Spud's Predictive MTF Stochastics

Anyway a short trigger just now and the longer stochs look to be curling down, but nearly 15m for the next closing of the 15m stoch so twiddling thumbs and waiting...be still my clicking finger

A nice short now for a bunch a pips would be a great way to end the week!

well m15 stoch closed up....at least 15 more minutes of thumbtwidling...

its 3:20 and it about time to fogettaboudit for this week...I'm beginning to think that paint dried already JD but it's not he color we were hoping for (short)!

Yeah Spud today we enjoyed trading mtf stochs , hope you will be with us on next monday !

Have a nice weekend !
Skyline

I'm in on the short right now..up +13

**EDIT: and out at +8.9 no more trading for the day. This day has worn me down

JD, I turned away for like five minutes and poof it was all over! Your careful monitoring earned you some extra pips to end the week! Have a great weekend fellow spudites.

FW

I intially entered the short too early and incurred a loss.
However now with better entry im up 33 pips. this could be a pretty nice escalator except for the stupid weekend to screw everything up.

Remind me again why we cant trade on the weekends?

correct me if I'm wrong, but I think forex markets are open but our brokers are not...hence the so called "gap" on Sunday on our charts when our brokers open again. For example mine, Interbank FX closes at 4pm EST but I know others are still open for another hour, right? Anyone correct me if I'm wrong.

Good job on that short Ayaz, I managed to nab the last 10 pips literally! TP at 1.2714

Thanks. As I look back over the day, I realize that I've taken a lot of risky trades just to say that I was in a trade. Beginning Sunday night, I'm going back to my road of discipline and I will make sure I have an actual checklist that I go by so that I stick to the PMTF stoch rules that we've established. I personally have enjoyed everyone's contributions and participation this week. I'm looking forward to hearing Spud and the rest of you when trading opens again on Sunday night. Have a good weekend and enjoy the time with your families and/or spouses or your own "me" time

For sure, these are the trades I lose money on.. I agree discipline and maintaining the integrity of the system is the key - when following the rules you can make serious and consistent pippage.

Just a quick question to the active members on this thread; what times of the day or sessions have you found to be the most active with this system if any? I'm kinda feeling a little frustrated because have missed some great trades this week and feel like I have to be in front of the screen a lot to catch them...Maybe a dumb question but I thought I'd ask.

Thanks,

J

Actually, this system works throughout the entire day to be honest with you. During the Asian session it may slow down a bit but even then there's opportunity to grab +10 or so pips.

Yes JD I would add that as every forex book/site/forum said statistically most of the move happen during London/NY market sections. For me is also a pain this because even if I'm in the euro zone so theoretically I can catch the whole London/NY action, during this time I'm at office (start at 9 am end 18 pm) so I cannot follow continuosly the charts otherwise I risk to be fired from my daily job

I made a minor add to previous version, just to help a little bit to see immediatly if stochastic is going up or down for all the situation when it's line is quite flat. So this v3 will calculate the difference between last 2 candles and show the arrow accordingly in the top-right corner of the indicator.
Hope you find it usefull

Note : Don't use any other previous version of this indicator nor any other stochastic indicator on the same chart of Stochastic_NoLastBar v3 otherwise it won't works.

I'm working trying to add some clarity to your entry/exit decision making. Please feel free to tell me "this makes no sense" if I start to loose you. However, I feel this will add tremendously to your trading success and ease your stress. This by the way is all the same thing in my past posts just presented a little differently.

I have modified my charts to help demonstrate this. Across the bottom are the Stochastices for M1,M5,M15,M30,H1,H4,D1 time frames. All are 14,1,3 (middle number does not matter) except M5 which is 14,1,1. (In using the stochastics this way the M5 at 14,1,3 is fine, I'm just stuck in my ways at 14,1,1). Stochastics showing %K only, of course.

The last daily closed Stochastic %K is our "PIVOT" point.

The bottom purple line is called the "Fixed Direction Line". This is where the stochastics in the short time frames will move to. It is simply a line from our Pivot point to the "0" point on the M1.
We only have 2 possible Fixed Direction Lines...the "Down" which is shown here drawn from the Pivot Point to the "0" point on the M1 Stochastic. The other is the "Up" which is a line drawn from the Pivot Point to the "100" point on the M1 Stochastic.
We can only have 1 Fixed Direction Line on our chart. This line moves only if the M1 hits 100 or 0. (This is not "exactly" 100 or 0 but pretty darn close...it will become obvious later what close means).
When M1 hits 100 our Fixed Direction line is drawn in the Down position ("0" to the pivot point). You can see in this example our M1 hit 100 a few minutes back. We only redraw at the close of the M5.
This keeps firmly in our mind what direction we expect the M1 to move too.

The other lines are simple drawn from the Pivot Point to the last close of the M1, M5 and M15 stochastic. This is "where we are". Lines are drawn at the close of every M5.

The "1" shows us that our M1 is going to move down. We expect M1 to hit "0" at some point in time. This is simply inevitable.

The "2" shows that our M5 is higher than our M15. This means our M5 is still in a long position and in this case if we are in a long trade we would stay in our long trade. Also notice that M5 and M15 are above our M1 line further stating the long.

The "3" is our last candle close price. In this situation it closed down.

These 3 indications anticipate an end to our long. At the very least a slow down in our long. We can not yet judge if this is a trend change or simply a pause in our long trade. Hence we have no entry into a short here but if we are in a long trade we stay in it (we should not enter long here).

M30, H1 and H4 are reference points. They simply tell us that M30 is falling and likely H1 will fall to prop up H4...if H4 is to continue to rise. For now, while M30 continues to to point down we favour short trends vs long trends. In other words, we want to try and stay in short trades longer and exit long trades quicker until something changes.

This may seem a bit confusing with 1 picture...but you will see how the movement of these lines will tell you the direction of our trade, entry and exit, as well as momentum.

5 minutes later...Short Entry/Long Exit

1. See how our M1 moves down towards our "down" Fixed Direction Line.
2. This is the M5 crossover of the M15. The M5 has moved across and fallen below the M15 line. Time to enter short and time to exit long.
3. Our M5 price move is down. M5 price does not have to be going in our direction..it is just much much better if it is.

10 minutes later...stay in the short

Really nothing to show here. Our M1 continues to fall and our M5 stays below the M15. Stay in the short.

Spud, have you decided to incorporate M1 in the trading of this system as well? Currently, I'm using M5/M15/M30/H1/H4, should I add M1?

15 mins later...stay in the short

Notice "1" on the chart. This %K is too far away to be considered "peaking" at "0". The only time we might consider this a peak is if M5 pointed up or our M1 line crossed the M5 line upwards.

Otherwise, we are in the short. We can see M5 pressing near the M1 line...this we have to watch. An M1 cross upwards across the M5 is a long signal, but an M5 cross below the M1 is a short signal.

Notice M15 rose. That's good news and supports the down trend.

20 mins later....

There is lots of action here to pay attention too.

One reason we use M5 closes is that we don't want to get thrown off by the oscillations of M1 too much. M1 is like a jumping bean on a pogo stick sometimes, so looking at the picture every 5 mins keeps our sanity.

1. What we want to notice here is that M5 crossed down below M1. it's a fine detail that can be missed and makes all the difference of going long or staying short here. It won't hurt you to make a boo boo here,but it might pull you out of a down trend too early. In this case we stay short.

2. That's a peak at 0%..it's actually about 1.5% but you can see it is pretty darn close. The other clue is M5 hitting 0%

3. Hitting the 0% peak flips our Fixed Direction Line to an "up". It now goes from 100% to our Daily pivot.

Other clues to stay short...notice M15 is below our Fixed Direction Line.

You can do the same thing with M5 to D1. Just use M5 like I use M1 here and M15 and M30 like I use M5 and M15.

You'll find M1 tightens the trades....using longer periods keeps you in the trends more. If you like to stay and play the trends use the larger time frames as your references. If you are a scalper use the M1. This doesn't mean that using M1 will lead you to scalp it just means you can. M1 will certainly optimize any trade but if it confuses you, just drop it and use M5.

25 minutes later....

1. M5 is still below M1 which should keep us in our short trade. You could exit here to be safe...after all we made a mountain of PIPS here. But this is still a "stay the short" signal. I wouldn't enter a short here, nor a long.