Silent Service Method | Page 288 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Silent room 2 replies

Silent Success of Patience 10 replies

My silent journal 4 replies

bo7a method... method for GBP/JPY 205 replies

Seeing Through the Silent Crash 4 replies

Attachments: Silent Service Method
Exit Attachments

Silent Service Method

  • #5,741
  • Nov 12, 2009 4:11pm Nov 12, 2009 4:11pm
Quoting drebin
Hey CW: when did you start diversifying? How much capital does one need to get into equities, etc.? thanks.
There is a work around to day trading laws for Americans. If you open an account with a place like Interactive Brokers, (10k minimum deposit) you can trade foreign markets. They fall under foreign laws.....so you can day trade the Toronto Stock Exchange all you want, as an example. As a side note, there are several companies that trade on both the TSX and NYSE, so it's basically the same thing.

I personally started to diversify about 1.5 years ago. I have found there are few differences between the markets beyond liquidity and tick value. You can check either before placing a trade. (Volume is huge.....lower volume, youhave to trade higher time frames. An example would be trading Mexican Peso/Japanese Yen. You can do it - on the weekly.....but anything under that is really noisy.)

To be honest, as I diversified - I became much better at picking better trades. (More charts.....better options.)
  • #5,742
  • Nov 12, 2009 4:19pm Nov 12, 2009 4:19pm
Quoting wh1zz0
Hi guys,

Today was another good day. I trust you all caught some pips here on this golden thread. There was a nice bottom on USD/CHF (H4). Zoomed in to H1 and there was great divergence @ my face. Waited for confirmation and pulled the trigger 3 times (of course 1 unit each, 3%). Closed the first & the second half moving SL to BE (so I could sit with the last lot). Just took out the last lot now (my reason being that the trend is still down).

Attachment

Attachment

Also, just to add to what clockwork said about round...
Whizz - great trades.......1.0000 is an obvious place for a bounce, well done. Also, I like the fact that you took profits because it was against the trend.

Plus, I wonder how many of that guy's customers were watching him on the television? If you were one, would you leave money with this guy? lol

Chris
  • #5,743
  • Nov 12, 2009 4:25pm Nov 12, 2009 4:25pm
Quoting Low
Thanks for the replies and clarifications. I will check out those two sites.

And whiz.....That video?

When talking bobble heads start singing the praises of the dollar's demise, I start thinking about going long the USD and short commodities.

In the long term view, I see inflationary policies as the only possible exit aside from more catastrophic events(sovereign default?), but in the mid-term I see a good possibility of a dollar bounce for technical reasons (besides....you went long the dollar at swiss parity, pretty easy bet, eur/usd...
The thing that really concerns me is that the government is playing games with the outcome. We are subsidizing people who want to upgrade their current homes. This is ridiculous. We are offering $8,000 tax credits trying to get people to get further into debt. Also, rates are super low.....any of this sounds familiar? It should....this is what started all of this.

It is my belief this chart should probably be updated. It should go farther to the right in my opinion.

If we want to get rid of inventory: Give each veteran one of these damn houses. It could become part of their benefits package.

Chris
  • #5,744
  • Nov 12, 2009 4:35pm Nov 12, 2009 4:35pm
LOL.. Oh my, leave money with him? LOL.. DEFINITELY NOT NEVER!!!..

Those guys are paid to talk crap.. LOL


Whew!!
  • #5,745
  • Nov 12, 2009 4:45pm Nov 12, 2009 4:45pm
Quoting clockwork71
The thing that really concerns me is that the government is playing games with the outcome.
Just an opinion, but I don't agree that they're playing games with the outcome. I think they have no idea what the outcome will be, and are pulling levers and pushing buttons in hopes of something actually working.

Historically, every financial crises experienced has been unique, not lending itself to future projections easily.

For instance, our conditions may be similar to the great depression, but it was exacerbated by dust-bowl, which obliterated not only a substantial part of our food supply, but all the jobs, debts, and various other transactions that part of the economy generated, compounding the problem.

Since the governments answer to everything is "throw somebody elses money at the problem", it's fair to assume inflation will be the preferred tool, yet in the end I believe all the big brains in DC will be as surprised at the outcome as anybody else.
  • #5,746
  • Nov 12, 2009 4:46pm Nov 12, 2009 4:46pm
I promise....I'll post something about FX next time>LOL.
  • #5,747
  • Nov 12, 2009 6:48pm Nov 12, 2009 6:48pm
Quoting Low
Just an opinion, but I don't agree that they're playing games with the outcome. I think they have no idea what the outcome will be, and are pulling levers and pushing buttons in hopes of something actually working.

Historically, every financial crises experienced has been unique, not lending itself to future projections easily.

For instance, our conditions may be similar to the great depression, but it was exacerbated by dust-bowl, which obliterated not only a substantial part of our food supply, but all the jobs, debts, and various other transactions...

Fair enough. But the response has been pathetic. I don't mean only housing, but everything in response to the "meltdown". One thing that seems to be missing: Nobody has been bothered to take the losses.

We bail out homeowners, we bail out banks, we bail out AIG, we bail out GM, and we will do it again.

Maybe that's a little closer to my problem. I live in Ohio, and there are a ton of auto suppliers here that rely on GM and Honda. GM was bailed out to protect jobs. Ok great, now who's going to buy the products? I am positive we will bail them out again. If they can't keep up - let 'em fall.

It's not like we wouldn't be able to buy automobiles if GM disappeared. I am pretty sure Ford would be willing to sell us one.

Chris
  • #5,748
  • Nov 12, 2009 7:30pm Nov 12, 2009 7:30pm
Thanks everyone for your response to my diversifying question.

CW, agreed about the bailouts, etc.

Forex, from my perspective has been really slow for a few weeks.
  • #5,749
  • Nov 12, 2009 9:26pm Nov 12, 2009 9:26pm
Quoting clockwork71
Fair enough. But the response has been pathetic. I don't mean only housing, but everything in response to the "meltdown". One thing that seems to be missing: Nobody has been bothered to take the losses.

On those points we don't disagree at all. Sadder still, this was Chrysler's second chance to pillage the public (not to mention who owns Chrysler), then there's Amtrak.....Lockheed in the 70's.....and a bunch more banks throughout the last 30 years.

If this "plunder-by-failure-and-ineptitude" paradigm was going to change, it would've by now. It's safe to assume something similar will happen in 10 or so years, once this noise has died down.
  • #5,750
  • Nov 12, 2009 9:55pm Nov 12, 2009 9:55pm
Just something I like to keep my eye on.

http://i38.tinypic.com/ogb6vt.png
  • #5,751
  • Nov 12, 2009 11:24pm Nov 12, 2009 11:24pm
Quoting Low
Just something I like to keep my eye on.
I agree, something to keep an eye on. However what caught my eye even more than the dow was the failure on the S&P, after hitting about 1105, it's fallen right back down and if we close lower tomorrow we'll have a very interesting looking bar for the S&P weekly.

Then again, every "buy the dip" player has done well in this rally, so we'll see what tomorrow brings and how the bar actually closes. And of course your Dow chart has a nice confluence to the 50% fibo retrace, the SPX has a little ways to go before it's there...
  • #5,752
  • Nov 13, 2009 7:37am Nov 13, 2009 7:37am
Finally reached a milestone in my trading career:

I managed to finish reading the first 100 pages of this thread.
Only 284 to go

The quality of your life is brought about by the quality of your thinking.
  • #5,753
  • Nov 13, 2009 8:34am Nov 13, 2009 8:34am
I drew these S&R lines using the line chart, this is how they look on a bar chart and a line chart. Do you think this a feasible way to spot PPZ ?
Attached Image(s) (click to enlarge)
Click to Enlarge Name: eu weekly.gif Size: 16 KB
Click to Enlarge Name: eu weekly line.gif Size: 11 KB
The quality of your life is brought about by the quality of your thinking.
  • #5,754
  • Nov 13, 2009 9:25am Nov 13, 2009 9:25am
Quoting hornet
I drew these S&R lines using the line chart, this is how they look on a bar chart and a line chart. Do you think this a feasible way to spot PPZ ?
Te biggest difference is that line charts only show closing prices at a given point, but to be honest, I think it can pretty much be done either way.

I do favor bars though, mainly because sometimes you get a really long wick on a bar that a line chart might not show.
  • #5,755
  • Nov 13, 2009 5:29pm Nov 13, 2009 5:29pm
Quick question - I'm only up to page 182 so forgive me if this has already been covered: I've been studying this method of trading for quite some time from various books, the web (james16, pring, personal testing etc etc) and quite agree that S/R does not occur to the pip but rather in zones.
W.r.t trading this method and similar ones I've always had my doubts about PA itself and recently started a thread over at T2W about it. To my mind it is ALWAYS the level that is important, followed by trade management and money management the shape of an entry bar much less so but even so, it still demands attention.

I've pretty much convinced myself under test conditions from about 500 discretionary entries that playing a good breakout from a zone on the 4hr with an appropriate stop size is enough to be profitable (last test on cable yielded 80% account increase over 66 trades with an average risk of 3%, win/loss ratio was very high with a maximum of 3 losers in a row...plugging the same numbers into monte carlo showed that only in 1 circumstance would the account be down after 66 trades and up in all other instances, the best case being 350% up, max drawdown in the 80% case was, from memory, 22%).

Still, there is always room for improvement and PA 'should' help here, however when trading a zone rather than a level things become a little less clear. Say we are expecting a retrace to a certain zone that is perhaps 300 pips wide, as a lot of them are as we see more reactions to a zone as the years pass. Where exactly are we expecting to see PA within that zone? I've seen too many pin bars, OBs etc which when they first appear seem to be excellent with no congestion ahead fail completely with price continuing past or continuing past then come back. Because we aren't looking for an exact price we have no way of knowing where we should be looking for PA entries and where, in the case of a pin, where stops are being tested will occur with 300 pips.

So the question is, I guess, are we looking for some kind of PA and then waiting for a breakout of the zone before entering or are we really just entering at random?

Hmm...not so quick a question but I hope a relevent one?
  • #5,756
  • Nov 13, 2009 5:42pm Nov 13, 2009 5:42pm
Quoting aserbfx
sm7 on weekly.
15 euro will be the next challenge.
last three daily bullish bars "caused" the outbreak.
that is how it goes:
Attached Image (click to enlarge)
Click to Enlarge Name: sm72.png Size: 16 KB
meine augen sind die sterne
  • #5,757
  • Nov 13, 2009 6:01pm Nov 13, 2009 6:01pm
Quoting clockwork71
Trade I am in at the moment.....stops at b/e. Not a huge trade, but it beats watching paint dry.....which I do quite often. Again, real live charts.
Chris:

Curious about what your stop-loss was initially on this Mini-Gold Trade after your entry at 1101? I.e. how much room did you give it to run?
  • #5,758
  • Nov 13, 2009 10:36pm Nov 13, 2009 10:36pm
Quoting InfinitySL
Chris:

Curious about what your stop-loss was initially on this Mini-Gold Trade after your entry at 1101? I.e. how much room did you give it to run?

If memory serves me correctly, 1098....about $3. That would be about $100 in real terms.
  • #5,759
  • Nov 13, 2009 10:49pm Nov 13, 2009 10:49pm
Quoting nunrgguy
Quick question - I'm only up to page 182 so forgive me if this has already been covered: I've been studying this method of trading for quite some time from various books, the web (james16, pring, personal testing etc etc) and quite agree that S/R does not occur to the pip but rather in zones.
W.r.t trading this method and similar ones I've always had my doubts about PA itself and recently started a thread over at T2W about it. To my mind it is ALWAYS the level that is important, followed by trade management and money management the shape of an...
Ok, I will try to answer this clearly. It's kind of asking what the difference between a harmonic minor scale and a Hungarian harmonic minor is to the ear....it's not much, it's hard to describe, but it is different.

First, let's look at what's important in my opinion:

 

  1. S/R areas
  2. Round numbers
  3. Price Action Bars

You are correct - it can be done without P.A., and in fact....I have even tested it. In my opinion, if you go with the trend, and look to buy at support in an up trending market.....well - that's enough to make money.

I see in your post something I once fought with. (I could be wrong, but I think I see this anyway.) I think you are making it way too complicated. So the question then becomes WHY? It's almost always the same thing: Fear of loss. I say this because normally over thinking this is because we are looking for that "sure-fire" way to trade. It doesn't exist. I'm not giving you a hard time, just suggesting you ask yourself that question.....

One of the greatest philosophers to ever live once said "Free your mind, and your ass will follow."

One answer to your questions is that I tend to put my stops behind a round number no matter what. Why you ask??? Because it gives me double protection. It might be the bottom of a pinbar AND under a handle as well. Sure....you and I both know the difference between 1.4990 and 1.5000 is only ten pips - but there is almost always some kind of reaction to those fat round numbers.....

The idea is make the market take a bunch of people out before me. ("I'm not going out alone.....some of you are dying with me.")

The bar itself, well....it just shows the reaction to an attempt on a S/R area. It's more of a visual clue. In my forum, I have examples of 2-3-4 bar combinations and what they mean. They almost always mean the same thing, but it might be over 12 hours instead of 4 or 24.....but really: What's the difference? A rejection of price at a specific point is just as valid if it is over the course of 3 hours as 16.

I hope I answered something, and didn't just confuse you more. lol.

Chris

  • #5,760
  • Nov 14, 2009 1:09am Nov 14, 2009 1:09am
Chris, I was wondering what your take on this is.

I just finished rereading Nicholas Darvas' How I made 2,000,000 in the Stock Market and it struck me, again, that one's odds of winning are much better buying a stock that is already going up instead of trying to buy it cheap. It just seems that this goes so much against human nature as we all want to get a "good deal," and that means trying to buy at the bottom, but there seems to be no better way to lose money than to try to do so. Last winter the number one stock on a fundamentals scan I was running was NVE Corp (NVEC), a nano tech company. I had read an article in the local paper about it, a local company in Minnesota, and started watching it. It sank down to around 20.00 and I wanted to buy it but could not bring myself to do so. I then watched it reverse course and begin to rise. I sat there on my hands as this stock went from 20.00 all the way up past 60.00, kicking myself the entire time. Because I had not been able to buy it "cheap" and did not want to buy it "dear" and see it fall, I sat there like a stump. I realize now that I need to conquer my "need" to buy cheap, and instead change my nature to the point where I only buy stocks that are "no longer cheap," and are looking like they should get more expensive. Darvas wrote that there is no reason to sell a stock that is rising. Well, the corollary is obviously that there is no reason to buy a stock that is falling. So I am going to develop a system that incorporates these ideas, only buying once there has been a reversal pattern, e.g., head and shoulders, double and triple bottoms, and the stock moves up to the next level. If it falls back down, so be it, can't win all the time, which is another thing I/we all need to take to heart in order to win at this.

It also seems that Darvas' box system is really just a breakout system where the stock is bought as it bursts through overhead resistance on higher volume, and the stop loss is placed just under this resistance. I have always been leary of breakout systems due to false breakouts. I believe, though, that rising volume puts the odds more in my favor. Some believe waiting for the breakout, and then a retrace to the S/R that was just broken, is the best way, but too many times I see stocks breakout and never again get close to that S/R line. Anyway, I am going to test this in my practice account and see how it goes.

On a totally unrelated note, what are folks' favorite screening programs/sites? I use stockfetcher and really like it as it has all manner of technical screens you can use/write, and its not too spendy either.
7 traders viewing now