Deprive a man of everything and you give him nothing to lose.
- #746
- Dec 1, 2008 7:08am Dec 1, 2008 7:08am
- Joined Oct 2008 | Status: Let the market come to you | 2,670 Posts
- #747
- Dec 1, 2008 8:43am Dec 1, 2008 8:43am
- Joined Aug 2008 | Status: Sharpen the Scalper Razor | 4,704 Posts
Sorry if I am posting too much...
A follow on to my previous post about the 1 min divergence, whether or not the divergence had anything to do with the move downwards shortly therafterwards, I noticed that on both THV signals, RSI was oversold and may have prevented one from entering the trade...it was even oversold on the 5 min chart. Is this something that should just be accpeted? It was afterall a 50+ pip move...
I know Cobra has said many times that one may have to discard certain indicators for various reasons...looking at this period is...
You are right, the RSI is not reliable on 1M and the smallest move after a flat market makes it oversold-bought. I don’t take it in account on 1M; you can disable it in 1M if you want. More accurate in that TF is the Trix, passing the 0,0003 line.
And you are not posting too much, keep telling us what you think, please.
- #748
- Dec 1, 2008 8:51am Dec 1, 2008 8:51am
- Joined Aug 2008 | Status: Sharpen the Scalper Razor | 4,704 Posts
- #749
- Dec 1, 2008 8:51am Dec 1, 2008 8:51am
- Joined May 2006 | Status: Still here. | 2,602 Posts
and is there a way to determine which way to anticipate the following movement...that is to say...does one follow the trend on trix or on the chart or does one just wait for movement?
The green and red line in the indicator window (T3 Trix) show us early possible trend changes on cross
the changes much earlier, I think it is better to follow the rules, at least while we are learning the system and adapting ourselves to its characteristics, in order to maintain a consistency throughout all our trading experience.
I noticed that on both THV signals, RSI was oversold and may have prevented one from entering the trade...it was even oversold on the 5 min chart. Is this something that should just be accpeted? It was afterall a 50+ pip move...
I know Cobra has said many times that one may have to discard certain indicators for various reasons...looking at this period is there any reason that ther could have been to take the trade...?
The green and red "worms" in the indicator window are RSI and show overbought and oversold areas and it is a sign that the PA may stop or reverse soon.
In both entries you show in your chart with a yellow vertical line, all the conditions for an entry are met: Trix has crossed before, showing the "early possible trend change", and:
PA (price action) and blue (aqua) T3 line crosses the big hull line and the candle is in color of direction (red -> short),
We only enter short under the cloud and vice versa.
Be aware that when you are trading on such a small timeframe as M1, strong changes in trend occur constantly and so RSI is prone to show overbought/oversold conditions more often than in other higher timeframes.
I am curious as well about this particular move..only thing i can see is the t3 trix indicator going down predicting the downfall...but one shouldn't trade on that alone...but in this case it worked..
Under this premise, a loser trade entered by the rules is a better trade than a good trade entered outside of the system... However, and as scalpers, there are sometimes where rules can be slightly bent... but this only will come with experience and total mastery of a particular system. It is not recommendable to tweak here and there until you master it completely as it is and with its rules.
Well, that is only my opinion anyway
(Please re-read the rules in the first post, FF won't let me quote so long a text. Sorry and thanks.)
- #750
- Dec 1, 2008 8:59am Dec 1, 2008 8:59am
- Joined Aug 2008 | Status: Sharpen the Scalper Razor | 4,704 Posts
The rules are simple
- #751
- Dec 1, 2008 9:16am Dec 1, 2008 9:16am
- Joined Mar 2008 | Status: PVSRA with Traderathome | 23,553 Posts
- #752
- Dec 1, 2008 9:24am Dec 1, 2008 9:24am
- Joined May 2006 | Status: Still here. | 2,602 Posts
Impatience, anxiousness and impulsivity (the "need for action") are the most difficult issues to master in Forex (as well as following rules and discipline).
Waiting for a perfect setup can be boring, a clear focus is needed and has to be sustained, and sometimes it just doesn't happen.... or it happens when we've already diverted our attention out of tiredness or boredom...
(best setups for me usually happen when I finally decide to go to bed, lol...)
One has to know when to focus and when to release focus, be able to alternatively hold and let go, and this takes hours of screen time to finally assimilate the feeling of "being in sync" with the market (even if we might sometimes be wrong) and feel confident that whatever occurs, we did our job well and as it was intended to be done.
The system is the edge... the core has to be consistency, and above all a good money management. With this, the trader ends being "the edge" him/herself and can master any situation.
Waiting for a perfect setup can be boring, a clear focus is needed and has to be sustained, and sometimes it just doesn't happen.... or it happens when we've already diverted our attention out of tiredness or boredom...
(best setups for me usually happen when I finally decide to go to bed, lol...)
One has to know when to focus and when to release focus, be able to alternatively hold and let go, and this takes hours of screen time to finally assimilate the feeling of "being in sync" with the market (even if we might sometimes be wrong) and feel confident that whatever occurs, we did our job well and as it was intended to be done.
The system is the edge... the core has to be consistency, and above all a good money management. With this, the trader ends being "the edge" him/herself and can master any situation.
- #753
- Dec 1, 2008 9:32am Dec 1, 2008 9:32am
- Joined Aug 2008 | Status: Sharpen the Scalper Razor | 4,704 Posts
Something rare happens today, the E/Y was falling almost 350 pips and the E/U is glued at about 1.2630.
What will happen if the E/Y retrace?
What will happen if the E/Y retrace?
- #755
- Dec 1, 2008 10:10am Dec 1, 2008 10:10am
- Joined Oct 2008 | Status: Let the market come to you | 2,670 Posts
Something rare happens today, the E/Y was falling almost 350 pips and the E/U is glued at about 1.2630.
What will happen if the E/Y retrace?
- #757
- Edited 12:19pm Dec 1, 2008 11:55am | Edited 12:19pm
- Joined May 2006 | Status: Still here. | 2,602 Posts
Therefore my first question is: do you cobra, doblece etc...take trades that net you 5, 10, 12 pips? As cobra said, sometimes scalping on a low time frame can be a long position on a daily chart...but are you sometimes coming out with single digit pips...I do, quite often and just want confirmation that using this system, that is not abnormal.
Though you can change the conditions of a trade if you see it has potential for developing in a higher timeframe, I think you should stick to a defined timeframe of your choice, and set up the parameters (stoplosses, MM, etc...) in regard to that specific timeframe. For example, if one uses the ATR (average true range) as a measure of the needed stoploss, it can vary from 15-20 pips on M15 to 350+ pips on monthly... so define that first, as stops set should NEVER be moved (usually the first impression is the good one - no second guessing running trades, this is my opinion anyway).
Scalping is usually referred to as: very frequent and very short time trades (usually a few minutes) executed on M1 or M5 timeframes and usually for a few pips (1-5).
Of course if the trade develops and goes on, one can decide to continue in the trade and have several options (scaling out or trailing stops, etc...) I don't know (as you don't mention which one you're using) if your platform allows for trailing though.
This is something I have had to deal with (principally because I wasn't sure that my broker would allow so many short timetrades - now I know that scalping is allowed as they have changed lots of conditions, like for example SL, trailings and TP at 2 pips distance...) and mostly also because when I started trading, my teacher had the idea that "scalping wasn't trading", that trading had to be done on higher timeframes (H4-Daily preferrablly) and the whole lot of prejudices and wrong ideas about what is correct or "normal" and what is not.
For example, on 100 positive trades, I can have 3 or 4 "long runs" (more than 150-200 pips), a dozen higher than 40 pips, a few dozens of 1 and 2 pips trades (mostly stopped out on "entry stop") and the core 50-60% is composed of trades between 7 and 25 pips.
I usually tend to close early, this is why I have set a daily target in pips, instead of expecting an infinite number to be reached and feel frustrated if "I did it again"... I'm working on it though, it usually happens when I've had to wait too much for a trade to develop and I want out as soon as it comes on my favor... Anyway I say to myself that "there's no early", as pips are there all over the place and opportunities arise all day long. The thing is to be there and alert to enter with the best and safer entry point possible so to keep on the trade the longer time possible. But if you "cash out" quick, at least be as quick or even quicker to stop your losses given the case... don't let losses grow out of hope. I have been an expert at this
Some scalpers never take more than 5 pips at a time and can perform 100+ trades in a day. Some long term traders entered a position in January and keep on checking and moving stops if needed. Some other intraday traders have a series of different approaches. But in the end the important thing is that you're here to make pips, and 10 times 1 pip is as good as 10 pips, it will all depend on your personal perception and your goals.
Scalping is not easy (though one can be out very fast so maybe it's safer... if one is swift enough to get in and out rapidly at the right time). It depends on your personality, for example I used to trade on longer timeframes when I had more capital, now I'm mostly scalping for a faster capitalization, and besides I need a system that doesn't require for me to be monitoring a trade for hours or days. There is no "normality", there are as much different styles as traders exist.
The other issue has to do with stop losses. I use MT4 for charting and another platform for execution. That paltform is one-click open and close and is very quick...no requoutes...my question is two fold...
1.) Becuase setting up a stop loss or OCO order takes a few moments I rather keep my finger on the trigger to stop a loss. Does anyone else do that?
2.) Is anyone using 10 pip stop losses are thereabouts. I sometimes use more and more often that not I try to use levels of the indicators as stop losses (just above or below) if it is too high,...
This is quite risky though in case there is a connection problem, but I prefer mental stops as they are often run through if fixed, especially if very tight as the ones I use (8-15 pips max - I trade on M5-M15 with an eye on M1). (question 2 replied
)I usually trail the stop manually now (I used to work with the trailings but only do it now if I am not going to monitor the trade personally) and set them with the parabolic SAR on M5 (0.04-0.2) three candles behind the current candle. I also use S/R levels and other trendlines, etc... to gauge the possible place for a safe trailed stop.
Trading the 1 min chart requires indeed very tight stops. Whipsaws are frequent. I do not trade the 1min chart myself because my finger wouldn't be fast enough, lol... but I can manage M5-M15.
- #759
- Dec 1, 2008 12:30pm Dec 1, 2008 12:30pm
- Joined Oct 2008 | Status: Let the market come to you | 2,670 Posts
Provided that your broker allows scalping, I don't see why it would be "abnormal".
Though you can change the conditions of a trade if you see it has potential for developing in a higher timeframe, I think you should stick to a defined timeframe of your choice, and set up the parameters (stoplosses, MM, etc...) in regard to that specific timeframe. For example, if one uses the ATR (average...
I will usually scale some more out as the gains increase, eventually leaving a small amount in case a bigger move comes. I will manually move my SL although sometimes I'll leave it trailing (especially if I need to go to the bathroom! 
) I also use entry orders frequently because market orders are too unpredictable. Entry orders make you think a little more so that you are less impulsive. And I also have been the victim and the perpetrator of "don't let losses grow out of hope". So if it's going bad I'm outta there! I basically trade M5 with M1 for entry, but I do look at M15 a little too.
- #760
- Dec 1, 2008 12:33pm Dec 1, 2008 12:33pm
- | Joined Jul 2008 | Status: Clear Cut System Trader | 1,111 Posts