Nb 10.0 range trading system

Hi Starlogic,
I was trading the same pairs as Bob (low volatile) Things have gone really downhill for me. I traded my account from $2500 up to $3600 over 3 or 4 months trading .02 standard lots. BUT....after the recent trending my account took a fatal hit... my equity is now at about $300 I found that because most pairs are so correlated they almost all move in the same direction. A couple of key things I learnt from this is:

.02 standard lots for my account size was too big for the amount of pairs I was trading (12 pairs)

DO NOT let your account go over 20%DD. Close out trades when this happens, so DD comes back down.

At the moment my balance is $1300 so i'm just going to recover these last trades I have and then probably withdraw my $$

Here i bragged about you to others. The dd hits do come in range trading it is just how you deal with it. Since I trade small I get through these patches. Like I said in my recovery I used about half of my Sept. profit to take out some trades. Things are under control for now. If there is another run I do have some room again. To me if 10.0 Range trading survives these moves then I think I finally found a range system that works just using an EA and you interfere with recovery. Anyway it appears that 1 penny per 500 of account seems to be a safe number to trade with. I only went over 20% of my account because of trades outside this system. The chf/jpy is going to take some time to recover but the rest are very doable. Good luck.

The secret to this range system is the dd control which i know is stating the obvious. You will always have winners from this system but the trick is to make sure the runs dont kill you.

I introduced sometime ago my hedge at 100 system it has saved me and i have continued to post gains throught the two months (since aug 12th) i posted results for a while but stopped as i felt it had no use apart from my ego. Since Aug 12th my account has grown by 187% my drawdown has never been over 24% (This was when i did not catch the hedge in time as it is not a auto (still awating this via phover new panel)

I have evolved my system as before i hedged and either matched lossers with winners as and when (the best method as it frees up those pairs to trade again- the issue with hedging is obviously it takes those pairs out of the game)

Now if the pair looks like a bb runner and using other indicators related to volume spread analysis (VSA) i place my second trade with the trend - i am also considering doing this automatically. or if it is seperated from the bb then i await the retrace using the recovery ea

I never compound my trades ie using the traditional 1,1,2,4 or other lot increase , i understand it but effectivley each trade is still a risk and if it goes against me i am further in the do do . So i stick to my base lot size. Also if i have not enough winners to offset then i generally wait and will pick off trades 1 at a time controlling my dd using some fundemenatals as a guide. It is not set and forgett so it has a lot of descretion in it. My point is (and i borrowed this from another thred basket trading) i see it as a business with stock controll, cashflow and profit/loss and if i have say 9 or 10 in hedge (which has happened ) i am not going to get the sam volume of winners so it can take time to match them out and take decsions 1 at a time - occassionally i will wipe the slate clean particualrly friday at 4-30 uk time and start again at 5am UK time (alot of my losses have happened sunday/monday so i have stopped trading at these times. Also i will stopp/ hedge everything if real major news is coming and wait till things settle. (This is range trading and i dont want to be the wrong side of a currency going of on a big run particualrly if i am not watching to hedge)

So just thought i would add my 2 penny worth this dd mng is a study in its own right and i think it will take me sometime to get to grips with it but nb has given me a platform and though process. The best tactic for me is the hedge means each pair is never to far out to put you in problems especially if you are patience and here is another key- you can trade all your life , every weekday is a trading day, but your account need protecting it is your lifeline and the mkt does not care about it so you must.

take care

Bob - am i right in assuming that the trend trading system is more profitable than the range trading one?

[quote=censura;5023180]

I occassionally i will wipe the slate clean particualrly friday at 4-30 uk time and start again at 5am UK time (alot of my losses have happened sunday/monday so i have stopped trading at these times.

Thanks for sharing your experience and down draft control system.
Do you mean in your statement you stop trading and clean your sheet Friday for 1/2 hour?? or till monday morning??

regards,
hans..

When the markets are trending yes, when they are not, no. Markets tend to range more than trend so it seems to me ranging profits more often. DD right now is a headache but before that ranging EA was knocking down profit for months while trend trading was frustrating.

censura,

you hedge at -100 pips: what is the rush to close out these 2 trades - price might come back to -50 in a couple of days/weeks and you close out the trades without a loss.
in the meantime your loss wont get any larger than -100 on the 2 trades anyway.

when hedged you say you cannot trade in that pair: why not, after all that trade is hedged?

just trying to understand and thank you for your reply

When you want to undo a hedge wait until the 10.0 system gives you the ranging period and then take out one hedge at the high and the other at the low. This way you are out with out a loss.

yep NB, that might be a more clever way to do it.......but anyway, in my opinion there is no rush to close out the hedge and take a 100 pip loss without trying for a better outcome I think.

I leave the floor to the professionals

The purpose of a hedge is to stop time. The trade that was going against you is stopped in time until you get a market in your favor. It is an account saver if a sudden story comes. I was furious that they stopped hedging in the USA. That was my backup plan to a super bad trade. Now I use smaller lots so I can use a bigger ranger in trading. I always know a market I like will eventually happen.

HI

You are tangling against quite the expert. I really dont trust a person who pisses on others in the field. Now he is after the bank traders and brokerage houses. I mean who does that leave beside himself. I just dont trust people like that. Anyway welcome, to range trading.

Digging myself out of a hole here but getting out. I am glad I down sized my lot size at the end of September or I would have had to add funds. Not because of the pairs here but some other trades I took.

Anyway, still in recovery aud/cad, aud/jpy, chf/jpy, cad/jap, gbp/usd, nzd/jpy, usd/cad

Most of them I am close to clearing out. Some are reduced in lot sizes so they are not that deep money wise anymore.

These pairs I am back to normal trading with the Range EA

aud/nzd (probably the best pair to trade)
aud/usd this one I just took some losses on cleaned out 1st and 2nd levels last week. Could have hung in there but I didnt want to violate my 20% rule. When over 20% DD start clearing out trades or add funds. Then next DD I experience I may make a new rule where if I go over 15% DD all profits must be used to clear DD. I have a tendency to keep pocking profits and letting DD get bigger. If I had done that with a couple of trades I might not have had to close any big losers. Any way will try that one. I have dropped aud/usd from my list, I think pairing that small of a pair with a major like USD will always lead to trouble some where.
eur/gbp this one held steady all the way through.
gbp/cad another good customer with some exciting moments at times.
nzd/chf DANG SNB still it came back and cleaned itself out.
usd/jpy wish this one would move just a little more.

The range pairs did as advertised stayed within a range during a big run. CHF bank interference made it more exciting than it should be.

As some of you saw in my recovery thread I took a 7% hit to get my account below 20% DD mark. Since then I have reduced that deficit by 25% So I am down 5.25% for the month. If I can get another solid week I will be back close to 0 and maybe eek out a profitable month. I have not had a losing month in a long time and I thought it might be this month but we will see. The good news is if I can eke out a profit month in a month bad for range trading then I would be excited about that. So keep plugging away.

Sorry, it was noty wriiten very well - close Friday uk time 4-30pm open Monday 5am
[quote=hansnl;5024712]

Bob,

It seems to me the single most important question you can ask before you take a trade is "Is this a trending or a ranging market". If it is a ranging market you should make one trade. And if it is a trending market you should the opposite.

How do you decide which is which?

Go to 10.0 Trend trading. It is all in the booklets.

Checking out your method in more detail. Always though your stuff was too complicated in the past but now it makes more sense. Alot to go through but so far so good.

Bob,

Forgive me if I missed it... sometimes things are hiding in plain sight... but I couldn't find the precise definition of a range or how to move between a range system and a trend system. I did look at your work so I know that you trend trade up when price on a daily chart closes above the two moving averages and you trend trade down when it closes below.

Definition of a range trade is when the Low or high is touching any of the two lines on the daily chart. Price is trending when the low and high are not touching any of the lines on a daily chart.