How to use the 123 strategy effectively

Not a ross hook trade but I took it anyway on the break of my point 2. Close to hitting TP at -38.2 fib (This was a 38.2 fib retrace trade).

My daily trade is still going well atm no where near the TP area yet but up 300 odd pips which is nice

p

Made my first live trades today....decided to go with a 1% TP/SL until I get more comfortable....as it turns out, both were winners, taking advantage of the big price movement at 1315 UTC...OANDA is one of my brokers, and this is where I have a "side" account...woke up at about 4:30am local time and started hunting....bagged these:

http://i13.photobucket.com/albums/a2...2120100006.jpg

...and this one here:

http://i13.photobucket.com/albums/a2...2120100004.jpg

U/J and A/U for 2%....just as my TPs were supposed to fire, OANDA crashed!

Tried to call....no answer....watched as the prices continued into profit, so at least I would be in the plus...finally got back online about 25 minutes or so....my E/U had triggered, but I decided to close for a gain...sure enough, the platform crashed again...OK, I was just able to get back on....it appears my A/U TP did not fire, but just before the platform crashed, I put in a close order, and I got a few extra pips out of it...

I'm still concerned about the correlation aspect of the pairs....I would like to optimally find pairs that are not well correlated (negative or positive) with each other...in addition, the pairs must have fairly low spreads at the brokers I use...I have a feeling it will be difficult, and my pairs will be limited to perhaps four at most...

I do not plan on posting many of my trades here because I do not want to clog up the boards (lol, kind of like vacation pics, eh?), and I still want to complete my E/U analysis...I just started November 2010, and I hope to get these done by January 2, 2011...

Regards,

Jeff

2 nice trades jeff wd

Iv been through 'the crash' many times not often now though..it used to make me feel sick now it doesn't effect me.

Good luck on the back testing..123 has been around for a long long time Im sure it solid and consistent but like all trading system methodologies patterns etc we need volatility

P

Yeah Oanda does have a glitch or two once in a while, been with them over 6 years.

Since I set a complete order with SLs and TPs all is ok, I've only had one issue with an order when a SL failed to trigger, I contacted them with the trade info and they corrected the trade....... It was in my favor.

...do you remember the day (NFP, I think it was) a few years ago, when the spread widened by 200 pips I got caught but to be fair they straightened the account out quite quickly.

Limit sell on EU at 1.3132 is still active

P

Just gone short EU from 1.3132

TP is 1.3065
SL is 1.3202

SL in pips is the biggest yet at 70 but MM has been adjusted and loss will be no greater than 5% of account balance

P

Slept in this morn .... missed two trades but got in on this one, we will see if it his TP which is at 1.3122.

I am in same trade...

Guess I'm still asleep..... I don't see this one, can you post a chart?

Have to be careful on 3081 level though as it is daily S1 level. Also the obvious support at 1.3100... we havent been below that and held since back in November.

TP hit..... nice start for the day.
EUR/USD
Sold at 1.3142
Tp at 1.3122

OK .... never mind, I found it.

Either I'm stupid, or the 123 strategy has too many false signals.

Like any other strategy it is not 100% however it does have a very good risk to reward, especially when proper MM is used.

Read the thread, read Paulus's rules, and study some charts.

...have you seen how others here trade the 123?...if not, read Paulus' method/rules and see if you think the way he trades it contains too many false signals....crossed with tradestar

@ Paulus....thanks for the encouragement, and thanks once again for your methodology!

Ha ha, I know some of you might be getting tired of this, but I'm going to keep on pressing....

What is a trend? So, I'm attempting to comprehend Paulus' very recent E/U trade...when I looked at the charts this morning, I saw this:

http://i13.photobucket.com/albums/a2...2120100007.jpg

...a nice down trend for about an hour starting at Alpari UK demo time 0825 and ending at 0920...nearly an hour of down with SMA 21 sloping to the downside....we most certainly had a channel there (from 0920 until 1415), and then the channel was broken, I had a trade placed to the upside, and all was well...VERY fortunately for me (lol), OANDA crashed, and I was not confident in being able to control my trade, so I closed it out for about +10...as we know, the price then came quite a bit down....

I'm assuming this is what Paulus viewed:

http://i13.photobucket.com/albums/a2...2120100008.jpg

We had a strong up move (and strong SMA 21 sloping) at 0200 Alpari demo time (note that this is 0100 UTC) that culminated nicely at 0825 and gave us a very big 1-2-3 (hmm also a head-and-shoulders)...

So, if I am to "see what Paulus sees" it looks to me that I should be looking even further back in time to get the overall larger trend for the 5 minute time frame, and include not only Asia, but also perhaps even the end of the US session....because my E/U trade at 1415 Alpari time (a fail as it turns out) was likely seen by Paulus as a continuation, OR perhaps it "didn't look good"....I'm just trying to learn this to capture the most reversals and not get caught up in missing what the "true" trend is, hence ending up trading continuations when I do not realize it...

One comment about this 70 pip trade currently live...just for fun, I wonder what the typical ATR is for the period 0700 UK to 2100 UK....this might give us a clue as to the probabilities of catching this one....

Regards,

Jeff

Ok cool man.

Jeff, as you know, Paulus looks at price action prior to 7am (UK time). Price (5min) was printing higher highs and higher lows in the run up to 7am, so the Paulus method is then on watch for a short 123 as the first trade of the day. A straight forward, simple approach.