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Building an equity millipede

  • #3,181
  • Oct 8, 2010 7:16am Oct 8, 2010 7:16am
the red box in the screenshot is telling you that the price now is close to the ema.
The reason i put it on the lhs is to keep the real time price action uncluttered.
Attached Image (click to enlarge)
Click to Enlarge Name: screenshot nzdjpy.gif Size: 19 KB
Don't kill your dreams - execute them.
  • #3,182
  • Oct 8, 2010 12:48pm Oct 8, 2010 12:48pm
Hello all, I pm'd this question to a few people and now posing it to anyone in the thread who feels they have a solid answer.....

I'm still a bit confused as to how FIFO won't severely hamper pipeasy's method.

Ex. We buy A,B,C,D at one week intervals btw each.

A now at + 50 pips
B now at + 40 pips
C now at + 30 pips
D now at + 20 pips

If we were to cull B C D to lock in profits for a smooth equity curve on the anticipation of a new possibly temporary reversing trend then his method works as we are removing the most vulnerable, locking in profit, and leaving our least vulnerable "soldier" (A) in play to weather the blips and gain on the long term.

With FIFO we have to cull in order so (A), our best soldier is ruined and only our most vulnerable scouts remain. Am I to understand the new rules will average our positions up after single removal ? How does that work? Even so it still leaves only our most vulnerable to play with which throws a considerable wrench into the heart of the method.

Is the only remedy for a US citizen to trade in another country? If so...I would have to politely say that this method for those in the US cannot be justified.
  • #3,183
  • Edited 3:56pm Oct 8, 2010 1:24pm | Edited 3:56pm
Quoting deepblue44
Hello all, I pm'd this question to a few people and now posing it to anyone in the thread who feels they have a solid answer.....

I'm still a bit confused as to how FIFO won't severely hamper pipeasy's method.

Ex. We buy A,B,C,D at one week intervals btw each.

A now at + 50 pips
B now at + 40 pips
C now at + 30 pips
D now at + 20 pips

If we were to cull B C D to lock in profits for a smooth equity curve on the anticipation of a new possibly temporary reversing trend then his method works as we are removing the most vulnerable, locking...
If you don't want to be bound by FIFO on your positions, just change brokers. Some US brokers have a looser interpretation of the FIFO rule than others. MB Trading and IBFX are two that I'm aware of that don't enforce FIFO on their MT4 platform accounts, though I believe they do enforce it on their non-MT4 platform accounts (MB Trading does, anyway).

Others on here may tell you that FIFO is nothing more than position management and if you manipulate the placement of your stops properly and keep track of your positions using Excel or something similar, you'll see that working within the confines of FIFO is no big deal. I don't disagree, but I don't see the need to go to that much effort if all I need to do is use a broker that does not enforce FIFO on its trading platform, which is what I do. I use MB Trading because they are an ECN broker and the lack of having to deal with FIFO is just a nice bonus.

Check out these posts for more info on how some brokers meet the FIFO rule without making their clients have to deal with it when trading:

http://www.forexfactory.com/showpost...postcount=3081

http://www.forexfactory.com/showpost...postcount=3082

Kevin
  • #3,184
  • Oct 8, 2010 2:03pm Oct 8, 2010 2:03pm
Quoting Starvin4Pips
If you don't want to be bound by FIFO on your positions, just change brokers. Some US brokers have a looser interpretation of the FIFO rule than others. MB Trading and IBFX are two that I'm aware of that don't enforce FIFO on their MB4 platform accounts, though I believe they do enforce it on their non-MB4 platform accounts (MB Trading does, anyway).

Others on here may tell you that FIFO is nothing more than position management and if you manipulate the placement of your stops properly and keep track of your positions using Excel or something...
Hey Kevin that is excellent news, I was unaware of those two brokers' policy toward FIFO. I'm assuming you meant "MT4" instead of MB4 above. Thank you for clearing that up. Are there any simulators out there that you would recommend to conduct testing of this method? Real world live testing of this strategy, for me at least as a newb, is a bit time consuming.

Thanks again
DB
  • #3,185
  • Oct 8, 2010 4:06pm Oct 8, 2010 4:06pm
Quoting deepblue44
I'm assuming you meant "MT4" instead of MB4 above.
Oops! Yes, MT4. Sorry about that. I have corrected my post. Thanks for letting me know, DB.

Quoting deepblue44
Are there any simulators out there that you would recommend to conduct testing of this method? Real world live testing of this strategy, for me at least as a newb, is a bit time consuming.
Yes, I use Forex Tester and I like it. Please see this post as we discussed simulators in this thread a while back. There are a few posts on that topic right around the post linked above and one of the members also attached a couple of free ones.

I'll reply to your PM later this evening as I'm about to step out for a while.

Kevin
  • #3,186
  • Oct 8, 2010 6:54pm Oct 8, 2010 6:54pm
Quoting Starvin4Pips
Oops! Yes, MT4. Sorry about that. I have corrected my post. Thanks for letting me know, DB.



Yes, I use Forex Tester and I like it. Please see this post as we discussed simulators in this thread a while back. There are a few posts on that topic right around the post linked above and one of the members also attached a couple of free ones.

I'll reply to your PM later this evening as I'm about to step out for a while.

Kevin
I was researching this further last night and ran into this broker http://www.fxcentral.net/fxcentral_technologies.aspx

Seems like they also are ECN with no FIFO restrictions. The link says "Unique back office functions with hedging allowed with no FIFO restrictions." so not sure if they allow hedging to US citizens.

Appreciate a quick PM if anyone here is trading with them. Their multitrader and NDF platform also looks quite neat.

p.s. not sure if posting the link here violates the FF policy. please advice and I will delete this post.
Staying in my lane...
  • #3,187
  • Oct 8, 2010 9:49pm Oct 8, 2010 9:49pm
@ DeepBlue

You are correct in your interpretation of the FIFO rule. The trades are averaged and when u attempt to close lots they will start with the first lots up to the number u indicate. So as in your example yes trades A,B, and C will be closed before D is.

I use MBTrading. I use their Navigator and that is subject to, the FIFO rule. But on the MT4 side of MBtrading, they have structured their back engine (software) and reporting in such a fashion that they are able to comply with the FIFO rule even though on your end (the user of MT4) you can control the trades in any order you desire. IBFX also has a similar setup for their MT4 customers.

As I indicated in my first post (several pages ago LOL) I am a long term trader, ala Jesse Livermore approach, and I have no problems with the FIFO rule nor the 50:1 situation. You can adapt any trading approach it's just a matter of utilizing some imagination .

Peace all,
Jess




Quoting deepblue44
Hello all, I pm'd this question to a few people and now posing it to anyone in the thread who feels they have a solid answer.....

I'm still a bit confused as to how FIFO won't severely hamper pipeasy's method.

Ex. We buy A,B,C,D at one week intervals btw each.

A now at + 50 pips
B now at + 40 pips
C now at + 30 pips
D now at + 20 pips

If we were to cull B C D to lock in profits for a smooth equity curve on the anticipation of a new possibly temporary reversing trend then his method works as we are removing the most vulnerable, locking in profit,...
Our AWESOME IMAGINATION is the true holy grail!
  • #3,188
  • Oct 9, 2010 1:16am Oct 9, 2010 1:16am
USA job reports came out yesterday. One question I have in that regard is how come you have 95 k jobs lost, which means more people are unemployed,
and unemployment rate improve from 9.7 to 9.6, which means less people are unemployed, if I read well? Please for an explanation here.

Muntu.
Patience is magic
  • #3,189
  • Oct 9, 2010 11:28am Oct 9, 2010 11:28am
It means that more people have given up looking for work. It is not good.

Unemployement rate only counts people who are "actively looking for work", and they can put all sorts of manipulation in there. Real unemployment is more like 15-20%.
  • #3,190
  • Oct 10, 2010 2:36am Oct 10, 2010 2:36am
Quoting mbkennel
It means that more people have given up looking for work. It is not good.

Unemployement rate only counts people who are "actively looking for work", and they can put all sorts of manipulation in there. Real unemployment is more like 15-20%.
Thanks MB, but I still think that if people lose their jobs, they will join the ranks of job seekers, thus worsening the rate of the unemployed in any given population.
Patience is magic
  • #3,191
  • Oct 10, 2010 12:01pm Oct 10, 2010 12:01pm
Quoting muntu ntu
Thanks MB, but I still think that if people lose their jobs, they will join the ranks of job seekers, thus worsening the rate of the unemployed in any given population.
True, but once their unemployment benefits run out, they fall off the government's radar. They're still looking for work, but they're no longer visible to the BLS and are no longer counted in the official unemployment number, hence the "real" unemployment rate of 17-20% when all of these people are factored into the equation. This "real" rate also includes those who are working part-time, but desire a full-time position, which the gov't does not consider to be among the unemployed. So, basically, the official unemployment percentage may vary slightly from month to month, but in reality it's a bogus number anyway due to the kabuki dance the gov't does to determine the "official" unemployment rate. It's all smoke and mirrors and 9.6% or 9.7% doesn't even begin to tell the whole story.

Kevin
  • #3,192
  • Oct 11, 2010 2:46am Oct 11, 2010 2:46am
muntu ntu, look at shadowstats for some real numbers relating to the US economy. It'll scare you witless.

olpip
  • #3,193
  • Oct 11, 2010 4:26am Oct 11, 2010 4:26am
Thanks a lot, now I see a bit clearer on american jobs stats.
Patience is magic
  • #3,194
  • Oct 11, 2010 5:39am Oct 11, 2010 5:39am
Quoting muntu ntu
Thanks a lot, now I see a bit clearer on american jobs stats.
Hello Muntu and Others,

Hope everybody is doing fine with learning and trading. I noticed that the thread has become less active. I understand that our master, Graeme, is not around.

Anyone is in contact with Graeme? how is he doing? I hope his health condition is getting better. I am still junior member, so I can't PM..hope you guys don't mind me writing this in here.
-happyTrading, maaj-
  • #3,195
  • Oct 11, 2010 6:45am Oct 11, 2010 6:45am
Just finshed reading the entire thread, en would like to thank Graeme for his efforts to teach us.
Best thread i've ever read.

Hope you are well Graeme!
Persistence will get it. Consistency will keep it.
  • #3,196
  • Oct 12, 2010 9:10am Oct 12, 2010 9:10am
Printed off Graeme's posts and was rereading them this morning.

Here is something to remind ourselves while we wait on him that we haven't really touched on:

July 9, 2010
"For me, monthly trend is the main trend. I tend to look at last 1-3 years of movement.

My main and primary objective is building a pyramid of positions in lieu with the main monthly trend of the previous years. I enter from daily charts under the guidance of weekly trend at market open (asian) and hope that the position survives the fluctuations of the day and transforms into another leg on my equity millipede.

If today is going to be a bear candle then whereabouts is the higher price? If we are in a downtrend (which is also in lieu with down weekly trend) and (unknowingly) today is going to be another down day. THEN tommorrow when we look back today, where is the most likely place for a position to survive?

It is at the near top... Near the open of the daily candle. This insures that you catch the major move of the day + highest probability that the position will survive the pullbacks of next day (and the next 2-3 years hopefully)...

You need to allow the time for a caterpillar to turn into a butterfly."
  • #3,197
  • Oct 12, 2010 9:11am Oct 12, 2010 9:11am
I hope the desire to keep the thread "clean" for Graeme isn't also leading to its demise. So far this thread has been a good read, it would be a shame for it to 'go away'.
Hej.
  • #3,198
  • Oct 12, 2010 11:30am Oct 12, 2010 11:30am
Methinks the thread is demised...

Hope the best for Graeme...
  • #3,199
  • Oct 12, 2010 3:19pm Oct 12, 2010 3:19pm
and... u/j @ 81.80 today....

Quoting pipEASY
Correct. And 4hr price movement has broken every support buyers managed to create.

Movement like that just doesnt disappear.

FB? Daily chart is FB + a volatile breakout

You would be worried when price tests a new support and struggles to break it.

At the moment its either 1 or 2 -10 pips or few hundreds/thousands pips profit.

In regards, to JPY intervention. That is nothing new. It happens more times than it is publically announced. It makes the japanese goods more attractive when lowering the yen and then tempered to make imports cheap....
  • #3,200
  • Oct 13, 2010 2:05am Oct 13, 2010 2:05am
Quoting longhornxtreme
Methinks the thread is demised...

Hope the best for Graeme...
This is why I thought there were no need to start another thread besides this one, for that would divide our efforts.
Patience is magic
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