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4H 5EMA System

  • #541
  • Oct 27, 2008 1:12pm Oct 27, 2008 1:12pm
Quoting alllivemind
Steve, are you using the Alpari or those timeframes? Seems to me that you are. Although you got a much better entry than we did it is not the system. Are you using the Alpari bar of 12:00? That is not a setup bar, as it did not make a lower low. The bar before it is. At this point though, I wish I was long at your price!
Michael

yes to the Alpari question,
but as I said the 1st bar was a valid setup but wasn't triggered by the next 2 bars, the next(12:00) bar didn't need to have a lower low just breaking the lower ema by 5 pips was enough to make it a setup bar(?)

Steve.
  • #542
  • Oct 27, 2008 1:19pm Oct 27, 2008 1:19pm
Quoting Arnold49
yes to the Alpari question,
but as I said the 1st bar was a valid setup but wasn't triggered by the next 2 bars, the next(12:00) bar didn't need to have a lower low just breaking the lower ema by 5 pips was enough to make it a setup bar(?)

Steve.
You should be long from 1.5665 with your stop at 1.5270.
  • #543
  • Oct 27, 2008 1:31pm Oct 27, 2008 1:31pm
Quoting Hiranya
You should be long from 1.5665 with your stop at 1.5270.
Yea i agree with Hiranya, Looking to move my stop loss and place a sell stop at the end of 1600 gmt candle at 1.5372
LISTEN TO MR FUNDAMENTAL AND MR TECHNICAL
  • #544
  • Oct 27, 2008 1:51pm Oct 27, 2008 1:51pm
Quoting Hiranya
You should be long from 1.5665 with your stop at 1.5270.
please can you explain why? starting from the 1st bar.
(I thought I'd got it right this time)

thanks,
Steve.
  • #545
  • Oct 27, 2008 1:54pm Oct 27, 2008 1:54pm
Quoting okehiedon
Yea i agree with Hiranya, Looking to move my stop loss and place a sell stop at the end of 1600 gmt candle at 1.5372

Am I right in saying the stop can't move if the current bar breaks both ema's
'cause it looks like that will happen

Steve.
  • #546
  • Oct 27, 2008 2:06pm Oct 27, 2008 2:06pm
Quoting stersuhr
Yeah the system is still flat for the week. I put the indictor into the idnicator section of alpari and loaded it and it dosent do anything. Anyone know what im doing wrong?

-Sterling
Hi Sterling

Open a 4hr chart of GU and attach the period converter to it
Allow DLL imports
Set period multiplier to 2 for an 8 hr chart or to 3 if you need a 12 hr chart
Click on "file" at the top left hand corner of MT4
Click on "open offline"
In the list of charts select the 8 hr GU and double cick on it

The 8hr chart opens and you can customise and apply your indicators onto it as usual
Note that the 4hr chart should be running all the time to have the 8hr chart running

Please let me know if there is any problem
Regards
  • #547
  • Oct 27, 2008 2:12pm Oct 27, 2008 2:12pm
Quoting Arnold49
please can you explain why? starting from the 1st bar.
(I thought I'd got it right this time)

thanks,
Steve.
On the attached chart the last setup bar is marked with an arrow
You should be long 5 pips above its high
Attached Image
Regards
  • #548
  • Oct 27, 2008 2:27pm Oct 27, 2008 2:27pm
Howard thanks for that , here is my version, please can you tell me what is wrong, I don't see it?
Attached Image
  • #549
  • Oct 27, 2008 2:32pm Oct 27, 2008 2:32pm
ok, I just re-read the rules & I see it now, ignore previous post

thanks,
Steve.
  • #550
  • Oct 27, 2008 2:39pm Oct 27, 2008 2:39pm
Quoting Arnold49
ok, I just re-read the rules & I see it now, ignore previous post

thanks,
Steve.
Anyway the system is now long but your position is in a better shape
Regards
  • #551
  • Oct 27, 2008 2:49pm Oct 27, 2008 2:49pm
I'm on 4H chart and have 4,8,16 hour bars. I'm long from 1.5468 and currently 220pips profit
Now a possible setup bar for short has appeared.
Waiting to see what's going on next
Attached Image (click to enlarge)
Click to Enlarge Name: gu.gif Size: 21 KB
  • #552
  • Oct 27, 2008 4:11pm Oct 27, 2008 4:11pm
Now closed closed long for 66 pips and switched to short @ 1.5534
  • #553
  • Oct 27, 2008 4:39pm Oct 27, 2008 4:39pm
Quoting stersuhr
When price in the case of a long makes a lower low and triggers the trade you move the stop below the new low. You have no choice about it being triggered so you just move the stop to the new low and continue with the system as usual. When I was backtesting and this happened I would move it down to the hour chart to see which came first to determine what the outcome would have been.

As far as it triggering the buy order and then getting stopped out in the same bar, you do not have a reversal order in the market (howard). The rules state you do not put the reversal order in until the reversal bar closes. If you were to put the reversal order in who to say that order wouldnt get triggered without even triggering a buy? That is why you dont do that. I hope this clears things up.

I think you guys see why I say you have to take every trade. This system does rely on the big 3-4 trades per month to be positive. The other 20-25 trades end up only slightly positive and so you have to have the big ones. I personally dont care how this system gets to 700 pips a month, I just know it usually does and thats all that matter. Let me know if my explinations of the trade rules werent clear. I believe what I said is wrote in the rules so check those out to for a little more clarification.

-Sterling
Thanks Sterling and Howard...that clears up everything except 1 question.

How do you determine where the next order should go once you've been stopped out (because you are now out of the market....no reversal trade was taken)??

Would the short order go in 5 pips below the candle that took out our stop?

Greg
  • #554
  • Oct 27, 2008 4:44pm Oct 27, 2008 4:44pm
Quoting AlexL
Now closed closed long for 66 pips and switched to short @ 1.5534
Yeah those candle closes definatly made a better trade on this one. On the big move down I believe your candle got triggered for a buy and stopped out and reversed which made the profit a little less, but it definatly made up for it here. All in all they should average out over the course of a year. Glad to see you made money on this one tho!

-Sterling
Founder of Day Trading Forex Live
  • #555
  • Oct 27, 2008 4:46pm Oct 27, 2008 4:46pm
Quoting Arnold49
Howard thanks for that , here is my version, please can you tell me what is wrong, I don't see it?
I think the rule you werent applying correctly is that after the setup bar price has 2 reversal bars to make a trade. Then if the trade would have failed to trigger the third bar could be the new setup bar if it breaks one of the EMA's.

-Sterling
Founder of Day Trading Forex Live
  • #556
  • Oct 27, 2008 4:50pm Oct 27, 2008 4:50pm
Quoting batesmotel
Thanks Sterling and Howard...that clears up everything except 1 question.

How do you determine where the next order should go once you've been stopped out (because you are now out of the market....no reversal trade was taken)??

Would the short order go in 5 pips below the candle that took out our stop?

Greg
If your using alpari charts your not stopped out and your still long. I think you were refering to the chart on post #551 tho. In that case the last bar on that chart is a setup bar to go short right? So you have the stop for the long trade 5 pips below that bars low and since its a signal to go short you also put a sell stop at the stop loss point. The stop loss for the new sell would be 5 pips + the spread above that bars high. Hope this makes sense.

-Sterling
Founder of Day Trading Forex Live
  • #557
  • Oct 27, 2008 4:54pm Oct 27, 2008 4:54pm
I'm having trouble understanding the concept of the reversal bar.

A reversal bar is a bar whose price breaks the high of the setup bar--in case of a long, or whose price breaks the low of the setup bar--in case of a short.

Do we wait for the reversal bar to close? I'm curious to know what happens when the price of the reversal bar breaks the high low of the setup bar, and then makes a new high/low.
  • #558
  • Oct 27, 2008 4:54pm Oct 27, 2008 4:54pm
Quoting howard
Hi Sterling

Open a 4hr chart of GU and attach the period converter to it
Allow DLL imports
Set period multiplier to 2 for an 8 hr chart or to 3 if you need a 12 hr chart
Click on \"file\" at the top left hand corner of MT4
Click on \"open offline\"
In the list of charts select the 8 hr GU and double cick on it

The 8hr chart opens and you can customise and apply your indicators onto it as usual
Note that the 4hr chart should be running all the time to have the 8hr chart running

Please let me know if there is any problem
Thanks I got it now, ill probably backtest that tonight.

-Sterling
Founder of Day Trading Forex Live
  • #559
  • Oct 27, 2008 4:57pm Oct 27, 2008 4:57pm
Quoting stersuhr
If your using alpari charts your not stopped out and your still long. I think you were refering to the chart on post #551 tho. In that case the last bar on that chart is a setup bar to go short right? So you have the stop for the long trade 5 pips below that bars low and since its a signal to go short you also put a sell stop at the stop loss point. The stop loss for the new sell would be 5 pips + the spread above that bars high. Hope this makes sense.

-Sterling
Actually, I was refering to post #553...I'll quote the part you explained.

"As far as it triggering the buy order and then getting stopped out in the same bar, you do not have a reversal order in the market (howard). The rules state you do not put the reversal order in until the reversal bar closes. If you were to put the reversal order in who to say that order wouldnt get triggered without even triggering a buy? That is why you dont do that. I hope this clears things up."

Where will the next order go?? Do we put in a sell order 5 pips below low of the bar that took out our stop??
  • #560
  • Oct 27, 2008 4:59pm Oct 27, 2008 4:59pm
Quoting Ronald Raygun
I'm having trouble understanding the concept of the reversal bar.

A reversal bar is a bar whose price breaks the high of the setup bar--in case of a long, or whose price breaks the low of the setup bar--in case of a short.

Do we wait for the reversal bar to close? I'm curious to know what happens when the price of the reversal bar breaks the high low of the setup bar, and then makes a new high/low.
In the case of a long:

When price is below lower 5 EMA you are looking for longs only. Inverse for a short. So when the setup bar closes you place your buy stop 5 pips + the spread above the setup bars high and the stop 5 pips below the low. You do this so you only have to look at the market once every 4 hours.

If price goes up and triggers the buy then makes a lower low, its simple, you lose. When this happens, since the bar that stopped you out made a lower low it now becomes the setup bar and when it closes you put in the buy order as mentioned above. It does not happen very often that you get a trade triggered and stopped out in the same bar but it does happen. I think it has happended twice this month. Hope this clears things up.

-Sterling
Founder of Day Trading Forex Live
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