two following bars dont break its high then the buy is cancelled and the stop is moved back to the original stop at the beginning of the trade. But in this trade your risking giving back +600 pips profit. So the new rules is as follows. If from you entry the market has ran 200 pips or more you move it to half profit which would be 100 pips in this example. If the market is already past half profit you close the trade with whatever profit you have.

So for the trade we are in now. If this reversal bar closes and we have two failed reversal bars after it we cancel the buy order and put the stop at 1.7008. We entered at 1.7365 and the low was 1.6651 which is a +714 pip move. Half profit on that is +357 pips which is how I got the stop of 1.7008. I hope this makes sense. This stop is far enough away to allow more downside but enough to lock in some good profits.

-Sterling
Founder of Day Trading Forex Live
  • #326
  • Oct 21, 2008 3:50pm Oct 21, 2008 3:50pm
Quoting alllivemind
I think it would be great and not much more work to use this system on another pair or two. Anyone done backtesting or have reason to believe that E/J or any other pair is as good as G/U with the system? If volatility is a factor I wonder about using this on GBP/JPY or AUD/JPY....
Of course they probabaly all look goo over the last day or two.
From my experience the G/J is by far way to choppy. Volatility is good if its directional but the G/J is not. The E/J is definatly a lot better. As Ive always said you are welcome to backtest any pair you like and post results, it would be a great service to the room. Just make sure you do it slowly to be accurate and you have a good handle on all the rules to the system. Other than that go right ahead!

And yes if you would have traded a basket of pairs like the most popular thread on this forum does last night you would have been wildley in profit accross the board on this system. But as you see with the other one when it goes bad for a basket it goes really bad! Thats why I stick with one pair, but eventually I would like to trade another pair that compliments the G/U.

I am currently in the process of paying for an EA to be made I will let you guys know how that goes.

-Sterling
Founder of Day Trading Forex Live
  • #327
  • Oct 21, 2008 3:58pm Oct 21, 2008 3:58pm
Sterling

I could not agree more...this is a good rule change because I believe this will happen often. Over the course of a month this could mean a big pip increase. This is the good thing about a system like yours...the ability to make changes with the ever changing market.

Good job

Mike

Quoting stersuhr
That rule is talking about cancelling the reversal order to go long, not the current short we are in.

I have a new rule that dosent effect the basis of the system just the way profits are takin on big trades and it goes like this:

When the market is going in your favor and you have a setup bar followed by two failed reversal bars you cancel the reversal trade right? So then where do you put your stop. I have always put the stop back to the original stop loss. But then I got to thinking and realized you could loose all your profits by doing this. So for an example the current huge bar down is the setup bar and if the two following bars dont break its high then the buy is cancelled and the stop is moved back to the original stop at the beginning of the trade. But in this trade your risking giving back +600 pips profit. So the new rules is as follows. If from you entry the market has ran 200 pips or more you move it to half profit which would be 100 pips in this example. If the market is already past half profit you close the trade with whatever profit you have.

So for the trade we are in now. If this reversal bar closes and we have two failed reversal bars after it we cancel the buy order and put the stop at 1.7008. We entered at 1.7365 and the low was 1.6651 which is a +714 pip move. Half profit on that is +357 pips which is how I got the stop of 1.7008. I hope this makes sense. This stop is far enough away to allow more downside but enough to lock in some good profits.

-Sterling
  • #328
  • Oct 21, 2008 4:41pm Oct 21, 2008 4:41pm
Why aren't all of the red bars today new setup bars?
  • #329
  • Oct 21, 2008 4:48pm Oct 21, 2008 4:48pm
Hi All

Is there a template for this system? It seems fairly straightforward but a template would help.

Thanks for any help given!

Mr Chips
Jim (MrChips)
  • #330
  • Oct 21, 2008 6:22pm Oct 21, 2008 6:22pm
Quoting killertrader
Why aren't all of the red bars today new setup bars?
They are. But in order for the trade to get triggered the high of one of them would have to broken and it hasent happened yet. So you just keep using the bar that makes the lower low and if it keeps going lower you keep having a new setup bar until the trade to go long is triggered.

-Sterling
Founder of Day Trading Forex Live
  • #331
  • Oct 21, 2008 6:24pm Oct 21, 2008 6:24pm
Quoting MrChips
Hi All

Is there a template for this system? It seems fairly straightforward but a template would help.

Thanks for any help given!

Mr Chips
Im not exactly sure what you mean by a template? All you need is a 5EMA applied to the high and a 5EMA applied to the low. Thats it. The rest is all price action.

-Sterling
Founder of Day Trading Forex Live
  • #332
  • Oct 21, 2008 6:52pm Oct 21, 2008 6:52pm
On an MT4 platform it's so easy to set up there is no need for a template. But I like the way Sterling's charts look and wouldn't mind it. Right click on the chart and template "save template" , give it a name. Then,
If you go to your program files-Alpari (or other broker) Mt4 platform-templates. You can upload it to this forum.
Well, we have yet another new low on the newest bar! So assuming it does not break the high in the next 2 hours we'll be locking in quite a bit of profit and having a much lower intro for what will hopefully be a reaction long. Nice system!
  • #333
  • Oct 21, 2008 6:54pm Oct 21, 2008 6:54pm
Quoting alllivemind
On an MT4 platform it's so easy to set up there is no need for a template. But I like the way Sterling's charts look and wouldn't mind it. Right click on the chart and template \"save template\" , give it a name. Then,
If you go to your program files-Alpari (or other broker) Mt4 platform-templates. You can upload it to this forum.
Well, we have yet another new low on the newest bar! So assuming it does not break the high in the next 2 hours we'll be locking in quite a bit of profit and having a much lower intro for what will hopefully be a reaction long. Nice system!
Ok Ill give that a try give me a minute and Ill load it up.

Yeah this trade is up over +800 pips now. Pretty good trade to say the least.

-Sterling
Founder of Day Trading Forex Live
  • #334
  • Oct 21, 2008 6:58pm Oct 21, 2008 6:58pm
Thats pretty cool...you learn something new everyday! Thanks Alllivemind.

-Sterling
Attached File(s)
File Type: tpl stersuhr.tpl   1 KB | 593 downloads
Founder of Day Trading Forex Live
  • #335
  • Oct 21, 2008 7:29pm Oct 21, 2008 7:29pm
Hey Sterling has anyone taken you up on your challenge yet?
  • #336
  • Oct 21, 2008 9:24pm Oct 21, 2008 9:24pm
I do not think that any one has taking the system challenge. I would love to see ster give some money out. So some one needs to take that challenge. But hell that is just mad cus love...
  • #337
  • Edited Oct 22, 2008 12:48am Oct 21, 2008 9:42pm | Edited Oct 22, 2008 12:48am
Quoting Hiranya
I do not think that any one has taking the system challenge. I would love to see ster give some money out. So some one needs to take that challenge. But hell that is just mad cus love...
lol....no one has started trading the challenge. And after this month I won't blame them. I wouldn't want to have my system get imbarresed either haha!! You know Eric being that your family youd think you wouldnt want to see me pay out money lol. Thats alright tho if someone beats me I will gladly pay them for there great system.

This current trade is up +1,150 pips or so. Hope someone other than me got in on it. If not there is always another one, and another month. This is NOT a fluke, thats what this system does!

-Sterling
Founder of Day Trading Forex Live
  • #338
  • Oct 22, 2008 1:12am Oct 22, 2008 1:12am
hi, awesome system, It's doing wonders for my poor battered live account!!

please can you advise current stoploss as mine is still at 1.6956 & I want to move it down, but not sure where to as all bars are totally below the MA.

thanks,
Steve.
  • #339
  • Oct 22, 2008 2:01am Oct 22, 2008 2:01am
Quoting Arnold49
hi, awesome system, It's doing wonders for my poor battered live account!!

please can you advise current stoploss as mine is still at 1.6956 & I want to move it down, but not sure where to as all bars are totally below the MA.

thanks,
Steve.
I think I know what I'm doing now. The last bar made a new low and is therefore a setup bar. It's high is 1.6563. add 5 pips plus your spread, mine is four, sterling is 3. So my stop is 1.6572, as is my buy stop for the next trade.
Michael
  • #340
  • Oct 22, 2008 2:09am Oct 22, 2008 2:09am
ok, thanks,I have moved it now anyway.

I just wanted to clarify the rules, I thought as the last few bars were below the MA they don't count as setup bars.

Steve.
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