Building an equity millipede | Page 48 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Thegman's Journal (Equity Millipede Concept) 102 replies

Trading an Equity Millipede 23 replies

Equity millipede & Flying Buddha trading journal 9 replies

Build an Equity Millipede with the filtered Flying Buddha 171 replies

Application Development - Journal of Building an equity millipede 14 replies

Attachments: Building an equity millipede
Exit Attachments

Building an equity millipede

  • #941
  • Aug 16, 2010 3:31am Aug 16, 2010 3:31am
The beauty with volatile breakout is you are risking relatively small for something great. Also some failed volatile breakouts still lose on breakeven most times as it still closes outside range.

Here are few successful ones

http://img42.imageshack.us/img42/7109/aa12x.png

http://img690.imageshack.us/img690/7607/aa1e.png

http://img826.imageshack.us/img826/8122/aa1x.png
  • #942
  • Aug 16, 2010 3:38am Aug 16, 2010 3:38am
Quoting pipEASY
http://img535.imageshack.us/img535/7397/aa1r.png

This is a gbp/usd 4hr chart. I have circled the positions that are added and x is a loss as the price retraced further than the previous candle high.

When Joe knows that the initial open position is working well, he will stack positions in 1hr, 15minutes as well with similar approach. When a golden opportunity buddha is happening he will stack very aggressively. He always ensures that the new addition has its SL always moved to...
Graeme in the above example I'd just like to ask:

1)You mentioned he moves to Be before adding each new position, can i ask at what point he moves to BE, for example will he move to BE on the close of the candle he made the entry? Od does he move to BE later?

2)In the above example as he moves to BE before making an additional entry so he makes the inital entry after the flying buddha marked by the first orange circle, on the close of that candle he moves to BE. He makes the second entry on the next candle marked by the second orange circle and moves his stop to BE on the close of the candle. He then takes the third entry on the next candle marked by the third orange circle. Unfortunately this hits his SL and his first two trades are also stopped out at BE because of the long upper wick on this candle.

so i this case although the downtrend has commenced he's made a small loss and two BE trades. If he were to try a re-entry on the next candle and move that to BE on candle close that would be the only position that survives. Any more positions added later will be taken out at BE the blue candle with the long wick a few candles later.

So in the end he wouldhave made money on only one position in this downtrend? Could you please tell me if I've understood this correctly Graeme?

thx for all the painstaking effort you've put in to teach us ..... much appreciated
  • #943
  • Aug 16, 2010 3:40am Aug 16, 2010 3:40am
Quoting leggo
Yes it broke through with a nice long bullish candle but then stalled so I have not entered again yet
Exactly.

It pierced but we care about what happens after. The next candle after the break should move fast and furious but it just stalled and lingered there. So we got no one to piggyback on.

This pair is not moving.

I have one position at BE
  • #944
  • Aug 16, 2010 3:41am Aug 16, 2010 3:41am
Quoting pipEASY
Good job Ben.

Keep practicing.

Always keep moving around the pairs.

A clear volatile breakout is very easily noticed. When price approach .50 or .00 price should puncture with no effort.

Sincerely,

Graeme
Thank you Graeme for your support you are a great mentor.
Regards,
Ben
  • #945
  • Aug 16, 2010 3:55am Aug 16, 2010 3:55am
Quoting fugly
Graeme in the above example I'd just like to ask:

1)You mentioned he moves to Be before adding each new position, can i ask at what point he moves to BE, for example will he move to BE on the close of the candle he made the entry? Od does he move to BE later?

2)In the above example as he moves to BE before making an additional entry so he makes the inital entry after the flying buddha marked by the first orange circle, on the close of that candle he moves to BE. He makes the second entry on the next candle marked by the second orange circle...
Good afternoon, fugly

Great question and observation

Joe moves his position to BE at the opening of the next candle if its in profit. And then will place another order at 50%. Yes, that X will close first 2 positions at BE and 1 at loss on the 4 hour chart.

Joe uses same principle to stack on 1 hour (and on 15minutes most times as well). So when that X candle is going up it is also closing out few of his 1 hour positions as well. However, he will continue stacking positions until a 'confirmed' 4 hour candle does close over the open price of the previous candle which in this case it doesnt. So in another words he would have positions when price is coming back down on 1hr chart that does not show on that 4 hour chart. When the first confirmed 4 hour candle does close over the open price of the previous candle then he closes half of all his positions including 4 and 1 hour.

His '1 thing' is in stacking positions without the anxiety attack most traders experience. This is up to each individual traders personal risk tolerance.

Even if the price only moved 2 4hr candles down he would still manage his positions to close out on profit and keep the rest for free.

To be honest that chart is not showing a optimum opportunity but even that chart would have pocketed Joe a tidy profit.

If you zoom out and look at a 4 hour chart, you will notice some buddhas run for days. Im not exaggerating to say that Joe would stack many many tens of positions quiet comfortably whilst ensuring that he is reducing/increasing his positions simultaneously.

Sincerely,

Graeme
  • #946
  • Aug 16, 2010 3:56am Aug 16, 2010 3:56am
Hello Pipeasy.
THis thread is very itneresting, however I feel u dont need to hold positions for months or years to be profitable. U said u take 8 trades per day on avarage.
You move SL to BE when price moves 20-30 pips in your favor and u use 20-30 pips SL. U also said u are able to move SL to BE 80% of the time.
So 6 out of 8 trades goes in your favor, and if u took profit just for 20-30 pips with RR 1-1 u would be up 120pips - 2 trade that hit SL for 40 pips. Just by your precise entry u are able to make 80 pips per day.
Now u trade 200 days per year, which makes 16 000 pips.
With this approach and high probability u can easily risk 0.5%-1% per trade, your equity would be rising faster and u can also increase your position size. 16000pips with 20pips SL and just 0.5% risk (without compounding) would net u 400% yearly gain, 1% risk would net u 800% gain.

Now the question is why would u bother with managing 100 positions, diversifying , regruoping etc... when u can achieve the same result just by applying your entry rules.
It seems that most important is to have good entry , therefore u recommended to practice entry skills for 6 months. To be honest Im terrible with momentum trading u need talent to be good to trade 5 minute bars and see momentum and all things u see.
Good luck
alter
  • #947
  • Aug 16, 2010 4:05am Aug 16, 2010 4:05am
Quoting alter
Hello Pipeasy.
THis thread is very itneresting, however I feel u dont need to hold positions for months or years to be profitable. U said u take 8 trades per day on avarage.
You move SL to BE when price moves 20-30 pips in your favor and u use 20-30 pips SL. U also said u are able to move SL to BE 80% of the time.
So 6 out of 8 trades goes in your favor, and if u took profit just for 20-30 pips with RR 1-1 u would be up 120pips - 2 trade that hit SL for 40 pips. Just by your precise entry u are able to make 80 pips per day.
Now u trade 200...
Good question, alter

And this would be last before supper.

I have practiced many many many times to know which is a good momentum. However, you do not need special eyes to notice volatile breakout. You will clearly see them when you watch them. You need to witness roughly 50 volatile breakouts before knowing very clearly.

I chose long term trading cause I wish to work less and less. 5min trading is very exciting however I only do it occasionally. Most of my trades are buy/sell stops. Most readers here are still practicing greatly on lower timeframe and I thought I could lend everyone my focal interpretation as a small guide.

Your correct. I can daytrade 5 minute momentum breakout candles everyday and still create a large profit. Do you realize that this is a very very stressful way to trade.

Perhaps I have a different perspective to trading as to most but I choose to have my positions work for me and not the other way around. I do realize however good positions are rare which excites me very much when I do find a good rare one. It feels like picking up a large diamond from the fields.

This reward pleasure is very different to trading intraday when im pushed with time and goal to create a profit everyday, everyweek.

2 completely different psychological mind frame.

Edit: Currently, calculated on last 14 months my unrealized profit is over 700% of my initial starting capital

Sincerely,

Graeme
  • #948
  • Aug 16, 2010 4:06am Aug 16, 2010 4:06am
Breakout trade short @ 82.37
  • #949
  • Aug 16, 2010 4:48am Aug 16, 2010 4:48am
Im short on Eur/Yen after 50% retrace on 4hr chart trying to use the wick!
  • #950
  • Aug 16, 2010 5:06am Aug 16, 2010 5:06am
I like the flying Budah's very simple and with a well defined "stop loss". Like most of us we are always looking to change if not improve so I have noticed a condition which might eliminate some of the losers. If the "Flying Budah" exceeds th eprevious high then its a no trade. When prices are about to reverse they usually range or consoildate. This semms to be where the "FB" an over bought type of condition fit is. Only my penny worth.

I have have a mtf system which is still in its early days as I have been trying to automate it. Its the way to go. Find a good long term trend and then look at lower time frames for entries.
Good thread will keep reading.
  • #951
  • Aug 16, 2010 6:40am Aug 16, 2010 6:40am
Hi Love the thread, much of which I have read 3 times so far; still trying to see if I can suffer the emotions - I have been trading 3 years now with modest succes, but continually changing / adapting systems -but still making mistakes as I love to trade at certain times on pure impulse and this usually gives back all profit made to date - if not more; Am trying very hard to commit to the exercise, but possibly too old and long in the tooth to change my spots.
My question is not related to this, but to the open positions you have; if I have done the math correctly you have something around $40M working in the market and unrealised profits approaching $7M.
Obviously you feel comfortable with this, but few brokers give any guarantees on your private funds - let alone unrealised profits. Given your discipline and the work you do in your journal and housekeeping etc. when you diversify, have you considered the following: Close all trades that are countertrending at that time, moving the appropriate portion of funds to a 'working' account and from this account re-opening all long term trades that you would have left with their original stops; it might cost the spread to do this, but the money you would be losing is from the working account, losses come from here and profit can be pushed back into your capital account which grows as normal?
You could have an EA and just one buy and one sell order per pair.
Perhaps the above is negated by any arrangements you might have with your broker, but I would feel happier sleeping at night with the money in my acount rather than on the table.
  • #952
  • Aug 16, 2010 6:48am Aug 16, 2010 6:48am
I've read this entire thread over the last week and am particularly fond of the overall trading philosophy presented here.

There seems to be so much focus on exact entry techniques but I think that is pretty much the least important aspect presented in this thread and it's been proven a couple of times by Graeme and others through the 00s entry and/or the 'Joe' entry. Joe even admitted that his profitability was due to catching a good trend that he can stack on heavy with. A great entry will of course help, but I don't think it's required for a method adopting this long term philosophy.

In the past I have tried to trade from a small basket of markets and without much success. Somehow I ended up choosing the wrong markets to trade or spending most of the day scanning rather than acting. This is where I will have difficulty. This is where I need to focus my skill development. I need to develop a routine for scanning opportunity, categorizing it, and then staying on top of it throughout the day. I can appreciate this is a discretionary task, just as trading should be. Maybe I am just strange (lots of people would agree), but I think this is the hardest thing about this trading style.

With kind regards,
MK
  • #953
  • Aug 16, 2010 7:27am Aug 16, 2010 7:27am
Quoting pipEASY
Good afternoon, fugly

Great question and observation

Joe moves his position to BE at the opening of the next candle if its in profit. And then will place another order at 50%. Yes, that X will close first 2 positions at BE and 1 at loss on the 4 hour chart.

Joe uses same principle to stack on 1 hour (and on 15minutes most times as well). So when that X candle is going up it is also closing out few of his 1 hour positions as well. However, he will continue stacking positions until a 'confirmed' 4 hour candle does close over the open...
thx Graeme for a crystal clear explanation .... as usual , I've now understood it very well

  • #954
  • Aug 16, 2010 8:31am Aug 16, 2010 8:31am
The link to the revised pdf up to page 64.


http://www.mediafire.com/file/lno6v4...e%20page64.pdf
  • #955
  • Aug 16, 2010 8:43am Aug 16, 2010 8:43am
This is amazing. I've been trading the past couple of days kinda like what you told us using the '00 style. I've been trading half of my trade kinda like a day trade getting out at first sign of trouble and moving the other half to BE plus a few pips. I'm stunned at how I have stacked up orders, they are one after another. The confidence you can have when you look at that pair and knowing it's all in profit and you know you are moving with the trend, even if it is just for a short term, is amazing. Plus I'm increasing my usable money with half the trade being taken in profit. If just a few of these legs go into a day or two, the profits will be amazing.

making more money with honestly less stress. This is an amazing frame work that can be adopted to anyone's style!
A woman drove me to drink, and I forgot to thank her
  • #956
  • Aug 16, 2010 9:53am Aug 16, 2010 9:53am
Quoting flyer415
The link to the revised pdf up to page 64.


http://www.mediafire.com/file/lno6v4...e%20page64.pdf
Flyer415,

Thanks for your efforts in making these pdf files. The updates hold such great value.

RD
  • #957
  • Aug 16, 2010 10:04am Aug 16, 2010 10:04am
Quoting flyer415
The link to the revised pdf up to page 64.


http://www.mediafire.com/file/lno6v4...e%20page64.pdf
Thanks a lot Flyer415. Very much appreciated.

Bak
  • #958
  • Aug 16, 2010 10:42am Aug 16, 2010 10:42am
Quoting flyer415
The link to the revised pdf up to page 64.


http://www.mediafire.com/file/lno6v4...e%20page64.pdf
Thanks flyer. I am definitely making use of this.

Hi Graeme, you confused me a bit when you said the 5min entries were not your primary entry technique. I thought they were. Can you elaborate on what your main entry method is? Asia session is better for me as well but little or no opportunities compared to London session so I am curious how you are stacking during asia session.
  • #959
  • Aug 16, 2010 10:43am Aug 16, 2010 10:43am
Quoting flyer415
The link to the revised pdf up to page 64.


http://www.mediafire.com/file/lno6v4...e%20page64.pdf

Thanks a lot. Your effort is highly appreciated...
  • #960
  • Aug 16, 2010 12:11pm Aug 16, 2010 12:11pm
Quoting flyer415
The link to the revised pdf up to page 64.


http://www.mediafire.com/file/lno6v4...e%20page64.pdf
Much obliged mate
20 traders viewing now