The Koala System (No brainer)

content

 

1. introduction
2. the system
3. on going testing
4. exceptions
5. to note
6. picture examples

1) Introduction

Hi all,

I used to trades at wrong time and watch winning trades turn on me to hit SL.http://4.bp.blogspot.com/_9gn6KLa5xt...oalaAlbino.jpg
I want to believe like all of you that forex works.

My idea of the koala system came when i was searching for no brainer ways to "trade" forex. I came across a 3 MA system and work constantly to tweak it.


2) The System

i call it the koala system because i like koalas. Secondly, i wish i can laze around like them. Forex is my hope

3 Moving Average Indicators on EURO/USD M30

Period of 3 , 6 , 9
Smoothed and apply to Median Price
Make them bold and off different colors.

We are looking to trade when the 3 MAs turns parallel / diverge with each other. The trade is in the direction of the MAs.

The earlier you enter, the higher chance of success.


3) On going testing

SL 50

I will usually use trailing stop loss of 45

TP I tried to put it just before it reaches a pivot S/R or major S/R.

However TP is flexible and based on your style.

Folks who prefer quicker response, at the risk of more false signals, can try M15.

The Koala System is to minimize your wrong entries AGAINST the trend. It does not guarantee easy money!


4) Exceptions ( High risk )

You have to do your homework and be aware of the market. If you are aware of upcoming important releases ( NFP for example ). Stay out!


5) To Note

Before you trade, always zoom out to at least a few days of M30. If it is OBVIOUSLY trending against, dont trade upon onset. Wait for 1 more candle to confirm.

IF your M5's KOALA is opposite of your direction, DO NOT TRADE


6) Picture Examples

First attachment

an example of a no trade situation. The day in context was a major bank holiday. Trades can go either way due to low volume.

Hence the Koala is right ... when in doubt, stay out !

Second attachment

a classical false alarm. If you take a look at the level 1.4000, caution should be taken

However if you use the standard 50 SL, you would have survived.

Third attachment

a good entry! The Koala is parallel / diverging


A)I hope i can gain insights from YOU. This is a honest sincere post don't flame.

B) Please do not link to other systems or have other discussions. This thread is for the refinement of the koala system

Feel free to try it out.

Take a look at the M30 charts and you can see it is pretty accurate.

Critically evaluate the koala system.

Make it better for all!

Trade safe.


You can visit my blog on various forex topics and Eur/USD views too


p/s please rate this thread if you find it useful

Cheers

*you are responsible for your own trades.*

Hy Trading801...

Do you pay attention to important S/R levels? Many times price is moving fast with your 3 MAs just parallel and very close to a S/R level... better sit on your itching hands...

Don't forget MAs are price derivatives... and lagging...


At this TF there are a lot of "micro trends" that make the longer direction... what I seek at this TF is a established trend (HH, LL)... and enter on some pullback... cause if you enter on the very beginnig, it's more like gambling that this is goin to be a trend period... a pullback and continuation is a strong clue that the trend is in place.... better if you have some other reason to enter (price Oversold/bought, S/R level, Pivots...)

Don't EVER take a trade if you got JUST ONE reason.... I seek at least 3...

Cheers, and good trading!

HT

maybe a different exit strategy? this is pretty interesting setup, it looks like if you exit when the 3 ma hits the 6 ma you will book a profit and then wait until the next setup to trade again.

Housetrader, thank you.

Summary:

When deciding to trade, take note of nearby S/R lines as it may affect the trend.

When decide to trade, entry after pull back may result in better outcomes? When you mentioned HH and LL, do you mean the price actions,

makes a high, pull backs, makes a higher high and pull backs?

How many of such should we be looking for become we can be more sure of a trend?

Sarchin.

this is a good idea and i considered it before, however....


I meant for the Koala System to be a no brainer, therefore i am trying to find a way to enter and forget. However i do accept logical arguements that such a system will fail.

The aim of this system is not 100% win. Anything above 75% will suffice.

Lets explore more !!!

Hi, trading...

Regarding to S/R, it depends on which TF are you trading.... I'm trying to to get my system as mechanical (or.. "no brainer") as possible.... I use to be a day-trader... very seldom I keep a trade open overnight... So I trade basically 15m TF, with eyes on 1H and D1 for the big picture...

For me, intraday Pivot Points are good enough S/R zones (there are a lot of MT4 indicators around...), since I stay "exposed" to market the less time I can (usually my trades last for 3 or 4 hours, even less)

BUT, always before pushing the button, I take a glance at higher TFs... and mentally number all the reasons why I'm "going to the water".... remember, there MUST be MORE than one good reason. If I foun ONE good reason NOT to enter, I simply skip it...

About pullbacks... when we got a trend reversal (that's when all the systems give "signals".... MA crosses, stochs, MACD...etc..) how do we know it's a reversal or just a pullback?... Price Action gives a clue... If we identify the new trend, sooner or later ther will be a "breathe" in the move, that's when our best odds to succeed come... the pullback....

If i got time later I'll post a screenshot...

Cheers!

HT

First Chart, according to Koala, all MA parallel, very nice short setup...

Second Chart, put some Pivot Points... humm.... close to intraday suport... And trend up in 4H TF.... very good reasons to skip the trade, IMO....

Just my humble view....

Hope we can get more feedback....

Cheers!

HT

Wouldn't be nice if we had pick that bottom? In hindsight looks easier... But who said it was a bottom when it was forming? We must play with the odds...

But a HH, with HL... that's our signal...

Cheers!

HT

HouseT,

you are good with your analatical skills. I appreciate your presence here

Your charts do bring up a good point.

However as you identified right, it is hindsight..

from your work,

i am thinking of 2 refinements,

1) entry in terms of HH HL , = concern is we may be too late when it is confirmed. Should a lower time frame be considered? imho, anything below m15 produces too many false alarm.

2) SL:TP ratio. TP can be small, 10pips? 20pips? this will prevent a bottom greatly. However the problems is SL. Usually we have smaller SL to improve win ratio. however a SL below 20 imho is asking for stop out.

Keep the ideas coming.. remember we are in this together to refine the Koala.

MANY THANKS

It's my pleasure to (try to) help...

Well, since Koala uses MA's, I would think about, when catching a pullback, put SL on the other side of the "fence" (the slower MA), maybe using a buffer, let's say, 5 pips (other side of the MA + 5 pips)..... As TP, personally I like a free ride.... take 50% of the money off the table when you hit 1:1, then maybe set the remainig to 2:1... or maybe exit when MAs giv a contrary sign....

Just thoughts.... wandering about....

Cheers!

HT

PS: Indeed.... below 15M is way too crazy for me....

if one entered the koala on the m15, it will be good pips today

housetrader.. do u notice the m60 trends last for sometime usually if koala is parallel ...

what do u think... is m15 our best timeframe .. hmmmm


anyone else have opinion too? join in !

My humble advise,
Get ride of your indicator mind set. indis only predict the past.. back testing is useless.. everything looks great in the hindsight.. markets go through cycles and everytime it does thats when your indicators go crazy and you end up with inconsistency. Consistency is key to a successful trading career.
Learn to trade naked.. train your eyes to read the market without crutches.

Join to the thread called "system II (with irony)".. decide for yourself.. look for me if you need help.

Good luck.

Well I agree with fxachilies, learning to trade "naked" is a nice way to get used to the market mechanics....

I use some indis on my trading... I prefer call them "tools". Since you KNOW they're lagging, you stop using them as TRIGGERS... it's just a tool that gives you some information.... I never use indis as triggers....

But Koala's approach are based on a set of MAs..... let's take advantage of what information they can give us....

System II with irony is an awesome thread, IMO to learn the "naked"...

Just wandering.... possible Friday trade

Well.. I'll take a look later at 60m, but as far as the market doesn't have Time-frames... I would be comfortable trading at 60m also, the same way..... looking for the MAs become parallel, looking for some kind of confluence and watching PA... For sure that would give us less signals, but also for sure, more reliable....

Later I'll give it a try....

Cheers!

HT

M15 and M60 's Koala all parallel .. today it is asian now and it prob. ranges..

i entered a small probe... short from 1.3450

m15 koala parallel .. entered a small probe long !

With the M60, trends are stronger.

The picture below is a good koala setup. Trailing stop to harvest the pips still stop out.

The only ? is how much trailing is optimal. Is anyone trying out the Koala?

ok i hit my TP @ 1.3693

am waiting to LONG again on a dip, provided The Koala is still parallel

A recap.

1) enter long here when koala is parallel

2) when koala flattens, always becareful. So far i used TSL of 50. Seems to be wide enough.


Anyone using Koala?

Hi, trading...

Glad to see you are doing fine with your system! Indeed m60 gives you less signals, but much more reliable!

Cheers!

Good trading!