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ALF revisited - simple, effective daytrading

  • #201
  • Jun 3, 2010 10:24am Jun 3, 2010 10:24am
Quoting k2kv
Lou,

On your last trade, did you enter when the first candle turned red below the ALF? Or, did you enter on the third candle, after price went back up to the line and came back down?

Just trying to get a better sense of how you're seeing things.

Been profitable thus far, thanks for your efforts!

Thanks!
See post #192 - entry when the candle turned red (below support). Had you entered two bars earlier (on M15) a 20 pip stop just above ALF would have been enough to save the trade.

Glad you're being profitable...
Old Benjamin was right
  • #202
  • Jun 3, 2010 10:27am Jun 3, 2010 10:27am
Quoting forexweasel
Hey lou, +85 today using the old indies on m30. I have a question: can the settings on alf candles be changed? I am using 5/12/12 on the old indie, I don't see the settings on the new one. thanks.

fw
Nope - that's the advantage. I have freed myself from the tyranny of fixed periods. The new indicator responds only to PA, which is why your chart can now be shifted between TF's without tinkering with settings.
Old Benjamin was right
  • #203
  • Jun 3, 2010 10:33am Jun 3, 2010 10:33am
A very good case for using these tools.
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Vincit qui se vincit.
  • #204
  • Jun 3, 2010 10:34am Jun 3, 2010 10:34am
Quoting Lou G
Nope - that's the advantage. I have freed myself from the tyranny of fixed periods. The new indicator responds only to PA, which is why your chart can now be shifted between TF's without tinkering with settings.
Lou

If I missed this forgive me. I know there is no repainting issues with candles. You say when candle turns red enter short. If in same candle price moves back up won't current candle change back to different color? I guess what I'm saying is that you don't wait for candle close
  • #205
  • Jun 3, 2010 10:38am Jun 3, 2010 10:38am
Quoting Mombone
Lou

If I missed this forgive me. I know there is no repainting issues with candles. You say when candle turns red enter short. If in same candle price moves back up won't current candle change back to different color? I guess what I'm saying is that you don't wait for candle close
Yes, that can happen - it's the nature of Forex. PA can always turn against you. That's where vigilance and trade management enter the equation.

If you are in profit and get that "bad feeling", take some pips and run.
Old Benjamin was right
  • #206
  • Jun 3, 2010 10:42am Jun 3, 2010 10:42am
Here's a good example of a possible retracement using the previous short trade (still in progress).

If you entered at the first blue arrow, you have a small profit but it's in jeopardy.

Better to wait and see if the candle indicated by the second arrow goes below support and turns red.

Or, assuming you entered as mentioned, take the +10-15 and close it out - your choice.
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Old Benjamin was right
  • #207
  • Jun 3, 2010 10:52am Jun 3, 2010 10:52am
Quoting Lou G
Here's a good example of a possible retracement using the previous short trade (still in progress).

If you entered at the first blue arrow, you have a small profit but it's in jeopardy.

Better to wait and see if the candle indicated by the second arrow goes below support and turns red.

Or, assuming you entered as mentioned, take the +10-15 and close it out - your choice.
Hello Lou G,

I don't have the same colors, I don't know why. And as colors are important to decide whether or not to enter...
Here is my chart on EUR/USD 15m using Alpari UK.

Thanks for your help.
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  • #208
  • Jun 3, 2010 10:56am Jun 3, 2010 10:56am
Quoting NewbieFxFx
Hello Lou G,

I don't have the same colors, I don't know why. And as colors are important to decide whether or not to enter...
Here is my chart on EUR/USD 15m using Alpari UK.

Thanks for your help.

Different brokers will give you different feeds, not all brokers are created equal.
So pick your poison.
  • #209
  • Jun 3, 2010 10:57am Jun 3, 2010 10:57am
Quoting NewbieFxFx
Hello Lou G,

I don't have the same colors, I don't know why. And as colors are important to decide whether or not to enter...
Here is my chart on EUR/USD 15m using Alpari UK.

Thanks for your help.
They look the same to me (in the area we're analyzing). Expand your chart one click so the charts are on the same scale...
Old Benjamin was right
  • #210
  • Edited 11:08am Jun 3, 2010 11:05am | Edited 11:08am
Entry short at the open of bar A was legit and would have required a stop >= 18 pips to keep the trade alive (stop just north of ALF).

Entry at bar B when it turned red at 1.2230 was also good.

First possible exit at bar C (exit rule #2) when bar turned green (which it did as soon as it opened) was good for +30 or so.

If you stayed in the trade, the final exit (if PA ever gets there) will be at bar D somewhere in the future when PA and ALF meet (exit rule #1). Note that ALF is currently at 1.2205 so profit cannot be less than +25 if you hang on for the duration.

Is everybody good? If not, speak up - that's why I'm here.

And let's not forget, it could still go lower...
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Old Benjamin was right
  • #211
  • Jun 3, 2010 11:09am Jun 3, 2010 11:09am
Quoting Lou G
Entry short at the open of bar A was legit and would have required a stop >= 18 pips to keep the trade alive (stop just north of ALF).

Entry at bar B when it turned red at 1.2230 was also good.

First possible exit at bar C (exit rule #2) when bar turned green (which it did as soon as it opened) was good for +30 or so.

If you stayed in the trade, the final exit (if PA ever gets there) will be at bar D somewhere in the future when PA and ALF meet (exit rule #1). Note that ALF is currently at 1.2205 so profit cannot be less than +25 if you hang...
Looks good. I re-entered around 2188. Did you see that also?? Great system. Thanks for the system and your time.

Mombone
  • #212
  • Jun 3, 2010 11:18am Jun 3, 2010 11:18am
Quoting Mombone
Looks good. I re-entered around 2188. Did you see that also?? Great system. Thanks for the system and your time.

Mombone
Yeah, the retracement was good as well - nice trading. I'm trying to deal with one thing at a time here since we have members who have varying skill/knowledge levels.

The whole reason for simplifying this method is to make it accessible to the less-experienced while keeping it sophisticated enough for everyone.
Old Benjamin was right
  • #213
  • Jun 3, 2010 11:28am Jun 3, 2010 11:28am
Thanks for making this example, which makes me understand the system better.
Just curious, what if "C" is a black/white bar, does that make it an exit? what's difference between black and white bars?

Quoting Lou G
Entry short at the open of bar A was legit and would have required a stop >= 18 pips to keep the trade alive (stop just north of ALF).

Entry at bar B when it turned red at 1.2230 was also good.

First possible exit at bar C (exit rule #2) when bar turned green (which it did as soon as it opened) was good for +30 or so.

If you stayed in the trade, the final exit (if PA ever gets there) will be at bar D somewhere in the future when PA and ALF meet (exit rule #1). Note that ALF is currently at 1.2205 so profit cannot be less than +25 if you...
  • #214
  • Jun 3, 2010 11:29am Jun 3, 2010 11:29am
London is closed and my trading is over for today. One trade (examined in exhaustive detail), +30 pips or so. Another okay day.

Those curious about how and why ALF_Candles does what it does, see post #190.

I check in here during non-trading hours so if you have questions or comments, post them.

Lou G
Old Benjamin was right
  • #215
  • Jun 3, 2010 11:29am Jun 3, 2010 11:29am
EURUSD, EURJPY and GBP USD market still look very bearish...anyone still short?
  • #216
  • Edited 11:40am Jun 3, 2010 11:34am | Edited 11:40am
Quoting rootkit
Thanks for making this example, which makes me understand the system better.
Just curious, what if "C" is a black/white bar, does that make it an exit? what's difference between black and white bars?
Well, it could be an exit if you are uncertain and want to play it safe. Generally speaking, the non-colored bars are meant to be "wait and see" bars. They are not perfect though, so use common sense and don't "wait and see" yourself into hitting a stop or turning a win into a loss.

That does not completely answer your question, however. The non-colored bars are bars that are moving counter to the direction ALF_Candles thinks they should be.
Old Benjamin was right
  • #217
  • Jun 3, 2010 11:37am Jun 3, 2010 11:37am
Quoting Trader88
EURUSD, EURJPY and GBP USD market still look very bearish...anyone still short?
I wish I was but I try to keep trading hours separate from the rest of my life, sometimes leaving a bunch of pips on the table
Old Benjamin was right
  • #218
  • Jun 3, 2010 11:54am Jun 3, 2010 11:54am
... for demo-addicted traders.

I know that this is true because I have done it:

If you are demo-addicted but really want to learn to trade, open a mini account and trade real money. Use 10 cent pips if you have to. Trading only on demo is like playing Monopoly when you aspire to be a real estate investor.

Trading real money changes the game, even if a 20 pip stop represents a risk of $10 or less. You will absolutely do things differently when cash is involved.

IMHO...
Old Benjamin was right
  • #219
  • Jun 3, 2010 12:01pm Jun 3, 2010 12:01pm
Quoting Lou G
... for demo-addicted traders.

I know that this is true because I have done it:

If you are demo-addicted but really want to learn to trade, open a mini account and trade real money. Use 10 cent pips if you have to. Trading only on demo is like playing Monopoly when you aspire to be a real estate investor.

Trading real money changes the game, even if a 20 pip stop represents a risk of $10 or less. You will absolutely do things differently when cash is involved.

IMHO...
Absolutely and to add to this: be sure to use a broker with a low spread. When you only target at say 15 pips, the lower the spread the better.
  • #220
  • Jun 3, 2010 12:02pm Jun 3, 2010 12:02pm
Quoting pbb
Absolutely and to add to this: be sure to use a broker with a low spread. When you only target at say 15 pips, the lower the spread the better.
Yes - main reason I trade EU.
Old Benjamin was right
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