Nb 1.0 trend trade system

The document mentions a stop loss of 40 or 50. I'm wondering how you arrived at it?

I have to say that I'm very encouraged by the idea of a fixed stop before the trade is in place. One of my biggest problems with the earlier systems was the whole idea of recovery systems. Even if they work (and I admit that they might), carrying that kind of drawdown was not going to let me sleep very well.

There are three conditions for a trade. Let us take a buy example
1. the TMA line is above the Weekly trend line or the light blue line is above the dark blue line or the middle line of the TMA is above the MA 240. These terms are all the same thing.
2. Price retraces to the bottom of the TMA line (the green line) and the Brick red line is somewhere near the green line ( the brick red is a 5MA LWMA shift forward 5) or is below the middle TMA light blue line. This is a retracement in a UT. I shifted this line out 5 steps so as to prevent as many false entrances as possible and to make sure we are not entering if price is changing direction. This gives more room for price action than any other previous system I have used. When price action recommits to the trend we want in. It is not 100% but the winners outweigh the losers in this.
3. Price then crosses the brick red line and enters. The logic in the program goes like this. When the Bid is greater than the 5MA shifted 5 enter the trade. Of course for sells this whole process is reversed.
conclusions
1. This is a trend following system that uses the higher highs and higher lows of the weekly chart with a super smoothed out TMA indicator using information from a 1H chart to determine trend.
2. Trades are then entered off of the retracements with the 5 MA shifted 5 steps as a filter to filter out the normal noise and movement of Forex price action.
3. So in short it enters the dips of a trend and it lets price action determine how long you stay with the buy or sells of the trend.
4. It gives a very clear cut definition of when a trend starts and when it ends. Something that is missing in every trend following system I have looked at.
5. It gives a clear cut place to close a trade 3MA shift 1 and stop loss line if you dont close the trade earlier.
6. It gives a place to put your stop loss that is consistent with price action and each particular currency's movement. Every SL will be different on every trade but you place it at the previous low.

I am hoping someone will develop an angle indicator that monitors the distance of the 240MA with the TMA center line. This way we know when price action is slowing down and a range period is coming. With learning and understanding that definition may come at a later time. You really dont know you are in one until you are in one. As you can see a weekly chart has fewer range times than lower time frames.

SL can be the previous high or you can use fractals. In the pic below is an example where the trade enters and where the SL can be placed. The previous high or bottom of the previous fractal. So this gives you two locations to place your SL

SL will vary from currency pair to currency pair because of price movement. Obviously they will be bigger for more volatile pairs verses less volatile ones.

Because I am using the weekly to determine trend the system is designed to also work in RT markets. IF the market is ranging we still use the same trade criteria but they will be far fewer. With 20 currencies posted though I expect there will always be trades somewhere. Here is a 2 week period with eur/usd where there are no trades using my criteria. Aug. 30 to Sept. 14. However the eur/jpy has two trades during that period and the gbp/jpy has 5 or 6 trades during that time. So trades can be found at almost all times.

Thanks for the replies.

Since we are trading with the trend, and one of the basics of an uptrend is higher lows, then of course, your stop placement makes sense. I didn't see that in the manual, so thanks for the clarification.

In some ways, this system looks very much like 6.0 with an additional filter based on your definition of a trend. Since 6.0 already worked in ranging markets, it makes sense that this system will also work in ranging markets. But, when you are getting into ranging market land (if you can identify where that is) it also might make some sense to loosen up the trend filter requirement.

Your final entry criterion is on the cross of the 5. I'm assuming that it's when price first crosses the 5, and not at the close of the bar where that happens. Because you are using a shift of 5, you don't have any of the problem of the wiggling snake head on the MA. It will hold still and thus offers a solid target any time. Is this correct?

Finally, I checked this over all the pairs for the last week and it does amazingly well. The one thing I noticed is that it seems to do much better when the TMA is diverging from the 240. When the TMA is angled away from the direction of the trend, even though its still a trend by the definition, it seems to be quite a bit more iffy. I'm wondering whether there are enough trades over the pairs to use this as an additional filter? Or do you think my observation is not valid over a longer testing period?

If I get an angle indicator that may help us answer some of these questions. If they are angling back we may want to trade both ways. My testing though shows that even when angling back the trades are still there but the profits are smaller. So an angle indicator will help us with our TP outlook. Probably add the MPTM at some point also but we will see. Once Steve, Swingman and their buddies look at this I am sure they will come up with something. Right now I want to keep it as simple as possible and not load it up with indicators. Anyways gotta go for now, teachers report back on Monday and students on Thursday. I dont get days off LOL, owners, administrators never do.

Your final entry criterion is on the cross of the 5. I'm assuming that it's when price first crosses the 5, and not at the close of the bar where that happens. Because you are using a shift of 5, you don't have any of the problem of the wiggling snake head on the MA. It will hold still and thus offers a solid target any time. Is this correct?

Yes the shift 5 helps with the wiggling snake head. I like that analogy, it was always a bug in my systems of the too early entry I like calling peekers. qualify enough to enter and then continue. The shift 5 eliminates almost all of these type of trade but of course not all. However, I think it will eliminate enough that using a SL system will now become viable. I suppose you could go with a really big SL using the blue 240 line but that would produce a big loser when you got one. Anyway I am happy with what I am seeing. The only bug I see happening are the MT4 brokers that use a Stop Loss hunt program and it goes after that SL. If we find that happening then we may have to look at not using SL or ??????????????????????

Nanningbob,

I just finished reading your materials. Looking forward to test the new system.

I have a question, from now on, you will just use this system and will no longer use the Nb5.3 system in the future?

Thanks

SS

As long as I stay with USA brokers. I may use counter trend methods with the blue lines converging but not when they diverge. I will need an angle indicator or histogram to use my counter trend methods with this system so that will wait until it is developed. I came up with this while trying to develop my new reentry system. It just kind of came together in a dream one night and I woke in the morning and saw it might work. Played with the idea and the pieces fell together over a couple of days. I have already tested the 5x5 EAs when I was working on my recovery methods, the TMA knowledge came from testing 6.0 theories, once I added the weekly trend line it just came together. I am really excited about this and I can see my self doing my daily reports again because the system is so simple and basic.

Holy Cow 840 views in the first 10 hours. Dang.

Hey Bob, thanks for the well prepared and excellently documented system. Happy new year!

Happy New Year Bob.
I like it.....; however, Bob it appears that we could squeeze some more save pips out of it. That TMA and the 5MA shift 5 is awesome.

Great system.

Your reputation is well known, as this thread will also be..

I pity those who don't find it till next month. They'll have a lot of pages to read.

Actually, I would be looking for ways to tighten the stop, not to increase it. Changing the stop size wouldn't have any bearing on the size of my losses. I will put the same amount at risk on any trade. That means I will lose the same amount whether the stop is 20 or 100. What changes for me is the return/pip.

I plan on starting some fairly thorough testing of this very soon (maybe tomorrow). From tonights eyeballing, it looks very promising indeed. In the meantime, thanks.

In trade number 19, the trade is an uptrend trade. But both at the time when the EA would get set, and when price crosses the 5, price is below the 240. Are you sure you want to include this as a valid trend trade?

A similar thing almost happens in trade 25. There its a sell trade, but price is above the 240 when the EA is set. By the entry occurs, price has also dipped below the 240, so this one makes a bit more sense to me.

Subscribed. I wish everybody A New Year with lots of Pips.

Yes, Bob, THANKS! My feedback is: Since I know your schedule, hopefully this will be an equally low maintenance trading system, since I can't and don't want to be in front of the PC any more than necessary. However, I'll need to see when the trades develop since I am asleep during most of the London session.

I too am concerned about "stop-hunting" and had incorporated a visible stop for safety and my real stop hidden. I may try to put that in your EAs for my use. Also would be nice if I could incorporate the SL automatically especially if I turn on the EA before going to bed. Actually, to standardize the risk, I'll need to estimate the SL before the order is entered.

You also mentioned a "close all trades" script, but I don't see it anywhere. And how far above or below that last high/low do you place your SL?

Looks Fantastic! Much simpler and easier to understand.

My question deals with which TMA to use. Right now, if you look at the USD/JPY on the H1 with the TMA True loaded, price broke below the 240 MA on December 23rd, so we're looking for shorts, but the price never hits the "red" top line of the TMA True indicator. But if you load the TMA Centered indi price hits the top red line of the indi several times. Just wondering which indicator to use. It seems ok on a lot of the currencies, but on others I'm not sure which one to use.

I'd really like to know which indi you use. Do you use the TMA Centered for some currencies and the TMA True for others?

Tom