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The Dance

  • #361
  • Mar 30, 2010 3:01am Mar 30, 2010 3:01am
Hi eclayf,

Thanks for this thread eclayf, whenever i get dishearten by a loss in trading and think about giving up trading forex.. i just go through your thread and read your amazing and motivating posts..and i immediately get confidence back and it gives me power to try one more time.. Surely i wont give up.

thanks again.. keep up the good work.
Anything is possible; everything is negotiable
  • #362
  • Edited 11:14am Mar 30, 2010 10:21am | Edited 11:14am

Took this trade a while ago. A stormer and no good reason to exit yet. I saw that the 5/10 MA lines were steep and that PA had made a clean break through the 35 and 50 MA's on H1. There were only shorts to be taken here and then a big blue bar rocketed up long. I could see that the pink MA (10 ema) and the dotted blue MA (this is the 50 MA from H1 a 200 MA on M15) were just above the xx.500 line. I was therefore preparing myself for the bar to not quite hit the MA lines but bounce off this level, only a tiny fraction before them. That's exactly how it played out so I entered at the touch of the psych line rather than the MA's but it was as good as an MA touch tbh.

To add on, i've kept one eye on the trade and have just taken 50 pips at the xx.00 RN. Only 10 pips SL on this


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  • #363
  • Mar 30, 2010 10:29am Mar 30, 2010 10:29am
Thanks for your help with the image posting eclayf.

I think it worked, I had to edit the post and repost it as the first one went a bit mad.

Don't know why it's so fuzzy though.....
  • #364
  • Mar 30, 2010 11:33am Mar 30, 2010 11:33am
Quoting EurekaForex
...whenever i get dishearten by a loss in trading and think about giving up trading forex.. i just go through your thread and read your amazing and motivating posts..and i immediately get confidence back and it gives me power to try one more time..
Hi EurekaForex, trading is a lonely business most of the time and it's easy to get discouraged. If you can stay encouraged, and keep working at it, YOU WILL get there and you WILL be successful. The main secret is persistence and as the image on each post says, NEVER GIVE UP! You do that, you WILL get there. May not get there as fast as another or with as huge a profit as another, but you WILL get there.

Once you do, the ONLY limit is what you believe you can achieve.

Keep it up and good work sticking with it.


Quoting Trotty
... To add on, I've kept one eye on the trade and have just taken 50 pips at the xx.00 RN. Only 10 pips SL on this...
Good trade Trotty. I see you put the Bollinger Bands on the chart. They really don't add much but more complexity. Be careful with them.

Still, if you are at +50, then the R:R on this one was at least !:5 so far. My trade last night ended up at a R:R of only about 1:4.5 or so, but it was a really good trade.

These are the reasons I love this strategy. Very low SL settings, with translates into very, very strong R:R on the trades.

Quoting Trotty
...Don't know why it's so fuzzy though.....
Not fuzzy when I bring it up to look at. SOMETIMES that happens though, but you can adjust the settings in most of the capture programs to increase the resolution a bit. That might help.

Good trading to you all,,,,
  • #365
  • Mar 30, 2010 11:39am Mar 30, 2010 11:39am
Quoting eclayf
Good trade Trotty. I see you put the Bollinger Bands on the chart....
Thanks again mate.

Don't worry about the BB's, they are on there for another reason, i'll make sure they're off the next chart to keep it all clean.

Loving the strat
  • #366
  • Mar 30, 2010 2:55pm Mar 30, 2010 2:55pm
Hi Clay,


I can't remember wether you replied to this question already or not (if you done already then please let me know the post number).

I can see you have several extra moving averages in your chart now. Which are MA 120 , 200, 960. Could you elaborate on how we can use these with the system. I suppose its the same way we using other MA's.


God Bless

Suranga
  • #367
  • Mar 30, 2010 5:43pm Mar 30, 2010 5:43pm
Quoting Suranga2500
Hi Clay,.......I can see you have several extra moving averages in your chart now. Which are MA 120 , 200, 960..........Suranga
Hi Suranga, I have only added two for experimentation, the 140 SMA, and the 200 EMA which are the H1 equivalents on M15. I still use the same three chart basic setup, but am experimenting a bit with using the equivalents on M15 so I can learn to "see" H1 a bit clearer and not miss some of the entries that I have missed that are also very powerful entries.

I AM NOT recommending that yet, but feel free to add those TWO if you want to. There are no other lines on my charts, BUT IF there are lines on SOMEONE ELSE"S chart and I comment on it, I normally just take a screen capture of their chart, or download it, make the comments and re-post THEIR chart.

THIS IS WHAT I MEAN WHEN I ASK THAT NO ONE USE ANY OTHER INDICATORS! It gets confusing.

If I continue to get people who are confused by this, I will have to start enforcing that rule pretty strictly, so for the rest, PLEASE, either setup another profile with the basic setup so you can capture images off that or take the additional indicators OFF before you post the charts.

Trading is difficult enough without adding confusion for others to sort through. Everyone has been doing really well sticking to the basics, and I really appreciate it and I am sure those trying to learn do as well.

I think everyone can tell from the tenor of all my posts that I am NOT a harsh person, but if this becomes an issue, I won't have any choice but to enforce that rule of "NO other indicators."

Thank you for the post for clarification Suranga.
  • #368
  • Mar 30, 2010 5:44pm Mar 30, 2010 5:44pm
Quoting Trotty
Don't worry about the BB's, they are on there for another reason, i'll make sure they're off the next chart to keep it all clean.
THANK YOU Trotty, I really appreciate it and so will others who are trying to learn this. Keep up the good work guy, and the posts.

God bless
  • #369
  • Mar 31, 2010 1:14am Mar 31, 2010 1:14am
Hi Clay,

Thank you very much for the reply. It apears I wind you up little bit on that issue. We can see how hard you trying to keep this thread cleaner without confusion. My salute to you Sir.

Suranga
  • #370
  • Mar 31, 2010 1:19am Mar 31, 2010 1:19am
Quoting Suranga2500
... It apears I wind you up little bit on that issue.
Nah, I don't get "wound up" anymore. Used to. Just needed to re-enforce the issue and your post was a great example of how easy it is for a thread to get confusing. VERY common problem in FF, unfortunately.
  • #371
  • Edited 2:07am Mar 31, 2010 1:41am | Edited 2:07am
Hi all,
Here is my 30 pip daily target achieved in one trade.
1. Took touch trade of the confluence of 1hr 35 and round number (not to confuse people but I felt even better when the Daily Pivot was also in the same area).
2. Target was my Daily dose of 30 pips which was also confluence on 15min 10/35/50 (triple confluence) and 5min 35/50 confluence.


Kostas

P.S.1 The red MA in the 1hr chart is 62 EMA that I found to work many times but please ignore for now.

P.S.2 Update on my no negative day streak: Still going strong at 15 positive days in a row. My MM plan is now at 0.1 lots (30-45 pips per day) but the plan calls for moving to 0.2 lots in a few days. See how that goes....

P.S.3 (Edited later): Actually now that I look again, if I was quick in thinking my target could be used for a reverse entry trade (short) as a touch trade on the 15min and on the 5 min (Clay could you comment on this?)
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  • #372
  • Edited 3:49am Mar 31, 2010 3:38am | Edited 3:49am
Quoting kostas1
Hi all, Here is my 30 pip daily target achieved in one trade.
Congratulations on a good entry and on nailing your daily target in one bar. Not bad, and these pairs often move +30 pips or more in one bar. Part of why we use them.

Quoting kostas1
P.S.2 Update on my no negative day streak: Still going strong at 15 positive days in a row. My MM plan is now at 0.1 lots (30-45 pips per day) but the plan calls for moving to 0.2 lots in a few days. See how that goes....
This is awesome news. Especially from a guy who was pretty close to throwing in the towel a few weeks back. KEEP UP THE GOOD WORK!

And, having a "plan" to increase your trade size consistently and gradually is a really, really, really great way to trade. For everyone else, there is an Excel file in the "tools" Zip on page one that will help you see what Kostas is talking about. Just open it and look at it. May be different from what Kostas is doing, but it's a good start at MM.

Quoting kostas1
P.S.3 (Edited later): Actually now that I look again, if I was quick in thinking my target could be used for a reverse entry trade (short) as a touch trade on the 15min and on the 5 min (Clay could you comment on this?)
I'm not a fan of taking immediate reverse trades ESPECIALLY NOT on M5 signals. M5 is OK, but there is a reason I took it out of the Strategy. The signals on M5 are not even close in strength to M15. If it works for you, that's fine, but I recommend against it and ONLY using M5 as a way to "fine tune" an entry BACK INTO THE TREND of the moment, and sometimes, but rarely as a way to fine tune an exit around a strong S/R level.
  • #373
  • Mar 31, 2010 3:48am Mar 31, 2010 3:48am
I made a bad entry, which I am showing here because of the analysis that goes with it and then flubbed the strongest entry, had to fine tune my entry after I missed the strong one, but made BACK ALL my pips plus some and still ended positive in the account today.

What I am going to say next will sound wild, but I did this with THIS strategy and THESE trades I have posted even WITH a few bad trades over the past 3 or 4 days of trading with LITTLE time to trade because of life issues.

I have gained approximately 56% in the account over the past 4 days of trading, during a sideways market, in consolidation, with precious few good signals.

You have seen what Kostas1 is doing, and there are others doing similar. The Strategy is very, very solid as long as you stick to the basics and focus on mastering the three MAIN TRADES.

Getting fancy is NOT the answer. Finding MORE entries is NOT the answer. FOCUS, PATIENCE, and mastering those three simple signals IS the answer.

One can easily earn a pretty consistent 2% to 6% PER DAY mastering the simplicity of this AND learn to have a life on top of that. THE GOAL is wealth, NOT huge numbers of pips or entries.

SO, ask yourself, is it worth it to be patient, master something extremely simple and learn to create true wealth, or is it more important to find the largest number of alternative entry strategies and try to gain the largest number of pips? The choice really IS yours to make.

Here is the series of charts from my last trade, and yes, it is the very next trade I made since yesterday's post.
Attached Images
  • #374
  • Mar 31, 2010 7:01am Mar 31, 2010 7:01am
Often, in PM I get messages that I reply to and once in a while I find something I think would benefit the thread. I posted one of dogfight's posts before, and I don't think he would mind this one being posted in part here, so here goes.

The first part I deleted as not relevant to this post because it talks of some charts he had me look at. It is the part starting with a quote from me in his post back to me that is where I want to start.

He was asking about using other Moving averages. The dots indicate areas I deleted as not really relevant here.

Quoting dogfight
...

Quoting eclayf
Which MA IS NOT the answer, the ANGLE of it IS!
Exactly! It is precisely this reason that I have implemented a more stringent rule in determining the trend, of which I have not shared, it is as messy as it can be now. And it is also due to this underlying reason that I have adopted your strategy.

OK back to the main topic.
The main point of this PM is to discuss

-Assuming all other entry conditions are met, i.e. 2 retrace bars, s/l of 11 pips, steep angle---- on a 2bar retrace to 10ema, there may be 2 scenarios


1) bar touches line, moves away and closes away from line

2) bar touches line, closes on the line.

The question is: Which has a higher probability? Why?
...
Here dogfight is struggling with how to determine if the way a candle ends at or near the 10 EMA makes a difference in the strength of the following trade.

Quoting dogfight
The reason that I PM-ed you is that it....
His strategy he is trying to implement.

Quoting dogfight
... is different from 'The Dance', although the framework is about there. .... but due to my personal inability I am unable to follow some strategies other than the 5/10ema touches.

Quoting eclayf
The SIMPLER you keep it the MORE successful you will be
That's precisely why I prefer to trade the 2bar retrace touches and nothing else!

I removed 35sma, and the 50/60ema
On his chart linked to in this next part. Feel free to look at it. BUT don't start discussing it here. PM him if you want to discuss his stuff further.

Quoting dogfight
...In essence, what I am trying to do while demo-ing is to make things even simpler, but at the same time look for ways to make my entries more stringent....

P.S. Please have a look at the example given below. It my represent my trades better.

http://yfrog.com/0b2examplej

Hope you had a great day trading.

Regards,
Raymond

Here was my response:

Quoting eclayf
...Hi dogfight. I did look at the image and this is the thing. You CAN trade that way and it IS a good system, many are. IF you stick to exclusively two bar retrace trades as you talk about, it WILL give you some really good trades and it is pretty simple.

The MAIN reason for the 35 is two fold. Number one and the most important is that there are some VERY strong trades off of it and most of the time, when it is close to the 50 EMA, it is a strong place to enter and the 50 then serves as a warning to exit if it goes through and you can usually place the SL a pip or two below the 50 and be just fine.

The SECOND reason is actually two in one. When they are extremely close and going sort of sideways, or literally "on top" of each other, it indicates a break out is imminent and often you can catch it simply by placing limit order about 15 pips above and below the area, then delete one when the other is triggered. AND, as they begin to separate during a move, it indicates an early warning system to start covering your trade as price is slowing and may reverse soon.

I have used the 60, and to be honest it's not different enough from the 50 to make much of a difference. In fact, in my quest to find The Dance, I once traded a 60/50 EMA combination to find the "trend." 50 On top...long,, on bottom short and so on. It works, just not as reliable as the interplay of the 35/50 lines for my tastes.

You can still use the "constrainment" entries when they happen as the 5/10 will also narrow to where the 60 is. The main issue is that there are many, many false signals of a move as price criss crosses back and forth over a 50 or a 60 EMA until it finally moves in one direction strong enough to be a signal

If you take a good look at the image you linked to you will see near point 2, that there is an area of "constrainment" that would have made a GREAT entry even on the third bar.

BUT, in my opinion, the most important thing is for you to find a strategy YOU can "see at a glance" and be CONSISTENT with. THAT is the ONLY issue that matters to be brutally honest. IF two bar retraces make it for you, master them before you do anything else or even start looking at anything else and THAT ALONE will be enough for you to become consistent and confident.

THEN you can move on to mastering signals you will begin to see later. In "The Dance" there are lots of signals I don't talk about, and once in a while, I take them because experience has taught me how to "filter" them with my own rules. Some of them work out amazingly well, and some don't work at all. Stuff like that happens.

NOW, I am going to say something truly heretical in Forex Trading circles. I DO NOT believe that there is any reason to make a bad trade, as in a losing trade. I FIRMLY believe that with enough experience, you can identify, master and trade a strategy that FOR YOU will allow you to be (if not 100% correct) very close to perfect in your trading. It's all about YOU and what YOUR mind "sees" on the charts.

I have always said that ALL indicators, including Moving Averages are just "eye candy" that either help you see, or cloud your vision of what is really happening on the chart.

Some people can see minute details "at a glance" in daily life. Some only the big picture, some a bit of both, but all of both. So, you find what works for YOU and you MASTER IT as quickly as possible, but DO NOT jump around. IF something makes sense, STICK TO IT UNTIL YOU MASTER IT! Then move on to other things.

IF we never master the alphabet, we never learn to read and write. If we can't to that, we can't go to school and learn even more. SAME PRINCIPLE at work in trading. FIND AN ALPHABET YOU can "see" and that makes sense to YOU. Master it and then move on.

Hope that helps and answers your question.
Here is the bottom line in all this effort. As I have said from the very beginning, there are tons and tons of decent strategies that one can choose from. If something literally jumps off the page at you, FOCUS ON IT for a while BUT STICK TO A SINGLE STRATEGY and master it.

Dogfight feels he needs something even simpler than "The Dance" and that may well be the case for him. If one finds a particular entry "best" for them, then MASTER it before you try ANYTHING else. MASTER ONE then master another. then another.

Mechanics don't work on race cars fresh out of mechanic shop in high school. It takes a while to master anything, but you MUST master ONE thing at a time to become truly successful in ANYTHING in life.

If it is Two Bar trades, then trade nothing but those for a while and MASTER them in all the variations they come. IF it is "touch trades" then MASTER those first, and TWO BAR trades are NOT always "touch trades" against a moving average. Some are against RNs, some are sort of half way between lines, some close after piercing a line, but the body closes EXACTLY on the line. THERE ARE TONS OF VARIATIONS you can choose to work with.

The Dance rules attempt to simplify this mess by defining some VERY high probability points of entry, NOT ALL the POSSIBLE points that often work. The main goal is to master something simple and robust enough to give solid entries at least a few times a day without tempting you to over trade and mess up what you have already gained.

I hope this post helps clarify some things and why I am so "hard nosed" about sticking to the rules, the rules of this thread and so on. BUT with that said, if you start "seeing" something that jumps off the screen, grabs you by the throat and screams "TRADE ME NOW!" then trade it a few times and see if it works for YOU. BUT STICK TO ONE STRATEGY while you do that so you ALWAYS have a baseline to measure against and come back to.

God bless and good trading to you all
  • #375
  • Mar 31, 2010 7:22am Mar 31, 2010 7:22am
Quoting eclayf
Often, in PM I get messages that I reply to and once in a while I find something I think would benefit the thread. I posted one of dogfight's posts before, and I don't think he would mind this one being posted in part here, so here goes.

The first part I deleted as not relevant to this post because it talks of some charts he had me look at. It is the part starting with a quote from me in his post back to me that is where I want to start.

He was asking about using other Moving averages. The dots indicate areas I deleted as not really relevant...
Really good stuff again and I am starting to see some of the things you mentioned with regarding to the interaction between the MA's. As you say, they are eye candy but very necessary eye candy because you can see how the big boys are using them to take profits, add on or open trades - hence why they are as reliable as they are.
  • #376
  • Mar 31, 2010 8:34am Mar 31, 2010 8:34am
Took this touch off the 10ema on the M15. Placed SL just below RN. I was stopped out quickly. The entry arrow was a trade on demo, I entered at the touch in my live account. I missed the best trade, the touch at the RN a little earlier. Any thoughts? Thanks again for all your help.
Attached Image (click to enlarge)
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Barry
  • #377
  • Mar 31, 2010 8:40am Mar 31, 2010 8:40am
Quoting Bary
Took this touch off the 10ema on the M15. Placed SL just below RN. I was stopped out quickly. Any thoughts? Thanks again for all your help.
Hi mate,

I was watching that as well. I didn't take the trade because I like a 1 or 2 candle retrace on the 5/10 ma's but also because the angle of the ma's had dropped off a bit and were only 39 degrees. Not a strong enough combination for my tastes but i'm a very cautious trader at the minute, i'd prefer to protect my equity than take trades that i'm not comfortable with.
  • #378
  • Mar 31, 2010 9:00am Mar 31, 2010 9:00am
Trotty,
Thanks for your response., and I agree. I didn't notice the 3 bar pullback...darn.
I also got in the E/U long on a touch of the RN after missing the touch of the 10ema. I tried to get in but it missed me by 2 pips. Moved stop to BE.
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Barry
  • #379
  • Mar 31, 2010 9:07am Mar 31, 2010 9:07am
Quoting Bary
Trotty,
Thanks for your response., and I agree. I didn't notice the 3 bar pullback...darn.
I also got in the E/U long on a touch of the RN after missing the touch of the 10ema. I tried to get in but it missed me by 2 pips. Moved stop to BE.
Well......you should be on for making your money back and more then
  • #380
  • Mar 31, 2010 9:13am Mar 31, 2010 9:13am
Out for +10
Barry
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