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Tony's Two Candle trading system

  • #141
  • Jun 7, 2009 12:53am Jun 7, 2009 12:53am
i already test this system. i think the system won't work in ranging market. most of the time it hits the SL than TP. I think with 1H timeframe, the 10-20 SL is too small. any response for this. I appreciate for all of the response. thx
  • #142
  • Jun 7, 2009 1:24am Jun 7, 2009 1:24am
  •  MPP
  • Joined Jun 2007 | Status: Be yourself, everyone else is taken | 2,734 Posts
Quoting ronm7d
i already test this system. i think the system won't work in ranging market. most of the time it hits the SL than TP. I think with 1H timeframe, the 10-20 SL is too small. any response for this. I appreciate for all of the response. thx

10-20 pips is not the SL - it's the target, the stop is at the end of the indicator candle, if the next candle fails to make the TP and turns around you have choices

ie
first indicator candle is long - tp 10pips on half, second half to BE if first half hit, stop at low of indicator candle ie 50pips

Tp not hit candle closes bearish, but stop not hit - exit trade wait for next candle to show, this candle become a bearish (short) indicator candle

next trade short tp 10pips etc

stop and reverse and so on.
  • #143
  • Jun 7, 2009 1:38am Jun 7, 2009 1:38am
  •  MPP
  • Joined Jun 2007 | Status: Be yourself, everyone else is taken | 2,734 Posts
Quoting tjsun80
Hi Tony,

I just notice your thread.For the graph below, if lets say you enter a bearish -5 pips on GMT 11, it would result in a loss, due to gmt 12 is a bullish candle. So how you prevent not to ether this kind of trade?

Attachment
i would suggest you go back and read the rules again, allowing the trades to go to 10pips tp i count 16winning trades and 3 losing trades over the 2 days trading shown in your charts

assuming i tp half on the winners and let half run from BE

locked in 160 pips profit on half lots - loses on 3 trades on full lot for average 20pips = 120pips equivilant lose total 40pips profit for the 2 days plus any pips gain from free runners, on just the 12:00gmt trade alone (depending on trade management plan) you could have gain 250pips if trailed using a 20sma

so how did it fail - not sure how you traded it, but this is just my view

please can people stop trying to destroy every new idea they see until they have at least had a run at it for a month.
  • #144
  • Jun 7, 2009 1:50am Jun 7, 2009 1:50am
  •  MPP
  • Joined Jun 2007 | Status: Be yourself, everyone else is taken | 2,734 Posts
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  • #145
  • Jun 7, 2009 1:54am Jun 7, 2009 1:54am
about sl:
Quoting tony_dtrader
Hi, The stoploss is just for protection purposes, in event the market suddenly turns a 100 pip against you, you could exit off with a limited loss.

Ideally you should exit if the price moves 5-10 pips against you and accept the tiny loss instead of a big one. There are many more opportunities that will arrive again, so you can try again.

The old saying, cut off the losers and let run the winners.
  • #146
  • Jun 7, 2009 1:56am Jun 7, 2009 1:56am
In ranging market I usually measure the average length of bars and the longest & shortest bar, so it will give me consideration to trade or not.
  • #147
  • Jun 7, 2009 2:12am Jun 7, 2009 2:12am
Tony, if sl been hit, do you entering second time on same candle?
  • #148
  • Jun 7, 2009 2:17am Jun 7, 2009 2:17am
Quoting Razor_trader
So then where does that leave you? Searching for the Holy Grail no doubt, wandering from thread to thread until there is literally someone who will trade for you. Good luck Mr Liquidity, the market welcomes traders with your time and effort.

Razor
Urm Razor you don't need to wish Paris luck she's been trading since before you came to ff and has made enormous contributions to basket trading strategies.

Just because a candle has closed higher than it opened doesn't mean theres a probability of greater than 50% (if you use a 1:1) of next one also being a white candle. I can't find any statistical evidence of this happening the market doesn't know what candles are thats just our perception. I think you're the one who needs good luck because thats what it appears to boil down to. Sure you can make money with this system provided you're lucky since you only aim to trade two candles a day. Maybe you're lucky both times. But for how long?
  • #149
  • Jun 7, 2009 2:29am Jun 7, 2009 2:29am
Quoting Paris Hilton
All I'm saying is i have much better systems that are much more profitable than this one. I only checked this one for the wonderful claims that the first poster made. But after reviewing the charts it didn't hold water. At least not on the usd/jpy. Haven't checked other pairs. It's black and white. Paris
P., on which TF you visually tested (checked) and how?
(since here few approaches, just tell how you did it)
  • #150
  • Jun 7, 2009 2:44am Jun 7, 2009 2:44am
Quoting fxxx
ind. - arrows on entry points +(sl/tp lvl)
2RevBarsEntry_arr0Bar_mtf.mq4 - blinker (current close><open condition)
dem, Tony, u shold be fast with this system, demit : )))))))
---------
p.s. blinker mtf would blink on lover TFs (1,5,etc min) -same exactly as ind. on 1h tf. does (condition -curr Close><Open), - open 1h(60min) bar untill it closes (open bull/bear candle)
Hi Fxxx,

thanks for this indicator it is really usefull for backtesting, would it be hard to turn it into a EA to trade 24/5 ?

cheers
Ian
  • #151
  • Jun 7, 2009 3:14am Jun 7, 2009 3:14am
Quoting Paris Hilton
All I'm saying is i have much better systems that are much more profitable than this one. I only checked this one for the wonderful claims that the first poster made. But after reviewing the charts it didn't hold water. At least not on the usd/jpy. Haven't checked other pairs. It's black and white. Paris

No problems,

I know there are better systems available, there are bound to be. On this Forum there must be thousands. Most systems stem from someone elses workings, are tweak and distorded over time. Few are completely unique. My reference was based on something that is all too common on trading forums, and that is imput on systems that provides little benefit to those who are taking the time to trial it.

If something doesnt look good to someone then they should just bit there tongue, or make the relevant comments and move on. I have made my comments and at times used specific examples or where I feel the wording should be different (the 100K post only 2 pages back is an example). The only time something should be frowned upon heavily is when there is a genuine risk of new traders following something, or joining something that is never going to work.

All in all, longevity is a key to determining success traders and is also a way of determining successful systems. Threads that gain momentum and last past 200 plus pages with a number of people enjoying success can in the end have credit in my book, regardless of how some people percieve the short or long term success of that system.

I guess in time we will find out just how well this works out.

Also as I have mentioned, a system doesnt need to be 50%+ to be successful. If a trader can eclipse the mental barrier of just trading for 2:1 or 1:1 then s/he can unlock a door that allows huge gains of single mediocre setups. Its rare, but possible. I trade for this, just like Joel Rensink and Peter Crowns. I trade with a small group live and we have been having great success with some traders this week making over 5:1 R/R and some cases 10:1. Sometimes the setups seem simple and therefore people associate simple results, move past this and there are ample opportunities to hold singular trades for much longer than the average.

Take care, my apologies at the rashness of the previous post.

Razor
  • #152
  • Jun 7, 2009 6:02am Jun 7, 2009 6:02am
Interesting idea. However, if you look at historical data, the probabilities with hourly bars is the same as with daily bars. The chance the that the next bar is the same direction is a coin flip, with a slightly improved probability going to the expectation that the bar will go the opposite direction.
.
  • #153
  • Jun 7, 2009 6:52am Jun 7, 2009 6:52am
  •  MPP
  • Joined Jun 2007 | Status: Be yourself, everyone else is taken | 2,734 Posts
Quoting redpine
Interesting idea. However, if you look at historical data, the probabilities with hourly bars is the same as with daily bars. The chance the that the next bar is the same direction is a coin flip, with a slightly improved probability going to the expectation that the bar will go the opposite direction.
Historical data - yes when you look at each bar, very few are in the same direction - nothing new there, thats not what this method looks for.

look at the wicks - how many made it past entry plus 10/20pips before changing direction

Momentum/round numbers/fib points/ma - most traders use these and base there trading on things like this, therefore we have wicks - why, because of the buyers/sellers targets for entry and exits, this allows price to move beyond the close of the previous bar - that's why this method has potential

Richard Farleigh - taming the lion, in his book he talks about trading with the masses, when price changes by around 10% either way get on board and go with the flow - he's a dam sight richer than most and no indicators

simple as that

try it for a few months.
  • #154
  • Jun 7, 2009 11:28am Jun 7, 2009 11:28am
relevant to this (and other) threads...

(quick post as must not get caught at the computer on a Sunday afternoon...)...

...thanks for the thread, Tony Two Bars.
Attached File(s)
File Type: pdf Forex Report - Predicting Price movement.pdf   642 KB | 5,385 downloads
  • #155
  • Jun 7, 2009 12:13pm Jun 7, 2009 12:13pm
Sorry to spoil the party but this system is sure to lose all your money.
It doesn't matter if in the short-term it seems to work, automate it and you'll figure this out.
{Promotion Removed}
  • #156
  • Jun 7, 2009 1:59pm Jun 7, 2009 1:59pm
Quoting M256
Sorry to spoil the party but this system is sure to lose all your money.
It doesn't matter if in the short-term it seems to work, automate it and you'll figure this out.
some statement... what did you figured? either support it or don't spoil the air with with b/s
  • #157
  • Jun 7, 2009 4:36pm Jun 7, 2009 4:36pm
Quoting MPP
Historical data - yes when you look at each bar, very few are in the same direction - nothing new there, thats not what this method looks for.

look at the wicks - how many made it past entry plus 10/20pips before changing direction

Momentum/round numbers/fib points/ma - most traders use these and base there trading on things like this, therefore we have wicks - why, because of the buyers/sellers targets for entry and exits, this allows price to move beyond the close of the previous bar - that's why this method has potential

Richard Farleigh...
I'm sure you have something but the original poster stated 99% accuracy with just one bar.

I trade a slight variation based upon reversals and inner bars for the daily timeframe. It has a 61% win/loss over 21 pairs and makes about 1000 pips a month. In live trading real money for two month I've gotten 65% win/loss and 1900 pips in two months. The only indicator is a regression slope.

I started with DIBS which can not be validated in backtesting, but discovered a few things looking at historical data. An inner bar is more likely to reverse and the best days to close a position is either the third or fifth (probably similar results would hold for hourly bars). The second and fourth days have a greater chance of reversing, historically speaking. Oh ya another thing is the sanctity of an inner bar holds no relevance for the reverse. For a long position the inner bar breaking the lower bound of the outer bar has no importance. In fact a breakout from that pattern has a higher probability of success.

So the thing I typically do do is look at which patterns play out with this system. Have you looked at any probabilities of wicks and their impact or is this anecdotal evidence as is provided in the start?

Sorry if I came of criticizing the system but I like to start with the odds in my favor. Has anyone looked at how this would play out with a reversal of the direction in the next bar? A reversal is more likely.
.
  • #158
  • Jun 7, 2009 4:40pm Jun 7, 2009 4:40pm
Quoting jtrade
relevant to this (and other) threads...

(quick post as must not get caught at the computer on a Sunday afternoon...)...

...thanks for the thread, Tony Two Bars.
Nice info.

Thanks!
.
  • #159
  • Jun 7, 2009 5:13pm Jun 7, 2009 5:13pm
  •  MPP
  • Joined Jun 2007 | Status: Be yourself, everyone else is taken | 2,734 Posts
Quoting jtrade
relevant to this (and other) threads...

(quick post as must not get caught at the computer on a Sunday afternoon...)...

...thanks for the thread, Tony Two Bars.
geat report, i could have done with that months ago

would have saved me some time.
  • #160
  • Jun 7, 2009 5:21pm Jun 7, 2009 5:21pm
Quoting redpine
I'm sure you have something but the original poster stated 99% accuracy with just one bar.

I trade a slight variation based upon reversals and inner bars for the daily timeframe. It has a 61% win/loss over 21 pairs and makes about 1000 pips a month. In live trading real money for two month I've gotten 65% win/loss and 1900 pips in two months. The only indicator is a regression slope.

I started with DIBS which can not be validated in backtesting, but discovered a few things looking at historical data. An inner bar is more likely to reverse...
why not? mtf candles - probably only ind. can be validated in backtesting - allows see (check, follow, validate) inside of open bar - run H1 candles on 1 min tf - see if yor TP or SL been hit first
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