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Odds are with a 4hr KISS

  • #321
  • Sep 27, 2010 11:03pm Sep 27, 2010 11:03pm
I agree.

Excellent, simple charts. Beautiful. It is all you need.

That unsuccessful trade is Unusual. It was worth taking.

Like the rest of you waiting for that good set-up to come.

Forest
  • #322
  • Sep 28, 2010 7:01am Sep 28, 2010 7:01am
Just trade on the right side of the 20ma and you'll be right most of the time...
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  • #323
  • Sep 28, 2010 7:11am Sep 28, 2010 7:11am
There are a lot of EA's out there and I'm sure some of them could work...but you just can't replace the human thought process. And with this method, I don't believe you could ever use an EA...you MUST be able to reason when a trade to trade and when NOT to trade. Here are two examples, EU and EJ, where a computer EA would have most likely gotten you into a trade...but you can see with human reasoning, you would stay out of the market.
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  • #324
  • Sep 28, 2010 8:49am Sep 28, 2010 8:49am
Let's see if I have this down --

On the AUD/USD right now:

1) Trendline is up so look for longs.

2) Priced fell back to 20 ema (the 20 was pierced but close of candle was above 20 ema).

3) MACD sloping up.

4) Price bouncing up off of trendline.

5) No reaons to NOT trade that I can see so...

Nothing left to do but go long @.9625 (with a 75 pip stop loss in place), sit back and wait.

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  • #325
  • Edited 11:34am Sep 28, 2010 11:10am | Edited 11:34am
Quoting jls
Let's see if I have this down --

On the AUD/USD right now:

1) Trendline is up so look for longs.

2) Priced fell back to 20 ema (the 20 was pierced but close of candle was above 20 ema).

3) MACD sloping up.

4) Price bouncing up off of trendline.

5) No reaons to NOT trade that I can see so...

Nothing left to do but go long @.9625 (with a 75 pip stop loss in place), sit back and wait.

Attachment
Looks like pretty sound reasoning. I see your 75pip stop loss...but what is your planned exit point??? For AU, EU, UJ I recommend 50pip limits. However, you are free to use whatever you want!

My only question is that your MACD indicator looks very different from mine, even though I see you are using the same settings(24,52,18) that I am.

Anyway, if you entered at 9625, it looks like you already have 50pips profit! Nice trade! Thank you for taking the time to post on here!
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  • #326
  • Sep 28, 2010 1:59pm Sep 28, 2010 1:59pm
Quoting Tw0eleven
Looks like pretty sound reasoning. I see your 75pip stop loss...but what is your planned exit point??? For AU, EU, UJ I recommend 50pip limits. However, you are free to use whatever you want!

My only question is that your MACD indicator looks very different from mine, even though I see you are using the same settings(24,52,18) that I am.

Anyway, if you entered at 9625, it looks like you already have 50pips profit! Nice trade! Thank you for taking the time to post on here!

Thanks. I moved my SL up to BE when the price was up 20 pips and began trailing the stop when price was up 25 pips. It looks like I am about to get stopped out in the next few minutes but a profit is still a profit!

The 75 SL looked a bit large to me as well but seemed to fall just under a resistance level... in the future I may tighten them up a good deal more. I think I would rather get stopped out early and re-enter a trade than give a trade too much breathing room as I did this time and lose a week's worth of gain in one bad trade.

I have no idea what I did to my MACD!!!! It looked normal until I started monkeying around with the settings. Now I can't get it back the way it was -- I will have to work on it LOL.

I think I got into the trade a bit late but I like having confirmation from rising candle after the first candle closes above the 20ema.
  • #327
  • Sep 29, 2010 5:46am Sep 29, 2010 5:46am
Here is another one that looks promising.

1) The main trend is down and this is a shorting opportunity.

2) MACD appears to be heading down and has recently crossed below the zero line.

4) Price recently broke out of a consolidation area (gray lines), retraced back to the 20 ema and appears to be heading down once again.

Placed Sell order at 9768 (looking for the addition of momentum to hopefully be on my side so I placed it a bit lower than where price is currently). 50 pip SL (which is just above the 20 ema).

Attached Image (click to enlarge)
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  • #328
  • Sep 29, 2010 5:56am Sep 29, 2010 5:56am
Quoting jls
Here is another one that looks promising.

1) The main trend is down and this is a shorting opportunity.

2) MACD appears to be heading down and has recently crossed below the zero line.

4) Price recently broke out of a consolidation area (gray lines), retraced back to the 20 ema and appears to be heading down once again.

Placed Sell order at 9768 (looking for the addition of momentum to hopefully be on my side so I placed it a bit lower than where price is currently). 50 pip SL (which is just above the 20 ema).

Attachment
Thanks for posting again...I don't typically look at CHF pairs, but from your chart..it looks like a good trade setup. In my humble opinion, the entry point was when price pullback to the 20ma. Not only was the 20ma acting like resistance...if you look to the left you can see all that prior support area that price finally broke through and is now acting like resistance as well!!! Entering at/near that prior resistance area & 20ma gives you a great entry point for minimal risk. But that's just my opinion.

Nice work and keep it up!!!
  • #329
  • Sep 29, 2010 9:57am Sep 29, 2010 9:57am
Quoting Tw0eleven
Thanks for posting again...I don't typically look at CHF pairs, but from your chart..it looks like a good trade setup. In my humble opinion, the entry point was when price pullback to the 20ma. Not only was the 20ma acting like resistance...if you look to the left you can see all that prior support area that price finally broke through and is now acting like resistance as well!!! Entering at/near that prior resistance area & 20ma gives you a great entry point for minimal risk. But that's just my opinion.

Nice work and keep it up!!!
You are correct. The best entry was when price was much closer to the 20 ema. I got into this trade too late (again) and then may have moved my stop up too quickly (again). Just stopped out for a 12 pip gain as price began to retrace a bit.

Well, two small winning trades in a row when they could have been larger winning trades may be a bit frustrating but they sure beat a kick in the head anyday!
  • #330
  • Sep 29, 2010 10:39am Sep 29, 2010 10:39am
Quoting Tw0eleven
There are a lot of EA's out there and I'm sure some of them could work...but you just can't replace the human thought process. And with this method, I don't believe you could ever use an EA...you MUST be able to reason when a trade to trade and when NOT to trade. Here are two examples, EU and EJ, where a computer EA would have most likely gotten you into a trade...but you can see with human reasoning, you would stay out of the market.
Just want to say your recent chart analysis EJ + EU are excellent!
Very good reasoning!
I am again learning your highly patience skills!
Keep up the great work!
Cheers
  • #331
  • Sep 29, 2010 12:52pm Sep 29, 2010 12:52pm
Quoting tradpat
Just want to say your recent chart analysis EJ + EU are excellent!
Very good reasoning!
I am again learning your highly patience skills!
Keep up the great work!
Cheers
Thanks Tradpat. I appreciate the kind words. The trades don't always work out as planned, but it's nice when they do. I just hope others are able to learn something here and be profitable!
  • #332
  • Sep 30, 2010 6:40am Sep 30, 2010 6:40am
Well, I must admit...GU got me yesterday! I went for the short setup and it ended up being a loser. However, there was a long setup right after that that was a winner. A couple comments about these two trades I want to make clear:

1) You will NOT be a winner 100% of the time with this system or any system that I'm aware of. But that doesn't mean you won't be successful!

2)I want to stress that PROPER trade management and money management will keep you trading and profitable!!! Even though I use an initial 100pip stoploss(and that's just in case the market REALLY does something wild and goes against you)...most of the time you will only have a 50pip or less loss. Now if you take a 50pip or 75pip winner after that....you are already back to breakeven or in a small profit for the week!!! Think about that... you took 2 trades, 1 loss and 1 winner( A 50% win/loss ratio)...AND YOU STILL HAVE AN ACCOUNT TO TRADE WITH!!! If you just follow the 1-2-3 rules about entering a trade and you have a good idea how to read Price Action....you will be SUCCESSFUL MORE THAN 50% of the time with this method!!!
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  • #333
  • Sep 30, 2010 6:44am Sep 30, 2010 6:44am
Here are a couple more examples of trades from last night/this morning:

1) EU...this one was pretty simple, just follow the trend...be patient for the pullback to the 20ma and pounce on it!

2) EJ...I put this example in here to show you guys/gals what your thought process should be on what to look for ENTERING trades and WHEN NOT TO Trade. Always remember, you need ALL of the 1-2-3 conditions met(price action, price in relation to the 20 moving average, and MACD) for a good, valid trade entry setup!
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  • #334
  • Sep 30, 2010 6:56am Sep 30, 2010 6:56am
Ok, first...I DON'T recommend taking all of the previous 4 trade examples I showed. In reality, there were only 2 good trades that should have been taken.

HOWEVER, for those of you who are new, not the best with price action yet, and/or just made a simple mistake like I did(on that first gu short trade)....I want to stress the importance of proper discipline,trade management, money management!!!

1) You MUST follow the exit rules just as you would the entry rules. Take that GU short trade setup...the exit rules state you have to exit on the first candle that closes on the opposite side of the 20ma from where you entered. So I went short GU with price below the 20ma...the first candle that closed above the 20 is where you exit. It resulted in a 40pip loss...that's a fairly small loss for a 4hr timeframe trade! Small losses keep you in the trading game!!! That's where Discipline comes in..FOLLOW THE RULES!!!

2) Had you not closed when you did and made the rookie mistake of waiting for price to pullback to where you could exit at breakeven...That would NOT have happened...GU never pulledback that far. You would be down about 100pips right now...you just DOUBLED your loss by not following the rules!!! That's where Trade Management comes in...or in this case, LACK OF Trade Management because you didn't do a very good job of keeping your losses small!


3) Now for whatever reason, lets say you took all 4 trades. GU Short for a 40pip loss, GU long for a 75pip gain, EU long for a 50pip gain, EJ long for breakeven and EJ short for breakeven. Add up all the gains/losses and you would have shown a GAIN of 85pips for the week so far!!! That's pretty good in my humble opinion for only having a 50% win/loss ratio! Had you taken the valid trade setups(GU long and EU long)...you'd be up 125pips!!! That's pretty good Money Management and that's the power of this method!!!!

Trade Smart everyone!!!!
  • #335
  • Sep 30, 2010 9:50am Sep 30, 2010 9:50am
Quoting Tw0eleven
Ok, first...I DON'T recommend taking all of the previous 4 trade examples I showed....
Bravo!
Patience Trading = Profit!
I am learning, again!
Thanks 211!
BTW any chance if you can "convert" your H4 trading method into Daily tf?
Reason - I am a full time employee and family man. Watching Daily is an alternative for me.
Cheers
  • #336
  • Sep 30, 2010 10:11am Sep 30, 2010 10:11am
Quoting tradpat
Bravo!
Patience Trading = Profit!
I am learning, again!
Thanks 211!
BTW any chance if you can "convert" your H4 trading method into Daily tf?
Reason - I am a full time employee and family man. Watching Daily is an alternative for me.
Cheers
Hi Tradpat,

I haven't really looked that closely at trading this 4hr method on the Daily. I HAVE briefly looked at it on the Daily, Weekly, Monthly Charts....they all seem to work fairly well. BUT, and that's a BIG BUT...I have no clue what the stoplosses would be or the profit targets. Nor do I know how close price would need to pullback to the 20ma in order for you to get an entry. On the surface, the basical rules seem to apply and work. You'd just have to figure out entries and exits.

ALSO, it would take a TREMENDOUS amount of patience on the Daily. It looks like you would only get 1 entry per pair maybe once every week or two??? Maybe not even that often. Wish I could be of more help.
  • #337
  • Sep 30, 2010 10:12am Sep 30, 2010 10:12am
I have been following your tread with some interest, it all appears common sense.

I am trying to set up on MT4 as per your template but don't have the same MACD as you. Could you please post your template?

Thanks

WickstedFX
  • #338
  • Sep 30, 2010 10:57am Sep 30, 2010 10:57am
Quoting wickstedFX
I have been following your tread with some interest, it all appears common sense.

I am trying to set up on MT4 as per your template but don't have the same MACD as you. Could you please post your template?

Thanks

WickstedFX
Hi WickstedFX,

Thanks for speaking up and posting on here. You are absolutely correct...this method is about common sense. The simple, basic rules traders learn when they first begin trading fx. Rules such as, "The Trend is your Friend," "Be Patient," "Be Disciplined," "Use Good Money Management." Trading fx does NOT have to be difficult. It's 90% mental, 5% technical and 5% luck in my humble opinion.

As for your question, a template is attatched. Welcome aboard and please post some chart examples of trades you are thinking about taking or have already taken!
Attached File(s)
File Type: tpl 4hr with 8hr macd.tpl   2 KB | 285 downloads
  • #339
  • Oct 1, 2010 8:34am Oct 1, 2010 8:34am
Thanks TwOEleven I appreciate the template

I having spent the last few hours reading thro the entire thread (working from home today..!) I see you have lost the lines on the Macd and also the 5 MA.

Am I right in thinking for a long you need the Macd graph above zero and moving up, the price to be above the 20 MA. Do you then look for PA and or candle formation to go long or are you looking for a pull back to 20MA before pulling the buy trigger?

Thanks

WFX
  • #340
  • Oct 1, 2010 1:47pm Oct 1, 2010 1:47pm
Quoting wickstedFX
Thanks TwOEleven I appreciate the template

I having spent the last few hours reading thro the entire thread (working from home today..!) I see you have lost the lines on the Macd and also the 5 MA.

Am I right in thinking for a long you need the Macd graph above zero and moving up, the price to be above the 20 MA. Do you then look for PA and or candle formation to go long or are you looking for a pull back to 20MA before pulling the buy trigger?

Thanks

WFX
Hi WickstedFX,

There are 3 main things to look at for a trade setups..First(and most important) is Price Action. Second is the 20 MA(make sure you are trading on the correct side of it...longs above it, shorts below it. And Third is Macd(just the histogram).

Now to answer your question about Macd...the BEST setups are when macd is heading in your direction AND on the correct side of the zero line! Example: You want to go long...make sure Macd is heading up and above the zero line. HOWEVER...there are times when it's perfectly fine to go long when macd is heading up, but it's still below the zero line. But that will have to be your decision to make...If Price action and the 20ma are obviously telling you long is the way to go...then go with it. Just be cautious that the trade "might" not work out.
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