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4H 5EMA System

  • #2,701
  • Edited 4:51pm Jan 20, 2009 4:34pm | Edited 4:51pm
Quoting alright
Reversal short triggered, trade closed at -112. Now we're in from 1.3910, with SL at 1.4061.

@ AlexL
I'm taking the pics while showing the scale as well this time. I hate cluttering up the thread with big pics.
in my case long was close with -166 pips , and I think it payment for too long ride south and I have on my chart order sell from 1.3856 with SL 1.4061
Good luck
Peter
  • #2,702
  • Jan 20, 2009 5:03pm Jan 20, 2009 5:03pm
Quoting pitpiter
in my case long was close with -166 pips , and I think it payment for too long ride south and I have on my chart order sell from 1.3856 with SL 1.4061
Good luck
Peter
Peter, I'm demo trading of course, but how is it possible to get such a big difference? Was the price moving fast on both occasions?
  • #2,703
  • Jan 20, 2009 5:07pm Jan 20, 2009 5:07pm
looking the chart GU on alpari US is freez , last tick was 23:23 or something wrong with alpari server.
Any way , if it go forward SL for sell changed on 1.3961 and we place pending buystop order with the same price and SL 1.3805.
Goog luck
Peter
  • #2,704
  • Jan 20, 2009 5:07pm Jan 20, 2009 5:07pm
Quoting batesmotel
Lol...J84_2....A good trader is like a pirate...ahrrrr....You have to learn to "sleep with one eye open"......or at least have a loud alarm clock...

With a handle like that, we might all be sleeping with one eye open.
  • #2,705
  • Jan 20, 2009 5:11pm Jan 20, 2009 5:11pm
Quoting alright
Peter, I'm demo trading of course, but how is it possible to get such a big difference? Was the price moving fast on both occasions?
I think , You change SL for buy , but why , U need change SL for buy if it triggerred and befor that maked new lower on reversal bar ? SL for buy is lower from set up bar minus 5 and in that level we need put revers order sellstop with SL higher from previos bar.
I think it make sens
Peter
  • #2,706
  • Jan 20, 2009 5:19pm Jan 20, 2009 5:19pm
Quoting fourxtrader
SETTING STOPS AND REVERSE ORDERS:

Looking from the sidelines and already giving suggestions:

The prudent thing to do in a 1000+ pip move is to watch
for an expected bounce and not consider it a reversal.
Most often there is the obligatory 'pause that refreshes' and
[i][color=blue]subsequent rebound or...
We all know this can be true most of the times, but the bottom line here is that Sterling and Hiranyah have traded the system this way for quite a long time and found this management to be the most profitable, even if it means to lose pips when the market rests. You might miss an opposite big move when it happens. As it's been said many times, the profitability of this system relies on those few big trades that overcome the little winners and losers. You miss a big one and the balance can suddenly turn into negative ground...
  • #2,707
  • Jan 20, 2009 5:26pm Jan 20, 2009 5:26pm
Here is my chart for current situation
Good luck.
Peter
Attached Image (click to enlarge)
Click to Enlarge Name: gu.gif Size: 19 KB
  • #2,708
  • Jan 20, 2009 5:28pm Jan 20, 2009 5:28pm
Quoting pitpiter
I think , You change SL for buy , but why , U need change SL for buy if it triggerred and befor that maked new lower on reversal bar ? SL for buy is lower from set up bar minus 5 and in that level we need put revers order sellstop with SL higher from previos bar.
I think it make sens
Peter
Sorry. keep making the same mistake. Maybe I should ask someone else to check my trades at night. I'm extremely tired
  • #2,709
  • Edited 6:24pm Jan 20, 2009 6:12pm | Edited 6:24pm
There still seems to be a little bit of confusion with respect to Setup Bars, Reversals and Stop placement etc. On my chart the last 3 closed bars are arrowed Blue, Red and Yellow. My understanding of the last 12 hours is:

1. Upon closure of the Blue bar, we can see that it set a new Low and thus became our Setup Bar to possibly go Long. My charts show a high of 1.4015 and a low of 1.3861. So, we set a Buy Stop Order at 1.4023 (5 pips plus spread above the High) with SL at 1.3856 (5 pips below the Low). In addition our TP for the open Short trade is shifted to 1.4023.

2. The Red Reversal bar opens and (a) closes our Short trade, and (b) opens our Long trade at 1.4023. We do not place a subsequent Reversal Order until this bar closes.

3. The Red Reversal bar closes and we are still Long. At this point we place a Sell Stop at 1.3856, which is also the SL for our current Long trade. The SL for the pending Sell Stop Order is set at 5 pips plus spread above the High of the Red Bar (1.4052), at 1.4060.

4. The Yellow Bar subsequently hits the SL of our Long trade and closes this position. At the same time, our Pending Sell Stop Order is opened at the same price of 1.3856 and we are currently Short.

5. No further Reversal Orders are entered as we do not "reverse a reversal". One of two things will happen here, (a) price will continue down, set a new Low and form a new Setup Bar to possibly go Long, or (b) our Short position will be stopped out at 1.4060. So, we are currently Short from 1.3856, with SL at 1.4060.

The important thing to always remember with this system, is that the system is based around Support and Resistance, which is why the rules governing Order and Stop placement are as written by Sterling. Simple and effective.

I hope this helps.
Attached Image
If there is ever any doubt then there is no doubt.
  • #2,710
  • Jan 20, 2009 7:38pm Jan 20, 2009 7:38pm
I am kind of confused here. I may need to go back to the rules,charts again.
Are my assumptions are correct?
1. We will be ALWAYS on a trade till weekend close (when we close our trades).
2. If there is a LONG trade which gets stopped, We AUTOMATICALLY trigger a SHORT trade (Irrespective of previous bar/setupbar/reversal bar qualifications?)
3. Same way, If there is a SHORT trade which gets stopped, We AUTOMATICALLY trigger a LONG trade?

Sorry, If my questions is are redundant.

Thanks guys for your time/patience/answers.

IKent
  • #2,711
  • Jan 20, 2009 7:58pm Jan 20, 2009 7:58pm
Quoting IKent
I am kind of confused here. I may need to go back to the rules,charts again.
Are my assumptions are correct?
1. We will be ALWAYS on a trade till weekend close (when we close our trades).
2. If there is a LONG trade which gets stopped, We AUTOMATICALLY trigger a SHORT trade (Irrespective of previous bar/setupbar/reversal bar qualifications?)
3. Same way, If there is a SHORT trade which gets stopped, We AUTOMATICALLY trigger a LONG trade?

Sorry, If my questions is are redundant.

Thanks guys for your time/patience/answers....

Not ALWAYS!

Reading El Dee's review of Sterling's system: (Post #2472)

Attached Fileshttp://www.forexfactory.com/images/attach/doc.gif4 Hr 5 EMA System.doc (http://www.forexfactory.com/attachment.php?attachmentid=183183&d=1229471950) (595.0 KB, 397 views)


Under 3. Reversal Bar

We read:

3.6 Another occasional occurrence is that the order is filled, creating the automatic stop loss position, and then the price reverses through the stop loss closing your position. This is unfortunate and you must now wait for a new setup bar and start the process again.


Also in Post #2709 Kristo's review:

5. No further Reversal Orders are entered as we do not "reverse a reversal". One of two things will happen here, (a) price will continue down, set a new Low and form a new Setup Bar to possibly go Long, or (b) our Short position will be stopped out at 1.4060. So, we are currently Short from 1.3856, with SL at 1.4060.
  • #2,712
  • Jan 20, 2009 9:57pm Jan 20, 2009 9:57pm
I am long from 1.3961. Chart is from IBFX. New Day starts at 7PM EST. So in few minutes, 2nd 4H candle will start.
  • #2,713
  • Jan 20, 2009 10:56pm Jan 20, 2009 10:56pm
Yes, Alpari chart followers should be long from 1.3960 with SL at 1.3806 as per the most recent Setup Bar arrowed yellow. Given that the Reversal Bar has also closed, a pending Sell Stop Order should also be placed at 1.3806 with the SL for the Pending Sell Order set at 1.4000, being 5 pips plus spread above the high of the Reversal Bar.

Should the current open Long trade be stopped out and the Pending Sell Order be triggered prior to the formation of a new Setup Bar to possibly go Short, then the SL for the Pending Sell Order would be moved to 5 pips plus spread above the high of the current bar forming (if that remains the highest point).
Attached Image
If there is ever any doubt then there is no doubt.
  • #2,714
  • Jan 21, 2009 2:06am Jan 21, 2009 2:06am
First off thanks for all of those contributing and second, I have attached a chart but its my first time so sorry if it doesnt work.

I am playing with small stakes here and I think its quite an interesting situation, luckily, in terms of price action - seems my ig charts mirror meta charts so should be fine to raise my points.

I will try and document this by detailing my actions and invite comments/advice/etc. I wasnt in the sell before bar 1 started and I havent mentioned +/- 5 pips as we all know this now.

Bar 1 - LONG at High of Previous bar (long signal bar), STOP at Low of Previous bar (long signal bar).

Bar 1 Close - SELL limit order entered at Low of Previous bar (long signal bar) - Same level as Long STOP order.

Bar 2 - Stopped out of long and entered into a SELL, STOP at High of Bar 1.

Bar 2 Close - Now, this is where my questions come in - Should I have moved my STOP from the High of Bar 1 to the High of Bar 2 and also added a BUY Limit order at the High of Bar 2 ?

I guess that is my first question.

If I did the above on Bar 2 Close, on Bar 3 I would have been taken out and put into a long trade at the High of Bar 2 with a Stop at the low of Bar 2.

I appreciate any feedback at all here.
Attached Image
  • #2,715
  • Jan 21, 2009 2:34am Jan 21, 2009 2:34am
Quoting wilczek
Bar 2 Close - Now, this is where my questions come in - Should I have moved my STOP from the High of Bar 1 to the High of Bar 2 and also added a BUY Limit order at the High of Bar 2 ?

If I did the above on Bar 2 Close, on Bar 3 I would have been taken out and put into a long trade at the High of Bar 2 with a Stop at the low of Bar 2.

I appreciate any feedback at all here.
Yes, you should, because when that bar closed, it becomes a valid setup bar;
And at the close of bar 3, you add a sell stop at the low of bar 2.

You were in a reverse trade, which don't get reversed again when stopped, but this doesn't apply if you get a valid setup bar (priority goes always to a setup bar, if you get one).
  • #2,716
  • Edited 2:48am Jan 21, 2009 2:46am | Edited 2:48am
Quoting wilczek
Bar 2 Close - Now, this is where my questions come in - Should I have moved my STOP from the High of Bar 1 to the High of Bar 2 and also added a BUY Limit order at the High of Bar 2 ?

I guess that is my first question.

If I did the above on Bar 2 Close, on Bar 3 I would have been taken out and put into a long trade at the High of Bar 2 with a Stop at the low of Bar 2.

I appreciate any feedback at all here.
I'll give you my view even though your question has already been answered by Kristo.
Since Bar 2 made a lover low, it became a long setup bar. So its high triggered a long trade. The stop is where you say and also a sell order.
At the moment I'm writing (8.39 GMT) the price is heading south and that long was closed while triggering a new short @ 1.3805. The stop is @ 1.4001 (for IG it should be @ 1.4032).
  • #2,717
  • Jan 21, 2009 2:58am Jan 21, 2009 2:58am
About the daily TF which looks terrific from the latest posts, I'm sure you did run a back test with your settings. In this case, do you mind posting your results?
  • #2,718
  • Jan 21, 2009 3:20am Jan 21, 2009 3:20am
Thanks Guys its much appreciated,

So can I say the following in relation to the updated chart, based on the fact I wasn’t in the original SHORT position and starting fresh.

Bar 1 - LONG at High of Previous bar (Long signal bar), LONG STOP order at Low of Previous bar (Long signal bar).

Bar 1 Close - SELL LIMIT order at Low of Previous bar (Long signal bar) - Same level as LONG STOP order.

Bar 2 - STOPPED OUT OF LONG and now SHORT. SHORT STOP order at High of Bar 1.

Bar 2 Close - As it’s a new Long signal bar - SHORT STOP order moved from the High of Bar 1 to the High of Bar 2 and also added a BUY LIMIT order at the High of Bar 2.

Bar 3 - STOPPED OUT OF SHORT and now LONG. LONG STOP order at Low of Bar 2.

Bar 3 Close - LONG STOP order moved from the Low of Bar 2 to the Low of Bar 3 and also added a SELL LIMIT order at the Low of Bar 3.

Bar 4 - STOPPED OUT OF LONG and now SHORT. SHORT STOP order at High of Bar 3.

Bar 4 Close - SHORT STOP order moved from the High of Bar 3 to the High of Bar 4.

Bar 5 - Currently open and made a new low. I assume that when this bar closes (assuming it wont take out the Bar 4 High) I move my SHORT STOP order from the High of Bar 4 to the High of Bar 5.

QUESTIONS

Is the above all right so far ?

On close of Bar 4 do I add a LONG LIMIT order at the High of Bar 4 ? If so do I then move it to the High of Bar 5 when Bar 5 closes ?

Thanks as always for your input and swift responses.


W
Attached Image
  • #2,719
  • Jan 21, 2009 3:33am Jan 21, 2009 3:33am
Quoting wilczek
Bar 3 Close - LONG STOP order moved from the Low of Bar 2 to the Low of Bar 3 and also added a SELL LIMIT order at the Low of Bar 3.

Bar 4 Close - SHORT STOP order moved from the High of Bar 3 to the High of Bar 4.
You don't move the stops on the above sentences;
Those are only moved when you have a new setup bar.

Edit:
You move it in the case of bar 4 close, but because it is a setup bar to go long (you also place a buy stop above it).
  • #2,720
  • Jan 21, 2009 3:42am Jan 21, 2009 3:42am
tonirai always fast and clear as usual
If I can add one more thing that is helping me avoid mistakes like yours and was also said many times, this system is based on price action around support and resistance. If you think about this, it will be easier to understand the way you move your stops.
I still forget about it...
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