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Powerful Fib Based System - by DAZfx

  • #2,081
  • May 25, 2010 4:50am May 25, 2010 4:50am
Quoting jarnilse
Hi Pip26
Thanks for the charts. I have some questions.
I did not take the EURJPY trade because the support line of the downward daily channel was reached mai 20th, and the price appeared to start climbing upwards. On the other hand, looking at H4 we see a nice downward channel. Is this why you took the trade?
Assuming the EURJPY price starts/continue heading towards the resistance line of the daily channel, will you in general take trades/look for setups when we have a downward channel in the H4 chart?

I guess the <--56:14 is your reward:risk...
I noticed that you are taking deep interest in this thread really appreciate able.

I use H4 and D1 channel for determining direction.

56:14 is not my R:R it is candle time to close.

Vertical line is showing my entry. I used opening of candle, previous candle is closed at 5 SMA so it is valid for entry. On H1 i use 1:1 for Half lot size and for remaining lot i use FE 61.8 FE 78.6.

Hope i clarify all your questions but if u still have anything else just ask.

Cheers
  • #2,082
  • Edited 5:34am May 25, 2010 5:31am | Edited 5:34am
Quoting Pip26
I use H4 and D1 channel for determining direction.
56:14 is not my R:R it is candle time to close.
Vertical line is showing my entry. I used opening of candle, previous candle is closed at 5 SMA so it is valid for entry. On H1 i use 1:1 for Half lot size and for remaining lot i use FE 61.8 FE 78.6.
Thanks for the reply.
My interest in this trade is mainly because the system use few indicators, is well defined (although I still have questions), and yours and vincentprices charts and comments are very helpfull and shows that it works.

I have never seen Dazfx explain how to calculate the risk reward.
If I ignore the spread and number of units/lots I trade, place stop loss at 0%, enter at 31.44% my risk is 31.44%. If the last profit target is 78.6% then (78.6-31.44)=1.5*31.44. That is: reward=1.5*risk.
Entering the trade before 31.44% will ofcourse improve the reward:risk ratio. If the last take profit level is 100%, then I should not enter after 40%.

How are you calculating the risk reward ratio?
  • #2,083
  • Edited 6:21am May 25, 2010 6:16am | Edited 6:21am
Use stop just above point C.

I mostly use 1:1 for half lot size and 1:2 for remaining lot.

Here is method part from DAZ fx about profit targets.

EXIT STRATEGY

Carrying on from the previous example, I would exit my first lot at Target 1. If price does reach Target 2, I will take out the second lot, and move my stop loss to Break Even (Entry point). I will then take out my last lot when Target 3 is reached.

If you look at the charts provided, you can see that the targets can be calculated using the Fibonacci Expansion tool.

-When the confirmation candle is a Harami (Inside bar), use FE 50.0 as Target 1, FE 61.8 as Target 2 and FE 78.6 as Target 3.

-When the 'AB' wave consists of more than 10 candles, use FE 50.0 as Target 1, FE 61.8 as Target 2 and FE 78.6 as Target 3.

-When the confirmation candle is quite large, use FE 61.8 as Target 1, FE 78.6 as Target 2 and FE 100.0 as Target 3.
  • #2,084
  • Edited 7:44am May 25, 2010 6:41am | Edited 7:44am
Quoting Pip26
Use stop just above point C.

Here is method part from DAZ fx about profit targets.

EXIT STRATEGY

Carrying on from the previous example, I would exit my first lot at Target 1. If price does reach Target 2, I will take out the second lot, and move my stop loss to Break Even (Entry point). I will then take out my last lot when Target 3 is reached.

If you look at the charts provided, you can see that the targets can be calculated using the Fibonacci Expansion......
Yes. I know this, and try too follow it.
But it does not explain how too calculate the reward:risk ratio, which Dazfx say should be at least 1.5.
Referring to the same document as you , go to INVALID SETUPS point 2) which states:

2) If the confirmation candle moves so much that the stop loss is widened to a point where the Risk/Reward ratio is no longer 1:1.5.

Dazfx never explain how to verify/calculate Risk/Reward.

From your answer I see that my previous post might have mislead you since I did not emphasize that my procentages was FE procentages. In my previous post the 0% is Point C. So all my calculations refer too the expansion from retracement point C.

My calculations means that if I enter after FE 31.44% then the stop loss has widened to a point where my risk/reward is no longer 1:1.5.

In the STOP LOSS section of the same document, Dazfx states that
"Only take a trade if the stop loss is smaller than your projected target 2".

The STOP LOSS section actually says that if my second profit target is FE 61.8% then I should not enter a trade below 61.8%/2=30.9%.

I normally place stop loss a few pips behind point C. But I ignore these pips here because I want to keep it simple. I just need a visible rule of thumb for the Reward/Risk ratio.
  • #2,085
  • Edited 10:53am May 25, 2010 10:13am | Edited 10:53am
http://i173.photobucket.com/albums/w.../Capture-2.png

i'm too good in demo

http://i173.photobucket.com/albums/w.../Capture-3.png

looking for n week setup for my real acc

sl +-100p

pls give me a comment

tq
  • #2,086
  • May 25, 2010 12:59pm May 25, 2010 12:59pm
GBPUSD H1 appears to be an opportunity. But I don't like that stochastic on H4 just crossed below 20, moving against the trade direction on H1.

Does this mean that it is best to ignore the setup?
Attached Images
  • #2,087
  • May 25, 2010 1:03pm May 25, 2010 1:03pm
Quoting jarnilse
GBPUSD H1 appears to be an opportunity. But I don't like that stochastic on H4 just crossed below 20, moving against the trade direction on H1.

Does this mean that it is best to ignore the setup?
Hi your setup may well work out fine, good luck. When there are a large number of candles on the 1h in the AB wave I normally turn to the 4h time frame and wait to see if a trade sets up there.

VP
Nil desperandum
  • #2,088
  • May 25, 2010 1:25pm May 25, 2010 1:25pm
Quoting vincentprice
Hi your setup may well work out fine, good luck. When there are a large number of candles on the 1h in the AB wave I normally turn to the 4h time frame and wait to see if a trade sets up there.
VP
Hi VP.
Thanks for your reply. Decided to wait and see. Maybe wait for H4.

In general: When trading H1 it seems to be safest to wait for setups where H4 stochastic is in the direction of D1, and the trade direction of H1.
Maybe too many setups are lost being that picky?
  • #2,089
  • May 26, 2010 10:11am May 26, 2010 10:11am
Hope for good reward
Attached Images
  • #2,090
  • May 27, 2010 6:33am May 27, 2010 6:33am
Hello to Allzzzzz,

Why members of this thread are sleeping, I see only few traders post their setups. I think we all should show interest in this method and start sharing setups, also i request senior members to keep newbie's guiding about new setups and trades.

I hope many traders will start contributing.

Good Luck to this thread.
& Good Luck to All
  • #2,091
  • May 27, 2010 11:49am May 27, 2010 11:49am
Quoting Pip26
Hello to Allzzzzz,

Why members of this thread are sleeping, I see only few traders post their setups. I think we all should show interest in this method and start sharing setups, also i request senior members to keep newbie's guiding about new setups and trades.

I hope many traders will start contributing.

Good Luck to this thread.
& Good Luck to All
I suppose is because all are having fun with their profits following this thread and dont care of it anymore
Greetings, BeLikewater
  • #2,092
  • May 27, 2010 3:37pm May 27, 2010 3:37pm
Quoting BeLikeWater
I suppose is because all are having fun with their profits following this thread and dont care of it anymore
LOL, still around, not been trading much this week, had a small break to relax a bit. Anyway here is a reasonable looking trade on the EUR CAD that just triggered.
Attached Image (click to enlarge)
Click to Enlarge Name: ec.jpg Size: 96 KB
Nil desperandum
  • #2,093
  • May 27, 2010 4:21pm May 27, 2010 4:21pm
Lets see who wins then
http://img717.imageshack.us/img717/1940/hahapf.jpg

Uploaded with ImageShack.us
Quoting vincentprice
LOL, still around, not been trading much this week, had a small break to relax a bit. Anyway here is a reasonable looking trade on the EUR CAD that just triggered.
Greetings, BeLikewater
  • #2,094
  • May 27, 2010 4:40pm May 27, 2010 4:40pm
Quoting BeLikeWater
Lets see who wins then
From looking at the stop loss and price targets on both charts, there is the possibility that both our trades could fill in profit! I hope that is how it plays out. . .
Nil desperandum
  • #2,095
  • May 27, 2010 8:15pm May 27, 2010 8:15pm
Quoting vincentprice
From looking at the stop loss and price targets on both charts, there is the possibility that both our trades could fill in profit! I hope that is how it plays out. . .
That is my very quiet week week probably over now. . .. . .trade filled for 63 pips profit.
Nil desperandum
  • #2,096
  • May 28, 2010 12:33am May 28, 2010 12:33am
Hi,

Some time ago there was a group of Daz traders who meet in Trading rooms. It was a live chat where one could post charts. That group unfortunately fell apart.

I am suggesting that we make a group on Sykpe, to talk live, since not everybody can monitor chart all the time. That way we could catch more setups.

What do you think?

Find me on Skype under name Brazool (from Slovenia)
  • #2,097
  • May 28, 2010 1:37am May 28, 2010 1:37am
EU - Long
Attached Image (click to enlarge)
Click to Enlarge Name: eu 28.5.10.gif Size: 23 KB
  • #2,098
  • May 28, 2010 1:41am May 28, 2010 1:41am
That,s a good suggestion because many people are using Skype and it is relatively effective and above all,free of charge.Cheers!
  • #2,099
  • Edited 6:05am May 28, 2010 5:54am | Edited 6:05am
These are setups on Daily charts, i m watching only.
All are making now higher lows on H4 so it can be a sign of trend change but D1 needs to be confirm the reversal so till then bearish only.

With the direction of H4 long trades on H1 but can be taken but can be risky too so take care.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: e11.PNG Size: 284 KB
Click to Enlarge Name: gjd1.gif Size: 13 KB
Click to Enlarge Name: gud1.gif Size: 12 KB
  • #2,100
  • May 28, 2010 7:39am May 28, 2010 7:39am
Do you find setups that only retrace to 50% fib, just as successful as the ones that retrace to 61,8 or 76,4 ? Taking into consideration that all other requirements are met (stoch in the right direction, confirmation bar, R:R ratio...)
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