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Bobnannings Range trading method

  • #61
  • Jan 15, 2009 2:01am Jan 15, 2009 2:01am
Quoting paradoxical
Looks like there's thousands of ways to approach this system and EA. Do you know if someone has made an excel sheet that can give you the PROFIT you would make if you successfully close a trade at level 2, level 3, level 4, etc.?
I'd like this for the checking I'm doing on the charts as far as how many levels a pair goes before it reverses, and the best stop to use. Also, what I was thinking is that if I was 5 levels deep on a 60X40, I could purchase an equal number of lots (as long as congress doesn't pass some anti hedge laws). That would effectively...
Yes just use frosty's excell and set it to 2 levels 3 levels and you can get the profit. I attached it here.
Attached File(s)
File Type: xls FrostCall ver. 5.0.xls   28 KB | 388 downloads
  • #62
  • Jan 15, 2009 3:54am Jan 15, 2009 3:54am
Now you've done it! were not rookies anymore!!
  • #63
  • Jan 15, 2009 10:34pm Jan 15, 2009 10:34pm
I want to thank everyone for contributing to making theese EA's profitable.
These are the settings that I use on this pair...I know that this pair had some spikes recently but with these setting it seems to take them in stride. Ok here are the settings for a 5minute chart.


ATR=1
ATR MULTIPLIER = .04
TAKE PROFIT= 55
PIPS= 50
MULTIPLIER= 1.8
MAX TRADES = 8
LOTS = .01
RISK= 5

I have FXDD wich is a 4 digit broker and a mini account (10 cents a pip) and with a 1500 dollar starting balance. If you test these setting I am sure that you will agree that the flexibility of this EA is the next best thing to having uncle sams money printing machine...let me know what you think...I have been demoing this and did plenty of back test, but if this month goes well i hope to go live with it.
  • #64
  • Jan 15, 2009 10:41pm Jan 15, 2009 10:41pm
Oh one thing that i forgot to metion is that stop loss is set to 1000...i really dont think it needs to be that high but that is what worked so i didn't mess with it so much.
  • #65
  • Jan 15, 2009 10:47pm Jan 15, 2009 10:47pm
You should use the excel spreadsheet to see what might happen if whatever pair you're trading were to go 500 pips against you without a retrace.
Each pair is different, and this is what I'm looking at now. Some pairs range for a long time without ever retracing as much as 55 pips.
Quoting ThePipmaster
Oh one thing that i forgot to metion is that stop loss is set to 1000...i really dont think it needs to be that high but that is what worked so i didn't mess with it so much.
  • #66
  • Jan 16, 2009 2:34am Jan 16, 2009 2:34am
Quoting paradoxical
Bob, i saw your post on the AUD/NZD thrtead, and don't want to post there on this, so as not to confuse that thread. You said you're experimentiung with a 60X35 EA, and it can be used on 10 pairs. That's what I'm looking at, also, and trying to determine good settings to avoid getting stopped on those swings in October and December. I'm looking at the 60X40 with 5 entries. I noticed the lesser trades usiung the 5 moinute chart, but that one does seem best, as it gets you into trades later, shaving pips off your initial entry. Your 80 PIPS away seems...
To get fewer trades all you need is to increase the 1st level entry. I am using 60x35 which is similar to 60x40 but slightly more profitable but slightly less range. My first day on 10 pairs using .01 as my starting lot netted me 21 dollars in profit. This kind of shocked me because I didnt expect it to return that well. It produce 12 trades and none went over level 4. Let me know how your doing on your end.
  • #67
  • Jan 16, 2009 8:43am Jan 16, 2009 8:43am
Bob, am having to do it manually as time permits, and to strike a balance between getting enough trades to make it worthwile and not getting stopped out. Your template is invaluable for this manual checking as I just change the level one to 100, 120, 130, etc., and then move the gold bands 40 or 60 pips away from that. Am looking at 60X40 and 90X60 levels on a one hour chart with distances away from center from 80 to about 180. Even on the ADD/NZD, I got stopped at 5 levels using a 250 pip stop entering at 80 PIPS past center on my demo account last week. Had I had a higher stop with more levels, I wouldn't have been.
I do think the key is entering at overbought/oversold levels, though. When you do, you've entered when that "rubber band" is already stretched and where there's a tendency for it to go back to the white line.
  • #68
  • Jan 18, 2009 8:51am Jan 18, 2009 8:51am
Just to let you guys know what I will be doing this week. I am going to work on my theory of letting the EA handle the first 4 levels but after that I will enter the 5th levels and higher to correspond with a MACD or MA cross, then going with a higher TP to see if I can finally nail down a way to avoid the death trade and to reduce losses on price runs. I have done this with one trade so far and instead of taking a loss in the hundreds I cut it down to a small one. If this works I may have finally solved the trades that move just out of range of the EA and instead of trying to pray the trade back to where it belongs we will just cut it back down to a bite size loss and go on. So here we go. If this works we wont have to be afraid of the sudden price runs that go agianst us. We just wait them out, limiting our risk to the numbers in the first four levels, reenter later and go for that retrace when it finally comes. I eyeballed this on last Tuesdays news run and after it was over I could have saved myself a couple of hundred bucks in losses doing this. I did it the very next day on a trade and it worked well. However, I would caution that this theory probably would not work on GBP/JPY trades because of the thousands of pips involved in some trades.
  • #69
  • Jan 18, 2009 6:06pm Jan 18, 2009 6:06pm
Quoting nanningbob
I would caution that this theory probably would not work on GBP/JPY trades because of the thousands of pips involved in some trades.
yeh i dont think we will ever be able to use that currency pair based upon ur 7 year fact sheet, theres probably id say 10 that could be reasonably traded based upon the fact sheet
Grabbing the bull by the horns!
  • #70
  • Edited 8:14pm Jan 18, 2009 8:01pm | Edited 8:14pm
Quoting nanningbob
Just to let you guys know what I will be doing this week. I am going to work on my theory of letting the EA handle the first 4 levels but after that I will enter the 5th levels and higher to correspond with a MACD or MA cross, then going with a higher TP to see if I can finally nail down a way to avoid the death trade and to reduce losses on price runs. I have done this with one trade so far and instead of taking a loss in the hundreds I cut it down to a small one. If this works I may have finally solved the trades that move just out of range of...
I like the idea of "reduce loss exit strategy" compare to the current get hit on SL. This system has pretty much establish entry point but lack of exit strategy [currently SL is the exit].
  • #71
  • Jan 18, 2009 11:25pm Jan 18, 2009 11:25pm
Quoting forexisfx
I like the idea of "reduce loss exit strategy" compare to the current get hit on SL. This system has pretty much establish entry point but lack of exit strategy [currently SL is the exit].
That is the failure of every martingale strategy a sound exit strategy, when in a loss. I have not seen anyone try to develop one, the answer has always been more margin and more levels. If we say we will go with it until a certain point and then look for an exit while we still have plenty of margin left. If we can develop a sound exit strategy we can finally defeat the death trade and be sound profitable traders. The SL will then become a seldom used tool we use to save an account from a sudden and unpredictable event.

As I look at this I think this is what you want to do. Find a currency you want to trade and find its range. Make sure your first four levels are well within that range. Then if it ever goes outside that range, you want that to be a rare event, you have a choice of cutting the loss right then and there (4 level losses usually are not that big yet) or using the next several levels to minimizing that loss to something small and manageable.

The first thing I am going to work on is an EA that stays inside 200 pips for the Aud/Nzd at 4 levles and then if it ever goes outside that, I have 2-4 levels left to make the loss small or even profitable if the retracement is big enough. I think that is sound.

My first attempt will be a 35x40 3.0 multiplication at .02 lots.
This gives me 4 levels at .02,.06,.18,.54 or maximum .80 I then will be around 140-180 above or below my median depending where I start. If it goes beyond 200 or out of range I then can but on a 60x35 at 1.8 for level 5 and up and see what I can reduce my loss to. This then puts me at over 250-300 pips from my medium. I dont think I have ever seen the Aud/Nzd go beyond that, (except for the first time I try this LOL ........... Dont you just love Forex trading) I will use a MACD or MA cross to start the 5th level so to be as safe as possible. My 5th level will be .54 x 1.8 or 1.0 lot. 60 pip profit from that would take out most if not all of the loss. Well that is the plan for now.
  • #72
  • Jan 19, 2009 1:27am Jan 19, 2009 1:27am
Quoting paradoxical
Your template is invaluable for this manual checking as I just change the level one to 100, 120, 130, etc., and then move the gold bands 40 or 60 pips away from that. Am looking at 60X40 and 90X60 levels on a one hour chart with distances away from center from 80 to about 180.
I was wondering where I could locate the template for this strategy, please?

Thanks!
  • #73
  • Jan 19, 2009 11:24am Jan 19, 2009 11:24am
Here is the template I am using for the 60x35 for the 5M chart. You can play with the lines and check for yourself on whether a currency will stay in range. I use a 40 or 80 MA with a 1H chart. Just put it in your templates folder and restart your MT4. Attach to a chart and away you go. Good luck.
Attached File(s)
File Type: tpl 5m 60x35 120 ma.tpl   3 KB | 355 downloads
  • #74
  • Jan 20, 2009 11:13pm Jan 20, 2009 11:13pm
I successfully pulled out two retraces today, one on the aud/nzd. Yesterday it went beyond the 4 level range I had set up. The one mistake I made with my fifth level was I entered to early. I learned to let the new level establish its new high and low. I took my entrance at the MACD cross on the 5M chart like I said but the problem I found is it didnt give me that much more space from the TP (only 22 pips away from the TP from the 4th level). I was using a 60 TP instead of the 35 from the 1st EA. If you want to enter a fifth level you need to make your entrance when the red ask line is above that highest high. I later had to do that with a 6th level. This morning (evening USA time) when it retraced It made a nice profit because I had put two extra levels on plus the 4th level made a small profit. This was beneficial to me but poor planning because if price had continued going against me I had only one more level I was willing to use. 6 or 7 levels is all I want to use with this.

I also tried this with a NZD/USD trade but all I did was get into trouble. The 3 commodity currencies can just keep running so I would not recommend doing it with them. I was lucky that the NZD/USD had a nice run up this morning and I got out with a small loss. If it had not done that, I would have been in trouble. All in all it ended up a break even day with the winners and losers but I was happy that I didnt have to take a big loss on 2 runaway trades.
  • #75
  • Jan 22, 2009 4:11am Jan 22, 2009 4:11am
Quoting paradoxical
I have 8 pairs, all relatively safe, and I should get a fair amount of trades.
May I ask you what 8 "relatively safe" pairs are, please?
  • #76
  • Jan 22, 2009 6:15am Jan 22, 2009 6:15am
Since the range trading method on multiple currencies incurs neither huge losses or gains, can anyone think of a reason not to use the highest available leverage? As long as the account can cover 8 levels of 12 currencies with .01 buys and sells and the potential losses, isn't any leverage size acceptable? Please no bashing, it's a fair question.
  • #77
  • Jan 22, 2009 6:25am Jan 22, 2009 6:25am
Apologies for two questions in a row. Exactly how much can your account drop trading the 100x80, assuming the worst possible scenario. Yes, I've read all the previous threads, and no I didn't see the answer. Using a demo I've never seen a deeper drop than $370.
  • #78
  • Jan 22, 2009 9:32am Jan 22, 2009 9:32am
Quoting jthomas71
Since the range trading method on multiple currencies incurs neither huge losses or gains, can anyone think of a reason not to use the highest available leverage? As long as the account can cover 8 levels of 12 currencies with .01 buys and sells and the potential losses, isn't any leverage size acceptable? Please no bashing, it's a fair question.
Right now that is what I do to keep my losses at a minimum. You can only lose what you have in the account. The smaller and still function the better. However, to lose because you overmargin your account is not good either. You must stay within the margin range of your account. I have never understood why guys give brokers 100,000 dollars when you can trade with a 1000. The guy with a 1000 who trades a 1.0 lot and has price goes against him 100 points loses 100 dollars at a 400:1 ratio. A guy who has 100,000 and loses a 100 points at 1.0 lot at 1:1 ratio loses 100 dollars also. They make a big deal about percentage of the account but in reality it makes no sense. 100 dollars is 100 dollars. Whether its .01% or 100% of the account the loss is still the same. However, if the brokerage goes out of business, I lose 1000 and he loses 100,000. Now that is a big difference.
  • #79
  • Jan 22, 2009 9:33am Jan 22, 2009 9:33am
Quoting jthomas71
Apologies for two questions in a row. Exactly how much can your account drop trading the 100x80, assuming the worst possible scenario. Yes, I've read all the previous threads, and no I didn't see the answer. Using a demo I've never seen a deeper drop than $370.
Use Frosty's excel sheet and you can figure it out. There are others also that show you what you can lose and at what level.
  • #80
  • Jan 22, 2009 9:37am Jan 22, 2009 9:37am
Quoting michaelhryu
May I ask you what 8 "relatively safe" pairs are, please?
They are the slowest moving pairs and have the least chance of going beyond the range of the EA. For instance the Eur/gbp has never gone over 400 pips in one day where as the gbp/jpy does that about 1 in every 20 days and recently almost every week.
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