Ken's Continuing Successes with EO's system

I'm not sure what happened there, I hope someone was lucky enough to be in a long and get a piece of that one.

It is interesting though that on the 15M price spiked above 113 and then not only closed below 113 but also has not gotten back above Friday's Asian session high after a good deal of effort. The rejection point itself had a good deal of PPA plus was right off the daily 50MA and the backside of a daily trendline that we broke out below previously..

I took a short in the 112.80s, it was a bit of a jumper as I was waiting for price to close below the 50MA on my 4H candle but went in a few pips early. It's on a tight leash, I'm about to cover it before I grab some sleep.

My 4H is attached

Hi all,

Change of plan for me so can trade for the next two days afterall

Reading through EO's thread, one thing I did notice as a recurring theme. EO's stop were/are a great deal wider than mine have ever been. He would talk about stops being "25 pips below the end of the wick" very often.

He's obviously an awesome trader but I'm struggling to understand this. If the trigger candle is a solid setup, why would you need to give it so much room? Surely 3-5 pips below the wick is more than enough? If it's going to fail, it's going to fail. If you are putting stops that wide and your candle is say, 15 pips large, you need 40 pips before you are even banking 1:1 R/R. My stops are sometimes as little as 10 pips if there is heavy confluence, meaning that i've banked 4 times the profit on a 40 pip runner.

Does he change this approach later on in the thread or has he always gone for big stops? What are your thoughts on it fellas, what sort of stops are you typically laying down?

Hey man! Hope your doing good this morning

Imo if your entering based on a candlestick trigger setting your stop based on the high or low of the wick just makes the most sence, if it crosses the top or bottom that basically means the candle failed. Only time I will occasionally set my sl further away is if its near a ppa line, this is probably what eo did. But again i personally hardly ever have a stop loss thats beyond 20 pips, so normally if my entry bar or trade requires more then that I will either take it on on a retrace or simply pass.

I'm on good form today thanks mate, hope you are too!

Yeah, we obviously share the same view about this. I sometimes have stops that are over 20 pips but these are determined by the size of the candle or, if i'm taking a touch trade, where the MAs or nearest S/R area is.

Mainly, like you, less than 20 though.

Quiet around here today so i'm just going to abuse Ken's thread with my "thoughts out loud!"

At the moment, EU is trading under the 10 ma. I have this area of interest marked on my chart in blue. Who knows if price will get there or not, it'll need another 45 pips more further south if it is to (and past some support). Here though, I have all sorts going on. H1 MAs, H4 50 ema, daily pivot, PPA support from H4, 50 fib level and a 00 area. If look to the left here as well, there are buyers down here, it's a demand area.

If it gets there, it'll be a steller place to buy IMO.

Not much going on so far, shorted gu for some pips and took a small loss on a eu long. Ej eu struggling at support, gu struggling at a longer term tl. Gu looks like it might break it long. Will drink my coffee and watch

I believe he did change to be a bit tighter later , but then he also talked of the 35 pip stop and range of the 35/50 trade. But you also will read where he would take a 5 to 10 pip loss. Those were mainly counter trend trades, Although EO never really talks of his begins in Trading I came to understand that he started with the J16 format. But then having seen that there was much more available he and others worked on finding ways to capture more of the action presented,

That is why their are as many different entries that there is. If you really look close you will see that each trading signal and trade will almost always end with the formation of another entry. If your really good you could almost catch every little swing in price .

I also remember when I first started following the thread there was a few trades I was trying to follow with Eo and infinity , start to finsh and within those three trades all failed with a combined loss over 100 pips or so,

The entries were at on s/r and the stop the next. Maybe why I didn't get the plot as fast, But of course at some point they got the next bus and it went for over 100 i am sure. You have to also understand that during the entire thread EO was running his own company full time. So he was allowing for not being present all the time and allowing some WIGGLE room.

Pippin who I believe developed into as good or even better a trader , Started from a different prespective than EO . WE both had come from trading with a group that looked for a entry signal and the stops were always 1 or 2 pips above the previous highs candle.

He also was a full time trader monitoring all his trades until they got covered at the least. If you look at your charts this morning . GBP and E/J
You will see that almost any of the entries off a previous level would have held. In the gbps case, say you took the 1.6081 short off that line.and held it even after it bounced off the 1.6029 line and it got stopped at BE there was another entry after you got stopped a I/B dbhlc signal.

This is something that most find very hard to do for some reason, Re-enter after being stopped. I know from trading with Pippin That taking trades from a level that if he got stopped with a tight stop , he would wait for a Signal to form then enter again, But would not take it as touch trade the second time within the same swing.

Example, Say price runs up to a ppa-s/r level we have marked and having confluence off higher charts and in a trading zone we are willing to take that trade off a touch. It goes our way a bit ,But then price goes back and retest that area once more pushing past the high or low and stopping us out , At this point we wpould then wait for a entry signal hangman or shooting star before trying to enter again That would add to our confluence as well.

Stops are not set in stone they are decided on by the price action we are trying to trade. For the cost of one persons 20 pip stop another trader could try 3 or 4 different trades, We are taking a trade based off our analysis that a level will hold and part of our plan is where we think the trade has failed.

I have always said that a entry as close to where your stop should be is the best entry there is for just that reason , because then it cost us less if it doesn't hold,

Don't get into the habbit of just throwing your money away just because you have a preset stop. That isn't a trading plan if price CLOSES beyond your stop the trade is dead, Doesn't mean there isn't another entry but it does mean your first one may have been early.

The moving of your stop intially falls right in line with this as well. I watch many people that get good entries have BE or even losses because they move thier stops to soon. IF you read the thread, When trading with the trend or expecting a major reversal a entry off the 4 hr or daily. That EO moves his stops after 35 or 50 pips , What he was waiting for was price to break that first swing on the 15 min.

That is always our first target for managing a trade. Price to close past the previous swing making that lower low or higher high. If it doesn't and you get a signal maybe close and wait for another entry or leave your stop and wait for the retest to fail. But if our stop gets taken out. Don't get all emotional and miss the next entry around the same level. That would be a better entry a double top which also gives you a built in profit target. Same with a head and shoulders.

So key points. Plan your stop while price action is underway. Always look for re-entries after a failed trade, Take profits if price action says your longer veiw maybe later and not right now. This also happens at the end of sessions. when volume dries up. Price will have given a great signal at a great level but the major players have left for the day.

plan and trade your stops just as you do your entries and TP's if not more so. Most traders fail from bad stop management not bad profit management.

Any other bussinees in the world would love to be able to cut their losses short on a bad job . This is why trading forex should be a piece of cake you have all the control in the world, where others can only hope and pray a bad job will turn around,WE can actually make that happen.

So your stop and spread are what we are willing to invest in this particular job ( trade) If you think your analysis was a bit off so you wnat to invest a bit more in a bad job thinking it will produce , That is a personal choice But as in any other bussiness good money rarely follows bad.

Better to shut that job down and start looking for a better one, maybe one with less investment required and in a better neighborhood. Or with a company that pays within 30 days instead of 120. It is all so revelent but we all don't trade our losses we let them own us. That can't happen !! we are responsible for every part of our trading. How we deal with a bad trade just like dealing with a bad custoomer, client, vendor or any job is what places us above the competition and makes us look like experts instead of the rest of the herd.

Be a leader and own your trading don't let it own you, If you are comfortable using big stops that is your choice it doesn't matter but if it takes 4 trades to make up one loss you willl find it hard to make a profit in the long run. If your big stops net you more gains, then all is well. But what happens is we don't want to close a bad trade thinking we were to soon, then we justify that with well so and so would probablly have a 50 or even 100 pip stop and he is a great trader, Yes but he also might hold it for a week after it does turn. If your not trading the big move in the green why are you trading the big move into the red.

Enough waffling. Trade Happy Ken

This is not waffle mate, this explains plenty

Like where you were at with the original thread with "struggles" rather than "successes", I am at a stage where I get a great deal of what it's about. I understand most of the setups and can clearly see how it's delivered the results that it has. But, understanding the setups and acting on them are two totally different things.

At the moment, i'm comfortable looking for my heavy confluence setups. They're working for me and delivering results. I'm sure some of the other setups will come in time and with confidence but at the moment, the idea of taking touch trades off a line i've drawn is a step too far for me! That would mean trusting the line that i've drawn and trusting in myself 100%. If I can trade a 10ema touch off a round number and ppa, I can trust 100% in EO's strat. If I take a trade off a line i've drawn, I have to trust myself much more and i'm just not there with that yet. Gump (or gimp, lol!) trading scares the pants off me as well!

But, struggles will turn to successes. Rome wasn't built in a day and when i'm good and ready, i'll progress.

Why did the EO thread die Ken? Have you any idea? It was only just over a year old before they all seemed to disperse. Did the likes of Infinity, Pippin and EO get bored of it? Such a shame to have not been there at the start, would have helped enormously I reckon.

Cheers Ken, as always. Just in case you’re in any doubt, you’re not allowed to “F Off” like the others, well not least until we’re all doubling our accounts each month

Still in this one although I took half off already. Here's my 15M on it, it shows what I was talking about with the failure to close above Friday's Asian high. Entry was at the red arrow.

EDIT: Fixed chart, I had the entry marked wrong

EDIT2: LOL, should have been "failure to close above Friday's Asian high", fixed. I'm very tired this morning, contemplating going back to sleep for an hour so I don't make one of these plentiful mistakes while trading.

Not sure but some don't have the paitence for the continuing asking of the same questions over and over, I find it helps me too focus myself on what is important. Plus trading BIG money now they may have moved on to different ideas a bit. I know they were leaning towards just getting the entries off the 4hr chart. Not scalping as much .


Don't worry about getting it all, That is something I think a lot struggle with. If you can find only one entry that you do really well that is all you need. Then as times go along if you start to trully SEE another one then add it. But if it isn't clear don't worry about it at all.

I find that the 1 and 5 oclock entries amy be the safest for most to start with as they happen after price as turned and continue a trend. No turning.

Next would be the 35/50 and the 62 EMa when used as retracemnet trades because they are just a bigger version of the 1 and 5 o'clock trades , Bith being retracement entries.

I read a lot about the 35/50 trade during ranging I have never really looked for that entry during those times. Fall back on range trading ideas for me or GUMP trading.

Anyway have a great day. Still abit tired form the BIg Weekend may not take any trades till afternoon. trading tired as never done any good for me.

Cheers Ken ,,

ps Nice trade. Nice spot to be when you have profits locked away.

Hi Ken,
Well some people like to come here and read your waffling lol.
Nice post as usually.
FX

Classic example of why touch trades can be scary and why I generally prefer to let a candle guide me in.

I took a touch off the H1 62 ema here and price stalled on her and there was such heavy confluence in the area. my stop was only 10 pips so I covered very quickly as I got the reaction I expected. I nearly reached my TP but the sellers took over and blew through my stop at BE.

The plan was always to let a candle formation guide me in for a longer term long so I will still wait for this. High volume pin has formed as I type so let's see if the next candle confirms the reversal......

I took this as well. But my entry was the hammer on 15min along with weekly pivot and 200ema. The tp was also imo pretty clearly defined with the second higher high on 1h at .3945. You could see that it had functioned as support and resistance, so when price broke through and went straight to the 62ma it was a pretty safe bet that it would come up and retest the line. Only my view of course

What was your tp?

Ahhh, I think you might be talking about the earlier trade at 3295? I got in there as well, lol. My entry was a little late so was holding out at 1:1 but it reversed just before the M15 50 EMA VERY quickly so I waited to see if it would retest and I was going to TP on the retest but it never did and took me out at 1 pip profit (i'd moved it to a pip).

If that's the one you meant, this trade came about an hour later, off the H1 62.

Two trades, a total of 1 pip profit

Lol im probably confused But it was from the area you mentioned earlier.

This is the trade I took, also came together with the 62ema.

Second pic is 1h btw.

Took a nap between 8am and 9am local time -- I was tired and we had all the CPI, personal spending, ISM manufacturing news, etc coming out so I saw it as a time of confluence!

Catching up with the thread, I see we've had some awesome discussion

Hi Ken

I have been a silent observer for a bit now....and have been trading on the demo as well with few profits but which out weigh the losses....so am a satisfied thread follower...for which thanks for bringing into attention an excellent strategy....You've mentioned about 1 and 5...can you please lemme know if that's est or gmt....looking forward to your reply...

Regards

Ali Raza

No, no, you aren't confused mate!

I took that trade but got in a little later than the hammer so didn't get in enough profit to be ready to take it before it reversed.

Then, when it came back down, i took the direct touch on the 62 as a retest trade, i just watched PA and it stalled right on it. i was only looking for a quick 10 pips from this one and nearly got it, just missed out.

It was just a little scalp really.

I see, now we're on the same page

Yea I like those places as well for quick scalps, confluence touches.

Do you take many?

I like a confluence touch at the 10 ema into the trend but that's as a holder.

These sorts of touches I do do often and they still make my bum twitch a little!