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The System II (Yes with irony)

  • #921
  • Mar 6, 2009 9:31am Mar 6, 2009 9:31am
Hi Feb,
I have read all the posts up to this point. I hope you are doing well.
Your insight is a great value and I give you thanks for it.
I was wondering down the path of trying more and more silly indicators and this thread brought me back to reality! Price action is king!

I started trading stocks, then went to options. I got a call from a Forex Broker about a year ago. I imiediately (knew) this is what I wanted to trade.
However... I would win a few then lose more. I reasoned it's ok I'm making back what I lose in Forex with my equity option trades. (Learning)

I kept noticing that more often than not my platform (MT4)
would freeze, delay, constant requotes, insanely wide spreads, etc. making it impossible to get in at a (advantage) or get out quickly with a small profit when I knew things were turning bad. I switched to another broker. At first things went well, then as I started showing some profit (due alot to your style in this thread) things started acting strange again. It's almost like playing against the computer in an old video game from the 70's. Know what I mean? It always makes just the right move no-matter how unlikely it would be. I got so frustrated, lost my cool, traded emotionaly, blew my account.
I stumbled across this thread and I was appalled at the implications!

MT4 Brokers' Virtual Dealer Plug-In
I suggest everyone read it!

To my point, I checked out currency futures as that is what you trade.
I have been trading demo for two months and am doing great! There are no dealer/market maker games, the spread even during NFP has never been more than 2 pips and is usually 1. You can buy the bid, sell the ask. No proximity to price limits, etc. In my opinion it is far superior to forex!
When things are slow I trade the mini s&p.
I am demoing with AMP Futures. I ask if you have any experience with them or would you suggest another firm? I have been using Ninja Trader and like it.
Any suggestions on platforms, data feeds, etc.?
Also, have you noticed any of the silly broker games like in forex?
My last question is are you willing to share any of your money management,
time of day, anything else pertaining to a new Futures trader.
Thanks in advance and I hope the very best for you in all that you do!
  • #922
  • Mar 6, 2009 9:35am Mar 6, 2009 9:35am

if


then


Two words you MUST incorporate in your trading. We already know markets are living objects to a certain degree.



"If the market reach xxx price/level, then I'll be Long/Short"


but


"If the market fail to go my way, then I''ll bail out"



and



"if after bailing out, the market goes the other way"


"then I'll go long/short at xxx price/level.


"After xx trades, if the market is not giving out, I quit for the day"


Risking 2% per trade is wrong. You need to know ahead how many trades you'll be placing and how you're spreading the risk among the trades. Look for at least 1:1 R/R .


It is good to play defensive. But ultimately you're a player and you're goal is to make this thing work.

Peace
  • #923
  • Mar 6, 2009 9:57am Mar 6, 2009 9:57am
Quoting RandyFX
Hi Feb,
I have read all the posts up to this point. I hope you are doing well.
Your insight is a great value and I give you thanks for it.
I was wondering down the path of trying more and more silly indicators and this thread brought me back to reality! Price action is king!

I started trading stocks, then went to options. I got a call from a Forex Broker about a year ago. I imiediately (knew) this is what I wanted to trade.
However... I would win a few then lose more. I reasoned it's ok I'm making back what I lose in Forex with my equity option...

I use pretty much the setup I already mentioned on my posts. I am using MT4 as ilustration puposes only. I personally don't like MT4's feed at all. Remember that futures are more expensive per tick. G/U is the cheapest and every tick runs about $6.00. As for spot forex, I had a brief experience with Oanda. The feed is somehow slow for my taste but I had no bad fills. The time with them was short so I really can't tell.

About the horror stories on MT4 borkers, I really can't tell as I never use them. My neutral-unbiased opinion is that you won't be able to survive in the broker business if you're out to hunt every single pip/stop outhere. I mean, people(traders) aren't stupid, you know. In my view, MT4 is not a relieable platform. At least for execution. There's something else you need to consider and is latency.

Soem people might disagree, because the feed they're getting is up to the tick. But maybe someone from other side of the world can tell discrepancies on the tick using the same platform/boker. That's is latency.

Another thing is liquidity. As the spot is not a zero-sum game (like futures) the broker needs sufficient liquidity form his providers in order ot honor you any particular price. If not, the broker is going to push you up and down on requotes until he finds a match. That's especially true on fast markets, like news, etc.

On money management, I don't like to risk more than 1% a day. I spread it out to many trades per day as I am still a hardcore scalper.

I apologize for any typos, but my hads feel crampy.

Hope it helps my friend.
Peace
  • #924
  • Mar 6, 2009 10:32am Mar 6, 2009 10:32am
Thanks Feb,
I've been trading 6e euro at 12.50 a pip. I checked out the mini 7e at 6.00 per pip but I found the liguidity not as good, thus wider spreads.
(slower action)
I load heavier than 1%..... but I'm either right or out FAST! lol
The days it's really working I'm learning to maximize my profit and the days it doesn't seem right to just do something else. Forcing a trade never works.

The plan is still under construction but at least now I have one!

I'm not a big poster but I will definately stop by once in a while to say hello.

May success and good health be yours!
  • #925
  • Mar 6, 2009 12:36pm Mar 6, 2009 12:36pm
Quoting RandyFX
Thanks Feb,
I've been trading 6e euro at 12.50 a pip. I checked out the mini 7e at 6.00 per pip but I found the liguidity not as good, thus wider spreads.
(slower action)
I load heavier than 1%..... but I'm either right or out FAST! lol
The days it's really working I'm learning to maximize my profit and the days it doesn't seem right to just do something else. Forcing a trade never works.

The plan is still under construction but at least now I have one!

I'm not a big poster but I will definately stop by once in a while to say hello.

May...

Thanks.
Peace
  • #926
  • Mar 6, 2009 4:52pm Mar 6, 2009 4:52pm
Hi! Feb

Read your thread with great intrest when are you going to teach us more about the 30 min strategy you are mention also intresting in your new strategy that you have started on this page (62) outbreak from sidways moves hope to learn more of this great thread, wiler im witing im going to thread the system 1 thread i have not done that yet keep the great info up and thanks.

best regards
  • #927
  • Mar 6, 2009 5:16pm Mar 6, 2009 5:16pm
Quoting jgadefelth
Hi! Feb

Read your thread with great intrest when are you going to teach us more about the 30 min strategy you are mention also intresting in your new strategy that you have started on this page (62) outbreak from sidways moves hope to learn more of this great thread, wiler im witing im going to thread the system 1 thread i have not done that yet keep the great info up and thanks.

best regards
Jeez!! I really don't know about 30 minutes But you know, levels are present anywhere. I guEss it will be hard for me to kick the scalper's habit LOL!!

I trade off daily charts using fractals. That's another story.

The outbreak from a sideways move is not a new strategy. Is just an example on what to look on the charts. I look for failures on moves. There's a reasoning behind those failures and that's a long subject, turst me. The idea is to spot early those failures and be the first in line. Breakout off the failure is what you want. Sometimes the breakout goes wrong. This is when the "IF and "then" comes on handy.
Peace
  • #928
  • Mar 6, 2009 5:35pm Mar 6, 2009 5:35pm
This is a 4hr charts.

Note the rejection levels - areas.

The advantage of higher time frames is the acumulation of data normally that's sufficient to sustain a move. On the last bar (red) , I assume a tremendous dumping of euro here on the futures side today on heavy voulme. Probably that move dragged the spot.
Attached Image (click to enlarge)
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Peace
  • #929
  • Edited 7:09pm Mar 6, 2009 5:44pm | Edited 7:09pm
Somebody ask me about contrarian moves. If you opt to go that route, do me a favor and don't go any lower than 4hr time frame. In order to be a contrarian, you have to be sure that enough data is acumulated on the bar you're using as a reference. Be very vigilant on your stops.

Here's the same layout I used on my last post, from a contrarian (counter-move) view.
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Peace
  • #930
  • Mar 6, 2009 10:17pm Mar 6, 2009 10:17pm
I just wanted to go back to my previous post about America's addiction to credit...

It seems the older I get, the more I realize there are weaknesses in every system. I was looking at a can of deviled ham a few minutes ago.... and on the wrapper was the PERFECT sandwich, with perfect garnish on the side.

It made stop and think a minute.

In the old days, I would go to dance clubs and party with friends and not have a care in the world. These days I am wondering if our way of life is going to come to a screeching halt without warning.

I mean, Obama can't fix the American peoples' hearts. Instead of leadership (like fireside chats, where he would plea for Americans to stop putting themselves into debt) he simply does the exact opposite, and maximizes HIS credit card (IE the taxpayers hard earned)

Well this might seem like a rant. It is more a realization of mine that anything manmade can crumble, and these desperate economic times haven't truly been dealt with by the "leadership."

We need to teach young people the value of a dollar. And that spending "easy money" with a credit card is actually someone else's that will need to be paid back. All the loan defaults recently are showing me that people don't really care about their credibility, which seems like a damning quality.
  • #931
  • Mar 6, 2009 11:23pm Mar 6, 2009 11:23pm
This is great feb tell us more


best regards
  • #932
  • Mar 7, 2009 1:46am Mar 7, 2009 1:46am
Quoting feb2865
Remember that futures are more expensive per tick. G/U is the cheapest and every tick runs about $6.00. As for spot forex...
Feb - excellent thread, thanks.

I have traded both EC and BP futures and often consider only trading the EC (euro futures); the problem with BP is that although the spread is tight during normal sessions, you can't trade any size.

As you probably know, the advantage of the futures is that a tick chart actually makes sense, as each tick represents an actual trade, whereas with cash fx it represents a change in the bid ask, without necessarily any trade. I like the tight 1 pip spreads, regulated exchange, and volume to use. BUT what always puts me off is the "round number" issue : if the futures hits an 00 number, the cash is going to be some way off, unles you're very close to expiration. Does this cause you any concern - or do you use the cash number, if at all ?

J.

PS. tdion - for once, I agree with you completely.
'Should have stayed on the gold standard...
  • #933
  • Mar 7, 2009 7:42am Mar 7, 2009 7:42am
Quoting jtrade
Feb - excellent thread, thanks.

I have traded both EC and BP futures and often consider only trading the EC (euro futures); the problem with BP is that although the spread is tight during normal sessions, you can't trade any size.

As you probably know, the advantage of the futures is that a tick chart actually makes sense, as each tick represents an actual trade, whereas with cash fx it represents a change in the bid ask, without necessarily any trade. I like the tight 1 pip spreads, regulated exchange, and volume to use. BUT what always puts...


I like EC better for it's liquidity. I personally had a bad rap with BP.

Some time ago, I decided to check the cash number to see if I can get away with some "up-down tick" advantage, but is not worth it. Some years ago I used NQ as a leading indicator for qqqq. It works very good. The only problem is uncle sam breathing on your neck(from the stock side.) Still need to report on the 60/40 tax rule from the futures side. Tax was killing me both ends. This is the single most profitable strategy I ever had. It's amazing to see how one follows the other. Well, that was 2003-2005 maybe the rules of engagement has changed, I don't know.

The spot forex is a great instrument for the trader that wants to have flexibility on the risk side. I know people with some capital, 25-50k and they're not willing to risk more than 1% a day (250-500 bucks). In futures you can't do that, well maybe trading one contract on EC but you migth still be off. Anyway, you have more control over your load, or maybe you want to try something new. Then you can lower your load down to 1 cent if you like.

As you said, you need to deal with changes on the bid and ask instead. of true tick reading, which is real zero-sum game. It's really a trade-off. In my case, I can't deal with it, I rather be with futures and their ocasional slippage.

Hey man, thanks a lot for bringing this subject.
Peace
  • #934
  • Mar 7, 2009 8:12am Mar 7, 2009 8:12am
Hi Feb,
I am a new member of FF and I find your thread very helpfull and love your strategy. I have been reading the post up to pg 50.
I was just wondering if anything in your original style has changed or is the same?
I also wanted to know what is your opinion in regards to bollinger band for sole purpose of recongnizing the 5min chart range time and breakouts? does it help with your system?

Thank you.
  • #935
  • Mar 7, 2009 9:04am Mar 7, 2009 9:04am
Quoting tdion
I just wanted to go back to my previous post about America's addiction to credit...

It seems the older I get, the more I realize there are weaknesses in every system. I was looking at a can of deviled ham a few minutes ago.... and on the wrapper was the PERFECT sandwich, with perfect garnish on the side.

It made stop and think a minute.

In the old days, I would go to dance clubs and party with friends and not have a care in the world. These days I am wondering if our way of life is going to come to a screeching halt without warning.

I mean,...


Tidion

The Federal reserve system as it is since 1913, It's designed to create an addictive debt-interest based society. There's nothing we can do. No president whatsoever will turn around this problem unless he take the bull by the horns. The american dream is not a house and a car like the 50's anymore, is the more you have, the better. Unfortunatley, this well-designed plan of the feds has made deep roots in american society. There's no turning back unless we take drastic measures.

The true beneficiaries are the Goldman's the stanley's and more recently the Mitsubishis's. I bet they don't even file tax returns.

In my oipnion, there's three things that will turn around this situation for the good.

1) Elimination of Income Tax, which by the way is uncosntitutional as violates the article 6 of the constitution - the law of the land.

2)A less intrusive goverment. - As a result we will have a smaller goverment. No more big brother-uncle sam stuff.

3) The elimination of the IRS and returning back the currency to goverment's control.


The question is, who's going to dome that beast?

Mr. Obama wants to jump-start this economy with greenbacks...ok

But makes me wonder, if US Dollar bill is the only legal counterfeit currency in the world, why me (Obama) as a comader in chief of this nation, have to pay this back to the feds?....witH INTEREST? OH LORDY.

I am fortunate to have a friend, who made a long and deep research of the roman empire, from the economic standpoint. Actually it was a group reserach. It took around 10 years. According to him, the Roman Empire had an estimated liquidity of 800 trillion dollars worth of gold. That's a lotta gold my friend.

Roman Empire had the best army in the world. I mean, they were the best in everything. But the stupidity of emperors and the whole goverment, made that empire crumble like a cookie in a glass of milk.

I don't want to compare apples with oranges, but do you really think U.S is inmune for a fallout? I don't think so.

The American people are living in slumberland. They surrended their will to the goverment, with the hope that everything will be resolved like a magic carpet ride. As long as we are blindfolded by white elephants (The Feds, nuclear weapons, etc) we will always be an slaved society.

"it's not what your country can do for you..." those were words of wisdom. Unfortunately not convenient for the feds...ouch! I said too much....LOL.
Peace
  • #936
  • Mar 7, 2009 9:13am Mar 7, 2009 9:13am
Quoting fxachilies
Hi Feb,
I am a new member of FF and I find your thread very helpfull and love your strategy. I have been reading the post up to pg 50.
I was just wondering if anything in your original style has changed or is the same?
I also wanted to know what is your opinion in regards to bollinger band for sole purpose of recongnizing the 5min chart range time and breakouts? does it help with your system?

Thank you.
Welcome to the thread.

My goal is for the trader to have a logical view on the charts. There's my irony about systems. I really don't have a strategy, is just a way to spot failures (pullbacks) and follow-thru's.

Bollinger bands, as well as any math-based indicator, are nothing more that a represenation of price in a more -pictorial way. I suggest you train your eye to spot ranges and breakouts. In my expereince, any crutches will put you in a second-guessing mode. That's not good for trading. Use a couple of single-horizontal lines. That will do the work nicely.

Feel free to ask anything. I will be around here more often.
Peace
  • #937
  • Mar 7, 2009 9:51am Mar 7, 2009 9:51am
Feb,
Thank you for the quick respond. Well understood. I be following your thread closley. I hope your health issues are well behind you and doing great.
  • #938
  • Mar 7, 2009 10:22am Mar 7, 2009 10:22am
Here's a chart form 3/5/2209
NFP Anouncement - a big mover across all markets.

A counter reaction on these moves are a very common pattern to follow.
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Peace
  • #939
  • Mar 7, 2009 10:32am Mar 7, 2009 10:32am
Here's more
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Peace
  • #940
  • Mar 7, 2009 11:07am Mar 7, 2009 11:07am
MORE.....
Attached Image (click to enlarge)
Click to Enlarge Name: today8.gif Size: 43 KB
Peace
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