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123 Method by lgtj

  • #101
  • Sep 29, 2010 2:49am Sep 29, 2010 2:49am
Quoting herty
Further to the above, the red dotted line is the presumed TP line. My question is what about all that resistance on the way up, do we ignore it? or be ready for a partial bailout?

Herty
It all depends on what price action does when it reaches those levels. Just keep an eye on the macd on the daily and 4H charts and the ma's when price reaches those levels.
  • #102
  • Sep 29, 2010 2:54am Sep 29, 2010 2:54am
Quoting Kasapreko
I entered that trade yesterday cause Ive seen MACD go up on the 4hr chart,but price has now retraced,so to me its even a better entry...just wish price will go up,up,up cause Im testing this system on my live account
please be careful with your money management....this is a long term strategy and the draw downs can be large......if you dnt have a good SL in place, you might get taken out often and price will still later go in your direction...hence the large pips risked..

Since this strategy gives you time to plan your trades, i suggest you envisage the amount of pips to be risked and equate that to the % of your capital you want to risk [i suggest not more than 3% per trade], this should give you the lot size to use...

Example....lets say you are to risk 300pips, and you are risking just 3% of your acct, say $1000,

3% of $1000=$30
300pips/$30=10..thats 10cents

so ur lot size will be 0.01

and TP is usually in the neighbourhood of 1:3

so you risk $30 for $90 gain.

trade this way and you'll never get jittery even if your trade is going against you.

just my 2cents.
God's Love For You Is Sure Never You Doubt It
  • #103
  • Sep 29, 2010 2:55am Sep 29, 2010 2:55am
I'm about to reach my break even point on eurusd.
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  • #104
  • Sep 29, 2010 2:56am Sep 29, 2010 2:56am
Quoting lgtj
It all depends on what price action does when it reaches those levels. Just keep an eye on the macd on the daily and 4H charts and the ma's when price reaches those levels.
Welcome Igtj,
Im just seeing something new you just said. What does price reaching the Moving averages mean? or is it just something extra you can use to beef up the accuracy?
  • #105
  • Sep 29, 2010 2:57am Sep 29, 2010 2:57am
Quoting D liberators
please be careful with your money management....this is a long term strategy and the draw downs can be large......if you dnt have a good SL in place, you might get taken out often and price will still later go in your direction...hence the large pips risked..

Since this strategy gives you time to plan your trades, i suggest you envisage the amount of pips to be risked and equate that to the % of your capital you want to risk [i suggest not more than 3% per trade], this should give you the lot size to use...

Example....lets say you are to risk...
Excellent advice!
  • #106
  • Sep 29, 2010 2:59am Sep 29, 2010 2:59am
Quoting Kasapreko
Welcome Igtj,
Im just seeing something new you just said. What does price reaching the Moving averages mean? or is it just something extra you can use to beef up the accuracy?
Read post #77. If you still need more clarity, let me know.
  • #107
  • Sep 29, 2010 3:09am Sep 29, 2010 3:09am
Quoting D liberators
please be careful with your money management....this is a long term strategy and the draw downs can be large......if you dnt have a good SL in place, you might get taken out often and price will still later go in your direction...hence the large pips risked..

Since this strategy gives you time to plan your trades, i suggest you envisage the amount of pips to be risked and equate that to the % of your capital you want to risk [i suggest not more than 3% per trade], this should give you the lot size to use...

Example....lets say you are to risk...
Thanks for the advise,but TP usually being in the neighbourhood of 1:3 isnt what I noticed especially when youre entering with the first method unless when MACD pops up in a buy trend and price is still below 50% fib or 38%fib level. Also Igtj says he or she takes trades even without price retracing to 50% fib level. I see you get better RR the further price retraces
just my 2cents
  • #108
  • Sep 29, 2010 3:21am Sep 29, 2010 3:21am
Quoting lgtj
Read post #77. If you still need more clarity, let me know.
Ok Ive seen it,but wasnt incuded in you rules.
So how do we use the ma's to find momentum and trend direction?
  • #109
  • Sep 29, 2010 3:27am Sep 29, 2010 3:27am
Quoting Kasapreko
Ok Ive seen it,but wasnt incuded in you rules.
So how do we use the ma's to find momentum and trend direction?
I use the ma's as a guide only. They help me to see how price is moving. That's all.
  • #110
  • Sep 29, 2010 3:30am Sep 29, 2010 3:30am
Quoting Kasapreko
Thanks for the advise,but TP usually being in the neighbourhood of 1:3 isnt what I noticed especially when youre entering with the first method unless when MACD pops up in a buy trend and price is still below 50% fib or 38%fib level. Also Igtj says he or she takes trades even without price retracing to 50% fib level. I see you get better RR the further price retraces
just my 2cents
ok..The bottom line is equity preservation...this is where most traders especially new ones get it wrong..
If you ask most traders which is more important, preserving your equity [minding how much you risk], or increasing equity [minding how much you make]...they'll choose the later [Most of my students fail this test, so i know].....and you know what the statistics say..''most traders'' loose.....

Equity preservation is more important...both are important and the chance to make more money is why you're in fx trading in the first place...but learn how to preserve your equity first before focusing more on how to increase it...do this and you'll rarely loose your capital not withstanding bad trades.

so i'll still advice not risking more than 3% per trade....even if you make 1:1, you'll see your account grow sooner than you imagine....
God's Love For You Is Sure Never You Doubt It
  • #111
  • Sep 29, 2010 4:10am Sep 29, 2010 4:10am
I Would advise use a trailing SL to close operations.

saludos
  • #112
  • Sep 29, 2010 4:38am Sep 29, 2010 4:38am
Quoting D liberators
ok..The bottom line is equity preservation...this is where most traders especially new ones get it wrong..
If you ask most traders which is more important, preserving your equity [minding how much you risk], or increasing equity [minding how much you make]...they'll choose the later [Most of my students fail this test, so i know].....and you know what the statistics say..''most traders'' loose.....

Equity preservation is more important...both are important and the chance to make more money is why you're in fx trading in the first place...but learn...
Ok,so how do you manage the news when they are about to hit and you're in a trade? atimes you're in a trade and exit mins before the news then see price head in your direction,then sometimes you leave the trade and the news spikes you and hits your SL. How do you manage trades around news events
  • #113
  • Sep 29, 2010 5:15am Sep 29, 2010 5:15am
Quoting Kasapreko
Ok,so how do you manage the news when they are about to hit and you're in a trade? atimes you're in a trade and exit mins before the news then see price head in your direction,then sometimes you leave the trade and the news spikes you and hits your SL. How do you manage trades around news events
..

I personally stay off important news 1hr before and 1 hr after...if i'm in a trade, i dont adjust my SL if the trade is still in red...but if in green, say 10% [not a hard rule] of the target profit, i move my SL to BE and see the effect of the news.....if more than 10 %, i lock in some profit as applicable.

I rarely close a trade because of news....afterall even we as technical traders need the news for momentum....

However after the news and its initial reaction by traders [which sometimes seems irrational to me], i reevaluate my trade based on the outcome of the news compared to the previous data [ i dont use the expected versus the actual data...this i believe is for the momentary spike]..the real effect of an economic data on a currency is the actual/new data compared to the previous data more so for a long term period...and since i'm a long term trader, this is what i consider....
God's Love For You Is Sure Never You Doubt It
  • #114
  • Sep 29, 2010 5:28am Sep 29, 2010 5:28am
Quoting D liberators
..

I personally stay off important news 1hr before and 1 hr after...if i'm in a trade, i dont adjust my SL if the trade is still in red...but if in green, say 10% [not a hard rule] of the target profit, i move my SL to...
Thanks for the info. I just wish you could help out in detail cause I know I'm not the only one that this affects
  • #115
  • Sep 29, 2010 6:03am Sep 29, 2010 6:03am
Quoting Kasapreko
Thanks for the info. I just wish you could help out in detail cause I know I'm not the only one that this affects
From my experience, I've learned that news really don't affect your trades as much when you're trading on the higher time frames, as long as you're trading with the trend. When you're trading on 1H and lower, then your trades will definately be affected by news.
  • #116
  • Sep 29, 2010 6:23am Sep 29, 2010 6:23am
Quoting Kasapreko
Thanks for the info. I just wish you could help out in detail cause I know I'm not the only one that this affects
Well,maybe when there's a live example, we will see better in details...perhaps you want to give me figures yourself?
God's Love For You Is Sure Never You Doubt It
  • #117
  • Sep 29, 2010 6:27am Sep 29, 2010 6:27am
Quoting lgtj
From my experience, I've learned that news really don't affect your trades as much when you're trading on the higher time frames, as long as you're trading with the trend. When you're trading on 1H and lower, then your trades will definately be affected by news.

Hello Sir,...any potential set up in the making?....still waiting for GJ to align
God's Love For You Is Sure Never You Doubt It
  • #118
  • Sep 29, 2010 6:27am Sep 29, 2010 6:27am
Quoting lgtj
From my experience, I've learned that news really don't affect your trades as much when you're trading on the higher time frames, as long as you're trading with the trend. When you're trading on 1H and lower, then your trades will definately be affected by news.
Thats one of the main reasons I'm following this thread
  • #119
  • Sep 29, 2010 6:45am Sep 29, 2010 6:45am
Quoting D liberators
Well,maybe when there's a live example, we will see better in details...perhaps you want to give me figures yourself?
I'm actually talking about my other way of trading.Like yesterday my method had given me over 90pips profit in 3trades but then that Consumer Confidence news came out and wiped out 70pips in my 5th trade. I would have bailed out but I was sticking to the rules and still stayed in till it hit my stop.
Some times this same scenario will happen and I will stay in the market then price will move in my favor or even still go against me but wont reach my stop,then come back to hit my profit target. I just want to maximize my method by knowing how to manage the news,like which numbers in actual,previous ,forecast or what and what happens to know if its going to move price north or south.
Thanks and God bless
  • #120
  • Sep 29, 2010 6:52am Sep 29, 2010 6:52am
Quoting D liberators
Hello Sir,...any potential set up in the making?....still waiting for GJ to align
I'm at work now, but when I checked the charts this morning before I left home, I didn't see anything setting up yet. I'm still waiting for eurjpy to retrace and gbpjpy to start heading north, hopefully. I'm also watching usdjpy because the daily macd has gone back into sell mode and the weekly and monthly macds agree.
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