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Trading Made Simple

  • #3,241
  • May 19, 2011 9:56am May 19, 2011 9:56am
Quoting dean
depends how well you hone your entry. I am intersted in how you manage your risk Kumo?? I read one of your posts which spoke about how you amss 1000 pips and move up a level in regards to your trading lots but I dont remember anything about your trade management....how do you deal with SL and TP??
1000? where did you read that?

I have stock SL of 100 pips, with risk of 3%. My 100 pip SL is not just to ensure I only ever lose 3% on any trade. Its so I decide when it's good to get out, not a rediculously small SL which will be hunted and hit by normal market cycles.

I rarely if every hold to -100 pips (hard stop). I get out when the tdi says and it looks to me according to s&r and round numbers that the trade isn't coming back anytime soon and is more likely to go to -100 then into profit.

I lock in profit as it moves past round number then retrace under them. (watch for the stop kunts!) Or just lock it in when it feels right.

P.S. Even great good entries are going to get stopped out on a 20 pip stop loss. You would have to be godlyke trader not to get stopped out consistently with a 20 pip SL.

P.P.S Trust me on this no matter how good your entry gets 20 pips is just to small. SL is not a good way to run trade managment. IMO SL should just be there in case your computer and connnection goes down. At LEAST 50 on the EU, IM0 even that can be to small.
  • #3,242
  • May 19, 2011 9:59am May 19, 2011 9:59am
Quoting Falcon82
Aha! I had their proprietary platform. That must be the problem. Thank you silversurfer and everyone that has assisted me
  • #3,243
  • May 19, 2011 10:06am May 19, 2011 10:06am
Guys and gals, why risking so much with such small stoplosses? Maybe this doesn't mean anything to you guys but my maximum risk is 2% with SL of 100 pips. When in 25 pips profit, SL moves to +5. I trade off of the 4H chart and my SL had never gotten triggered. Always at least 5 pips of profit. I aim for the next support/resistance zone as my TP. Slowly but surely guys. Don't aim for big bangs and bang up your accounts.
  • #3,244
  • May 19, 2011 10:06am May 19, 2011 10:06am
Quoting KumoDragon
1000? where did you read that?

I have stock SL of 100 pips, with risk of 3%. My 100 pip SL is not just to ensure I only ever lose 3% on any trade. Its so I decide when it's good to get out, not a rediculously small SL which will be hunted and hit by normal market cycles.

I rarely if every hold to -100 pips (hard stop). I get out when the tdi says and it looks to me according to s&r and round numbers that the trade isn't coming back anytime soon and is more likely to go to -100 then into profit.

I lock in profit as it moves past round number...
No the 1000 wsnt your SL I think you were explaining that when you reach 1000 pips profit you step up your trade lots and if you lose 250 you step it down.
You say that you only risk 3% of your account, but that % risk is directly tied to your SL so if 100SL is 3% risk, it just means you have a massive account. You may be the same as Big E in that you are ultra confident in your ability, but bottom line for me....if I get stopped out....and we all wil, or have a losing streak...I dont want to have to get 3 trades right to ONLY get back to even for one loser.
And ther are people on this forum not getting stopped out using 30, and thats with a couple of weeks practice....25 should be no problem a few months down the track. One guy said today he had made more than 50 trades with a hard SL of 30 and had been hit twice....so people are doing it.
  • #3,245
  • May 19, 2011 10:09am May 19, 2011 10:09am
Quoting dean
No the 1000 wsnt your SL I think you were explaining that when you reach 1000 pips profit you step up your trade lots and if you lose 250 you step it down.
You say that you only risk 3% of your account, but that % risk is directly tied to your SL so if 100SL is 3% risk, it just means you have a massive account. You may be the same as Big E in that you are ultra confident in your ability, but bottom line for me....if I get stopped out....and we all wil, or have a losing streak...I dont want to have to get 3 trades right to ONLY get back to even for...
I remember that post, nope different guy.
  • #3,246
  • May 19, 2011 10:11am May 19, 2011 10:11am
Hello, my people in the forum, I am new to this forex trade and this is my first post here, I was told that support and resistance are very important tools to trade with, but my problem is how to know exactly when a resistance or support has been confirmed broken, what condition will confirm this? One more thing, are support and resistant is a perfect number or it has ranges? eg: 1.4750, is it exactly at 1.4750 or in between a few pips. Thanks.
  • #3,247
  • May 19, 2011 10:16am May 19, 2011 10:16am
Quoting dean
No the 1000 wsnt your SL I think you were explaining that when you reach 1000 pips profit you step up your trade lots and if you lose 250 you step it down.
You say that you only risk 3% of your account, but that % risk is directly tied to your SL so if 100SL is 3% risk, it just means you have a massive account. You may be the same as Big E in that you are ultra confident in your ability, but bottom line for me....if I get stopped out....and we all wil, or have a losing streak...I dont want to have to get 3 trades right to ONLY get back to even for...
I don't have a massive account my account was at 7k last week wednesday, now it's up to 7.5 K. Just risking 3%

People may not be getting stopped out using 30 pips, that's a little better ,but still to small. But 20 you are definately going to get boned.

Also, do some research and find out how many of those people are actually trading demo.

You can do what you want, I'm no guru, but I've been trading live for over 5 years a 20 pip SL simply WILL screw your end results. And it will lead to things like jumping back in and out and over trading. (Because you got stopped out and now it's moving in your direction so you were right after all.....so why not jump in.)

The market movements change sometimes from week to week and sometimes from day to day and sometimes within hours. What works as a SL today or tommorow or has for a couple of weeks won't in the near future. The 100 pip SL also helps protect me from changes in volatility.

P.S. I know why some of the traders here are using 20-30 pip SL, it's so that they can spread their risk over smaller SL, so when they do get that 50-200 pip run, the reward is huge. And that's great, when it works, but in the long run it's going to backfire.
  • #3,248
  • May 19, 2011 10:19am May 19, 2011 10:19am
Quoting keroll
Hello, my people in the forum, I am new to this forex trade and this is my first post here, I was told that support and resistance are very important tools to trade with, but my problem is how to know exactly when a resistance or support has been confirmed broken, what condition will confirm this? One more thing, are support and resistant is a perfect number or it has ranges? eg: 1.4750, is it exactly at 1.4750 or in between a few pips. Thanks.
I believe you should go to www.babypips.com to learn more of the basics of forex. Go through the school a few times it will do you good.

P.S. Generally S&R is considered broken if a candle can pass it and closes past it, AND there is retrace under it that continues. Thats general though, it's never a guarantee.

S&R comes in couple of flavors, the ones painted by the candles. (where you see candles have a hard time passing, and round numbers. (00 &50)
  • #3,249
  • Edited 10:39am May 19, 2011 10:25am | Edited 10:39am
Quoting keroll
Hello, my people in the forum, I am new to this forex trade and this is my first post here, I was told that support and resistance are very important tools to trade with, but my problem is how to know exactly when a resistance or support has been confirmed broken, what condition will confirm this? One more thing, are support and resistant is a perfect number or it has ranges? eg: 1.4750, is it exactly at 1.4750 or in between a few pips. Thanks.
A decent starting point might be http://www.babypips.com/school/
Gives you the essentials in a pretty easy to grasp format and at your own pace.

EDIT:
KumoDragon beat me to the punch!

Also: anyone heard from BigE?
  • #3,250
  • May 19, 2011 10:31am May 19, 2011 10:31am
whats the stop loss and the takeprofit on the 4H
  • #3,251
  • May 19, 2011 10:47am May 19, 2011 10:47am
Quoting dahmy123
whats the stop loss and the takeprofit on the 4H
lol..good questions...read back
  • #3,252
  • May 19, 2011 10:53am May 19, 2011 10:53am
Talking of stoploss...for me...you have 2 choices..

1. small stoploss with lower win rate and higher risk:reward
2. large stoploss with higher win rate and lower risk:reward...

there are not other things...

For me with this system the better stop placement is above/below the last swing high or low...

Today I made 3 trades but I placed a wrong stoploss, I've been stopped out by 1 or 2 pips in all 3 trades...
Using the last swing as stop i would be in the trades and in profit...
Market is like a puzzle, YOU have to fit the pieces!!
  • #3,253
  • May 19, 2011 10:58am May 19, 2011 10:58am
Quoting Chris_B
Talking of stoploss...for me...you have 2 choices..

1. small stoploss with lower win rate and higher risk:reward
2. large stoploss with higher win rate and lower risk:reward...

there are not other things...

For me with this system the better stop placement is above/below the last swing high or low...

Today I made 3 trades but I placed a wrong stoploss, I've been stopped out by 1 or 2 pips in all 3 trades...
Using the last swing as stop i would be in the trades and in profit...
same here got stopped out on audjpy..got in at the first cross hit my 30 pip sl and headed south in my direction to the tune of 55 pips....
  • #3,254
  • May 19, 2011 11:00am May 19, 2011 11:00am
Quoting XxLessoxX
same here got stopped out on audjpy..got in at the first cross hit my 30 pip sl and headed south in my direction to the tune of 55 pips....
AUDUSD, AUDJPY and USDCAD..I was in the right direction but the stop was not right..lesson learned...

all 3 trades went to profit
Market is like a puzzle, YOU have to fit the pieces!!
  • #3,255
  • May 19, 2011 11:02am May 19, 2011 11:02am
Quoting keroll
Hello, my people in the forum, I am new to this forex trade and this is my first post here, I was told that support and resistance are very important tools to trade with, but my problem is how to know exactly when a resistance or support has been confirmed broken, what condition will confirm this? One more thing, are support and resistant is a perfect number or it has ranges? eg: 1.4750, is it exactly at 1.4750 or in between a few pips. Thanks.
just my opinion, but s/r is a zone...price will almost never hit an exact number 1.400 eg and suddenly reverse..you will see it differently depending on the timezone you are looking at as well. when you have a trade on an hourly chart that is stalling you can sometimes zoom in or out of the chart and see its sitting at some zone of s/r....others believe a moving average can be a dynamic s/r.
  • #3,256
  • May 19, 2011 11:05am May 19, 2011 11:05am
Quoting Chris_B
AUDUSD, AUDJPY and USDCAD..I was in the right direction but the stop was not right..lesson learned...

all 3 trades went to profit
also i cant sit and watch these trades anymore...set them and check in at a later time....my hard stop is now going to be 2% at 100 pips..which on a 16k account is acceptable to me. my sl has been too tight, big e says he doesnt use them during the day, so mine will just be an emergency stop
  • #3,257
  • May 19, 2011 11:14am May 19, 2011 11:14am
Quoting XxLessoxX
just my opinion, but s/r is a zone...price will almost never hit an exact number 1.400 eg and suddenly reverse..you will see it differently depending on the timezone you are looking at as well. when you have a trade on an hourly chart that is stalling you can sometimes zoom in or out of the chart and see its sitting at some zone of s/r....others believe a moving average can be a dynamic s/r.
Good point and don't forget to add the spead also. Sometimes the S/R at horizonal lines is down to the pip.
  • #3,258
  • May 19, 2011 11:17am May 19, 2011 11:17am
hI EVERY ONE, MAY BE THIS A GOOD TRADE IN SHORT? I WAIT FOR YOUR COMENTS
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  • #3,259
  • May 19, 2011 11:41am May 19, 2011 11:41am
1.4300 resistance broken im in long 1hr chart
  • #3,260
  • Edited 11:59am May 19, 2011 11:50am | Edited 11:59am
Quoting dean
yep thats correct....but BigE is not your normal trader......He developed this..he knows it intimately and has no doubt.....he risks 10 - 15% on trades...and he expects on his 4 hour trades to wake up with 150 pips in the bank.....an RR better than 1:1
Fact is....most of us cant afford to do that nor want to. I want the minumu risk with the highest prob trades.
He considers he has that and doesnt feel the need to protect his account and I envy that....but its not me. If I am going to risk losing 100 pips....I want to MAKE 100 on the winners.
I agree with your point. But, based on Big E's statements I went back on EU and GU H4 charts. I have horizontal lines plotted to show where the Big Numbers (Craig Harris term) are. In looking back for the months of March, April and up to about May 10 or so, I looked for valid entries in accordance with the rules. If a valid entry appeared I then looked to see if I had used a 100 pip SL would it have been hit. Unfortunately I did not keep track of the number of valid trades that I observed but in the range of 50. The number does not matter, because not once would a valid entry with 100 pip SL get hit. NOT ONCE.

Even based on this I have not had the courage to go beyoned a 50 pip SL, and have had that trigger twice. Maybe someone else can do a similar exercise and relate results here.

Also Big E uses stops just outside last swing high or low, and if those points are greater than 100 pips he uses 100 pips. Just to clarify.
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