james16 Chart Thread

My wife is going to crack up if she catches me practicing that. Then again it won't be THE most awkward moment of our 20 yr relationship.

K.I.S.S.

hehe.... same here. I was short all the way back at the Daily Pin Bar that began the move but got out too soon.

Exit Strategy is definitely a something that is hard to perfect. Specially with so many different opinions on the subject. It's hard to make up your mind when even the experienced people disagree on it.

CkM8,
yes everyone will disagree or have different views on this.
simply because we all have different principles, personalities, circumstances, risk profiles, etc..
As it is difficult to point & get in on the exact top/bottoms for entries, the same goes for exits.
Not all our entry orders will get hit, same with take profit targets & even our stops (im sure most/all have experienced entries, targets &/or stops being missed by +/-1-10 pips).
1 way as a "work around", for exits, is taking partial profits & remaining position/s allowed to run freely to subsequent S/Rs, PPZs.

its times like this when oanda sucks!!
wots the spreads like on the other platforms right now!!??my mt4 platforms are only demos??
jon

ha i was there too! was this the one with ted nugent opening or skid row? either way i was present. great shows. i was astonished on how much i enjoyed ted's set. this may sound like blasphemy, but he may have stole the show... please don't hate me. 8-)


Hi All!
long time lurker here. I came here about a year ago linked from traderdante's thread at trade2win and can not say i have read every post here, but i have put countless hours in this thread and recognize the senior posters easily. I have learned so much here from so many. i did get sucked into the systems thread for a while and ended up back where i started. PA at significant levels. I look forward to having my discipline under control to take full advantage of the knowledge i am absorbing.

Thanks
-lowmach

Market is closed, probably not a big deal

it is my dream, if i could hold a position overnight without being stopped out. i just wonder if this could be done, so many times, i got 150 to 200 pips in the money, but, after one or two day, gone, coz the reversal wiped out what excited you. the day before yestoday, i had another one, gbpchf, 170 pips could be banked, but, yestoday, gone, it hitted my stoploss at breakeven. i am getting used to this, think, forex is maximum a one day play; but, whenever the chances come in, i still wanted to try let it run, never succeed though. i think you have a lot of correct concept, let profit run is the one. i think i need to work this out for a good runaway. thanks for sharing you have made it.

Jon,
most/all platforms are closed now.
my MT4s are demos too.
Thanks for sharing....
I have plans of of finally opening a second account with a different broker (Oanda). will check them out with a much much smaller account than my original already-too-small account.

mmm Jon actually i think Oanda its doing u a favour with those spreads LOL

Why on earth would you want to place a trade at this time on a friday??? at best price will creep going no where and u will have that position over the weekend... i don't see the point even if u have a setup.. wait till monday/sunday, then u will have more info to base your trade on, and the traders coming in for the work week.

Just a thought..

have a good one mate

MAtty

Hi Ryanmcd:

I like your concept of adding on...it makes sense...Better to nibble on the bait, and if it works out, keep adding on.... On long term trades that is...

I think I was debating with you whether or not the GBPCAD would bounce off of the 1.8245 support level (now resistance)...You were absolutely right, it basically blew right through that level (What a V reversal !!)...I hung in there and toughed it out....I'm currently up 800 pips (on 2nd half). If I kept adding on, I'd probably be up 6% on a 2% risk trade by now....as it stands, I'm up maybe 1.5%.

Anyhow, we could use you here to teach us that MM....very interesting.

I somewhat disagree with the adding on if you are scalping off a 1 hour or less though...If you can get a 1:1 and average a win rate of 7 out of 10 trades (that's the hard part) at a 2% risk each trade, you should earn 8% for each 10 trades.On a 1 hour scalp, you should be able to find 2-3 trades (if not more) per day. That can really add up over the month...

BTW, How close should I trail my stop on the GBPCAD?

Hope you reconsider your sabbatical... and keep posting here.

GregB

I agree what you said. Everyone trades this stuff their own way. If you have ever read the Dibs thread, that is all about lots of small losing/be trades and and then catching a big move with a small stop and descent position size, then adding on the pull backs to build massive trades that run for weeks on end. A few of these year makes up for all the losses and then some.

Next we look at another way of trading where you look at where price is going to next based on the local S/R based on the TF you are trading and maybe the one below. You can trade lots of setups on the higher TF's, regardless of whether price is in a range or not, as long as the nearest local S/R is minimum R:R 0.75-80. You get a high hit rate and take full profit at the S/R level.


Of course the best plan is to mix these so you can trade consolidation take quick profit and let profits run in a trend.

My current pending trade is of the second type, stop is @90 pips profit is 110.
Tac

Tac,

If one takes every DIBS break without a proper filter, then it is possible to get a lot of small losing trades with some potential big winners.

However i don't see why, with proper filters, one cannot separate A+ DIBS from B+ DIBS, similar to what is done here!

Z

I agree if you used some discretion with dibs, like maybe only take the inside long it it follows a bullish pin bar or outside bar at good location, with space to run.

You hit the nail on the head. A good understanding of price action is required.

Z

Yup! Both were there! That's the weekend that I first knew that I wanted Ted to run for president!

K.I.S.S.

It's so so true Matias.
I never put any trade on Sunday/Monday night and Friday afteroon. Brokers are fat cats anyway what's the reason to feed them more.

Your not wrong with the increasing concept at all. In a trend. I'm working on this one continuously myself.

All those knocking the set to Break Even / Take tight profit methodology.

Go back and take your grade school maths classes again. I don't want to be aggressive here, but some are 'giving out' pretty strongly on this lately...

A trader with a 90% or higher win ratio can trade differently to one using %50 and so on. Those people should stop pissing on other peoples methods because they can't find a way to have them work for them. That comes from combining the wrong elements and being inexperienced with them. You don't mix a %50 win rate with less than 1:1 R:R ratio

Ryan is correct for his style of trading. Ryan, you know that by taking "Ryan setup 1" and "Ryan setup 2" etc that you will be a winner in the long term. That over 1000 trades you will be in profit. I DO NOT DISAGREE with you on that at all. But what you do is different to a super high win-rate trader.

Jim's trading involves sniping for the trades where he knows the trade will reach point X AT THE VERY LEAST. That's SNIPING for trades. Not just "taking every trade because you know in the long run you will be ahead"
People keep glossing over the specifics when criticising his way of trading.
There are dozens of guys on here that will attest to the very high win rates you can achieve by being super picky and knowing your S/R very well. There are trades everyday where they KNOW they will make, for example, the previous bars high at the very least. ...Or a minor PPZ and so on. When you combine that with waiting for the right opportunities (by NOT trading into a PPZ that's 10 pips away, etc) you can trade in a totally different way to the often quoted "highly favourable R:R" ideology.

When people knock this other method they are always quick to point out the worse case examples, like "WHY did someone have a stop 300 points away and only take 30 pips profit??" ....That's NOT what a sniper style trader is trying to do at all. That's just where things went pair shaped. And the experienced trader wasn't shooting for JUST that 30pips. He was shooting for more, BUT he was smart enough to know to watch that possible dodgey area on the chart where his trade had a potential stumbling block. Most trades will shoot through this first stumbling block.

These criticisms are coming from people who need to re-read the first hundred pages of this thread again.

I know both ways work. I use both successfully. I use both in tandem.

A case for taking partial profits...

Two different methods, same trigger...

Method 1:
I see a bearish outside bar . I can see that I am able to shoot for a major PPZ that is 3:1 distance in relation to my stop price from entry. In this example I know that I can take 100 trades like this and have a win rate of %65-70% or so percent by shooting for that target. I risk %1 of my account on the trade.
Summary:-
3:1 risk
%65-70% chance of hitting my target.
%1 of account risked


Method 2:
I see that same bearish outside bar. I can see that the first potential trouble area is less than 1:1. But the chance of failure is only like %5 ( through the possibility of unexpected news, or a large company needing to move money quickly etc.) I have no doubt that it will make this area at the very least. That rare %5 chance of a loss is acceptable. I risk %1 of my account on this trade too.
Summary:-
Less than 1:1 risk reward. ...But I don't care. Only a rare event will stop this from hitting my first target.
%90 chance of hitting my target.
%1 of account risked

If you were combining both methods into one trade, taking half profit is totally acceptable and makes complete business sense. You are ending your method 2 trade only. Over 100 hundred trades this first half is part of a winning method.

You can go on about - "but if the trade hits your stop loss before moving positive you loose a combined %2 of your account . This doesn't make sense!! It's wrong!!!"
NO it DOES make sense. They were two totally different methods, both with positive expectancy over 100 trades.

When NOT to take partial profits...

You take profits based on what works for the method you choose for that trade. Cutting things short when the method requires you to "stick it out" upsets your overall results, of course. Your backtesting / experience tells you to risk %1 and wait for target 1 , which is 100 points away. Don't then turn around and take profit at 20 points because you got scared. THAT is the type of quick profit you SHOULD NOT take. It goes against what your method needs to be profitable. This is not the same as taking 20 points in a low reward method with high risk that IS profitable

You also do NOT mix tight profit taking and poorly chosen trades. If you are shooting for %60 percent win rate then taking tight profits all the time will kill your account if you are also letting your losers hit the full stop.
This is again where Jims methods are DIFFERENT. He hardly lets any winning trade become a loser.( ...BAM!!.... High win rate again!! Tight profits aren't as detrimental.)

When you closed your first half at the first trouble spot (or target), THAT was ok, it was for a reason that had merit.. You closed it because experience has taught you that the set up you took, over many trades, works in your favour when you do that.

If another set up you take requires a Rew:Risk of say at least 2:1 then you DON'T take profit until you hit your expected target. By doing this you expect a low percentage of winners, because not all your trades will make the target before stopping out totally. The math works out for this case as it does the others.

Adding exposure into a trend...

Overall you are adjusting your exposure to the market all the time. Adding exposure into a trend should be done when it makes business sense.

If you've taken half profit out and also moved your stop on the remainder when it hit a your first PPZ, then your overall risk as it sits now may have gone from %2 all the way down to something like %0.5. ...Possibly.

If you get a Set up that says..."This trend is continuing and it's case is just as good, if not better than my original entry conditions" then you may as well do what it takes to increase your exposure back up to that 2% by deciding where your new stop will be for the new lot and adding the equivalent lots to bring it back up to 2% again. That's 2% (TOTAL!) from your current EQUITY figure, don't risk the free gains you already have!
(If conditions have improved even further , it's up to you if you want to go to your highest exposure amounts or whatever as the trend strengthens. But only on merit!!)

Don't forget that the amount you are willing to risk should take into account the gains you have ALREADY made. If you are up %5, then having yourself exposed to the original "All stops hit" account balance of -2% is just plain dumb. The market has given you %5. Why give back %7???

...You are looking at the market and deciding which way to expose yourself at all times. Short, Long or Flat. Less short... More short ...flat. Or whatever.

All your trades are changes in exposure that are based on what you are risking verses what the reward will be. It's the same when adding into a position. What's the risk to your overall worth? And is the reward worth it?

Great post, I'm not sure if I read all of it but good stuff. i think the thing people don't realise is that how reliable these bars are if you know when to play them and where to take profit. This is why I will always think of Jim as a GOD. He has given a 95% trading method. He spent years coming up with it and shared it freely.

Love is all you need.

Hello Bundy,
Very common sense article, just reading from across the pond.
Question on adding, if I take a 2% trade in a trend which moves away, I then move stop to b/e, the price keeps moving away & then presents another good entry, perhaps above/below next s/r level. In theory I can take a 2% trade again because my first trade is at no cost? And this could be done again and again?
Regards from this Kiwi.

Sorry Bundy. I got side tracked.

Freaking awesome post brother.
Its great having you as part of the true J16 family.