How to use the 123 strategy effectively | Page 35 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

How to use the 9/20 EMA setup effectively 162 replies

Why not 123 strategy? What are Advantages and Disadvantages! 5 replies

How To Effectively Trade In Both Range And Trending Market By A Single Method 39 replies

Scalping the EUR/GBP effectively - Forturama 158 replies

Attachments: How to use the 123 strategy effectively
Exit Attachments

How to use the 123 strategy effectively

  • #681
  • Jan 4, 2011 1:48am Jan 4, 2011 1:48am
hey ho

in and out today put off alot last week .....

P
  • #682
  • Jan 4, 2011 1:59am Jan 4, 2011 1:59am
Trailing stop loss may or may not be the best option here. just dong some testing at this point.
It is a method used by Feb in his thread.

Any thoughts on this Paulus?
  • #683
  • Jan 4, 2011 2:06am Jan 4, 2011 2:06am
Well the trailing stop took me out.......
  • #684
  • Jan 4, 2011 2:14am Jan 4, 2011 2:14am
Quoting tradestar1
Well the trailing stop took me out.......
do you use a 4 or 5 digit crim?
Catching a falling knife, no, I'm just trading the Gartley!
  • #685
  • Jan 4, 2011 2:34am Jan 4, 2011 2:34am
Closed long cable for +44... I dont usually trade less than D1, but I was bored...
  • #686
  • Jan 4, 2011 3:49am Jan 4, 2011 3:49am
Quoting tradestar1
Trailing stop loss may or may not be the best option here. just dong some testing at this point.
It is a method used by Feb in his thread.

Any thoughts on this Paulus?
hi tradestar... i followed feb and fxa's method for a few months. feb is a scalper, and his approach was very different from what paulus is proposing. feb set a fixed sl of -20 and fixed tp at +21.first, if the trade went against him from the start, he would never let sl be hit, and would close at a small loss. also, when he was up +10/+15 and price came back to +5 he would bank immediately. this method produces many small losses, many small wins, and an occasional runner. but most important, i found that it gave me a lot of anxiety. personally, i'd rather have a sl in the most logical place which is beyond point 1, and leave it there until it or tp are hit. just my opinion, though.


missed all the action this morning, just got back and looking for shorts on 5mn
  • #687
  • Edited 5:37am Jan 4, 2011 4:53am | Edited 5:37am
Hi tradestar1,
try this.

first TP at 162 fib ext then pull SL to 62 fib retr or some significant LH/HL to bank some pips
second TP at 200

gives you 0R if it goes against you and 0.8R if both TP are hit

you have to do the math over a couple of trades whether this works out or not

Cheers

Thomas

Quoting tradestar1
Well the trailing stop took me out.......
  • #688
  • Jan 4, 2011 5:49am Jan 4, 2011 5:49am
Happy New Year to you all.

Obviously, lots of you carrie don trading over the holiday and as a consequence added some valuable contributions to the thread.

I have a quick question for anyone who has time to answer - do you look at and mark s & R levels from the upper t/f or do you simply take the trades on your preferred t/f and allow the market to do its work?

The reason for my question, is that often I do not enter a trade, because it is too close to a level only to see it drive straight through it.

Just curious to know others' thoughts.

thanks!
  • #689
  • Jan 4, 2011 6:33am Jan 4, 2011 6:33am
nice PA on GU - such is life
at least got out at BE (from my short)

better to stick to Paulus's trade management

and don't look at the chart before the TP or SL is hit

Quoting tdeu
Hi tradestar1,
try this.

first TP at 162 fib ext then pull SL to 62 fib retr or some significant LH/HL to bank some pips
second TP at 200

gives you 0R if it goes against you and 0.8R if both TP are hit

you have to do the math over a couple of trades whether this works out or not

Cheers

Thomas
  • #690
  • Jan 4, 2011 7:56am Jan 4, 2011 7:56am
Quoting Delite
Happy New Year to you all.

Obviously, lots of you carrie don trading over the holiday and as a consequence added some valuable contributions...
hi delite...personally i removed everything from my chart. i trade on the same chart i post, nothing on it except fib. i used to have RN, pivots, S/R, and the result was complete trading paralysis. there was always something that would make me doubleguess and keep me from placing an order. and after being upset for missing a good trade, i would jump in and lose.

i've decided to KISS.
  • #691
  • Jan 4, 2011 8:05am Jan 4, 2011 8:05am
Quoting Delite
Happy New Year to you all.

Obviously, lots of you carrie don trading over the holiday and as a consequence added some valuable contributions to the thread.

I have a quick question for anyone who has time to answer - do you look at and mark s & R levels from the upper t/f or do you simply take the trades on your preferred t/f and allow the market to do its work?

The reason for my question, is that often I do not enter a trade, because it is too close to a level only to see it drive straight through it.

Just curious to know others' thoughts....
I tend to mostly stay on the 5 minute chart and place a pending order if I see a 1-2-3 set up

I do sometimes look at the higher time frame and if the 123 is in the direction of the higher time frame trend then I will put a larger take profit....and if the 123 is against the current trend on the higher time frame I will put a smaller take profit.

.....but I am still working on my discipline and trading smaller amounts of money until I can learn to control my bad habits. LOL

PGPB
  • #692
  • Jan 4, 2011 8:21am Jan 4, 2011 8:21am
[quote=bubola;4285241]hi delite...personally i removed everything from my chart. i trade on the same chart i post, nothing on it except fib. i used to have RN, pivots, S/R, and the result was complete trading paralysis. there was always something that would make me doubleguess and keep me from placing an order. and after being upset for missing a good trade, i would jump in and lose.

i've decided to KISS.[/quote

Thank you! I know exactly what you mean. I had something of an epiphany yesterday when showing my husband some charts and brought up one with only candlesticks on it, and I realised how much clearer the patterns were. Will try taking everything away (except maybe my trusty 200MA..!!!)
  • #693
  • Jan 4, 2011 8:22am Jan 4, 2011 8:22am
Quoting pgpb
I tend to mostly stay on the 5 minute chart and place a pending order if I see a 1-2-3 set up

I do sometimes look at the higher time frame and if the 123 is in the direction of the higher time frame trend then I will put a larger take profit....and if the 123 is against the current trend on the higher time frame I will put a smaller take profit.

.....but I am still working on my discipline and trading smaller amounts of money until I can learn to control my bad habits. LOL

PGPB
Again, thanks! I think making things as simple as possible is key.

Good luck!
  • #694
  • Jan 4, 2011 8:34am Jan 4, 2011 8:34am
Quoting ChinaWombat
do you use a 4 or 5 digit crim?
Oanda gives you the choice to display either 4 or 5 digits.
I choose to display 4.

Also the trade that the trailing stop got me .... I got back into it as it still looked feasible and it finally closed out with a 45 pip win making up the loss and then some......
  • #695
  • Jan 4, 2011 8:40am Jan 4, 2011 8:40am
Quoting bubola
hi tradestar... i followed feb and fxa's method for a few months. feb is a scalper, and his approach was very different from what paulus is proposing. feb set a fixed sl of -20 and fixed tp at +21.first, if the trade went against him from the start, he would never let sl be hit, and would close at a small loss. also, when he was up +10/+15 and price came back to +5 he would bank immediately. this method produces many small losses, many small wins, and an occasional runner. but most important, i found that it gave me a lot of anxiety. personally,...
After looking more closely at the trailing stops I think I will keep this as simple as possible, that seems to be the way to the least stress and best profits......
  • #696
  • Jan 4, 2011 8:51am Jan 4, 2011 8:51am
I agree completely that simple clean charts are better and easier to read and see possible set ups. I also do not believe in trading completely blind either. Support and resistance levels and daily range are very important factors in considering taking a trade. Some have said that using support and resistance etc... keeps them out of too many trades but it can also save you from taking some bad trades.

You may see a nice 123 set-up on your clean chart and completely miss the fact that in order to break up and hit your TP you have to clear strong resistance levels to get there. Should this keep you out of the trade? Not always but support and resistance levels as well as psych levels need to be considered when entering a trade.

Another important factor is daily range. Most of the pairs have and mostly obey their daily ranges. Does this vary? Sure some days the pairs barely move and others they go 50 pips past their normal range... for the most part however they stay within 10-20 pips. Again if the EURUSD has already moved up 170 pips and I see a long set up I will be much more hesitant to jump in.

Anyway that's just my 2 cents on trading with nothing but the Fibo... clean is great but you still have to be careful...
Today's zone = Tomorrow's opportunity!
  • #697
  • Jan 4, 2011 8:58am Jan 4, 2011 8:58am
Paulus,

I had two longs set up last night Euro for +45 and Pound Dollar for +45. Did you catch the pound trade also?
PIP'N
  • #698
  • Jan 4, 2011 9:10am Jan 4, 2011 9:10am
Quoting pres78

if the EURUSD has already moved up 170 pips and I see a long set up I will be much more hesitant to jump in.

unless of course there was a short set-up that had also completed and you had a successful sell trade....without that there would be little point to take a long at such an extreme move..
Catching a falling knife, no, I'm just trading the Gartley!
  • #699
  • Jan 4, 2011 9:12am Jan 4, 2011 9:12am
Quoting ChinaWombat
unless of course there was a short set-up that had also completed and you had a successful sell trade....without that there would be little point to take a long at such an extreme move..
Very true. Even with a successful sell on the way up if the pair has moved it's normal limit I will still be wary in jumping back into a long after the pair has completed it's normal daily range.
Today's zone = Tomorrow's opportunity!
  • #700
  • Jan 4, 2011 9:22am Jan 4, 2011 9:22am
Quoting tradestar1
Oanda gives you the choice to display either 4 or 5 digits.
I choose to display 4.

Also the trade that the trailing stop got me .... I got back into it as it still looked feasible and it finally closed out with a 45 pip win making up the loss and then some......
depending upon if the crim is 4 or 5 digits (assuming you're using MT4) then you have to add a digit to your trailing s/l which i've learnt the hard way... thinking i had a 30 pip trailer but which closed me out at +3 pips, needless to say what happened to the original tp...

my personal preference would be that if price has moved to 70-80% of the target then you should prudently move the sl to B/E. You never want a winning trade to turn into a loser. As we are all pretty much agreed there are plenty of trades each day so that even if you do put a scratch trade on, the next trade is usually quite soon. Everyone needs to find there own level of comfort with this method and RR.
Catching a falling knife, no, I'm just trading the Gartley!
1 trader viewing now