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Attachments: (LCB) Largest Candle Breakout
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(LCB) Largest Candle Breakout

  • #1
  • First Post: Edited 5:55pm May 11, 2009 5:26am | Edited 5:55pm
DISCLAIMER MUST READ.
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this system is currently under development & under NO CIRCUMSTANCES should it be traded in a LIVE account.
ONLY DEMO this system
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This thread has just been opened after I noticed something rather strange on Sunday while trying to refine the entry for the London Breakout System that Paulus posted in the 1 Trade a Day thread. The entry is there, we still have to define the TP and Exit.


Hopefully Paulus and others will come over to this thread and contribute to fine tuning this system as it has been tested today for the first time after I posted projected breakouts on various pairs based on this system in the above mentioned thread. http://www.forexfactory.com/showthre...165513&page=20


Shift the TF to a m15 chart,
(right click/Properties/Common) use the "Show Period separator" and find the longest candle over the whole 24 hour period and put a line on the top as resistance and on the bottom as support, highlight the area between the two lines with a reasonably long rectangle so you will be able to identify the area quickly. Even a Sunday candle is valid.




Shift the chart to an H1 TF and watch for the breakout of the S&R lines where the 5EMA breaks the line.

I recommend using an RSI to verify the breakout.

Don't ask me why this works but it appears to be consistent, even the Sunday bar seems to work. As I mentioned earlier, this system has only just been stumbled over and needs a lot of work on it. What it doesn't need is more than 2 indicators.



Setup on GBP/USD M15 Sunday May 10 M15 candle
Attached Image
Starting to see instead of just looking.
  • #2
  • May 11, 2009 5:34am May 11, 2009 5:34am
As we can see, the trade broke at the point we expected and ran for all it was worth.
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Click to Enlarge Name: 2.jpg Size: 297 KB
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  • #3
  • May 11, 2009 5:55am May 11, 2009 5:55am
Note how this one bounced off the low till it broke through.

This tends to lead me to think that this is possibly a valid support level as price retraced to this point before breaking low again.
Attached Image (click to enlarge)
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Starting to see instead of just looking.
  • #4
  • Edited 8:53am May 11, 2009 6:02am | Edited 8:53am
In fact we can still see that this area is important 24 hours later.


Hhm,perhaps this could act as a TP.
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  • #5
  • May 11, 2009 6:21am May 11, 2009 6:21am
largest candle form by news is valid ?
  • #6
  • May 11, 2009 6:23am May 11, 2009 6:23am
Broke the 23.6 fibo and bounced right off the 76.4 mark, for a 120 pip breakout.


Right, I am going to drink lots of beer then come back in the morning and see how these M15 S&R areas held up.
Attached Image (click to enlarge)
Click to Enlarge Name: Fibo.jpg Size: 374 KB
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  • #7
  • May 11, 2009 6:45am May 11, 2009 6:45am
Quoting forexisfx
largest candle form by news is valid ?

Not sure yet, this system was only stumbled on yesterday.
You will have to bear with us for a while.
Starting to see instead of just looking.
  • #8
  • May 11, 2009 9:01am May 11, 2009 9:01am
EUR/JPY went over 200 pips.
The entry had to be watched closely as it was bouncing below and above the breakout point before it finally broke through.

Most of these predicted trades were posted earlier on the 1 day thread to show that I am not doing this after the fact.
Attached Image (click to enlarge)
Click to Enlarge Name: EURJPY.jpg Size: 260 KB
Starting to see instead of just looking.
  • #9
  • Edited 8:30pm May 11, 2009 9:34am | Edited 8:30pm
Rastaman,

I threw together this indicator very quickly, but it should plot the two horizontal lines (high and low of yesterday's biggest 15-minute candle).

I actually compiled it as an EA (not an indicator), to potentially expand on it later as this system develops. Just drop it in your experts folder, and attach it to a 1-hour chart.

** EDIT **
I will keep this post updated at all times with the current version of the EA. Beginning now, I will also number the versions, so this will be 0.1

Version History
===========
0.1

 

  1. Plots hi/lo lines based on yesterday's largest 15-minute bar
  2. External parameter "MagicNumber" - will be used when the logic to execute trades is added to play nice with other EAs or manual trading the same pair.
  3. External parameter "useRSI" - set to True to use the RSI filter (over 50 for long trades, under 50 for short trades)
  4. External parameter "waitforclose" - True = wait for the candle to close to confirm the trade - False = Enter as soon as the cross happens..
  5. EA does NOT yet execute trades. Draws green "up" arrows for longs, red "down" arrows for shorts
  6. EA does NOT look backwards. Arrows for past trades will not appear - only when setups happen after the EA has been added to a chart.

Attached File(s)
File Type: mq4 CL-LCB-0.1.mq4   4 KB | 578 downloads
  • #10
  • May 11, 2009 9:45am May 11, 2009 9:45am
Quoting cgrey
Rastaman,

I threw together this indicator very quickly, but it should plot the two horizontal lines (high and low of yesterday's biggest 15-minute candle).

I actually compiled it as an EA (not an indicator), to potentially expand on it later as this system develops. Just drop it in your experts folder, and attach it to a 1-hour chart.

Thanks CGREY.

Will give it a try.

Just looked at D1 to W1 looks interesting.
Look at the size of the weekly candles after the break.
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Starting to see instead of just looking.
  • #11
  • May 11, 2009 9:53am May 11, 2009 9:53am
Looks good! Great job.

Is there any way to figure the cross of the RSI below or above the 50 mark and also the 5EMA cross on the high or low?

No rush for this as we are still testing.
Hopefully you will also be looking at this on demo.

Thanks for the indicator.
Starting to see instead of just looking.
  • #12
  • May 11, 2009 10:22am May 11, 2009 10:22am
Quoting Rastaman
Looks good! Great job.

Is there any way to figure the cross of the RSI below or above the 50 mark and also the 5EMA cross on the high or low?

No rush for this as we are still testing.
Hopefully you will also be looking at this on demo.

Thanks for the indicator.
Thanks. Yeah, I'm working on that now. I have a little time today, and this is actually quite a simple "system" in terms of creating an EA for it. I should have it put together in another hour or so (unless work distracts me )

Yeah - I planned to run it on a demo on a few pairs - hence my interest in an EA for it ...
  • #13
  • May 11, 2009 10:23am May 11, 2009 10:23am
To clarify - you want RSI below 50 to confirm a sell, and above 50 to confirm a buy, right?

What RSI period - 5 to match the EMA period, or.... ???

Oh... and wait for the close of the candle that the EMA crosses, or go in as soon as it crosses? From your screenshots, it looks like waiting (usually safer) could also lead to getting in way late.
  • #14
  • May 11, 2009 10:52am May 11, 2009 10:52am
I've been gone from this forum for a while but I was browsing and ran across this thread. Looks pretty interesting. Would it be possible to do an EA for both and see which one is more profitable. One EA opens the trade as soon as the EMA crosses the line and then the other opens the trade on a candle that closes along with the EMA having crossed the line.

Quoting cgrey
To clarify - you want RSI below 50 to confirm a sell, and above 50 to confirm a buy, right?

What RSI period - 5 to match the EMA period, or.... ???

Oh... and wait for the close of the candle that the EMA crosses, or go in as soon as it crosses? From your screenshots, it looks like waiting (usually safer) could also lead to getting in way late.
  • #15
  • May 11, 2009 10:59am May 11, 2009 10:59am
Quoting Siuol
I've been gone from this forum for a while but I was browsing and ran across this thread. Looks pretty interesting. Would it be possible to do an EA for both and see which one is more profitable. One EA opens the trade as soon as the EMA crosses the line and then the other opens the trade on a candle that closes along with the EMA having crossed the line.
Possible - sure. For me, personally, I don't know. I am interested enough to throw this together really quickly as I mentioned above. And as the thread progresses, will do my best to keep it updated with whatever the "official" trading rules will be. Creating multiple versions to test multiple scenarios is probably not something that I'll have a lot of time to do (given how many different people may all want different things to test), but I will always post my version(s) as uncompiled source for anyone to modify as they see fit.
  • #16
  • Edited 8:09pm May 11, 2009 11:28am | Edited 8:09pm
The attached EA does the following:

Plot an arrow to indicate buy or sell (green arrow pointing up = buy, red arrow pointing down = sell). It will NOT open orders - just plot the buy/sell arrows. We need some parameters for stoploss and takeprofit.

Currently, the trades (arrows) will fire as soon as the 5EMA crosses the hi/low lines. If we should wait for candle close, I'll modify this.

Also, there are two external parameters (see screenshot). MagicNumber (not used yet - will be later if we get to the point that we're opening trades on multiple pairs) and useRSI. If useRSI is set to "True" (the default), long trades (arrows) will only fire if RSI(14) is above 50, and shorts if below 50.

** EDIT **
Attachment removed - current version of EA is here: http://www.forexfactory.com/showpost...66&postcount=9
Attached Image
  • #17
  • May 11, 2009 11:56am May 11, 2009 11:56am
You doing that is more than enough. Thanks for doing all that you have and so quickly.

Quoting cgrey
Possible - sure. For me, personally, I don't know. I am interested enough to throw this together really quickly as I mentioned above. And as the thread progresses, will do my best to keep it updated with whatever the "official" trading rules will be. Creating multiple versions to test multiple scenarios is probably not something that I'll have a lot of time to do (given how many different people may all want different things to test), but I will always post my version(s) as uncompiled source for anyone to modify as they see fit.
  • #18
  • Edited 8:10pm May 11, 2009 12:19pm | Edited 8:10pm
I added another external parameter... If you want to wait for the candle to close before entering, set "waitforclose" to true. Leave it false to enter as soon as there is a cross.

If you want to run these both side by side to test one against the other, just rename one of them in your "experts" folder.

I'm not going to make any further changes until/unless an error is discovered that shows this EA is not following the "rules" correctly, or until Rastaman decides (or approves) what the TP and SL values should be - at which time I will add the logic to actually optionally open or close trades as opposed to drawing arrows.

I do have some thoughts on stoploss and takeprofit. For stoploss, (a) the opposite line (so, if you go long, the SL would be at the low line), or (b) the most recent swing hi or low. For takeprofit, 1.5% gain on account balance (assuming the stoploss is a 1% loss, making R/R 1.5:1). Ultimately, though, I think Rastaman should have the final say on this.

** EDIT **
Attachment removed - current version of the EA is here: http://www.forexfactory.com/showpost...66&postcount=9
  • #19
  • May 11, 2009 12:51pm May 11, 2009 12:51pm
hi

Im normally good at this sort of thing but can you explain how to get the CL-LBC onto the chart I have put it in the normal folder but when I drag it onto my chart nowt happens

I know Im doing some thing basicaly wrong here

Cheers

Paulus
  • #20
  • May 11, 2009 1:10pm May 11, 2009 1:10pm
Quoting Paulus
hi

Im normally good at this sort of thing but can you explain how to get the CL-LBC onto the chart I have put it in the normal folder but when I drag it onto my chart nowt happens

I know Im doing some thing basicaly wrong here

Cheers

Paulus
Do you have it in your EXPERTS (not indicators) folder? It is an EA, not an indicator (even thought it isn't opening trades yet).
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