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Trading "The Constrictor"

  • #41
  • Edited 3:22am Aug 12, 2010 2:46am | Edited 3:22am
Quoting BWise
Ghous,

With ET2, do the 21 and 50 EMA need to be constricted when a trigger bar is formed?

The reason I am asking is b/c there is a nice PB on the EUR/NZD H4 but I am not sure if it is a valid ET2 because the MA's are not constricted. Could you shed some light on this for me?

Thanks
Hey B,

A constriction isn't necessary, but still recommended. Often, when price breaks out too soon you might find it retesting the CZ for a second or sometimes even the third time.

If you take a look at the Usd/Cad 4H IB, we had a similar situation where price blew through the CZ and then we had quite a few 4H bars sitting up at the CZ.

On the very chart (Eur/Nzd) I have highlighted 2 more such examples. (A & B) where price broke off the CZ after the first pull back (though only B appears to be a valid ET2 setup) but because the CZ isn't tightened up price pulls back for a 2nd time to the CZ.

The Pb you are talking about is caught up in a similar situation. I see we are 2 hours into the current 4H bar and price hasn't exactly broken hard in he direction of the Pb. An important factor would also be the 1.8 that price is running straight into, that you might want to consider.

(BTW this pair isn't included in the ones that I trade - it's been pretty choppy these days)

g.
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I believe . . .
  • #42
  • Aug 12, 2010 4:04am Aug 12, 2010 4:04am
now we have a 4H pull back to hide our stops behind

g.
Attached Image(s) (click to enlarge)
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Click to Enlarge Name: usdcad.png Size: 19 KB
I believe . . .
  • #43
  • Aug 12, 2010 8:00am Aug 12, 2010 8:00am
We did get a BEOB on Gbp/Chf, but the close was unsatisfactory. An authoritative close at or below 1.65 is what I was looking for.

g.
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I believe . . .
  • #44
  • Aug 12, 2010 1:02pm Aug 12, 2010 1:02pm
Quoting ghous
Hey B,

A constriction isn't necessary, but still recommended. Often, when price breaks out too soon you might find it retesting the CZ for a second or sometimes even the third time.

If you take a look at the Usd/Cad 4H IB, we had a similar situation where price blew through the CZ and then we had quite a few 4H bars sitting up at the CZ.

On the very chart (Eur/Nzd) I have highlighted 2 more such examples. (A & B) where price broke off the CZ after the first pull back (though only B appears to be a valid ET2 setup) but because the CZ isn't tightened...
Did you go for this trade B?

1.8 was always going to prove a hurdle.

g.
Attached Image (click to enlarge)
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I believe . . .
  • #45
  • Aug 12, 2010 1:25pm Aug 12, 2010 1:25pm
CAD has had it's fun, and so have we?

11R runner!

g.
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I believe . . .
  • #46
  • Aug 12, 2010 1:32pm Aug 12, 2010 1:32pm
congrats, ghous ! this system looks impressive, talking about ma system, i'd say i love them, and yours is something innovative and special, great job,well done, really good for you that you have found the solution to avoid the choppy market trading ma systems

just a quick question, what is the win loss ratio and the average R R so far?

jeurre
  • #47
  • Aug 12, 2010 7:10pm Aug 12, 2010 7:10pm
Quoting jeurre
congrats, ghous ! this system looks impressive, talking about ma system, i'd say i love them, and yours is something innovative and special, great job,well done, really good for you that you have found the solution to avoid the choppy market trading ma systems

just a quick question, what is the win loss ratio and the average R R so far?

jeurre
I haven't been doing the math all that much so won't go on to give exact figures but the win loss %age should be well above 50, and as far as R R goes it varies tremendously. Most of the trades go for 1R-3R but then there are those occasional 8Rs and 11Rs (like the trades on Eu and Usd/Cad that I missed) and obviously quite a bunch of BEs too.

Once I have data spread across more time I'll make sure I get these stats done - just thought such numbers had little value atm given that I've only been trading this system for 2 months (back testing is BS when it comes to statistical analysis)

g.
I believe . . .
  • #48
  • Aug 12, 2010 7:50pm Aug 12, 2010 7:50pm
hey, ghous, it is important in the sense that you may understand the style of this system and adapt your mentality accordingly, therefore, i had this question. in order to trade this system, i guess you may need to visit your chart once per each bar closure ?

jeurre



Quoting ghous
I haven't been doing the math all that much so won't go on to give exact figures but the win loss %age should be well above 50, and as far as R R goes it varies tremendously. Most of the trades go for 1R-3R but then there are those occasional 8Rs and 11Rs (like the trades on Eu and Usd/Cad that I missed) and obviously quite a bunch of BEs too.

Once I have data spread across more time I'll make sure I get these stats done - just thought such numbers had little value atm given that I've only been trading this system for 2 months (back testing is...
  • #49
  • Aug 12, 2010 9:13pm Aug 12, 2010 9:13pm
Quoting ghous
Did you go for this trade B?

1.8 was always going to prove a hurdle.

g.

Yeah, I took the trade (demo) and got out right before 1.8. Im just trying to limit the pairs to apply this method to, to avoid the unneccesary choppiness. And also familiarize myself with the different entry criterias. So far, so good.
  • #50
  • Aug 12, 2010 9:17pm Aug 12, 2010 9:17pm
Quoting jeurre
hey, ghous, it is important in the sense that you may understand the style of this system and adapt your mentality accordingly, therefore, i had this question. in order to trade this system, i guess you may need to visit your chart once per each bar closure ?

jeurre
that's right, roughly about once every bar closure but only when things are interesting - there have been weeks where the markets in general go flat and you can comfortably take the whole week off.

g.
I believe . . .
  • #51
  • Aug 12, 2010 9:17pm Aug 12, 2010 9:17pm
Quoting BWise
Yeah, I took the trade and got out right before 1.8. Im just trying to limit the pairs to apply this method to, to avoid the unneccesary choppiness. And also familiarize myself with the different entry criterias. So far, so good.
I believe . . .
  • #52
  • Aug 12, 2010 10:28pm Aug 12, 2010 10:28pm
aha...
so u did push through with your journal!
Good luck bro!


btw, im not sure why u called it constrictor... i thought all this time u HATE snakes
  • #53
  • Aug 12, 2010 10:50pm Aug 12, 2010 10:50pm
Quoting supremeChaos
aha...
so u did push through with your journal!
Good luck bro!


btw, im not sure why u called it constrictor... i thought all this time u HATE snakes
I believe . . .
  • #54
  • Aug 12, 2010 11:25pm Aug 12, 2010 11:25pm
Here's an update to the Eur/Nzd 4H,

See how price pulled back into the CZ for the second time after the initial break? This will often happen when the EMAs aren't constricted enough. Price makes it all the way to the 21 (1.81 ppz) gives off another pin bar and this time breaks out of a more constricted CZ. I was really hoping the breakout bar would close below 1.8 but it failed to give us an authoritative close hence no trade.

g.
Attached Image (click to enlarge)
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I believe . . .
  • #55
  • Aug 13, 2010 2:03am Aug 13, 2010 2:03am
Hi ghous,
it's me again. Does this extension of the J16 method fits you more and does it improved your trading results?

I wish you a lot of pips today
  • #56
  • Aug 13, 2010 3:35am Aug 13, 2010 3:35am
Again rejected off confluence of 21 + SR. Currently found support on strong 0.82 but if it closes well below it may well go as down as 0.80 with little or no opposition.
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Trading = a mirror to your human flaws. Fix them or be fixed.
  • #57
  • Aug 13, 2010 4:14am Aug 13, 2010 4:14am
Trendline break on Daily and was just retested. Going down to H4 I see the reversal bar at confluence of 21 + TL + SR. Sell order with TP just above RN 0.7.

P.S. These are all demo trades, my live trades are from Daily timeframe using a trend following strategy. But am really interested if I can use this H4 method to tighten my entries.
Attached Image (click to enlarge)
Click to Enlarge Name: nzdusd.png Size: 73 KB
Trading = a mirror to your human flaws. Fix them or be fixed.
  • #58
  • Aug 13, 2010 4:26am Aug 13, 2010 4:26am
Quoting soso
Trendline break on Daily and was just retested. Going down to H4 I see the reversal bar at confluence of 21 + TL + SR. Sell order with TP just above RN 0.7.

P.S. These are all demo trades, my live trades are from Daily timeframe using a trend following strategy. But am really interested if I can use this H4 method to tighten my entries.
I took this train too...

g.
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I believe . . .
  • #59
  • Aug 13, 2010 4:29am Aug 13, 2010 4:29am
The missing streak continues!

I was off for my Friday prayers and came back in time to get in on the Nu,

IMO Nzd/Jpy, and Cad/yen look spectacular as well,

Have put in some sell limit orders on these to hopefully get in on a quick retrace if possible. The orders will get pulled off if we don't get a pull back quick.

My goodness! I need to take my trades!!!

g.
I believe . . .
  • #60
  • Aug 13, 2010 4:30am Aug 13, 2010 4:30am
Quoting MCFly
Hi ghous,
it's me again. Does this extension of the J16 method fits you more and does it improved your trading results?

I wish you a lot of pips today
Hey MC

It fits me more yes, my trading results so far have been pretty much in line with what I used to have when trading conventional James16 - that is - "pretty good".

g.
I believe . . .
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