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Attachments: catch large moves! EMA(7) & multiple timeframes
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catch large moves! EMA(7) & multiple timeframes

  • #1
  • First Post: May 19, 2009 6:43pm May 19, 2009 6:43pm
Hi all!

I have an interesting concept for you to consider. I found that trading in a long term is less risky and therefore more profitable (mainly thanks to jacko and fti contribution to my forex exeperinece) To identify good entry point I use the following:

Exponential Moving Average 7

Multiple Time Frames:

H4
H8
H12
H16
H20
D1

DON'T USE CANDLE STICK CHARTS!!!

Only line chart is aplicable in this system.



ENTRY RULES
If the price line cross* the EMA on each H4,H8,H12,H16,H20,D1, make an order.

*) cross is considered valid, only when the close of the last period is on the opposite side of the EMA than the previous one.



EXIT RULES
If the price line cross the EMA on each H4,H8,H12,H16,H20,D1, giving the entry singal in the opposite direction, close the order (at the same time make an order in the opposite direction)

Cross has to be made not too far from the present - max of 2 periods on each time frame.

SL different - depending on the particular pair

In the attachement there is an example of how the valid cross is supposed to look like.

Comments please.
Attached Image (click to enlarge)
Click to Enlarge Name: ff.gif Size: 17 KB
  • #2
  • May 19, 2009 7:44pm May 19, 2009 7:44pm
You'd be waiting days/weeks just for an entry though right?
  • #3
  • May 20, 2009 3:40pm May 20, 2009 3:40pm
yep! for the first one. And then, any exit from long/short would be equal to entry into short/long.
  • #4
  • May 20, 2009 3:47pm May 20, 2009 3:47pm
So you're saying instead of closing the position you just switch from long to short or short to long?
  • #5
  • May 20, 2009 4:24pm May 20, 2009 4:24pm
How do you get 8, 12, 16 and 20 hpour chart?
  • #6
  • May 20, 2009 4:57pm May 20, 2009 4:57pm
Use period converter script. I think it's standard with MT4 now.

Quoting aelimian
How do you get 8, 12, 16 and 20 hpour chart?
  • #7
  • May 20, 2009 5:56pm May 20, 2009 5:56pm
Quoting lucashammer
So you're saying instead of closing the position you just switch from long to short or short to long?
If you're long and it crosses, you close that long position, then open a short. So once you get your first entry, you're going to pretty much always have an open position, you'll always be in the market.
  • #8
  • May 20, 2009 6:27pm May 20, 2009 6:27pm
Hi Dupek,

I´l like to know which EMA or SMA in your experience works very good in times frames lower => 5M, 10M, 15, 30M and 60M, likes your EMA 7 in the 4H?
Tks and sorry about my poor english.
RRBO
  • #9
  • May 20, 2009 8:08pm May 20, 2009 8:08pm
Quoting dupek.
yep! for the first one. And then, any exit from long/short would be equal to entry into short/long.

From your experience how often do you have a new entry?
  • #10
  • May 21, 2009 4:11am May 21, 2009 4:11am
Quoting lucashammer
So you're saying instead of closing the position you just switch from long to short or short to long?
Yes, that right.
  • #11
  • May 21, 2009 4:33am May 21, 2009 4:33am
Quoting pierre23
If you're long and it crosses, you close that long position, then open a short. So once you get your first entry, you're going to pretty much always have an open position, you'll always be in the market.
When I came up with the idea how to enter the market I didn't know how to exit. I intended to place some sort of TS - I can't left my pc running all the time so it would have been SL (200 or so) - and I wanted to move it every time when the price move in my favour, and left it the same, if not. However in order to catch really big moves it is better to simply exit when there is a signal, (as valid as the one of entry). So what may be the signal? The entry into opposite direction! Thus one position will be opened always - like a slave who works for you 24h a day.
  • #12
  • May 21, 2009 4:53am May 21, 2009 4:53am
Quoting RRBO
Hi Dupek,

I´l like to know which EMA or SMA in your experience works very good in times frames lower => 5M, 10M, 15, 30M and 60M, likes your EMA 7 in the 4H?
Tks and sorry about my poor english.
RRBO
EMA7 in the H4 doesn't work very well per se. Only combination with other time frames gives decent results. I have not been thinking about applying this idea to lower time frames. Nevertheless it may work as well, regardless of higher volatility.

EMA7 is not a rigid rule. I started this thread cause I want you to suggest what is wrong, what can be improved and what will work better. I hope togather we will develope the idea so it become a truly powerful system.

Don't sorry about any language mistakes. English isn't my first language too. Its ok until we understand each other.
  • #13
  • May 21, 2009 5:04am May 21, 2009 5:04am
Quoting aelimian
From your experience how often do you have a new entry?
That depends from the market in a longer term - whether its trending or ranging. In almost a half year time til know I had about 13 entries (eurusd).
  • #14
  • May 21, 2009 10:12am May 21, 2009 10:12am
Quoting pierre23
You'd be waiting days/weeks just for an entry though right?
That would indeed be an exercise in waiting, for 4HR TF down to D1 TFs to cross at the same time. may be a trade per month

kos
John 3:16 - From THIS love no power on earth can me sever.
  • #15
  • May 21, 2009 10:41am May 21, 2009 10:41am
This is position trading. Big reward but very frustrating when you see a good trade turn to BE.
  • #16
  • May 21, 2009 11:47am May 21, 2009 11:47am
It does catch big moves but a lot of stop and reverse in choppy periods.

I do not understand the reasoning behind all time frames lining up, maybe 4h and D1 would do the same job, any explannation would be appreciated
Regards
  • #17
  • May 21, 2009 3:15pm May 21, 2009 3:15pm
Quoting melpheos
This is position trading. Big reward but very frustrating when you see a good trade turn to BE.
Yes it is. But lets think about it in the following way. 95% of traders lose. Then who are those who win and make enormous money? Now look at the forex forums and what do you notice? Most of threads is about cathing small batches of pips and trading very often. It is huge advantage of forex market comparing to, for example, trading with shares. But perhaps those who win at forex are those involved in position trading - they look at the market in a different way, they have share-trader's attitude. Obviously it may be annoying to wait for a signal such a long time if one used to make a number of trades daily, though why not ? You can run one position this way and at the same time do day trading (if only deposit allows you to do so). One does not exclude another.
  • #18
  • May 21, 2009 3:27pm May 21, 2009 3:27pm
Quoting dupek.
Yes it is. But lets think about it in the following way. 95% of traders lose. Then who are those who win and make enormous money? Now look at the forex forums and what do you notice? Most of threads is about cathing small batches of pips and trading very often. It is huge advantage of forex market comparing to, for example, trading with shares. But perhaps those who win at forex are those involved in position trading - they look at the market in a different way, they have share-trader's attitude. Obviously it may be annoying to wait for a signal...
Have you considered this? A 7ema on a daily chart, is ROUGHLY the same as the vegas 1 hour tunnel
  • #19
  • May 21, 2009 4:14pm May 21, 2009 4:14pm
Quoting howard
It does catch big moves but a lot of stop and reverse in choppy periods.

I do not understand the reasoning behind all time frames lining up, maybe 4h and D1 would do the same job, any explannation would be appreciated
The idea came from EMA7 and Daily time frame. In this case it is only apparently profitable, you are right. In choppy periods when MA and price line are crossing very frequently, trades couldn't be worse on daily time frame! Like in the example.
Attached Image (click to enlarge)
Click to Enlarge Name: ff.gif Size: 18 KB

To be honest it is really hard to find all of the time frames lining up (here is where I took 'max 2 periods' from in the first post). The idea of multiple time frames was suggested by a friend, and this was the idea which I was sticking to and having quite good results. Now it is the moment when I am asking you all for a positive contribution to this concept. All the time frames I've listed starting this thread are not the hard, strict rules. I want you to help me with shaping them.
  • #20
  • May 21, 2009 5:04pm May 21, 2009 5:04pm
Quoting TheGreatMilenko
Have you considered this? A 7ema on a daily chart, is ROUGHLY the same as the vegas 1 hour tunnel
I don't know too much about vegas.. I thought it was some sort of scalping system, thus I didn't give it much attention. I'll read sth more about it in a spare moment.
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