Building an equity millipede

Thank you Graeme for the encouraging words. I actually still have one position from two days ago @1.3262 if that one survives the range, I'm still happy

Kindest Regards,

Cam

Hi Graeme,
do you take into account that this week is the last week of the year and that liquidity is terribly thin for trading ad therefore the PA may not be as reliable and based on technicals as much?

Or do you consider this huge whipsaws as part of trading and just move as the market moves? ( buy on uptrend n sell on downtrend)

right now i still have hindsight on weekly charts as DOWN so i guess we gotta have faith in our beliefs and focus on getting in risk free entries..

Hello fellow millipeders, may I ask how you guys keep trading logs? I`ve been keeping mine by hand but I`ve found it to be very inefficient and tedious and erroneous. and later when I do analyzation of my trades I have to enter all the entrys one by one into excel. this is very time consuming. I wonder if you guys have better ways doing this?

Good morning, all

eurusd, gbpusd is currently in buyers control

eurusd had a clean 5/10ema crossover on daily

Today being the last day of december one has to look and analyse what december has become.

For the last 2 weeks we hoped that the eurusd follow through what november did however it did not work out.

At this point one has to assess what january will be like and its uncertain for eurusd. Their is no clear indication on the monthly chart.

For the last 2 weeks and for the current exercise, we are only participating in one direction and one has to maintain a further patience.

For the traders who are following eurusd, my suggestion would be to probe only at the new highs when buyers are stalling. Normally when I participate both direction I will probe both the new highs and new lows at stalls. However, please do not deviate from the initial plan and for now attend to one direction.

Gbpusd traders are in a better position than eurusd.

This is crucial phase of ones trading. Dont try to force a profit to catch up to your realized losses. Must keep level headed and maintain your belief in inevitability.

In regards to probing, it is simply overtrading to be probing all night all day. A simple few probe at new highs and new lows is the best area. And if it doesnt work out, reset price alert and walk away.

Sincerely,

Graeme

Well said Graeme, this is quite an exercise in patience and risk management (to not overtrade basically). In a sense, this kind of market is teh best teacher... it will be quite an achievement to make it through this period and reach the inevitable better and profitable periods.

Kindest Regards,

Cam

I use Excel too but first in MT4 I go to account history and save the detailed statement but drop it down from html to excel, I then copy and paste to my trade journal, or else I update manually as I enter the trades, especially if I am not going to make many entries that day.

current monthly bar being an inside bar of the previous monthly bar unless something huge happens today...
it may be considered as a continuation of the latest down move but i covered both direction with 4 scenario..We'll see how its going to move next month...
good luck all...

Hi guys!
I wonder if you have some tips and trics for entering during volatile movement. I observed that most of them happens within 5min candle or lower.

Human reaction+slippage+ping+snowing all the time equals for me that I ussualy end at candles high/low and then the price retrace. I use smallest possition possible, so i have to stack them more frequently. It is very hard to stack positions manualy during such movements.

Maybe there is some EA, that could stack for us, while measuring, that price is moving fast (i.e. with bigger volume than usual) in one direction.

Happy new year!))

I'm using myfxbook.com which links right in with my Oanda account and imports the trading information automatically.

One can argue that you should still do some sort of manual record keeping. When combining these online services with manual record keeping you can keep the amount of manual entries to an absolute minimum.

when in doubt.. time to re-read. dont forget to come back in 6 months and let us know how you do.

Hi Graeme
I have followed your thread since its inception and would like to congratulate you on presenting your trading methodology in such a clear and concise manner.
Running profits and cutting losses sounds simple but is not always easy to achieve. However, you seem to have done it by developing an attitude of getting the trade to BE then effectively forgetting about or ignoring it for several weeks or months, until it comes time to diversify.
Developing this sort of mindset is probably the biggest hurdle most of us will struggle to overcome in order to trade your method effectively. It seems the main challenge, initially, is being patient and accepting the number of losses and break-even trades that inevitably occur before the first big runner is underway. This is further exacerbated by the fact your method has many discretionary aspects, so attempting to quantify entries and exits by creating simple rules is difficult.
However I like to try and get a handle of what I am letting myself in for before I start trading a new system/method, so I hope you don’t object to my attempt to establish very general statistics for some simple scenarios.

In an attempt to do this, I have utilised 2 things you said in your posts
1)Look to buy when price is above open and look to sell when price is below open.
2)Be wary if bar close is less than open of previous up-bar and if close is greater than open of previous down-bar

And from this have created 2 rules
Buy if
a)Close > Open of weekly and Close > Open of Daily (green circle on chart)
b)And Close > Open of previous down-bar
The buy signal is the green triangle on chart

Sell if
a)Close is < Open of Weekly and Close < Open of Daily ( pink circle on chart)
b) And Close < Open of previous up-bar
(The buy signal is the inverted red triangle on the chart)

I realise this is about as basic as you can get, It is only one trade at a time, it does not include any filters, hindsight, support and resistance, technical analysis, candlestick patterns, chart patterns, stacking or hedging and to get any sort of result I have had to use targets, unlike open ended diversification

It is not what you would described as a low risk entry, so if it produces any sort of a positive outcome, that will be quite unexpected.

The strategy was run for the last 12 months on the British pound future which moves in unison with the GBP-USD (results gained back testing futures tend to be more meaningful because real tick data can be utilised whereas forex brokers data tends to be batched). The parameters I used to test the strategy i.e. stops, moving stops to BE and targets are shown in the box at the bottom of the chart.
On the chart the narrow green boxes are winners but stopped out at BE +2pips, the red boxes are losers at 10 pips and the large green box is an active trade still running.
Check in the attached PDF and you will see the charts and data

Considering the simplicity of the rules the results are surprising

311 trades 217 losers and 94 winners (30.2% winning percentage) but 90 of those winners were at BE + 2.
So, in the entire year, only 4 trades were big winners (i.e. 1.3% of all trades), yet it was overall profitable with a profit factor of 1.66 and a profit of $9,138 which is equal to 1462 pips ($6.25/pip) in 12 months or 122 pips/month .
However, the first big winner did not come until after 90 losers and BE’s and the drawdown initially was considerable. The first winner brought the equity curve back up to zero and from there it descended down another 900 pips until the second big winner at trade number 240 returned the curve back into positive territory, where it remained for the last 1/3rd of the year.

Interestingly, if the stops are changed from 10 pips to 45 pips and all other parameters remain unchanged the figures change to:
190 trades, 44 losers and 146 winners (76.8% winning percentage) but 141 of those winners were at BE + 2.
So, in the entire year, only 5 trades were big winners (i.e. 2.6% of all trades), yet it was overall profitable with a profit factor of 1.95 and a profit of $11,538 which is equal to 1846 pips ($6.25/pip) in 12 months or 154 pips/month .
With the wider stops, the first big winner came after 40 trades so the drawdown was contained to 580 pips and the equity curve returned back up to zero in the early part of the year and remained above zero for the vast majority of the time thereafter.

So, 2 tests with fairly similar end results but totally different paths in getting there.
It is surprising to see that even with no attempt to get a low risk entry, the tests are profitable. So logically, looking for low risk entries should increase the profitability.

I appreciate the rules I have concocted bear little resemblance to the way you actually trade the method. I suspect it will be ver’ nigh impossible to actually create such rules. All I am trying to do is get a feel for what sort of win/loss ratio may possibly be encountered in establishing runners.

Other than to discover that such a basic strategy can generate nice profits, it is debatable as to what value can be gained from this exercise. 2 tests on 1 currency over 12 months does not produce statistically significant results, however, it has given me some basic insight as to how much pain may be required to achieve the gain. If you see any value in pursuing this avenue of research please let me know. I have MT4 charts but have limited experience in their use. I have attached the charts I used in a PDF file.
Happy New Year to all.
Tonkar

Hello Graeme,

I've been following your thread for about 6mths now (read through all pages).

One of the most intriguing threads.

Definitely very detailed and a bit of a learning curve for new folks, but your methodology / psychology (going for homeruns / sending probes or little foot soldiers to test the waters / building legs that run for as long as the market allows), is quite amazing.

I look forward to purchasing your book when it is done.

Your very detailed trade by trade documentary and outline of your thought process = gold.


1) Sentiment / hindsight
2) participation (with skillful price action analysis and nimble entries / exits )
3) trade management (emphasis on protecting / 'sealing' the legs - moving to BE and letting them run)


I like how you view probes as a little 'cost', that can yield huge gains. Little matchsticks along the way, to a couple of nice bonfires.

Simple concept. But profound.

[quote=Tonkar;4278383]Hi Graeme
I have followed your thread since its inception and would like to congratulate you on presenting your trading methodology in such a clear and concise manner.


Happy New Year!
Best wishes to all and your families as well.

Tonkar, i don't know if it is an automate testing,propably it is,can you make
this test also in pairs like USD/CHF or AUD/USD?

I don't want to be smart but you have to have a picture with a pair that is
trending to see also the true potential of this method.

I firm believe that a test across multiple pairs is going to give you a better
idea about what YOU can expect,trade or whatever.

Again Best wishes to all

John

[quote=Epsilo;4278753]
I was trying to find it and i did
For everyone's licking
http://www.citigroup.com/citi/fin/da...?ieNocache=858

Well I'm chugging along slowly and I've decided not to trade EU, Gu for the time being, its whipsawing like crazy and has taken out my longs as well as my shorts at B/E along with some losses (15~20 pip including spread) while on the other hand other pairs like EC, EA and GJ are trending beautifully and im concentrating on that. I've begun spreading out positions over the board and am finding it much more profitable to concentrate on pairs which are trending rather than trying to trade pairs in ranges with my limited experience with this method. give it a try .......

in time when my hindsight improves with practice as Grahame has said I'll try trading the ranging pairs as well.

another thing i've noticed is that in this method the entry is quite important. You need to get the entry right otherwise you would just be expending your ammo needlessly so practicing entries with Graeme's 20*3 exercise really helps.... I'm on day 95 and its helped LOADS (thx Graeme)

Last point want to mention is that by far my most successful entries have been in the asian session. Reasin is volatility is low so its easy to get in aligned with the long term trend without getting stopped out because of noise as there isnt a lot of movement to stop you out if you pick the entry well .... and thats really worked for me with my 15~20 pip sl.

thx Graeme

Happy New Year everyone !!

hello Graeme,
a few questions and thoughts of my own.

would you accept me as your student?
if i dare assume yes, then may i bow and say sifu Graeme, you contribute too much to the community and i feel blessed to have found your thread.

i dont know how to thank you enough. you are not my first teacher but my second. i tried to indirectly post my first teacher's thread/forum here the first time, but was not approved by the mods as he has a bad rep. but he is just that type of person, he tries to beat the sense of arrogance out of new traders with a stick. and make them SEE.

you on the other hand, is much nicer and spend time to explain with HW (LOL, i laughed so hard when you tried to make us learn step by step, but greatly appreciate it. BOW*).

the real benefit i get from this thread is not the money part. and i mean this from the depth of my heart. i find this thread will help me reach a deeper meaning of life in general. and THAT can never be taken away from me and no matter how much money can not buy(money is relative, society made a piece of paper worth something, or goldbars, its the same thing).

and i hope more trader can apply what they see in the market to real life. and always remember to give back. you made money means somebody lost money and that is just the fact of the market. think about those desperate people using their life's savings to save their house on this casino we call the market.

i am sorry if the above post sound like a lecture, me being so young and no rep in this forum at all. i apologize in advance if this post offended any of you.

master Graeme, if you have the time and patience, can you share your view on life with me through PM? as i cant PM you yet being a junior member.

edit: it seems that i cant receive pm either, i guess i can only follow you for now, on page 40 so far. ^.^ plan to be on page 100 tomorrow, I'm so glad the mod let me post this. thank you mod, whoever you are

edit: Graeme, i really appreciate the TIME you put into this thread, the only cap we have in this world is time, 25000 days more of less, money is relative, it can be zero=>infinite, so i really really appreciate the Time you put into this thread. "Time is money" we all heard that, but how many actually know or follow this quote??

edit: i feel that i saw the slim of light from the other side of the wall, i see the world, society, the universe, an atom, a whole completely different way, but that is just the light ray through a crack on the wall. i think the enlightenment you mention at the beginning of this thread to others is not making $$$ in the forex market but some thing SOOO much more. i really want to know your view on the world, and am willing to share my thoughts. i want to open my eyes as far as my brain can handle. (greed i know, for which why we are sinful since the day we are born). i dont want to go offtopic from what most perceive as the purpose of this thread thats why i want to PM instead.

edit: i just realized i might have offended all of you on this thread, i truly apologize. but i want to reach enlightenment as a person first before than go tackle the market, that way i will be prepared for the sharks in the market and in real life. the very structure of the universe is both fractual and circular. fractually, i understand that (sharks in the market = pro traders, life sharks = sales people and young beautiful women divorcing old rich men come to mind), circularly, we can't live without the one or the other.

thank you so much for your everlasting patience and the priceless time you put into this thread. on post 640 so far, even superman lose his temper/patience some time.

Hello Graeme

I have been referred to your thread as I start my journey into forex.
I am looking forward to learning.
I am in no rush as I have youth on my side.
I will begin reading from the beginning and if I may I may post some questions from time to time.
thank you
Kaitlin

moving slowly through the posts on this thread (-.- <= literally my asian eyes, astigmatism),

superman comes back with a bang ^.^ really, ever think about open up your own school?

you certainly have the patience that most will never possess. (impatience is my weakness and i know it. waiting for my post to be posted felt like eternity. interesting that we think of bad times as eternity whereas we should should really be appreciating the good as eternity.)

easier said than done. i still see the lady revolving counter-clockwise T.T

master Graeme, can you switch it between left and right, or maybe the question has already been answered pass page 48. ^.^ then sorry about my impatienceness.

ever thought about spending 2.6 million to speak to warren buffet? he must be a very interesting person to talk to about life.

edit: lmao, willf and the onething, i had a good laugh. this thread is so much bless/win. i truly feel blessed to be surround by the "good" apples.

hello, master Graeme,

i can now see the model rotating both left and right.

for someone who wants to do this mental exercise, i suggest open the model gif with quicktime player and put it on loop, but cover the top portion of the model's body and only stare at model's feet. at the same time, think about car wheels. (we all know if a car is going fast enough, it seems as if its rimm is rotating backwards.)

this has helped me to be able switch the model to be swiveling left and right by my perception, still take a bit of time, as the model seem to be moving left and right for a moment before switching. and this is a great exercise as market can go up and down, we need to be able to interpret price action without bias. i been looking for this answer for so long, i think this exercise will be my first step to do this. through life's influences, our mind overtime sees the figure rotate one way, a minor few sees another way. (trust me, there will be a huge discrepancy between which way the majority views certain things, thats why only few are billionaires, to put it in money terms). i want to be able to see both ways. (sorry about my greediness, i ask for forgiveness everyday).

^.^ thank you all, this thread is EPIC. and this is just my small contribution, a better method may have been posted already, then sorry to have clogged this thread with my useless post.

edit: thank you Graeme, this helped me break down the psychological wall even further.

edit: i originally posted the gif again, but choose to delete it as it may distract the flow of the current topic at hand. the original is on page 46 of this thread for those interested.

Has a recent post by Graeme been deleted from here? I'm sure I started reading one the other day, fairly long, which seems to have disappeared?

Cheers
SJB