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4H Breakout With Custom Stop Loss

  • #141
  • Sep 26, 2009 10:23am Sep 26, 2009 10:23am
Hi Pharoah

Thanks for posting this, am about to add it to my Ace system.

One question, you state that your system works on any ???/JPY pairs, but works best on GBP/JPY and EUR/JPY - (first post).

Has anyone tried on other pairs?
Should work fine?

Thanks
  • #142
  • Sep 26, 2009 11:39am Sep 26, 2009 11:39am
Quoting macman
Hi Pharoah

Thanks for posting this, am about to add it to my Ace system.

One question, you state that your system works on any ???/JPY pairs, but works best on GBP/JPY and EUR/JPY - (first post).

Has anyone tried on other pairs?
Should work fine?

Thanks
Last week, I tried this system with 5 pairs, and even the most ranged of almost all pairs (EURGBP) was still in profit, I would actually test it out on other pairs but I simply don't have the time. I will have detailed backtesting on every pair to draw my final conclusion in hopefully sooner than later.
  • #143
  • Sep 26, 2009 11:53am Sep 26, 2009 11:53am
Hello Pharoah. How does the stop system fare in the difficult 2005 year when this method did not do so well.
  • #144
  • Sep 26, 2009 12:11pm Sep 26, 2009 12:11pm
Quoting davewooldrid
Hello Pharoah. How does the stop system fare in the difficult 2005 year when this method did not do so well.
Because the system is designed to cut losses before they accumulate to any devastating amount (1 100% box size can blow an account if the box is big enough) Theoretically, it would have survived, as stated in previous posts, I do not and will not be providing data for 2008 on, instead, I am going to be providing data from 2001 and on. This will be provided when the development of my EA start moving again (near a month into programming and alot of features still not implemented). Which means, I may be in the market for a programmer to complete my code (this is a private not for release autotrading EA to extensively backtest this manual system so yes, I am expecting there to be a fee).
  • #145
  • Sep 26, 2009 10:50pm Sep 26, 2009 10:50pm
Pharoah . . . your rules for both Condition 1 & 2 always refer to what happens based on the position of BOTH the Red MA and Black MA when a trade occurs.

For example, the Short trade rule for Condition 1 is:

 Sell: If a sell occurs and both the RED MA and the BLACK MA are above the Low (not including buffer) of the first 4H bar of the week.

My question is this . . . for either condition, and for either a Sell or Buy, what happens if BOTH the Red MA and the Black MA are not in sequence i.e. one is above the Low and the other below the Low, for example, in the event of a Condition 1 Sell?
Greetings from Guanajuato, Mexico
  • #146
  • Sep 26, 2009 11:27pm Sep 26, 2009 11:27pm
Pharoah . . . when you refer to the "Breakout Zone" in the rules, are you referring to the 4H Box excluding the buffer? If not, what does it refer to?
Greetings from Guanajuato, Mexico
  • #147
  • Edited 12:43am Sep 27, 2009 12:33am | Edited 12:43am
Quoting yen44x
Pharoah . . . when you refer to the "Breakout Zone" in the rules, are you referring to the 4H Box excluding the buffer? If not, what does it refer to?
Breakout zone is the area including buffer.

Also, think about the rules this way, when a trade is executed. Follow the Red MA if you can, if not, use the trailing stop.

Later on if the trailing stop crosses over the red MA before it crosses over Break Even, set the stoploss to follow the Red MA, otherwise follow the next set of conditions.

If the black MA is inside the breakout zone when the trailing stop passes over it, continue to follow the trailing stop until Break Even, then when Black MA passes BE, follow that.

If the trailing stop crosses the break even point before crossing the black MA, follow the trailing stop until it passes the black MA, afterwich follow the black MA on.

Also, if someone has a EA that closes half a position at a certain point, if they could post it as it is a vital part of this system for those who may not have time all the time to close out that half position at TP1
  • #148
  • Sep 27, 2009 12:49am Sep 27, 2009 12:49am
Quoting Pharoah
Breakout zone is the area including buffer.

Also, think about the rules this way, when a trade is executed. Follow the Red MA if you can, if not, use the trailing stop.

Later on if the trailing stop crosses over the red MA before it crosses over Break Even, set the stoploss to follow the Red MA, otherwise follow the next set of conditions.

If the black MA is inside the breakout zone when the trailing stop passes over it, continue to follow the trailing stop until Break Even, then when Black MA passes BE, follow that.

If the trailing stop crosses...
OK, thanks. So, if I'm following correctly, the rules for Condition 1 & 2 Stop Losses are based on the first 4H candle of the week, but EXCLUDE the buffer. The basis for determining the size of the trailing stop, on the other hand, is based on the traditional 4H Box which INCLUDES the buffer.

Is that correct, or am I still wandering aimlessly in the dark?
Greetings from Guanajuato, Mexico
  • #149
  • Sep 27, 2009 1:38am Sep 27, 2009 1:38am
Quoting Pharoah
If the trailing stop crosses the break even point before crossing the black MA, follow the trailing stop until it passes the black MA, afterwich follow the black MA on.
Was this part of your original rules? If it wasn't, are there any other rules you would recommend that were not included in post #1?

Sorry for all the questions . . . I'm trying to get all this to click before the start of the new trading week.
Greetings from Guanajuato, Mexico
  • #150
  • Sep 27, 2009 1:57am Sep 27, 2009 1:57am
Quoting yen44x
OK, thanks. So, if I'm following correctly, the rules for Condition 1 & 2 Stop Losses are based on the first 4H candle of the week, but EXCLUDE the buffer. The basis for determining the size of the trailing stop, on the other hand, is based on the traditional 4H Box which INCLUDES the buffer.

Is that correct, or am I still wandering aimlessly in the dark?
exactly right. To determine which stoploss variation of the 2 to follow, if the Red MA is inside the BAR that forms the box or farther from the entry, use rules 1, if the Red MA is inside the buffer zone or closer to entry, use conditionals 2.

And no, I don't think this was part of the original rules, I will include it in the proper place in post 1, thanks for pointing that out for me.
  • #151
  • Sep 27, 2009 4:52am Sep 27, 2009 4:52am
Quoting Pharoah
exactly right. To determine which stoploss variation of the 2 to follow, if the Red MA is inside the BAR that forms the box or farther from the entry, use rules 1, if the Red MA is inside the buffer zone or closer to entry, use conditionals 2.

And no, I don't think this was part of the original rules, I will include it in the proper place in post 1, thanks for pointing that out for me.

yes, it would be nice to have these rules all in one place and with simple explanation. Pharoah, are those simple MAs you use for determining stop loss?
next Sunday i hopefully set limit orders again if i will be back on time but tonight i will be watching using different strategy. i am watching to enter gbp/jpy short... it looks like probability of further downside is great, but i think we might have some retracement. would be nice to see it retrace back to 148.00
  • #152
  • Edited 7:57am Sep 27, 2009 7:24am | Edited 7:57am
Pharoah . . . thanks for the feedback. I was also referring to this part of your response in post #147:

"If the trailing stop crosses the break even point before crossing the black MA, follow the trailing stop until it passes the black MA, afterwich follow the black MA on."

Was that part of your original rules, because I don't see that stated in the first post. Thanks.
Greetings from Guanajuato, Mexico
  • #153
  • Sep 27, 2009 10:09am Sep 27, 2009 10:09am
Hi Pharoah,

Thank you for sharing this new system. To be frank I am still not fully understand how to use it. I am a newbie,may ask funny questions along the way,pls pardon me for that and hopefully I can start to use the system soonest.

Thanks again.
  • #154
  • Sep 27, 2009 11:20am Sep 27, 2009 11:20am
Quoting shiko
yes, it would be nice to have these rules all in one place and with simple explanation. Pharoah, are those simple MAs you use for determining stop loss?
next Sunday i hopefully set limit orders again if i will be back on time but tonight i will be watching using different strategy. i am watching to enter gbp/jpy short... it looks like probability of further downside is great, but i think we might have some retracement. would be nice to see it retrace back to 148.00

No, the MA's are not simple, they are smooth.
  • #155
  • Sep 27, 2009 11:20am Sep 27, 2009 11:20am
Quoting yen44x
Pharoah . . . thanks for the feedback. I was also referring to this part of your response in post #147:

"If the trailing stop crosses the break even point before crossing the black MA, follow the trailing stop until it passes the black MA, afterwich follow the black MA on."

Was that part of your original rules, because I don't see that stated in the first post. Thanks.
That's what I was talking about, it has been added to the original post as of last night.
  • #156
  • Sep 27, 2009 11:51am Sep 27, 2009 11:51am
Quoting fxann
Hi Pharoah,

Thank you for sharing this new system. To be frank I am still not fully understand how to use it. I am a newbie,may ask funny questions along the way,pls pardon me for that and hopefully I can start to use the system soonest.

Thanks again.
Because there are conditions to the conditions, I am having a hard time explaining it, please read the first post.

The Red MA is only a Break Even MA, you ONLY follow this MA for stoploss until it hits Break Even. if you can't use the Red MA as a stoploss because it is located in the profit zone on trade execution, use a trailing stop of 50% breakout zone

The Black MA is only used for a take profit (even tho it acts like a stoploss)

I just woke up, and don't really have time to wade through my thoughts to properly write the system on paper.

Not to mention, I'm not sure I can be any more detailed in my system, I've laid it out (except that one part that yen pointed out, thanks) in full, explaining everything there is, maybe it's because there are conditionals to conditionals, and people are confusing them as individual conditions, when it's a condition based on this condition.


There are ONLY 2 conditions to consider when entering to determine what stoploss you are using

Question to ask yourself when entering a trade
"Is the red MA in the buffer zone or profit zone?"

If the answer is no, it is not, set the stoploss of this order to = the red MA.

If the answer is yes, set a trailing stop of 50% box size.

Question to ask yourself after in the trade
"Is it using the Red MA for a stoploss?"

If the answer is yes, follow condition 1 rules from Red MA on

If the answer is no, follow conditiona 2 rules from Trailing Stop on

Question to ask yourself a little later
"Has the Trailing Stop crossed the Red MA before crossing the Break Even?

If the answer is yes, adjust the stoploss to the Red MA, and continue following condition rules 1 from red MA on.

If the answer is no, ask yourself the next question

Question to ask yourself
"Has the trailing stop crossed the Break Even before crossing the Black MA?"

If the answer is yes, keep the trailing stop going until it does cross the Black MA, then follow condition 1 rules from black MA on.

If the answer is no, adjust to Break Even, and continue condition rules 1 from break even on.

I hope this "play by play" explain the system better.
  • #157
  • Sep 27, 2009 2:43pm Sep 27, 2009 2:43pm
Quoting Pharoah
That's what I was talking about, it has been added to the original post as of last night.
Thanks . . . I noticed that once the second cup of coffee kicked in.
Greetings from Guanajuato, Mexico
  • #158
  • Sep 27, 2009 2:47pm Sep 27, 2009 2:47pm
Quoting yen44x
Thanks . . . I noticed that once the second cup of coffee kicked in.
Omg... we have a energenticless yen, everyone, pinch yourself and make sure this is no dream rofl
  • #159
  • Sep 27, 2009 2:50pm Sep 27, 2009 2:50pm
Quoting Pharoah
Omg... we have a energenticless yen, everyone, pinch yourself and make sure this is no dream rofl
Yeah, everyone, pinch yourself . . . in fact, do it twice. It's kind of nice to know I can be responsible for bringing pain to people around the world (other than my jokes, of course, which bring a different sort of pain).
Greetings from Guanajuato, Mexico
  • #160
  • Sep 27, 2009 2:53pm Sep 27, 2009 2:53pm
Quoting Pharoah
I just woke up, and don't really have time to wade through my thoughts to properly write the system on paper.
Hey, no wonder you have energy and I don't . . . your post arrived just before noon and you "just woke up" . . . I've got a 5-hour headstart on you (of course, I need it to keep up with the young bucks).
Greetings from Guanajuato, Mexico
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