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Trading using Murray Maths and Price Action

  • #1
  • First Post: Mar 21, 2009 6:26am Mar 21, 2009 6:26am
Hi All,
I am Karthik from India. I have been trading forex for the past 4-5 years (never realised that i was trading for so long until i checked my records today !!). Anyway, as the title suggests, i trade mainly using Murray Maths and Price Action. Before i go any further, a little history about my forex career.

As stated, i started out about 4-5 yrs back. I have lost a lot of money and i have also gained a lot of money. But most importantly for me, i have learnt a lot during the journey. As my experience grew, i also started managing accounts. I blew up some of these accounts (along with mine) initially, due to various reasons, which included the fact that i was new to managing accounts at that point of time and also due to the investors themselves who wanted me to over leverage inspite of me repeatedly warning them about the risks involved.

Anyway, as stated, i grew up and learnt a lot and now i am a fund manager with a company in Slovenia (i dont want to reveal any names as it is against the rules). I read a lot and have been a regular visitor at FF for the past 3-4 years. I admire the trading skills of lilmoe, karmo and malcolmb.

I have started my own share of threads in FF (esp. a couple of years back) and also ran a very successful forex blog (which had 150-200 regular visitors per day) but i had to give them up as i did not have time. So, i guess some of you in here might remember me.

I am not a full time fund manager or forex trader (yet) and i have other businesses to take care. I can see that most guys in FF are part time traders only....So i guess, i can understand your problems with forex better.

Anyway, i wish to use this thread to share some of the lessons i have learnt so that i can fast track some of you guys and also help some of you avoid the pitfalls that i faced. I will not only try and share what i learnt, i will also post charts, reveal how i trade and also take some trades in this thread along with you guys. Let us see how this journey goes.

As i said, i am not one who sits on the screen 16 hrs a day watching the market and so i would be a bit off and on. Excuse me for that.

So lets get started. I welcome all of you to post whatever u feel like and also can ask me any questions that u want. I will answer as many as i can.
  • #2
  • Mar 21, 2009 6:37am Mar 21, 2009 6:37am
Quoting ns_karthik
Hi All,
I am Karthik from India. I have been trading forex for the past 4-5 years (never realised that i was trading for so long until i checked my records today !!). Anyway, as the title suggests, i trade mainly using Murray Maths and Price Action. Before i go any further, a little history about my forex career.

As stated, i started out about 4-5 yrs back. I have lost a lot of money and i have also gained a lot of money. But most importantly for me, i have learnt a lot during the journey. As my experience grew, i also started managing accounts....
Congrats bro for starting the new thread and hope lot of newbies and experienced traders too learn from this thread since even if a trader has more than 50 years experience he always learns something new everyday. I am too from India but work in Dubai been trading part time forex for last 5 years had my shares of losses and gains and most of the losses have been due to not sticking to basic rules laid by us only. It happens never been able to stick to a strategy and keep trying new methods which is also not wrong since learning is very important and one has to pay a price for learning always which is fair. I would like to know your style of trading and do have the murray maths indicator on my platform but never used it or rather tried it. Would look forward to you sharing me how to use it and which time frames and with any other indicators. All the best god bless and take care

Balaji
  • #3
  • Mar 21, 2009 6:38am Mar 21, 2009 6:38am
Hi, karthik ... i'm an indian too... frm malaysia...

Best Wishes... Hope can catch up with your method...
STRENGHT IS LIFE ,WEAKNESS IS DEATH - SWAMI VIVEKANANDA
  • #4
  • Mar 21, 2009 6:52am Mar 21, 2009 6:52am
thanks for the wishes....what i have personally learnt is that price action is King. I have tried hundreds of indicators, standard ones in MT4, ones posted on FF, ones on russian forums, u name it, i have used it.....thru all this, i have found that price action is the best...indicators seem to work but they work only for specific periods and for specific types of markets, they dont always work....so one week, they work very well, u make a lot of money and u start trusting it....so next week, cos of ur trust, u start to overleverage when u take trades and what happens ? the indicators dont work and u lose whatever u earnt and more....

Studying price action is not easy...it takes time, it takes experience to understand how the price moves, when and why...forex is not a get-rich quick scheme.....but when we are ready to spend so many years in our respective work areas (manufacturing, automobile, software etc.) to get some money, its amazing how people tend to get impatient when they enter into forex and they tend to over leverage.

Lesson no. 1 is 'dont ever over-leverage'....u should not risk more than 3% of ur account in any trade...ever....if u do, u are bound to lose in the long run...u could win in a week or mnth but u will lose in the long run....thats for sure....

reason why people over leverage is cos of greed....lesson no. 2 is to control greed....but its a contradictory thing....lets face it...most of us trade cos we are greedy...we are not happy with the money that we are earning and we want more...thats why we move to trading...but, the trade experts say that we should not be greedy....how can u avoid something which was the very reason that u entered into forex in the first place?? its tough....its really really tough....it took me about 3-4 yrs to control greed....

but just remember this, do u realise that by earning just 50 pips a day using a $1000 account using 3% leverage, u could be making $1000 a mnth after just 5 mnths? and $2000 a mnth after just 7 mnths?? $2000 a mnth is more than enough for a lot of us...and i could go on and on on how we could keep building this amount....

what i have said is not impossible...anyone could afford $1000....3% leverage is a standard leverage...and 50 pips a day is very much possible if u know what u r doing....so, all that i have said above is possible for all of us....but it keeps a lot of self control...

u could make 50 pips a day just by trading for 2 hrs a day during the euro or the US session.....but being patient and waiting for the right trade is the key...thats where everyone loses....
  • #5
  • Mar 21, 2009 7:04am Mar 21, 2009 7:04am
Hi Karthik.....its good to see another Indian in the ForEx world. I live in kolkata and trade my own account. Wish you great success ahead .

Regards.
The only way to get smarter is by playing a smarter opponent.
  • #6
  • Mar 21, 2009 7:22am Mar 21, 2009 7:22am
perhaps someone can post a chart showing whatever criteria they use.......

thanks
  • #7
  • Mar 21, 2009 7:39am Mar 21, 2009 7:39am
i use price action and support & resistance....i hope everyone understands what support and resistance is and what they do...if not, let me know and i can explain...attached is a chart of GJ in 1H timeframe....see how the price reacts to the S & R.....i use just this...thats all....rest of it is purely down to understanding the market, what it does, when and just getting a feel of how price will move....

edit - a very important thing to understand abt S & R.....S & R are not price points where price will reverse...in other words, S & R gives u a small range of prices where price could reverse....say, if support is 100, it is not that price could reverse from exactly 100 and so if price reaches 99.5, it is not assumed that the support is broken....if we say that the support is 100, price could reverse from anywhere between 99 to 101.....so, u need to watch price action and ensure that the price stays below support or above resistance for atleast 15 mins before u could safely assume that it is broken...a lot of traders see a price spike beyond S & R and immediately enter into a trade assuming that the S or R is broken only to see the price going back within a couple of minutes...
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  • #8
  • Mar 21, 2009 7:53am Mar 21, 2009 7:53am
congratulation Karthik for this new thread . Hope we all learn something new to avoid risk, mistakes we regularly doing .

I am trading part time and from mere time pass it became habbit forming now through loss -profit but never so consistent.I am working in Oman.

fontu
Not understand?better not follow my analyses!doubt clearer first, risks ++
  • #9
  • Mar 21, 2009 9:18am Mar 21, 2009 9:18am
Hey Karthiki i also like using MM. I was recently trading nzd/usd daily & this pair hit the 0/8 area so i placed a buy & it moved up nicely but i didn't hit my take profit. I got impatient because it would go down & come back up again. So it was trading in a range. So i closed the trade with a small profit. And then the next thing that happens it starts moving up for a gain of over 600 pips. It went up 9 straight days! When i closed the trade my thinking was that this pair is not going to go up too much. I should have been more patient. I got to leave my trades alone & stop watching them every 5 minutes. On the smaller time frames do you see price reversals at those levels 0/8, 8/8 & so on? I am thinking with smaller TF it is more risky than the daily? When does the MM repaint? I have seen these same levels on my daily charts for about a couple of weeks. gl & thanks
  • #10
  • Mar 21, 2009 10:30am Mar 21, 2009 10:30am
Quoting ns_karthik
i use price action and support & resistance....i hope everyone understands what support and resistance is and what they do...if not, let me know and i can explain...attached is a chart of GJ in 1H timeframe....see how the price reacts to the S & R.....i use just this...thats all....rest of it is purely down to understanding the market, what it does, when and just getting a feel of how price will move....

edit - a very important thing to understand abt S & R.....S & R are not price points where price will reverse...in other words, S & R gives u...
Thats true in this Murray math SR seems very important to understand. I have never read about before but now searching in this forum read some information only once so far & they seems very complicated specially mathematic parts . Anyway did not understand SR if the same as we refer in the charts everytime but value of ref. as 100 not understand.and those MML are depending upon the SR only.

Hope this SR & the value determination will be clear in time .

fontu
Not understand?better not follow my analyses!doubt clearer first, risks ++
  • #11
  • Mar 21, 2009 12:09pm Mar 21, 2009 12:09pm
Quoting ns_karthik
reason why people over leverage is cos of greed....lesson no. 2 is to control greed....
......it took me about 3-4 yrs to control greed....
Greed and Forex go hand in hand, and for me it all stemmed from trading demo accounts. Demo accounts ofcouse have none of the emotion of a live account, and being reckless is easy, and sometimes you see quite amazing gains. Thats where the greed started for me, its taken several years but I have under control now (most of the time).

Quoting ns_karthik
u could make 50 pips a day just by trading for 2 hrs a day during the euro or the US session.....but being patient and waiting for the right trade is the key...thats where everyone loses....
50 pips per day is my personal taget, I rarely achieve it because of impatience, I often make more than 50 only to later go negative by a similar amount. Timing is key, and keeping pips in your pocket also vital.

Couple of questions for you :

1. What is Murray Math? I will ofcourse google that after finishing this post, but please explain in your words as well.
2. Do you rate pivot points as a valuable tool? Pivot point as far as I can tell is a soild S/R level.

Thank you Karthik for this thread. The discussion has been stimulating so far.

Darinder
  • #12
  • Mar 21, 2009 12:09pm Mar 21, 2009 12:09pm
Supports and resistances are points in the price of an entity (it can be a share or a currency pair or a commodity or any other entity) where the prices stall. They have got more to do with history and user sentiment. Lets say that the price of the entity is 5 to begin with. It begins to rise and it keeps rising and seeing this price, more and more people would want to jump in and they keep buying and the price rises even more. This means that the demand is more than the supply and as long as this happens, the price will rise.
The price will continue to rise until a stage is reached where people start to feel that the price has become high enough or those who bought it early feel that they have earned enough profit. Lets say that at this point, the price of the entity is 10. So, people start feeling that the price has risen too much (this is also called overbought conditions) and slowly start selling. The demand becomes less than or equal to the supply and the price slowly drops from 10. As the price continues to drop, the people who plan to make money on shorts also jump in and the buyers (even though they might have very less profits or are in loss) start getting panicky and they start selling and the price starts falling more and also at a faster rate.
So the price continues to drop from 10 and thus 10 becomes resistance as the price has not breached 10. Next time the price comes close to 10, the buyers and the sellers will look at past history and find that 10 was the place where selling started the previous time and so the buyers would want to get out at that point just to be on the safer side and so 10 becomes a even bigger resistance.
The price drop from 10 continues and at one place, the opposite to the one explained above happens ie. the users feel that the price has dropped too much (say at 2) and they start buying again and the price starts to rise again. Thus 2 becomes the support.
Remember, the greater the amount of time that a support or resistance has not been broken, the stronger it is. Even yesterdays high and low are resistance and support respectively but they are not very strong as they are quite recent prices.
So, always watch out for supports and resistances. The big banks and traders dont sit with their ema or whatever indicators and buy and sell based on that. They look out for stops and resistances and buy / sell based on that. So be careful, watch out for opportunities and get a feel of the market before jumping in.
  • #13
  • Mar 21, 2009 12:11pm Mar 21, 2009 12:11pm
Quoting fontu
congratulation Karthik for this new thread . Hope we all learn something new to avoid risk, mistakes we regularly doing .

I am trading part time and from mere time pass it became habbit forming now through loss -profit but never so consistent.I am working in Oman.

fontu

thanks fontu....lets hope that we all learn together in this journey...
  • #14
  • Mar 21, 2009 12:17pm Mar 21, 2009 12:17pm
Quoting ferndog
Hey Karthiki i also like using MM. I was recently trading nzd/usd daily & this pair hit the 0/8 area so i placed a buy & it moved up nicely but i didn't hit my take profit. I got impatient because it would go down & come back up again. So it was trading in a range. So i closed the trade with a small profit. And then the next thing that happens it starts moving up for a gain of over 600 pips. It went up 9 straight days! When i closed the trade my thinking was that this pair is not going to go up too much. I should have been more patient. I got to...

well, Murray maths and murray levels serve as wonderful supports and resistances....i personally have seen that these levels work best at 1H and above....anything lesser than this, these murray levels seem very risky to follow....

and yes, u should have patience and avoid seeing and reacting to each and everything that the market does....at 1H or more, once one murray level is broken, it usually surely goes to the next murray level or at least very close to it 80% of the time...if u r trading a daily chart, u have to have the patience to wait for atleast 3-4 days for each and every trade....thats how the trade matures...if u r trading a daily chart, there is no point in reacting to hourly changes in price....

likewise if u r trading an hourly chart, u have to allow atleast 3-4 hrs for the trade to mature...there is no point taking a trade based on a hourly chart and reacting to change in price in every 5 mins...

but dont worry, as long as u close a trade in profit, thats just fine....there is always another opportunity in this market...u learn that with experience....

MM levels repaint depending on the price movements in a day....if the price ranges within a small range, the levels dont repaint....but i open and close my MT4 atleast once a day just to ensure that the lines are drawn again...
  • #15
  • Mar 21, 2009 12:25pm Mar 21, 2009 12:25pm
Quoting drcubi
Greed and Forex go hand in hand, and for me it all stemmed from trading demo accounts. Demo accounts ofcouse have none of the emotion of a live account, and being reckless is easy, and sometimes you see quite amazing gains. Thats where the greed started for me, its taken several years but I have under control now (most of the time).



50 pips per day is my personal taget, I rarely achieve it because of impatience, I often make more than 50 only to later go negative by a similar amount. Timing is key, and keeping pips in your pocket also vital.

[u]Couple...

50 pips a day, as i said, should be easy as long as ur patient and are not greedy...some people just walk off from trading after they have made 50 pips for the day...maybe u could try that for sometime just to learn that self-control...

anyway, as for Murray Maths, it is quite a complicated topic where price and time are divided into multiples of 1/8 and each level is assigned a specific importance....i could do into details but it could get very complicated....i have a PDF for those who might be interested....lemme know if u need it...from trading point of view, these murray levels are just lines of S & R and each line has its own importance....

Pivots are also very good but if u look into various such price action concepts, all of them would revolve around fibs and murray only...
  • #16
  • Mar 21, 2009 1:05pm Mar 21, 2009 1:05pm
Quoting ns_karthik
i use price action and support & resistance....i hope everyone understands what support and resistance is and what they do...if not, let me know and i can explain...attached is a chart of GJ in 1H timeframe....see how the price reacts to the S & R.....i use just this...thats all....rest of it is purely down to understanding the market, what it does, when and just getting a feel of how price will move....

edit - a very important thing to understand abt S & R.....S & R are not price points where price will reverse...in other words, S & R gives u...
hi, can you share the indicator you have on your chart.
ayour2a
  • #17
  • Mar 21, 2009 1:42pm Mar 21, 2009 1:42pm
Quoting ayour2a
hi, can you share the indicator you have on your chart.
ayour2a

here u go....
Attached File(s)
File Type: mq4 #MurreyMath-TimeFrame.mq4   18 KB | 8,348 downloads
  • #18
  • Mar 21, 2009 1:47pm Mar 21, 2009 1:47pm
Quoting ns_karthik
thanks fontu....lets hope that we all learn together in this journey...
Thanks , i got the site searching ff about Murray maths .hope it may help start learning .
http://www.foretrade.com/MM_description.htm
Not understand?better not follow my analyses!doubt clearer first, risks ++
  • #19
  • Mar 21, 2009 1:53pm Mar 21, 2009 1:53pm
Quoting fontu
Thanks , i got the site searching ff about Murray maths .hope it may help start learning .
http://www.foretrade.com/MM_description.htm

dont remember having seen this site....so something for me to study as well....but more than all this, i guess its all in the mind...!!
  • #20
  • Mar 21, 2009 2:02pm Mar 21, 2009 2:02pm
Quoting ns_karthik
here u go....
Thanks for the indicator ,just plot it to look into eurusd .interesting .
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Not understand?better not follow my analyses!doubt clearer first, risks ++
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