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  • #3,721
  • Jul 30, 2010 9:51pm Jul 30, 2010 9:51pm
I love the fact that with only 1 winning trade per month - that's a 1 in 40 win/loss ratio, you could still turn a $5,000 account into close to $1,000,000 in one year with this system! (based on a 1 pip loss average).

How easy is it to get our hands on reliable historical data for LO & NY opens for the past few years? Tick or 5sec data from Oanda would be ideal. Could be a real eye opener...
  • #3,722
  • Jul 31, 2010 12:35am Jul 31, 2010 12:35am
I enjoy checking into this thread from time to time as the method used here is in the same ballpark as some ways that I trade. Its been a while since I posted but I thought I might voice some constructive criticism. I don't mean any disrespect to the OP.

I'm a firm believer in breakout trading. I regularly fish for break-outs and enter large, typically at about 0.2% of account per pip - that's a 5-pip sl for a 1% account risk. But I vary the entry size based on the prospective trade. There are lots of recognizable PA formations that are good for break-out fishing - even on one pair (E/U for me, mostly) there are many good trading opportunities in a given day.

The differences I have with ther method here are:

- why only the LO and NYO? Definitely not a bad idea to watch to trade those times, but arbitrarily choosing just those opens is an unnecessary limitation. Also good to watch the major news events, scehduled and otherwise. But the PA on your chart can tell you lots about when breakouts may occur. There are many more than 2x a day when good trades can be made with a large size/low risk entry.

- and why the arbitrary tp? Why 140 pips or 100 pips, and not 110 pips or 60 pips? Actually, it is wise to let the charts inform you about what a good profit target may be. If there are ranging conditions and only let's say a 120-pip daily range, does it make sense to have a tp much larger than that? You can use the information on your charts to do better than establish an arbitrary range.

Friday's LO was a really good opportunity on EU, but I see some here got stopped out of that. I entered E/U short at the open at .3090, but with a 20-pip sl for a 1% risk - that's 0.05% of account per pip. I let it run without watching but checked on it about an hour later and saw it reversing around .3040. So I cashed in for a 2.5% gain. I got up later that morning and saw that it had switched back and dropped all the way to .2980. You could say I left money on the table - but I took the best of what I saw when it was there. I like to take profit repeatedly - there is always another trade waiting around the corner.

Trading breakouts is one of the most lucrative methods there is. But there's more than one way to skin a cat. Break-outs can happen many times a day, not just at the NYO and LO. Watch PA for a few months/years and you will be able to see them before they happen. And if you are tired of getting stopped out with a 2-pip sl, maybe think about scaling back on your trade size a bit so you can afford 5- 10- or 20-pip sl's. Maybe you make less profit per trade but you may find that you will get good entries more often and so have many more winning trades, earning more overall.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,723
  • Jul 31, 2010 5:53pm Jul 31, 2010 5:53pm
2 pip SL is the key of this method my friend.
It allows a huge R:R in case you caculate your risk on max risk% of your account.

I experienced many SL size on EU, my best one is 2,6 pip + (0.9)spread. Makes risk calcul at 3,5pip = 1% of my account.
  • #3,724
  • Jul 31, 2010 6:52pm Jul 31, 2010 6:52pm
Quoting Walcott
2 pip SL is the key of this method my friend.
A method based on arbitrary entries and exits is no method at all. Anybody who has studied volatile price action for more than a little while will be aware that very tight sl's are just a gift to the broker's kitty. But hey I'm not looking for converts, any method might work for a given trader - and only his account balance can tell the tale.

I won't have anything else to say, so best of luck all.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,725
  • Jul 31, 2010 9:07pm Jul 31, 2010 9:07pm
Quoting The Fool
I enjoy checking into this thread from time to time as the method used here is in the same ballpark as some ways that I trade. Its been a while since I posted but I thought I might voice some constructive criticism. I don't mean any disrespect to the OP.

I'm a firm believer in breakout trading. I regularly fish for break-outs and enter large, typically at about 0.2% of account per pip - that's a 5-pip sl for a 1% account risk. But I vary the entry size based on the prospective trade. There are lots of recognizable PA formations that are good...

Hi there very large post, I'm going to answer you the same orders as you asked the questions.

- I now limit my entries to NY and London open because I can have my SL reduced to 1 pip initially. Disadvantages of the things you named: S&R: impossible to have 1 pip SL, S&R have a tendency to bite back or retrace to the initial line... minimum SL would be 5 pips SL. Keep in mind that I trade 99% of my bank account each time I enter a trade. Expected News: minimum SL would be 20 pips: slippage, spreads, whipsaws you name it! 20 pips risked is a complete WEEK of trading for me. I actually trade before the breakout and not after it. After it's too late, on the opens you can expect a big move and you're already in the trade before it.

-why arbitrary? because forex is arbitrary or chaos, I'm not a believer of any analysis, any at all. Forex studies, whatever they are are useless and are a good tool for the institutions to take away money from others. If it was all about forex technical analysis everybody would be rich. It's a math thing... and also money management. 140 pip TP is perfect for me, it's based on experience.

I'm not contradicting you since I am also doing what you are saying... if you take time to read the thread you will see that I often and very often enter at major support and resistance (on the 5 Min chart) with a 2 pip stop-loss... I also enter on big 5 sec candles (8+ pips) with the same SL.... in high volatility... but will never enter a trade with 10 or 20 pips SL like you said... my TP would then have to be not 140 pips but 1400 pips as 20 is 10x bigger than 2. If it works for you, you can't want anything better... after all look at my signature!
Invest in alarm clocks
  • #3,726
  • Jul 31, 2010 10:09pm Jul 31, 2010 10:09pm
Quoting The Fool
A method based on arbitrary entries and exits is no method at all. Anybody who has studied volatile price action for more than a little while will be aware that very tight sl's are just a gift to the broker's kitty. But hey I'm not looking for converts, any method might work for a given trader - and only his account balance can tell the tale.

I won't have anything else to say, so best of luck all.
actually fool(why would you make it hard for me to address you seriously?), trading the open times is really not as arbitrary as you make it sound. The reasoning behind it is sound.

I do agree with you that exits need to be more planned than the 140 pips static number. THAT is arbitrary.

Perhaps it would help if you understood that your method of trading has nothing in common with tony's. They may look similar to you, but they're not. What Tony does is look for opportunities where volatility has a good chance of being high, meaning he has a good chance of jamming the 0SL in asap.

Once you have a method that has a good chance of getting to 0SL quickly, it doesn't matter how often u get stopped out. In other words, the entire plan from the get-go is not to get a good trade, but to get a trade that allows you to trail the SL to BE asap. Probability takes care of the rest.
  • #3,727
  • Jul 31, 2010 10:19pm Jul 31, 2010 10:19pm
Quoting Yibble
I love the fact that with only 1 winning trade per month - that's a 1 in 40 win/loss ratio, you could still turn a $5,000 account into close to $1,000,000 in one year with this system! (based on a 1 pip loss average).

How easy is it to get our hands on reliable historical data for LO & NY opens for the past few years? Tick or 5sec data from Oanda would be ideal. Could be a real eye opener...

i looked into this and found that oanda provides tick data for it's customers when requested. It took them only 10 mins to compile and send me tick data from eurusd and gbpusd from jan 1st 05 to 2 months ago.

It's alot of data to wade through, and i'm in the process of writing a simple program to parse through it all. This will take time however(it's not exactly top priority for me on a weekend). What should be noted however, is that the tick data provided is to the 4th decimal, ie eurusd at 1.3041. Depending on your understanding and necessity in fractional pips, it can mean its more accurate or less.

For the more adventurous who may wish to play with the data themselves, a fair warning : the csv files containing data for each pair were about 190mb each, and excel,openoffice or notepad won't open it properly. VIM has never failed me before this, but it grudgingly opens the files after about 5 mins...and lags or crashes everytime I scroll down.
  • #3,728
  • Aug 1, 2010 1:06am Aug 1, 2010 1:06am
Quoting deathbait
i looked into this and found that oanda provides tick data for it's customers when requested. It took them only 10 mins to compile and send me tick data from eurusd and gbpusd from jan 1st 05 to 2 months ago.

It's alot of data to wade through, and i'm in the process of writing a simple program to parse through it all. This will take time however(it's not exactly top priority for me on a weekend). What should be noted however, is that the tick data provided is to the 4th decimal, ie eurusd at 1.3041. Depending on your understanding and necessity...

How much does Oanda charge for the tick data ?
  • #3,729
  • Aug 1, 2010 3:58am Aug 1, 2010 3:58am
[quote=deathbait;3913551]actually fool(why would you make it hard for me to address you seriously?), trading the open times is really not as arbitrary as you make it sound. The reasoning behind it is sound.

I do agree with you that exits need to be more planned than the 140 pips static number. THAT is arbitrary.

Perhaps it would help if you understood that your method of trading has nothing in common with tony's. They may look similar to you, but they're not. What Tony does is look for opportunities where volatility has a good chance of being high, meaning he has a good chance of jamming the 0SL in asap.

Hi deathbait,



Perhaps it would help if you understood that your method of trading has nothing in common with tony's. They may look similar to you, but they're not. What Tony does is look for opportunities where volatility has a good chance of being high, meaning he has a good chance of jamming the 0SL in asap.

Tony & followers would stand a better chance of success of a more regular scale if they waited for volatility to show its beautiful face, instead of just entering in the direction of the 1st 1pip candle.

The current entry method is no better than using the outcome of a coin toss to determine entry.

Regards,

BabeFX
  • #3,730
  • Aug 1, 2010 4:04am Aug 1, 2010 4:04am
[quote=BabeFX;3913730]
Quoting deathbait
actually fool(why would you make it hard for me to address you seriously?), trading the open times is really not as arbitrary as you make it sound. The reasoning behind it is sound.

I do agree with you that exits need to be more planned than the 140 pips static number. THAT is arbitrary.

Perhaps it would help if you understood that your method of trading has nothing in common with tony's. They may look similar to you, but they're not. What Tony does is look for opportunities where volatility has a good chance of being...
BabeFX, If you don´t trust in Tony´s entry, what is your entry criteria?
  • #3,731
  • Aug 1, 2010 9:32am Aug 1, 2010 9:32am
[quote=BabeFX;3913730]
Quoting deathbait
actually fool(why would you make it hard for me to address you seriously?), trading the open times is really not as arbitrary as you make it sound. The reasoning behind it is sound.

I do agree with you that exits need to be more planned than the 140 pips static number. THAT is arbitrary.

Perhaps it would help if you understood that your method of trading has nothing in common with tony's. They may look similar to you, but they're not. What Tony does is look for opportunities where volatility has a good chance of being...
BabeFX, I have the equivalent of 8 years of experience.

If you actually do wait for volatility to kick in, it's too late, it's already over and you missed the train.
You have to be in "before" the volatility kicks in, it's expectancy. Let me give a very clear and simple example: It's 3:00 am.... nothing is moving yet... there is no volatility.... all of a sudden there is a sequence of 5 nice big candles... all 3 pips tall.... moving down south... you enter for a short.... oups! it retraces back... Mr. bankman just took your money... That's what people do all the time... if you would have actually entered before with a 1 pips SL you would be in a EPIC win situation.
Invest in alarm clocks
  • #3,732
  • Aug 1, 2010 10:38am Aug 1, 2010 10:38am
[quote=BabeFX;3913730]
Quoting deathbait
actually fool(why would you make it hard for me to address you seriously?), trading the open times is really not as arbitrary as you make it sound. The reasoning behind it is sound.

I do agree with you that exits need to be more planned than the 140 pips static number. THAT is arbitrary.

Perhaps it would help if you understood that your method of trading has nothing in common with tony's. They may look similar to you, but they're not. What Tony does is look for opportunities where volatility has a good chance of being...
At first glance you could say that the entry method is a coin toss...but it's not as there is a reason behind the entry method and that is the timing of the entry. A coin toss entry would mean random direction at a random time.

Why this method can be successful is:

a) the time that the trade is taken i.e. London and NY open and the reason why this might lead to a situation where price quickly moves away from your entry.

b) the movement of the SL to BE asap ensuring that it becomes a risk free trade.

But, don't forget that a coin toss entry method can still be a very profitable strategy if the risk management and trade exit are the key behind the method.
  • #3,733
  • Aug 1, 2010 10:53am Aug 1, 2010 10:53am
Quoting Tony112
Next week's plan:

- 10 entries will be made only (NY and London x5)
- no support and resistance trades will be made
- no big 5 seconds candles will trades will be made
- all entries will have a min of 100 pips TP
- all entries will be posted (10)

the week will be filled with new wonderful opportunities ! On a positive vibe see ya on Monday's London open Have a nice week-end. No party for me tonight, I'm relaxing.
I'll follow you at the moment because of the holiday but I'll start to push the price a little with you from September

I always traded reversal candlestick on daily chart and is what i'm still doing but I want give this system a try to maximize the leverage use and because it seems so obviously profitable

Good luck everyone for the week to go
  • #3,734
  • Aug 1, 2010 11:02am Aug 1, 2010 11:02am
tick data is free for all oanda account holders with minimum $1000 in the account

regarding coin toss, i think the common mistake ppl make here is confusing probability with expectancy.
  • #3,735
  • Aug 1, 2010 11:53am Aug 1, 2010 11:53am
[quote=lovejoy80;3914019]
Quoting BabeFX

At first glance you could say that the entry method is a coin toss...but it's not as there is a reason behind the entry method and that is the timing of the entry. A coin toss entry would mean random direction at a random time.

Why this method can be successful is:

a) the time that the trade is taken i.e. London and NY open and the reason why this might lead to a situation where price quickly moves away from your entry.

b) the movement of the SL to BE asap ensuring that it becomes a risk free trade.

But, don't forget...

I would agree to consider my method as a coin toss, as long as one side of the coins weighs more LOLLLLL
Invest in alarm clocks
  • #3,736
  • Aug 1, 2010 1:54pm Aug 1, 2010 1:54pm
I just had a conversation with a friend of mine, also a good trader, there is this point :

Entry on open first 1 pip
+ entry on the beginning of the movement
- Random entry on open

Entry on big candle
+ Avoid most of flat moves on open
+ with the trend
- late entry (volatility has already started, price can retrace before BE easily)

His idea was to use both of these techniques.
Entry on first 1 pip candle on open and depends to what happen : if BE or SL, wait for a big candle off S/R.

that way you increase your chances to be in the move (even if it reverse, shame but it's part of business) because sometime volatility takes time to come, and in this case second technique is powerful, and sometime volatility start as soon as LO/NY open... first technique is in. If you get stopped quikely on first technique because you was against the trend, you should wait for a big candle or beautiful trend in spite of looking at charts your BE or SL being touched like a dumb ass whereas volatility do this work front of you.

The thing is : the two techniques are good, with +'s and -'s, using both allows us more chances to take advantage of volatility.

Tony is right and he is the most experienced to say if it's indeed a good thought, I watch him doing well with big candle method and I keep in mind the fact that is important to don't miss the train because it's not like it happens often.
  • #3,737
  • Aug 1, 2010 1:57pm Aug 1, 2010 1:57pm
An interesting method, how long have you been trading this Tony?
  • #3,738
  • Aug 1, 2010 8:42pm Aug 1, 2010 8:42pm
London open coming in about 5 hours
Invest in alarm clocks
  • #3,739
  • Aug 1, 2010 8:43pm Aug 1, 2010 8:43pm
Quoting PA Trader
An interesting method, how long have you been trading this Tony?
4 years
Invest in alarm clocks
  • #3,740
  • Aug 1, 2010 11:18pm Aug 1, 2010 11:18pm
[quote=Tony112;3913972]
Quoting BabeFX

BabeFX, I have the equivalent of 8 years of experience.

If you actually do wait for volatility to kick in, it's too late, it's already over and you missed the train.
You have to be in "before" the volatility kicks in, it's expectancy. Let me give a very clear and simple [b]example: It's 3:00 am.... nothing is moving yet... there is no volatility.... all of a sudden there is a sequence of 5 nice big candles... all 3 pips tall.... moving down south... you enter for a short.... oups! it retraces back... Mr. bankman just...
Hi Tony,

What is the probability of the trend going against the first 5sec bar direction when the mkt open?
Don't we have to wait at least for some volatility i.e 3pip 5 sec bar, before making a decision?
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