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Trade What You See - Almost Naked Trading

  • #16,201
  • Jun 17, 2011 8:35am Jun 17, 2011 8:35am
Quoting jdcompute
Took this H1 BO down to the support line.
And now it looks like it is in the continuation stage of a ZC trade.
Attached Image
  • #16,202
  • Jun 17, 2011 9:13am Jun 17, 2011 9:13am
I am posting this chart because it is so interesting and I had not noticed this before. That move down from 2008-2009 was a 7000+ pip move. That is the potential we have here with the long term trading.
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  • #16,203
  • Edited 9:50am Jun 17, 2011 9:23am | Edited 9:50am
Alright guys, I need some help.

I had 8 more MT losers last night, with 2 more that are in the negative right now but haven't hit SL yet. In case you didn't see my last post this week, that's a total of 26 straight losers. I lost over 27% this week, and all my profits from the last 3 weeks have now been lost. I was up 27.8% going into this week, now I'm at about -3% total.

I am only risking 1% per trade, and this is obviously too much if we are going to have runs like this. 27% drawdown is far too high.

Just closed my last 2 trades, so I'm at square 1 again.

What do you guys think?

Back to the drawing board for CC...
Enter Signature
  • #16,204
  • Jun 17, 2011 10:07am Jun 17, 2011 10:07am
Quoting CrucialCraig
Alright guys, I need some help.

I had 8 more MT losers last night, with 2 more that are in the negative right now but haven't hit SL yet. In case you didn't see my last post last week, that's a total of 26 straight losers. I lost over 27% this week, and all my profits from the last 3 weeks have now been lost. I was up 27.8% going into this week, now I'm at about -3% total.

I am only risking 1% per trade, and this is obviously too much if we are going to have runs like this. 27% drawdown is far too high.

Just closed my last 2 trades, so I'm...
I had that same problem with 3 taps. Lost three weeks work during couple of days. Its not very inspiring to lose 3 weeks work, but dont give up. I analysed the problem a while ago and found that if weekly trend changes (or if the price is ranging, but thats not as bad as trend change) in the middle of the week, thats bad for 3 taps as well as other longer tf trades. If you check last two weeks, there has been a change in the trend in the middle of the week on many currencies. If the trend continues the whole week as it started on monday, there is no prob, but to ride with it. LG said before that weekly trend is more reliable later in the week. This might have something to do with that also. I havent been able to solve this problem so far, but I think that it could be worthwhile to secure your potential profits by trailing tp in the middle of the week as well as check out trend confirmation on open trades during the week by eg. highs/lows, higher highs/higher lows on 1h or 4h.

I will test this approach after my summer holiday on july. If somebody figures out how to forecast middle week trend changes I would be more than glad to know Maybe its fundamentals or market sentiments that play a part in this?
Just some thoughts that came to mind. Successful trading to you all.
  • #16,205
  • Jun 17, 2011 10:15am Jun 17, 2011 10:15am
Next week I will start trading MT in a separate account. I will be starting with micro lots just to have the "live" trading feel vs "demo". There is a difference in mentality when trading live. Micro lots give me the opportunity to go live with minimal risk while I get familiar and comfortable with the system.

My other account I will concentrate on the 3Tap and 1h 4C BO methods. Should be in the six figures by this time next year. LOL. Well ya gotta have goals!

Today I am still in:
aud/cad long
cad/jpy short
gbp/jpy. short

Still working on my long term mentality.

Took SL on:
usd/cad
gbp/usd
nzd/jpy
eur/jpy


My own biggest obstacle to trading has been sticking to the rules and not bending them to "tweek" more profits. Usually resulting in losses.

LawGirl you have been successful here for some time and I know you traveled the same route as most of us. Therefore, I will be deferring to your expertise and learn also to be a successful trader. Thanks again for all your support and help. I should have stayed here from the beginning instead of wandering off to "greener" pastures.

My total for this week trading MT exclusively is -93 pips. Not bad considering what kind of week we had.

Have a good weekend everyone and see you all again next week.
  • #16,206
  • Jun 17, 2011 10:43am Jun 17, 2011 10:43am
Quoting CrucialCraig
Alright guys, I need some help.

I had 8 more MT losers last night, with 2 more that are in the negative right now but haven't hit SL yet. In case you didn't see my last post this week, that's a total of 26 straight losers. I lost over 27% this week, and all my profits from the last 3 weeks have now been lost. I was up 27.8% going into this week, now I'm at about -3% total.

I am only risking 1% per trade, and this is obviously too much if we are going to have runs like this. 27% drawdown is far too high.

Just closed my last 2 trades,...
Hi CC,

I am new for this method so I had to think it over - and for me the real account risk for this kind of trading is 0,3% ,

and secondly I can trade this system only as a separate account to not get insane while mixing it with other trades, for me psychology is the key here, because the system is really simple,

Peter
Jesus Christ is my only Lord !
  • #16,207
  • Jun 17, 2011 10:47am Jun 17, 2011 10:47am
CC I agree that with the MT system a 1% per trade may be too much for comfort. I suggest a .25% may be better to start and then as we go can add branches to the winners while moving the SL to BE as we continue with the trend. Moving the SL to BE when my profits are double the initial SL is what I think I will start with. Just to set some rules for the trades.

I am sticking to the 30 pip SL for now because as LG stated we can throw more bait out to catch the bigger fish without doing significant damage to our account.

Just my thoughts on it. Any other ideas?

LawGirl have you set any rules yourself for moving SL?
  • #16,208
  • Edited 12:51am Jun 18, 2011 12:29am | Edited 12:51am
Hi all I have been lurking around this thread for a while. I am pleased to be here to learn and help. Enough said about me. Lets get on to it.

Quoting airbeat
CC I agree that with the MT system a 1% per trade may be too much for comfort. I suggest a .25% may be better to start and then as we go can add ...
In my humble opinion.

Could the undesirable drawdown from MT be mitigated by doing some backtesting for a few years to adjust the position size accordingly? I am not saying MT is bad, just that- Do we need more info about MT's pass performance to determine the right position size for us to avoid excessive drawdowns? I am trying to learn here.

Hi LawGirl thanks so much for this thread. To anyone that can answer. May I ask, I have read the first post and couldn't find any instruction about setting SL and TP for the 3 tap system. Is there a system for it or is it discretionary as LG say. place it at the support or resistance. (if so what would someone kindly reiterate the guild lines for me?)

I am going to trade this system BO and 3 tap on demo, I will post the results here.

Thanks
Ben
Riding the order flow
  • #16,209
  • Jun 18, 2011 9:10am Jun 18, 2011 9:10am
Quoting Binyamin
Hi all I have been lurking around this thread for a while. I am pleased to be here to learn and help. Enough said about me. Lets get on to it.



In my humble opinion.

Could the undesirable drawdown from MT be mitigated by doing some backtesting for a few years to adjust the position size accordingly? I am not saying MT is bad, just that- Do we need more info about MT's pass performance to determine the right position size for us to avoid excessive drawdowns? I am trying to learn here.

Hi LawGirl thanks so much for this thread. To anyone...
Thanks for your input Ben. To answer your question, I have never suggested a TP or SL for 3 Taps other than reasonable R/S levels. The reason is that I never considered these methods beginning trader methods, although they are deceptively simple and many newbies have embraced them. But I always assumed traders could determine their own levels, based on individual tolerance, comfort, and accounts.

I have tried hard to avoid getting into long discussions about MM, how to draw trendlines, support and Resistance levels, etc..again because I assumed every trader was intimately familiar with these things. I now see that with MoneyTree, MM issues have cropped up...and that's certainly ok.
  • #16,210
  • Jun 18, 2011 9:12am Jun 18, 2011 9:12am
What I would like traders here to understand and I don't believe I have done a great job at it so far, is that I have tried to systematically take you through a method of trading.. starting with H1 charts (H1 4C BO)...then H4 charts (3 Tap) and now daily charts (MoneyTree)...that is extremely interrelated.

These systems can be traded separately, or all together. By that I mean a H1 BO can be used to enter a MoneyTree trade, as can a 3 Tap or a H1 BO can become a 3 Tap and both can become a MoneyTree trade. Or a trader can stick with only H1 trades or only 3 Tap trades. But, in my opinion, MoneyTree is the endgame. And with Moneytree, my work on the thread is almost done.
  • #16,211
  • Jun 18, 2011 9:15am Jun 18, 2011 9:15am
Quoting hipcio
Hi CC,

I am new for this method so I had to think it over - and for me the real account risk for this kind of trading is 0,3% ,

and secondly I can trade this system only as a separate account to not get insane while mixing it with other trades, for me psychology is the key here, because the system is really simple,

Peter
You are exactly right Peter...psychology is the key.
  • #16,212
  • Jun 18, 2011 9:23am Jun 18, 2011 9:23am
As You confirm that psych. is the key, dear LG, I will simply give myself a trial of about 2 months demo to get confidence, as there is nothing to learn here.

I will of course make and write down my observation in the meantime without any interrupting or changing the rules.

This would help me to decide if I want to use it in real or not,

Peter
Jesus Christ is my only Lord !
  • #16,213
  • Jun 18, 2011 9:49am Jun 18, 2011 9:49am
Quoting hipcio
As You confirm that psych. is the key, dear LG, I will simply give myself a trial of about 2 months demo to get confidence, as there is nothing to learn here.

I will of course make and write down my observation in the meantime without any interrupting or changing the rules.

This would help me to decide if I want to use it in real or not,

Peter
That's the way to do it..individual testing over a longer, rather than shorter period of time.

It's great to report your observations, but not on a day to day basis, because it is meaningless and will be too discouraging. Remember that most trades will fail.

Another thing I am finding, do not place all trades on the same day..especially on a smaller account and certainly not on a live account. The chance of all of them hitting SL around the same time is greater.
  • #16,214
  • Jun 18, 2011 9:52am Jun 18, 2011 9:52am
Quoting lawgirl21
That's the way to do it..individual testing over a longer, rather than shorter period of time.

It's great to report your observations, but not on a day to day basis, because it is meaningless and will be too discouraging. Remember that most trades will fail.

Another thing I am finding, do not place all trades on the same day..especially on a smaller account and certainly not on a live account. The chance of all of them hitting SL around the same time is greater.
Yes, observations and conclusions at the end of course,

Peter
Jesus Christ is my only Lord !
  • #16,215
  • Jun 18, 2011 10:05am Jun 18, 2011 10:05am
I have added, what I hope will be a "refinement" to the MT rules on page one. It is subtle, but huge. I have been using the H1 BOs and 3 Taps for adding branches, but now want to try using these entries for initial entries. This should give us fewer, but hopefully more reliable, trading opportunities. Here is the change:

2. Enter using either the H1 4C BO entry or 3 Tap entry or other entry of your choice in the direction of the RSI within the first few hours of the beginning of your new daily candle, if possible (whatever time of day that is for you), say within the first 6 hours (although 6 is arbitrary). The point is, we are trying to capture as much of the full day as is possible.
  • #16,216
  • Jun 18, 2011 3:15pm Jun 18, 2011 3:15pm
Quoting lawgirl21
The reason is that I never considered these methods beginning trader methods, although they are deceptively simple and many newbies have embraced them. But I always assumed traders could determine their own levels, based on individual tolerance, comfort, and accounts.

I have tried hard to avoid getting into long discussions about MM, how to draw trendlines, support and Resistance levels, etc..again because I assumed every trader was intimately familiar with these things. I now see that with MoneyTree, MM issues have cropped up...and that's...
Yup I am not a newb, but I won't say I am not at all familiar technical levels. From the pass post I can see some members are profitable and it seems to be fine. The problem is I think writing an EA for this will be hard.... But I will backtest it manually to check things out for myself. It seems to me from FF threads that systems that needs some human discretion tend to do better than otherwise. In my humble opinion.
Riding the order flow
  • #16,217
  • Jun 18, 2011 9:06pm Jun 18, 2011 9:06pm
Quoting Binyamin
Yup I am not a newb, but I won't say I am not at all familiar technical levels. From the pass post I can see some members are profitable and it seems to be fine. The problem is I think writing an EA for this will be hard.... But I will backtest it manually to check things out for myself. It seems to me from FF threads that systems that needs some human discretion tend to do better than otherwise. In my humble opinion.
I hope there is never an EA written. Backtest one of the long...years long.. trends like GBPJPY or EURCHF. I would love to see what multiple branches on those pairs would yield. Not sure if adding a branch with each H1 4C BO would be possible to backtest, but it would be interesting. How many times did price return to the entry price over a certain period of time, would be interesting to know.
  • #16,218
  • Jun 19, 2011 2:44am Jun 19, 2011 2:44am
Hiya Lawgirl, and hello folk's,

Thank's for this thread, and sharing your time and making the effort.

Total novice here, but have been reading anything and everything the last couple of months. Demo trading here, and will be for awhile yet until i feel i'm ready. I'm going to try the 1H 4 candle BO method this week, as it appears to be fairly straightforward for a boofhead such as myself. I've applied the method to some of last weeks charts and it seems to make sense to me, so i'll be giving it a whirl this week, and look forward to doing so.

Best wishes, and happy trading everyone.

Greg.
'Fail to plan, plan to fail'
  • #16,219
  • Jun 19, 2011 8:24am Jun 19, 2011 8:24am
Quoting lawgirl21
I hope there is never an EA written. Backtest one of the long...years long.. trends like GBPJPY or EURCHF. I would love to see what multiple branches on those pairs would yield. Not sure if adding a branch with each H1 4C BO would be possible to backtest, but it would be interesting. How many times did price return to the entry price over a certain period of time, would be interesting to know.

I have started the 3 tap 4 h method a few weeks ago, and I`m pretty interested in this method. I have losers and winners with this method, so I will switch back to demo trade for 4-6 weeks, and make 3 personal modifications:

1. SL with 30 pips is OK, for the majors, if entry is well on the lower timeframes. But not enough for volatil pairs like geppy or exotic currency pairs.

2. LG, you try to catch the big trend. I will focus in my demo on the opposite way with near targets plus the big trend. Lets say I splitt a trade in 3 parts, with first target 1 daily candle length (or the average daily range). The second target is 2 times a daily candle length (or 2 times the averge daily range). The 3 trade is a free runner, to catch a BIG trend. See first chart for explanation.

I read a few month ago, the market 80 % the time is in range mode, and only a little time trending. With my 3 targets I cover a ranging market and a trending. It is most importend for a successfull trading strategy also to cover a ranging market.

3. I have had a little thinking about my losses. What a 3 tap 4 h means? In a down market it means, price is testing a resistance and resume downdtrend in the direction of the RSI. BUT what happens if it taps 3 times and breaks through it, opposite to the direction of the RSI ? This means the resistance is broken and price will reverse. So if I have a 3 tap 4 h entry short, how about to put a buy limit order a bit above my SL ?

Just in case price will reverse ? I will not trade this in my demo, but I will watch behaviour of price after my SL is hit, if it reverse. See example in the second chart.

green pips to all.
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  • #16,220
  • Jun 19, 2011 11:25am Jun 19, 2011 11:25am
Quoting peaches
I have started the 3 tap 4 h method a few weeks ago, and I`m pretty interested in this method. I have losers and winners with this method, so I will switch back to demo trade for 4-6 weeks, and make 3 personal modifications:

1. SL with 30 pips is OK, for the majors, if entry is well on the lower timeframes. But not enough for volatil pairs like geppy or exotic currency pairs.

2. LG, you try to catch the big trend. I will focus in my demo on the opposite way with near targets plus the big trend. Lets say I splitt a trade in 3 parts, with first...
Hi peaches, I hope u don't mind me pointing u in the right direction by posting this link. As pippete has previously mentioned, your trendlines are incorrectly drawn.
http://www.forextrendline.com/
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