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EUR/GBP Trendmagic System

  • #4,621
  • Jul 27, 2010 8:55am Jul 27, 2010 8:55am
From the post earlier this week http://www.forexfactory.com/showpost...postcount=4604


here is the chart now at the end of today the blue TM line will be fixed at that angle which means the SL can be moved from A to B

the position is now 126 pips in the black and thats protected pips

P
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  • #4,622
  • Jul 27, 2010 11:44am Jul 27, 2010 11:44am
Hi Paulus:
Great to have you posting here again. I see that you're using this on both the 5 min and the daily, do you use it on any others? Nice to see this thread back on track and the negativity gone. Thanks

Jim
  • #4,623
  • Jul 27, 2010 12:21pm Jul 27, 2010 12:21pm
Paul, thanks for posting this. It's a great example of the versatility of your system. Which brings me to this:

I'm in no position to be telling you what to do, but I have a humble suggestion I would like you to consider. Namely, you have proven to us that this system can be used on low and high TFs. From my personal experience, I can confirm that this system also works on TFs lower than M5 (I've tried M1 and M3). However, quite a few members of FF have a day job, which means that they aren't able to trade the lower TFs. My suggestion would be the following: could you please consider adding a line or two into the first post on this thread for those who don't trade M5? People usually read the first post but don't necessarily read the whole thread, which means that they might miss those charts with higher TFs. Your system has proven itself over time and it would be great if the mention of M5 didn't scare people away from your thread. Again, this is just a humble suggestion.

Let me know what you think.

Chris
If you don't risk, you don't ever have to lose.
  • #4,624
  • Jul 27, 2010 12:29pm Jul 27, 2010 12:29pm
For those interested in trading 4-hour timeframe, I suggest Andrew Forex thread: http://www.forexfactory.com/showthread.php?t=214635

His system is very similar to this one because his main indicator is the same - Supertrend (here known as TrendMagic). And the second indicator that he uses is a close relative to BB MACD - nonlagMA or nonlagdot. (MACD and MA come from the same family )

For me, Andrew Forex thread was very inspirational. Unfortunately, at some point it died like it happened before to some very good threads. People are often looking for indicator mess and not clear and simple systems.
  • #4,625
  • Jul 27, 2010 12:40pm Jul 27, 2010 12:40pm
One more suggestion. Those traders who find Supertrend (TrendMagic) too slow could find Adaptive Laguerre Filter (ALF) interesting: http://www.forexfactory.com/showthread.php?t=239353

I think, ALF can be used in this system instead of TM. Faster entries, also faster exits, but also possibly more false entries. Something for aggressive traders who have good feeling of the price action.
  • #4,626
  • Edited Jul 28, 2010 4:17am Jul 27, 2010 2:31pm | Edited Jul 28, 2010 4:17am
Quoting Indrek
One more suggestion. Those traders who find Supertrend (TrendMagic) too slow could find Adaptive Laguerre Filter (ALF) interesting: http://www.forexfactory.com/showthread.php?t=239353

I think, ALF can be used in this system instead of TM. Faster entries, also faster exits, but also possibly more false entries. Something for aggressive traders who have good feeling of the price action.
Seems like we are reading the same threads. I had been trading on H4 a very similar method to this one for months with good results. You may remember I prefer to wait for a break of 24 hr H/L as entry filter. I discovered ALF and replaced Supertrend with Alf. This month I have begun to trade 2 models. One using Alf, the other,ST. Alf produces better when price trends strongly with little retracement. ST gives back less in the chop. Both are good!
Vincit qui se vincit.
  • #4,627
  • Jul 28, 2010 3:31am Jul 28, 2010 3:31am
Quite a tough morning so far.
EU -17
EG -17
AU -5
If you don't risk, you don't ever have to lose.
  • #4,628
  • Jul 28, 2010 4:29am Jul 28, 2010 4:29am
hi bug post your charts of EU and EG please doenst tally with what I have u sure your starting at 8am UK time

cheers

P
  • #4,629
  • Jul 28, 2010 4:43am Jul 28, 2010 4:43am
Here they are. I'm pretty sure I've got my clock set right - 10:00 local time, 7:00 GMT, 8:00 London. The entries, now they might be a different story.
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If you don't risk, you don't ever have to lose.
  • #4,630
  • Jul 28, 2010 5:52am Jul 28, 2010 5:52am
Quoting bug
Here they are. I'm pretty sure I've got my clock set right - 10:00 local time, 7:00 GMT, 8:00 London. The entries, now they might be a different story.
Hey bug

Can you also give a reason why entere where you entered thos trades? IMHO the places where you entered the trend was already exausted and the reason for that is that TM changed color several bars before your entry. At the same time based on you charts you did not took short entry on EU.

Regards

Kristjan
  • #4,631
  • Jul 28, 2010 7:25am Jul 28, 2010 7:25am
Both of those entries were taken because they satisfied the rules to some extent (blue dot, blue TM). However, I recognize that none of those two trades were taken at the beginning of a swing. What I did can be considered an attempt to reenter a trade. I know that reentry is quite difficult to master and quite honestly that's the reason I took them. You see, I went over numerous London opens and came away with the impression that one could just hop on in the direction of the London open as a general rule. I did this to end my doubts, so to speak. I put in the SL as I was supposed to and just waited to see what would happen. Why I took 2 simultaneous trades at the same time, I have no idea. The conclusion for me is that I should not attempt to reenter a trade. I sort of knew that before, but I just need to learn it the hard way.
Why didn't I enter short EU? By the time I noticed the rules were giving me an entry signal, the pair had already gone below 1.30 and I wasn't keen on risking too much so I just stayed away.

Here are two trades from later that day. I didn't attempt to reenter on those ones. I did close EJ manually though.
UJ +11
EJ +33
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If you don't risk, you don't ever have to lose.
  • #4,632
  • Jul 28, 2010 1:17pm Jul 28, 2010 1:17pm
Quoting bug
Here they are. I'm pretty sure I've got my clock set right - 10:00 local time, 7:00 GMT, 8:00 London. The entries, now they might be a different story.
sorry for the delay..just because both were blue at 8am does not mean enter we need TM go from red then to blue as long as BBmacd is blue we enter



Cheers
Paulus
  • #4,633
  • Jul 28, 2010 1:25pm Jul 28, 2010 1:25pm
from post 4566

All systems require volatility ..its the life blood without it we all fail regardless

We have not had a volatile market for a few days..its frustrating I know TM goes blue macd BB is blue we go long..in volatile markets prices climb and we follow up with our stop in none volatile markets the price reverses...and there is nothing we can do about it..

Your only defense is to also trade this on a longer time frame and so limite the lack of volatility has...dont forget 1-3% risk per trade..big losers should not hurt your account..large stop means small number of contracts small stops means large number of contracts... a money management programme can work that out for you

use this one is easy and helps in such times

P
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File Type: xls Risk Calculation.xls   27 KB | 417 downloads
  • #4,634
  • Jul 28, 2010 1:27pm Jul 28, 2010 1:27pm
Quoting bug
Paul, thanks for posting this. It's a great example of the versatility of your system. Which brings me to this:

I However, quite a few members of FF have a day job, which means that they aren't able to trade the lower TFs. My suggestion would be the following: could you please consider adding a line or two into the first post on this thread for those who don't trade M5? People usually read the first post but don't necessarily read the whole thread, which means that they might miss those charts with higher TFs. Your system has proven itself over...
Hi Chris will do so now thanks for the reminder

cheers

P
  • #4,635
  • Jul 28, 2010 1:52pm Jul 28, 2010 1:52pm
Quoting Paulus
sorry for the delay..just because both were blue at 8am does not mean enter we need TM go from red then to blue as long as BBmacd is blue we enter
I think I'll have to write that down and put it somewhere where I can see it right before I start trading each day until I finally feel at home with the system. This is just my second week of using it and I keep tripping and falling. They say it takes 4 weeks for a habit to stick with you.

Volatility. I guess it'll have to return pretty soon. Right now we are sitting right near important pivot levels on GU and EU so either we break - up or down, it should bring volatility back. Friday is US flash GDP estimate day, which should bring some clarity and volatility.

Paul, what about the trades I took in the afternoon? Were they 'according to the rules' or was there something you would have done differently? I appreciate your help.
If you don't risk, you don't ever have to lose.
  • #4,636
  • Edited 7:02am Jul 29, 2010 6:54am | Edited 7:02am
Quoting bug
This is just my second week of using it and I keep tripping and falling. They say it takes 4 weeks for a habit to stick with you.
Bug, since you are a beginner may I suggest that you just practice PA - price action - entries and exits. Leave all the indicators alone.

I seem to remember that CH said that if you just did that you would win!!

See the video of the 'natural flow' and it is all about swings! Swing up Swing down.

Find the topmost bar of an up swing, this is the pivot, the next bar down is the confirmation of the change of direction, you enter on the next bar down. As someone else said, the move was over when you joined.

In following this simple strategy you may make false entries and get whipsawed but you will also strike lucky with a good swing in your direction.

There is no way to know what will happen next so we take our losses with our wins.

The attached pic was the wrong one Sorry, so removed it
  • #4,637
  • Jul 29, 2010 7:07am Jul 29, 2010 7:07am
lol, like a good novel. thanks for sharing.
  • #4,638
  • Jul 29, 2010 7:34am Jul 29, 2010 7:34am
Quoting Phreddy
Bug, since you are a beginner may I suggest that you just practice PA - price action - entries and exits. Leave all the indicators alone.
You're kidding, right? This is not my first day of trading, you know. Trying to read price action off a naked intraday chart is one of the toughest things if you're trading real money. That's why I'm using indicators as outlined by Paul in the beginning of this thread. I've tried trading naked intraday and I've got the scars so prove it. IMHO anyone who suggest trading intraday trying to predict swing top and lows is either selling something or doesn't know what he's talking about. There are exceptions, but they are very rare.

Look, I'm not trying to stir up emotions in here, but I'm not looking for some sort of fartherly figure to tell me that PA is the real shit. I'm in this thread because I like the indicators, I've tested them extensively and I am confident at using them. I also explained in a previous post that the reason those two trades sucked was because they were deliberate reentries. I knew what I was doing and I don't need someone to start suggesting me to remove them.
If you don't risk, you don't ever have to lose.
  • #4,639
  • Jul 29, 2010 8:39am Jul 29, 2010 8:39am
Paul, I have a question for you concerning reentries. The two trades that I posted before, the EU and the EG, were reentries into the London open. As I outlined in my post, they were taken to 'test' the reentry. I have now taken another look at possible reentries and I have a chart with a question. As my experience told me, it is not wise to reenter into an existing trend at the open. However, would a reentry after point nr.3, when the candle closed below TM been a signal that you would have considered taking? The same setup was visible on EU this morning, only the TM and MACD were blue in that case. I had another look at the EU and EG charts and with this kind of reentry setup, I would have had to stay out. What are your thoughts?
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If you don't risk, you don't ever have to lose.
  • #4,640
  • Jul 29, 2010 9:13am Jul 29, 2010 9:13am
Bug

Could try adding a stochastic to show when price is OB/OS and when we should then expect another push with the trend. A candle close above the TM would then confirm probabilities are in our favour.

Or drop to the 1min chart and catch the next change of BBMAC dot with the 5m trend.

Very good day today using this strategy - Ive only been playing with it for a few days running alongside my normal system but really really like the simplicity or it. Give this strategy a couple of days screen time and I feel you begin to like it.

D
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