C4 Scalping

Hi 4xStar:

That is a myth that paves the path to ruin. What does Mark Douglas say about predicting?

I have come to believe that understanding PA, as you describe in that post, is the key to success in Forex. But this is a real challenge to learn, something that is elusive to most people. And it is why I had landed in this thread to begin with. C4 appeared at first to be a totally mechanical system, that would alleviate the need to "get a feel" for the market (PA).

Then I came to the opinion that C4 is a hybrid of the two, so I have been on a path to filter the C4 signals based upon my "feel" for PA. Have been successful for a short while.

But then FrankenPip offers his perspective that seems to be working for him, which is back to the mechanical trading again.

I think it is great that two different approaches borne from the same seed can both lead to profits.

But I am left wondering what Edge is trying to teach.

Doc

I'm not sure where you got the idea that we should take every signal .. that is while we are practicing and acquiring the skill to identify PA, apart from any indicator, and have mastered the discretionary part which may be different for everyone. Which is why he said we will have to think very hard about it. Your discretion and mine will probably differ in the end, and be different from Edge's & others .. but we all can be successfully trading this method.

For me .. as I posted awhile back, I've found that adding a simple trendline to my renko charts helps keep me out of trouble. On my C4 charts I have added 2 ma's which do the same .. mostly because I am very familiar with using them.

Edge has taught me #1 Less is more, #2 I had way too many indicators on my charts #3 I was looking at too many timeframes and #4 and most important: KEEP IT SIMPLE!!

I think in the end we will have as many different charts as there are people in this thread .. but those who perservere will be successful because once the mechanical part is mastered (through practice) the discretionary part will be whatever works best for you. And that will be revealed with practice as well.

So .. back to practicing ...

The fact that the discretion in the method does not relate to making a judgement about PA.

That the discretion relates to where price is relative to other market forces, i.e. S/R, daily ranges, etc.

This simplifies things immensely. I had been trying (somewhat successfully) to filter the C4 or Nitro signals based upon my "feel" for the strength of the PA. Something that is difficult to do.

So if the discretionary aspect of this system is only related to these other factors, things that I understand well, then great.

Doc

http://articles.mql4.com/635
Check this out...
Ea to assist scalpers, it doesn't do all the work for you, it just makes it easier and quicker to enter trades with predetermined TP & SL.

That's why I had it in quotes. You can substitute "guessing real hard with some degree of probability"

And I will oblige.

Nice give and take going on between yourself, Frank, FXStar and Glen. Several good points for each in your postings.

The 75% mental is indeed directly connected to the discretionary aspect of trading this methodology. I am aware everyone would love to have the 25/75 reversed, but that just not they way I think trading occurs.

So, let me address as many items as I can here by you four in general.

1. Demo Trading - I am not built to just throw something out there and say "Here, go trade this and enjoy your life". I deliberately put material out with the purpose of stimulating the thought process. The more a person thinks, the more they exercise the brain. The more they exercise, the stronger and better fit they become. Same as with physical conditioning.

As with Glen, I have dealt with quite a few traders over the years. My 'training' is a bit more unforgiving I fear though. I am a strong proponent of demo testing with monopoly money first.

Why?

This plan(s) are not set up to achieve a profit expectancy. Will never happen scalping. That is for swing and position traders and is a completely different trading philosophy. This material is designed to develop mental strength. By trading at the +2%/-4% goals set forth initially, you have only to apply efforts in spurts. You should trade each session on demo for as long as you can. As mentioned previously, the goal should be to focus your energy on attaining predetermined targets, and then resetting the demo platform to $10k, trading at 1 lot level, and doing it again.

If you do not have the mental discipline to do this exercise over and over again, then you will never be able to trade any real money in the Forex. If you cannot focus for a couple of hours, how can you think you will be able to focus for an entire session?

As for trading real money, if you trade 'dimes' and reach a loss point where you simply recharge the account with another $50.00 to play again, you lose! You obviously did not feel any 'pain' in trading at this level, so there is no purpose. Try it at $5-10 per pip! I will guarantee you focus on trading then. That is why I think it best to demo with the mindset of increasing mental strength. Learn to focus on a task as this is no game.

2. In the beginning, you should trade everything until 'you' are confident you can recognize a trading signal without fail. After that, you should go 'conservative' and trade only the dominant trend signals when available. If there are none, DO NOT TRADE. Again, another exercise in building mental discipline.

3. You NEVER trade above +5. NEVER, EVER, NOPE, DON'T, STOP!!!!! I'm not impressed with pip counts. For every signal you take, get to +8 and above, start patting yourself on the back and lose it in a retrace, I will have a +5 banked. DO NOT EXCEED +5.

4. You were asked to look at a big picture when trading. This entailed scanning four currency pairs. Many have said that is too much for them to handle. Well, better put your big boy pants on then. Focusing on one pair trying to get optimum setups will cause you trouble. There is NO pair that rules the market. These are different times. The EU still leads in volume, but that means nothing. The ONLY reason it leads in volume is its cost to trade factor. Period.

The reason you were provided four pairs is so you can SEE what the overall market is doing from a PA perspective. Did I ever say you HAD to trade them all? NOPE. I said they are a tool! The tool is called correlation!

With correlation in the market with these pairs, whether C4 or Nitro, you are easily able to see when they are working relatively close to each other in movement. Thus, you instantly become more attuned to watching their movement. That movement is called PRICE ACTION! That is for Mary4X also. That is how you study PA. That is how you get a 'feel' for what the market is doing. Staring at one pair hour after hour is an exercise in futility. Especially the EU.

5. C4 cannot be traded from a 100% mechanical perspective. Many have tried the ea route. ALL HAVE FAILED. LET IT GO. You cannot predict PA and candlestick are noisy enough on a 5m chart to make many nervous. There you have the 'fear' factor. Jumping the gun in or out and not adhering to the plan. Very few in this thread have not been caught in that trap.

6. Read #4 again.

7. Read # 4 once more.

8. Take a good hard look at the Nitro pairs with RENKO. Is it smooth and in correlation often? Were you provided a glimpse of Nitro? Does it not seem that C4 is a 'primer' for Nitro?

9. Once you understand how to see what the market 'big picture' is doing, does it not seem possible to take a simple set of signals, a 10 tic brick with relatively smooth PA (as compared to a 5m candlestick) and extract 5 pip from such pretty often?

10. Which plan have I been trading for some time?

11. Was C4 ever touted as a 90% plan? It is a hell of a good 'basic' trading plan that helps develop mental discipline. Problem with the thread is that so few can focus on this. How many people posting charts with C4 seem to have a good grasp of the concept and decent trading results? How many trade it in off hours? How many try for MORE than +5? Lots of mental discipline issues here still.

As such, I will not move forward with Nitro until I feel there is adequate progress made on trading with mental discipline and without whining about losses to warrant such. Sure, there are many who could trade C4 productively day in and day out. I did for quite awhile.

12. Why the search for the perfect entry? If you are looking at a big picture, it stands to reason that your entry only need be close after your triggering mechanism. You are only seeking +5. Again, read #4 once more.
Correlation in the market = MOMENTUM which when patient = +5 pretty darn often.

This is not an individual achievement course. The purpose of the thread is to work within a 'community' or group as you will. Same as the military in some fashion. You build a camaraderie with those in your 'group'. This practice has been getting some traction these last few days. I provide the tools, you folks use your brains and do the work.

Some pretty astute folks are wandering around this thread. With patience, you will do fine. Remember these concepts.

A. Discipline trading efforts each and every time you trade.

B. Focus on hitting targets, reset and repeat.

C. Find the big picture PA. Trade with it always once you are proficient in trading the basic setups.

D. Stop worrying about that damned SL. Once you get proficient, you will be able to hit +2% so often that losses will not continually cloud your minds.

E. Train your mind to trade without fear. Some here proclaim to understand probability theorem trading. Understanding the concept and practicing it are two different things. Read the pertinent chapters of the book again.

Last, I better not see another chart posted without its three compadres along side it. Win or lose the trade, we will easily be able to see the problem then.
Trade the plan as designed for a while, not like you want. And everyone need not make excuses. Just do it! Man up!!!!!!! Stop thinking it to death.

Regards.

Not quite that easy. S/R and ranges on the 5m candlestick charts are sketchy at best.

Regards.

You and me were (are) on the exact same page! I agree with you.

But Frankenpip offers a totally different approach.

I just don't know what Edge is trying to teach.

But just to be clear, this whole discussion came out of a recommendation from me several pages ago that ultimately the trader needs to have a feel for PA so the C4 or Nitro signals can be filtered. I suggested taking all trades so that the people who are learning/struggling can get a feel for PA.

Then Frankenpip chimed in and basically says that a "feel" for PA has nothing to do with the discretionary aspect of the system.

You and I are in agreement. FrankenPip is in the take all signals camp. But he just clarified not "all" signals - need to take into consideration other market factors. But I still think he says that the indicators are all that you need to measure PA.

I don't really agree with FrankenPip's view. And I think Edge is trying to teach along the lines of what we are thinking. But if he is right, and only Edge can say for sure, then I would really like to know that.

Doc

I would respectfully ask this be cleared up on the other thread. We are close to forcing integration of two trading plans here. Unfortunately, I am a segregationist with regards to trading plans.

Thanks and,

Regards.

Hi Doc:

I hope I didn't say or imply that at all. I don't use indicators on my blue line/red line train station charts. I don't need them. I use the indicators on the charts I post in this thread to stay on topic.

Yes, set your entry rules in stone, take all signals and quit when you reach your goal.

Aren't your candles color coded based upon TRIX? If so, you may not have the actual indicator on the chart, but you are using it because it is coloring your candles.

Nice post.

Helped clarify things a bit.

My assumption was that people were not making entry errors on reading the signals. Bad assumption on my part. I know how that can happen in the natural progression of learning to trade. Been there, done that! Fortunately I am past that.

And it is ironic how you clarify the role of the four correlated pairs. After trading this for several weeks I had made a mental note about how monitoring all pairs at the same time had reinforced my entry decisions. Was something I wanted to post, but had forgotten about.

Thanks,
Doc

All the focus on 'discretion' is being way overcooked.

I do not care what a daily range, or a conceptual S/R area, or a solid number, or a fib. number, or a gann fan, or a 200 EMA being crossed by a 50 WMA and interconnecting with a daily line chart with candlestick high/low split is doing.

You can put enough 'discretionary' concerns in your heads to match the number of indicators that have been tried. You still end up back to square one.

If four pairs with decent correlation are trending up, my own discretion tells me to take longs, manage the trade relatively efficiently and go after 5 pips with a good signal. Opposite is true for a short. That is the total and absolute extent of my discretionary considerations.

That covers a complete faith in my trading plan, and a solid TP goal based upon a firm belief (and practice) of probability theorem trading. That is 3/4 of the 75% discretion equation. The only thing left is about 15% intuition. That is something EVERY human has to some extent. It is also something that can be honed with time, patience and diligent practice of ONE trading methodology day after day after day, week after week after week, and month after month after month.

Regards.

Excellent post, Edge. I think in some way, shape or form, it should be on Page 1. Or maybe a link to it.

Kind regards
Pardy

Excellent!

Edge, THANKYOU for this post, it has really cleared up a lot of mental baggage for me. I will keep reading it until it's firmly planted in my mind. And sorry, I will never post another screenshot without all four pairs included.
Regards,
Matthew

Here you go... you can sell it on Ebay

That's the only indicator I use now.
In the settings you can adapt him to fit the settings in Post #1.

- It's showing the Trix, MA and Momentum as bomb
- Arrows at each trix cross (same as scalper signals) including alert.
- Buy, Sell and Wait indicator for those who need a signal service

It's a stand alone indicator... no other needed for him to work.

Pure nitro/c4 signals with no filter, no MTF... the rest is PA and your work!

A little bit like an EA without the trading.

Edge, if you want me to take it off... no problem!

Have fun guys...

Hey Edge,
Good Post
Couldn't help but think- Occam's Razor

http://en.wikipedia.org/wiki/Occam%27s_razor

Regards

Interesting as to what Edge said and has repeated several times during this learning process about the relationship of the 4 pairs.
Interesting that all 4 pairs at this time are in a "bull" mood