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4H 5EMA System

  • #2,941
  • Edited 10:08am Feb 2, 2009 9:59am | Edited 10:08am
Yes, I use El Dee's and Howard's version. If i remeber correctly on daily method, the entry and SL are 10 pips way from H/L instead of 5 like on 4h method. That's why i have those prices.
  • #2,942
  • Feb 2, 2009 10:26am Feb 2, 2009 10:26am
As for me they use for math price and stoploss 10 pips for high and 5 pips for low and do not add spread.
Regards
Peter
  • #2,943
  • Feb 2, 2009 10:47am Feb 2, 2009 10:47am
Quoting pitpiter
As for me they use for math price and stoploss 10 pips for high and 5 pips for low and do not add spread.
Regards
Peter
That is correct, it is 10 pips above and 5 pips below the bar.
Regards
  • #2,944
  • Feb 2, 2009 11:03am Feb 2, 2009 11:03am
Quoting tonirai
And update for 4H users

Yesterday at the openning, we have reentered the buy @ 1.4438, and placed the SL & sell stop @ 1.4420;

Those were later activated (-18 pips for the long), so we're short since;

Currently, we have locked profit, with a SL & buy stop @ 1.4351. The current bar, though it's too early to be sure, seems to be heading south, and will enable to lock around 100 pips more.


Are others still in a sell?

I'm in @ 1.4429 (not a precise entry) but still running,
up + 200 pips. S/L and a buy-stop order @ 1.4252.

Don't think I'll look at the daily strategy until I gain greater
confidence in and master the 4H method.

Dr. D.
  • #2,945
  • Feb 2, 2009 11:46am Feb 2, 2009 11:46am
S/L and buy-stop triggered @ 1.4252

Short trade closed from 1.4429 with +177 pips.

Dr. D.
  • #2,946
  • Feb 2, 2009 1:48pm Feb 2, 2009 1:48pm
Current buy trade running, triggered at 1.4252 CANDLE B
off of long set-up CANDLE A. Up + 20 pips.

Dr. D.
Attached Image (click to enlarge)
Click to Enlarge Name: long trade.gif Size: 56 KB
  • #2,947
  • Feb 2, 2009 1:51pm Feb 2, 2009 1:51pm
Quoting fourxtrader
S/L and buy-stop triggered @ 1.4252

Short trade closed from 1.4429 with +177 pips.

Dr. D.
Let me add that the SL for the current buy is @ 1.4046;

And when the reversal bar has closed, minutes ago, we added the reverse sell order at that same price.

I also remember what we do for the SL of the pending reverse order:

At the moment we have placed it, the highest high was the one from the reversal bar itself, so we placed it 5 pips + spread above it, which is 1.4291;
If the current bar makes a higher high, at its close we will move that SL above it, etc.

Of course that if the bar makes now a higher high, then goes down to trigger the pending sell, and then shoots up again... the SL wouldn't be at the (recent) higher high, because we're not supposed to be aware of it... but it's a rare case and a small price to pay for protection from abnormal events.
  • #2,948
  • Feb 2, 2009 1:54pm Feb 2, 2009 1:54pm
Quoting fourxtrader
Current buy trade running, triggered at 1.4252 CANDLE B
off of long set-up CANDLE A. Up + 20 pips.

Dr. D.
Your SL isn't according to the system's rules... you're free to trade it as you wish, but I'm just pointing that out to avoid confusion to new comers.
  • #2,949
  • Feb 2, 2009 2:56pm Feb 2, 2009 2:56pm
Quoting tonirai
Your SL isn't according to the system's rules... you're free to trade it as you wish, but I'm just pointing that out to avoid confusion to new comers.

My wife if always asking why I am the maverick? I think I'm
just terrible with directions and reading the manuals.

I'm having the hardest time (after the initial set-up and reverse
candle) with when and when not to move up the S/L and when
and where to position reverse trades and when to let it go flat.

I suppose if I keep posting incorrect materials (unintended) I
will surely rouse some commentary and further training.

Thanks Tonirai for any corrections.

Dr. D.
  • #2,950
  • Feb 2, 2009 3:24pm Feb 2, 2009 3:24pm
Don't worry.
Like I said, my comment meant to point out the right rules to new comers, I'm sure you wouldn't have posted it, if you were aware it had mistakes.

The rule is simple:

You know that, after entering a new trade with a setup bar, the SL goes to the low of that setup bar (rare exception is if the reversal bar made a lower low before triggering the buy - better say it goes to the lowest low between the setup & reversal bars);

Now the SL only moves when we'll get a new setup bar in the opposite direction.
  • #2,951
  • Feb 2, 2009 11:20pm Feb 2, 2009 11:20pm
Quoting tonirai
Don't worry.
Like I said, my comment meant to point out the right rules to new comers, I'm sure you wouldn't have posted it, if you were aware it had mistakes.

The rule is simple:

You know that, after entering a new trade with a setup bar, the SL goes to the low of that setup bar (rare exception is if the reversal bar made a lower low before triggering the buy - better say it goes to the lowest low between the setup & reversal bars);

Now the SL only moves when we'll get a new setup bar in the opposite direction.

I'm not sure I understand 'opposite direction'. A new set-up
candle is a 'potential' set-up for a reverse trade in an 'opposite
direction'. So if a trade keeps moving up or down with several
consecutive candles forming - each having higher highs or lower
highs... do we not move the S/L up or down with each subsequent
'new set-up' candle.

I've attached a chart with 33 candles each labeled.

The challenge I have is properly labeling changes in S/L and
reverse trades - pending sell-stop and buy-stop orders.

I'm sure I've benefited the most in this tedious exercise but would
welcome anyone who is willing to critique my labels and make proper corrections.

HERE GOES:

A - A new long set-up candle forms - a buy-stop is entered 5 pips + the spread above the high of candle A as soon as it closes and a S/L 5 pips below its low
B - A valid reverse candle forms triggering a long trade off of the high of A. The S/L simultaneously is placed below candle A. Candle B doesn't not constitute a valid set-up candle since it's high and low each penetrate the high and low 5 EMA lines by more than 5 pips at each end.
C - A new short set-up candle forms. The S/L for the long trade is moved to the lower end of candle C - 5 pips. A pending sell-top order is placed at the same position and a pending S/L for that same order is positioned 5 pips + the spread above the high of candle C.
D - A new short set-up candle forms at the close of candle D and the pending sell-stops and pending S/L's for the sell trade are moved up to the appropriate levels based on the parameters of candle D. So also is the S/L for the continuing long trade moved up to 5 pips below the low of candle D.
E - E candle triggers the reverse sell-stop short trade positioned off of the low of D candle and hits the S/L to close the trade.
F - a new set-up candle since the trade was closed in candle E and a new high formed, waiting for a new set-up for new trade.
G - a new set-up candle with higher high - sell stop order placed 5 pips below the low of candle G - no current trade
H - a new set-up candle with higher high - sell stop order placed 5 pips below the low of candle H - S/L and buy-stop order pending above its high - no current trade
I - candle I becomes a valid reverse candle and triggers a short trade. The S/L remaining above high of candle H with a pending buy-stop order
J - no new highs or new lows - short trade continues
K - same - short trade continues based on the sell-stop order off of the low of candle H
L - short trade continues with higher highs approaching the S/L and pending buy-stop order
M - short set-up candle forms with rising price action that triggers S/L on short trade that was initiated in candle I and simultaneously fills buy-stop order from candle H - S/L that was pending for the buy-stop order established below low of candle H is moved up to below the low of candle M which is now a new short set-up candle
N - a new short set-up candle with higher high - long trade continues - S/L moved up to below the low of candle N
O - a new short set-up candle with higher high - long trade continues - S/L moved up again - pending sell-stop order place with the S/L below candle O
P - failed reverse candle - long trade continues - S/L remains below the low of candle O
Q - valid reverse candle triggers the S/L of the previous long trade (from candle M) and a sell-stop order placed below candle O - short trade starts - S/L on the short trade is placed above the set-up candle
R - a new long set-up candle is created as the sell trade continues - S/L and new buy-stop pending order place above the high of candle R
S - short trade continues - candle S forms a new long set-up candle - S/L remains above candle R with the pending buy-stop order
T - triggers the S/L above candle R and fills buy-stop order and with a lower low forms a new S/L position for the new long trade
U - long trade continues as candle U forms a new short set-up candle - S/L in long trade placed below the low of candle U along with a pending sell-stop order
V - candle V forms a valid reverse candle triggering the sell-stop order - S/L placed above its high
W - short trade continues with no new low or new high
X - short trade continues with candle X forming a new long set-up penetrating the lower 5 EMA - S/L of the short trade moved down to above the high of candle X along with a new pending buy-stop order
Y - short trade continues with a new low off candle Y and a new long set-up - S/L and pending buy-stop moved down to the high of candle Y
Z - candle Z forms a valid reverse candle triggering the S/L in the short trade and filling the buy-stop order - new long trade initiated - a S/L for this long trade is position below the low of candle Z along with a pending sell-stop order

The next 3 candles (1, 2, 3) form new short set-up candles as the long trade continues - the S/L is raised with each of these candles along with a pending sell-stop order positioned just below the low of each of the rising candles. Candle 4 triggers a reverse trade (sell-stop) off of the low of candle 3. Candles 4, 5, 6 & & all produce positive pips as the bearish trend.

Dr. D.
Attached Image (click to enlarge)
Click to Enlarge Name: a-z candle labels.gif Size: 52 KB
  • #2,952
  • Feb 3, 2009 6:58am Feb 3, 2009 6:58am
Quoting fourxtrader
I'm not sure I understand 'opposite direction'. A new set-up
candle is a 'potential' set-up for a reverse trade in an 'opposite
direction'. So if a trade keeps moving up or down with several
consecutive candles forming - each having higher highs or lower
highs... do we not move the S/L up or down with each subsequent
'new set-up' candle....
You are partially right - I say partially, because you are forgetting the first condition which defines a setup bar:

A setup bar to go short pierces (or is beyond) the upper ema by at least 5 pips (without piercing the lower ema).

Only after this condition is met, you compare the highs/lows between bars.

So, what was wrong on your SL yesterday was:
You were on a long trade - so you start looking for a setup bar to go the opposite direction;
Since we entered that trade and until now, no bar pierced the upper ema, so there was no setup bar yet... so the SL (and reverse order) is still at the original place.

I haven't got time now to fully analyse your "exercise", but I will later, if nobody does it in the meantime;
Anyway, if with this post you find you've made mistakes in it, feel free to repost a correction.
  • #2,953
  • Feb 3, 2009 8:03am Feb 3, 2009 8:03am
Thanks tonirai for looking at this.

Found my first typo error written in haste in that post.....

"""I'm not sure I understand 'opposite direction'. A new set-up
candle is a 'potential' set-up for a reverse trade in an 'opposite
direction'. So if a trade keeps moving up or down with several
consecutive candles forming - each having higher highs or lower
highs... do we not move the S/L up or down with each subsequent
'new set-up' candle."""

Should read.....

- each having higher highs or lower LOWS...

I'm thinking I might have the exercise still on track as originally written
but I will go over it further.

I would like to see that we DO move the S/L up or down in a continuing
trade so long as each subsequent candle qualifies as a new 'set-up' candle
justifying the moved S/L.

Yes, I see that in the current long trade which now is in its 6th candle,
there has not been a 'new set-up' candle form since all highs have been
below and have not pierced the upper 5 EMA.

Dr. D.
  • #2,954
  • Feb 3, 2009 8:37am Feb 3, 2009 8:37am
does anyone have the total pip count for January using:

Daily method?

4H method?
  • #2,955
  • Feb 3, 2009 9:07am Feb 3, 2009 9:07am
So I see we have just closed a 4H candle and it has
pierced the upper EMA to qualify as a new short set-up.

Stop loss is now moved up to below its low and a
pending sell-stop order is positioned there.

long trade continuing from 1.4252 (up ~+120 pips)
S/L with pending sell-stop order moved to 1.4172
with pending S/L for the sell trade at 1.4354

Is this what others have?

Dr. D.
  • #2,956
  • Feb 3, 2009 9:54am Feb 3, 2009 9:54am
OFFTOPIC

Quoting stersuhr
The grand total for the last eight trading days is +193 pips. Could have been a lot better if we wouldnt have got that big market gap against us but if you dont follow ALL the rules to a system you will always end up catching the loosers and missing the winners.
nothing personal, please don't be offended... i usually don't care about spelling or grammar but i believe this one word has become the exception.
looser: to become more loose
loser: opposite of winner
this one misused word has propagated itself too many times on many forex factory forums... and throughout the internet. it would be in everyone's best interest to realize its incorrectness; especially since many, including myself, forex factory members aren't native english-speakers

cheers
  • #2,957
  • Feb 3, 2009 10:10am Feb 3, 2009 10:10am
Quoting acosta2269
does anyone have the total pip count for January using:

Daily method?

4H method?
31/12/09 Buy +336
12/01/09 Sell +367
16/01/09 Buy -43
18/01/09 Sell +758
26/01/09 Buy +228
29/01/09 Sell -264
30/01/09 Buy -238
02/02/09 Sell Open
Total excluding open sell: +1144
You don't have to be right, just don't be too wrong
  • #2,958
  • Feb 3, 2009 10:12am Feb 3, 2009 10:12am
Quoting monek87
OFFTOPIC



nothing personal, please don't be offended... i usually don't care about spelling or grammar but i believe this one word has become the exception.
looser: to become more loose
loser: opposite of winner
this one misused word has propagated itself too many times on many forex factory forums... and throughout the internet. it would be in everyone's best interest to realize its incorrectness; especially since many, including myself, forex factory members aren't native english-speakers

cheers
I thought it was some sort of fashion to use "looser" instead of "loser" all over the FF forums
Regards
  • #2,959
  • Feb 3, 2009 11:23am Feb 3, 2009 11:23am
Quoting El Dee
31/12/09 Buy +336
12/01/09 Sell +367
16/01/09 Buy -43
18/01/09 Sell +758
26/01/09 Buy +228
29/01/09 Sell -264
30/01/09 Buy -238
02/02/09 Sell Open
Total excluding open sell: +1144
The daily system seemed to drastically out perform the 4H system for January. Is this typical for other months? Which of the two systems has proven the better over a back tested period?

Thanks
  • #2,960
  • Feb 3, 2009 11:49am Feb 3, 2009 11:49am
Quoting howard
I thought it was some sort of fashion to use "looser" instead of "loser" all over the FF forums
Apologies to all English people across the pond. Its what the world does to your language for ruling different parts of the world for so long. Its payback

I think we @ FF just try to trick our brain from thinking a losing trade as a "loser" and make it easy on ourselves by calling it a "looser" - we just have let the trade and our money to run loose , albeit against us.

BTW, don't report me for "abusing" English people
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