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Nanningbob 4H trading system

  • #1,881
  • Jun 18, 2010 7:09am Jun 18, 2010 7:09am
Hi Bob

I am experimenting with an idea of combining your system with Volume Spread Analysis. The foundation will be your system plus couple of more indicators for confirmation of trend change. I still want to use the mptm and the function of reentry after closing trade, however, instead of 6x6 or 3x3 I want to use pending orders.

I looked at the attachments and there are no EAs prior to 2010 and I was wondering if you have any old EAs which may suit my purposes. Even if none of them have the pending order option, I may be able to get someone to put that in.

Kind regards
  • #1,882
  • Jun 18, 2010 11:35am Jun 18, 2010 11:35am
Are you on a 4H chart. Here is mine, the signal was at the cross!! The warning device has nothing to do with Sto or Macd. It only works on MA crosses.
Attached Image (click to enlarge)
Click to Enlarge Name: cad chf.gif Size: 34 KB
  • #1,883
  • Jun 18, 2010 11:37am Jun 18, 2010 11:37am
Quoting sfg7th
bob...why do I get erroneous 6x6 cross alerts,ie, this am 06:42:55 alerted cross sell on cad/chf, the ma lines are not even close, also RWB are all below 15, have 2 aqua buy signals???
When you change charts or TF it will give you the last cross message. Doesnt mean it is now.
  • #1,884
  • Jun 18, 2010 6:39pm Jun 18, 2010 6:39pm
Price stayed flat and didnt go anywhere much. Picked up some MPTM's and that was all. Hopefully Monday prices will move around some. Still in a lot of trades and some potentials there. Not is deep trouble on any but all sitting good to break even or TP.

RESULTS
cad/chf +25
gbp/chf +25
gbp/usd +25
Sells
cad/jpy
gbp/usd
Buys
eur/aud
gbp/chf
usd/jpy (both usd trades did not enter)
usd/chf
usd/cad
STILL IN OR REENTERD
aud/cad -55
 aud/jpy - 45
aud/usd -139
chf/jpy -130 2L -12
eur/jpy -189 2L -54
eur/usd -133 2L -2
gbp/nzd -132
nzd/cad -98
nzd/jpy -43
nzd/usd -286 2L -104

TOTALS
total for day + 75
for the week + 739
for the month +1374
Carry over -1422
  • #1,885
  • Jun 18, 2010 7:19pm Jun 18, 2010 7:19pm
Quoting astral77
Hi Bob

I am experimenting with an idea of combining your system with Volume Spread Analysis. The foundation will be your system plus couple of more indicators for confirmation of trend change. I still want to use the mptm and the function of reentry after closing trade, however, instead of 6x6 or 3x3 I want to use pending orders.

I looked at the attachments and there are no EAs prior to 2010 and I was wondering if you have any old EAs which may suit my purposes. Even if none of them have the pending order option, I may be able to get someone...
One of the reasons I post my ideas is to encourage innovation. Having said that all trading EAs are based on indicators and they all have one main problem. It is what I call the peeker trade, in other words no matter what you use as your qualifications there is always those small handful of trades that qualify and then price reverses. This happens in trend following EAs a lot and to a lesser extent my counter trade system. I am having this same problem all week with my trend following EA. A trade will qualify and then reverse fields. I already know whatever you come up with will have peeker trades happen. This means we dont try but that is the problem that needs to be solved. Solve that one problem and your a millionaire. Now there are several ways to handle these.
1. Take a SL (most common approach, death slowly by SL, the tighter the SL the more often it is hit. The wider the less often.)
2. Multi-level trade ( IE reenter at another position and zero out the negative trade but have rules to limit your losses if you cant)
3. Martingale ( keep adding until you win or wipe out your account)
4. Hedge (come back another day, week, or month and trade under your conditions not the markets) Right now I dont have a set a rules for this but am working on it.
  • #1,886
  • Jun 18, 2010 9:01pm Jun 18, 2010 9:01pm
Let me give you a lesson on indicators. All indicators are based on moving averages, you need to understand this to know their limits, weaknesses and strengths. For instance you take any major indicator in your MT4 system and all they do is take a moving average and post it on your screen using lines or in the case of Haiken Ashi, it uses bars instead of lines. Ichimoku uses MA and plots them into the future and then draws cute little clouds of different colors on your screen. All it is doing is plotting previous S/R lines based on certain MAs and moving them into the future. Neat little system but still a MA system. Some use separate charts like MACD and Stochastics etc. and they will draw lines or bars. Some systems use math formulas off of highs and lows and then draw lines. Pivot point systems do this along with Fib and the 6ths indicator I use. Pivot point system uses the previous days high and the low and the middle is your pivot. Then it uses math formulas to draw lines above and below the pivot. It changes every day. Fibs uses the last previous high and low from longer period time frame to draw lines on a screen. These lines are based on a percentage from the high and low or a moving average of the high/low plus a math formula and freezes it in time. The difference between a MA line and pivots and fibs are pivots, Fibs, etc. are MAs frozen in time based on previous highs and lows and some Math formula and MA lines keep moving with price and time. People keep coming up with new indicators but they dont realize they will all have the same flaws. MA no matter how you design them only tell you what has been happening. They can never predict the future so when you commit to any indicator there is always a chance price will not do what it has been doing and will suddenly reverse at or near your entrance point. No indicator can ever solve this problem. Every once in a while someone will come onto my threads and say if you just use indicator A or B or C this will solve your problem. No it wont because I know your indicator is based on some form of MA and all MA have the same weaknesses and strengths. The problems will just pop up at some different point than some other indicator.

So I have come to one conclusion concerning Forex trading. What goes up must come down and what goes down must come up. That truth is always 100% true. If we apply some common sense rules and not get overly committed to any trade or group of trades we can wait out the market for its reversals and counter rallies and counter dips. These will always happen and we can profit by them. That in a nutshell is my philosophy behind all my systems. You can change indicators and adjust them but they do not know whether price will go up/down 50, 100, 200 or 500 pips the next minute, hour, day, or week. I only know that when they do reverse they will come back down/up again and I make money or break even. That is my philosophy. The only thing I need to fear is the super news stories and interest rate changes. (NFP, news spikes, etc. are not super news stories).
  • #1,887
  • Jun 18, 2010 10:02pm Jun 18, 2010 10:02pm
I know I said I would try to get my new idea out this weekend but there is no way. Again the peeker trades are haunting the trend following system, the bugaboo of all trend trading systems. You just dont know when the trend is over or going to continue, the peeker trade enters during this transition period and it is a matter of when do I cut this loss. You cant 2.4.2 your way out because the peeker trade will be at the very bottom/top of the trend so you cant outlast being at the beginning of a new trend going the other way. The trend trading part seems to work fine, its figuring out how to deal with transition. That may take some time. I thought I had a solution but it has peeker trades that are just in a very bad spot.
  • #1,888
  • Jun 18, 2010 11:46pm Jun 18, 2010 11:46pm
Quoting Mixer
Hi Nanning,
How do u use this indicator? In which folder do you put it?
The indicator goes in the indicators folder.
  • #1,889
  • Jun 19, 2010 6:52pm Jun 19, 2010 6:52pm
Quoting nanningbob
Let me give you a lesson on indicators...
Thanks for your thought provoking remarks. There is no doubt in my mind that you are 100% right regarding indicators. I have not studied indicators in as much detail as you have but one thing which is true with all of them is that they are ALL Lagging and trying to predict future price movements based on past events. Nothing can change that.

What puts your system in a league of its own is the clear set of rules dealing with bad trades. Although as you have pointed out these rules would benefit from further development and a clear hedging strategy is needed. Furthermore, traders own skills, judgment and development is essential part of this system as well as any other system.

As I mentioned before, I am currently studying the concept of Volume Spread Analysis. I know most people would say it is impossible in forex and I am of that opinion as well but I am giving the argument the benefit of the doubt for the time being. Nothing beats experiments in determining the validity of a concept so I plan to experiment once I know more about the concept. In the meanwhile the only proven system for me is NANNINGBOB`s System.

Many Thanks and Kind regards
  • #1,890
  • Jun 19, 2010 7:33pm Jun 19, 2010 7:33pm
Quoting nanningbob
Let me give you a lesson on indicators. All indicators are based on moving averages, you need to understand this to know their limits, weaknesses and strengths. For instance you take any major indicator in your MT4 system and all they do is take a moving average and post it on your screen using lines or in the case of Haiken Ashi, it uses bars instead of lines. Ichimoku uses MA and plots them into the future and then draws cute little clouds of different colors on your screen. All it is doing is plotting previous S/R lines based on certain MAs and...
Bob,

Good point. I am somewhat new to FOREX, but have been trading FUTURES for quite a bit longer. I was not profitable in FUTURES until I actually mastered the underlying instrument and how it 'danced' or 'sung' without the indicators occasionally wasting my time. I found out over time, that tune or move changed considerably and I just had to adjust and keep in line, kind of like dancing to a new partner.

I have been working on a double grid system and I think I have come to the conclusion that a Martingale system no matter what only works if you have a lot of cash on very little leverage and hence your returns become nominal.

I have almost killed it for now. However, I took you EA (from other thread) and added stop gap trailing and a trailing stop embedded in the code and it works reasonably well. But, you still get into those death spins and the key would be to stay out of it, but how do you know how far and long the drop will be. My trading in Futures is I get in, I am out in 15 minutes max with some serious ticks, OR, I am out right away with a small loss so completely different mindset...

Just thought I would share. I will also post my new EA with changes in the other thread to see if anyone has any interest. I had to dig out of my brain my old crappy programming skills.

Oh, and there is an interesting anti-grid trend following system that 7-bit is doing that could help your trend system maybe... It is in the platform area and I think it is called snowball. I have actually come up with the same idea, but mine adds positions off of bar closes instead of so many pips...
We are our own best indicator.
  • #1,891
  • Jun 20, 2010 3:53am Jun 20, 2010 3:53am
Quoting bluemele
Bob,

Good point....
Thanks for the note. The only system I have ever used that has stayed profitable for a long period of time has been this one. Doesnt mean I always win but it is a complete system. I am constantly working on ideas but most of them have their issues. If I make any new breakthroughs it is going to be in the area of hedging. Testing out some ideas and thoughts now and a couple look promising. Hedging is easy to do, unhedging is another matter. As I solve each problem area it looks more promising. If I can come up with a complete list of hedging rules, I feel I can limit my DD to a certain number and it will not get bigger. This then would get us through these rough patches and we could trade freely and openly any kind of market. I am working on hedging because my trend EA is working well but the transition period is a mess. To declare a trend over means you have trades that are already in trouble. In other words you entered and the trend is not continuing so now what?? Until I solve that problem it is difficult to work the system. I am beginning to think the only way to make a trend system to work is to use a daily or weekly chart. There are just too many reversals dips and rallies even on a 4H chart to stay out of trouble. Well keep trying, meanwhile I will continue to fight off the DD with the 2.4.2 system until something better comes along.
  • #1,892
  • Jun 20, 2010 4:00am Jun 20, 2010 4:00am
Can someone publish forward trading results for this system?

Thanks
  • #1,893
  • Jun 20, 2010 6:50am Jun 20, 2010 6:50am
Quoting serviziforex
Can someone publish forward trading results for this system?

Thanks
I post my results every day, what more do you need????? I post my trades before I take them and then I tell you the results the next day. I certainly cannot hide anything.
  • #1,894
  • Jun 20, 2010 6:55am Jun 20, 2010 6:55am
I am not sure how this will affect my system but looks like the Cad, NZD, and Aud are going to be bullish over the long run. China unhinged its RMB from the dollar. Since we are basically short term traders it may not affect us much.

"When China raised its exchange rate in 2005, by 2.1 percent, commodities rallied for more than a year after the revaluation, although not solely because of Beijing's move."
  • #1,895
  • Jun 20, 2010 7:37am Jun 20, 2010 7:37am
Quoting nanningbob
I am working on hedging because my trend EA is working well but the transition period is a mess. To declare a trend over means you have trades that are already in trouble. In other words you entered and the trend is not continuing so now what?? Until I solve that problem it is difficult to work the system.
How do we ever solve this riddle?
Trend EAs suffer in ranging periods and martingales in long trends. As we go towards higher TF may be we postpone that rogue trade happening but when it happens it will cause equally higher damage.
May be we look at a middle range TF say H1 or M30, enter as many boring pairs with a smaller TP and Pips and close trades at the end of the day, whatever happens. Have a fixed target for either profit or loss.
Sixth EA has lot of promise according to me even on lower TFs like M30 or H1.
"Put all your efforts in becoming effortless"
  • #1,896
  • Jun 20, 2010 6:00pm Jun 20, 2010 6:00pm
Quoting IamTHAT
How do we ever solve this riddle?
Trend EAs suffer in ranging periods and martingales in long trends. As we go towards higher TF may be we postpone that rogue trade happening but when it happens it will cause equally higher damage.
May be we look at a middle range TF say H1 or M30, enter as many boring pairs with a smaller TP and Pips and close trades at the end of the day, whatever happens. Have a fixed target for either profit or loss.
Sixth EA has lot of promise according to me even on lower TFs like M30 or H1.
The lower the TF the higher the percentage of whiplash. I originally started with my RWB lines on lower TF and I would get killed at time. It did not become profitable until the 4H TF. The problem I have seen with every trend following program has been whiplash. Like this morning with the gaps. Bunch of news traders went out and bought commodity currencies but that pushes the price of their goods up and makes them less affordable. In a recession time that is not good for them. People cant buy right now until they get their jobs back. So the Yuan story, I believe will have short legs for now.
  • #1,897
  • Jun 21, 2010 6:49am Jun 21, 2010 6:49am
Quoting nanningbob
The problem I have seen with every trend following program has been whiplash...
IMHO this counter trend system is the way to go. The reason I find the concept of Volume Spread Analysis appealing is due to its explanation of price jumps and trends, claiming that by the time ordinary folks jump on the trend band wagon (the concept of HERD mentality)the Smart money is already disposing their holdings.

Although as mentioned before the vast majority of forex traders do not think that volume can be accurately gauged in forex. I am not sure but keeping an open mind for the time being. I do not think we should discuss this concept here since there are plenty of threads where you can see the arguments for and against it.

The areas where NB H4 can be improved is mainly money management and entry. At present we do not have clear rules as to when to exit a non profitable trade and this is very much open to individual trader`s discretion. Maybe we should have a clear set of guide lines as to when a -ve trade should go into recovery using 2-4-2 and when we should just take the loss and move on.

Kind regards
  • #1,898
  • Jun 21, 2010 9:07am Jun 21, 2010 9:07am
Quoting IamTHAT
How do we ever solve this riddle?
Trend EAs suffer in ranging periods and martingales in long trends. As we go towards higher TF may be we postpone that rogue trade happening but when it happens it will cause equally higher damage.
May be we look at a middle range TF say H1 or M30, enter as many boring pairs with a smaller TP and Pips and close trades at the end of the day, whatever happens. Have a fixed target for either profit or loss.
Sixth EA has lot of promise according to me even on lower TFs like M30 or H1.
IAMTHAT,

Did you combine Blessings with Bob's EA? Interesting as I am doing that kind of myself! Pretty cool concept.

I agree smaller timeframes are great for the EA, but sometimes it gets 'caught' and whammo... What are you doing to alleviate the smaller time frame big runs. The only thing I could think of was trade in off "opens" times...
We are our own best indicator.
  • #1,899
  • Jun 21, 2010 5:31pm Jun 21, 2010 5:31pm
Quoting astral77
IMHO this counter trend system is the way to go. The reason I find the concept of Volume Spread Analysis appealing is due to its explanation of price jumps and trends, claiming that by the time ordinary folks jump on the trend band...
If you dont use the 2.4.2 system then you close trades based on experience etc. For instance I will close trades much earlier than that when I think a trade is going to be trouble. IE on the wrong end of a news story and dont want to bother with 2.4.2, so I just take the loss. I did that yesterday and will do occasionally. I dont know how to teach that, that is just experience and a gut feeling.

For example I live here in China and watched closely the YUAN exchange. Their message was a farce, they are not free floating the YUAN but doing controled movement. It is the typical, we did something but it really wasnt anything real thingy. So I believe the markets are going back to normal from this story. The Chinese want to got to the G20 meeting to blunt criticism of their manipulation of the exchange rate but they made a change to show they have. They are not really going to change much. So I expect things to go back to normal as traders and markets realize this.
  • #1,900
  • Jun 21, 2010 5:41pm Jun 21, 2010 5:41pm
Quoting nanningbob
If you dont use the 2.4.2 system then you close trades based on experience etc...I dont know how to teach that, that is just experience and a gut feeling...
That can not be taught pure and simple, comes with experience. If you have time please have a look at this article http://cdn.forexfactory.com/attachme...9&d=1221085865 . It can explain the concept much better than I can.

If you ever wanted a rationale for being counter trend trader this is it. For people who do not have time here is the last paragraph: QUOTE:"Summary: 60-80% of volume in the markets is professional activity. 90% of traders lose money. 90% of weak money buy tops and sell bottoms. 10% of traders sell tops and buy bottoms. Why so many people are focusing on and copying what majority or 90% of traders are doing and miss the fact that if something is very obvious in the market, it is obviously wrong."

Kind Regards
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