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EurAnalysis Kindergarten 24 replies

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EurAnalysis

  • #18,121
  • Jan 6, 2012 12:26pm Jan 6, 2012 12:26pm
Quoting the redlion
i welcome peer review on my money management strategy, please rip it apart.

1.86% of account risk per trade due to 35% loss ratio= streak of 35/100 trade losses total account depletion would be 65.10% with fixed out of original balance (in other words 1.86% is constant of original balance, not adjusting to new account balance) it is a little aggressive but more defensive than this would be very at least in my view very slow growth.

Attachment

let me explain what you are looking at. historical average range of euro is 121 pips...
I understand where your trying to go with this as I read your thread. I find it interesting and at times confusing since I'm not a math wiz.
With that being said, I have a couple of questions:

With this method are you proposing to let the stop take you out of the trade?

How do you determine if the market is experiencing "normal" volatility?

I may be wrong, but I'm of the belief that you're attempting to remove as much of the emotion and discretion from your trading as you possibly can by using mathematical logic to formulate a trading plan.
Mark ... Everything you have been told is a LIE
  • #18,122
  • Jan 6, 2012 12:28pm Jan 6, 2012 12:28pm
Quoting Tyoon
..

http://www.forexfactory.com/attachme...9&d=1302980293
If there was easy money lying around,no one would be forcing it into your
  • #18,123
  • Jan 6, 2012 12:32pm Jan 6, 2012 12:32pm
Quoting bumapatria
believe it or not u can use geometry for technical analysis
heres examples from JR my buddy and superior in the topic... not advertising his coolness btw

http://www.forexfactory.com/attachme...1&d=1234312463
http://www.forexfactory.com/attachme...1&d=1315147937
I know my little brother
But too complicated for me
Btw,Mr.Kno Love you
Lucu yah
If there was easy money lying around,no one would be forcing it into your
  • #18,124
  • Jan 6, 2012 12:34pm Jan 6, 2012 12:34pm
Quoting the redlion
ask away, what was not clear?
tested the method of that MM yet mate?
would be more interesting if you can open a journal and apply it so we can follow the development
btw,may i use your words as my signature like that "no matter how good u read the chart is one..."
If there was easy money lying around,no one would be forcing it into your
  • #18,125
  • Jan 6, 2012 12:35pm Jan 6, 2012 12:35pm
Quoting the redlion
ask away, what was not clear?
what im seeing to is that u trade near the open and thats the tilt of price and u use volatility for triiggers and sd as well. say volatility and standard deviation at euro was at an extreme and price is below daily open but is at a weekly open and monthly pivot. despite price being below at open isn't it better to go long? its lowest risk there right? or do you tend to take trades where volatility and standard deviation is at the usual mean?

say you are trading intraday. your "pivot point" would be the daily open correct? how would you predetermine with your calculations the chances of price hanging on to above the open or below the open?

or is it always 50/50?

and i dont get the part where u use hihger leverage at a certain points

Thank you in advance
Have I got something on my face, SOLDIER?
  • #18,126
  • Jan 6, 2012 12:36pm Jan 6, 2012 12:36pm
Quoting spzd
I understand where your trying to go with this as I read your thread. I find it interesting and at times confusing since I'm not a math wiz.
With that being said, I have a couple of questions:

With this method are you proposing to let the stop take you out of the trade?

How do you determine if the market is experiencing "normal" volatility?

I may be wrong, but I'm of the belief that you're attempting to remove as much of the emotion and discretion from your trading as you possibly can by using mathematical logic to formulate a trading...
no not at all, i am very discretionary, what i am trying to do is come up with a way to put a cap on my total risk exposure according to win loss ratio in case of worse case scenario hence the 1.86%

now the stops are placed at 62 due to statistical analysis over 2,856 trading days that pretty much gives me probable statistical outcomes. so for example if i am bullish, once my stop is hit, that means that i have 16% chance of being right so either i close my platform or rethink my analysis.

how do i determine the market is experiencing normal volatility? there is no way of predicting that, however i want to make sure that my stops are not susceptible while not over exposing myself.

a trading system without discretion will fail in the long run, what i am attempting is to DEFINE my risk parameters, i cannot predict the market BUT I CAN CONTROL MY RISK
AVT INVENIAM VIAM AVT FACIAM
  • #18,127
  • Jan 6, 2012 12:37pm Jan 6, 2012 12:37pm
Quoting FXMindset
tested the method of that MM yet mate?
would be more interesting if you can open a journal and apply it so we can follow the development
btw,may i use your words as my signature like that "no matter how good u read the chart is one..."

it would be my honor for any one to use my ideas.

and yes a journal would be interesting, but i have tried before and gets in the way of my trading
AVT INVENIAM VIAM AVT FACIAM
  • #18,128
  • Jan 6, 2012 12:42pm Jan 6, 2012 12:42pm
Quoting bumapatria
what im seeing to is that u trade near the open and thats the tilt of price and u use volatility for triiggers and sd as well. say volatility and standard deviation at euro was at an extreme and price is below daily open but is at a weekly open and monthly pivot. despite price being below at open isn't it better to go long? its lowest risk there right? or do you tend to take trades where volatility and standard deviation is at the usual mean?

say you are trading intraday. your "pivot point" would be the daily open correct? how would you predetermine...

which one do you want answered first? my trading entrances and exits or the leverage that you mentioned?
AVT INVENIAM VIAM AVT FACIAM
  • #18,129
  • Jan 6, 2012 12:44pm Jan 6, 2012 12:44pm
haha jose u got hammered with others' to ask u as well LOL time ta start talkin punk lol


yeah u should make journal. i woud defintely want to learn volatility and standard deviation into my trading.

am quite too hybrid a trader. lol

so in my weapponry i got:
1. Price action - support resistance, supply demand, retest etc, patterns..
2. Cycles - Fib bar counts, planetary, static
3. Gann - Square of nine, master chart, gann fans etc
4. waves - elliot 1-5 abc wave counts (just basic) fib ratios of swings
5. Volume spread analysis - uptthrust, no demand, vol divergence etc
6.?
7.?
8.?

id like to add volatility and standard dev. into number 6..

number 7 might be fundies.

number 8 might be something like market profile.




i know i know i try to know too much. its not that i cant make profit i need a style that can make me profit, but theres so much knowledge out there, u just cant graduate in forex.
Have I got something on my face, SOLDIER?
  • #18,130
  • Jan 6, 2012 12:45pm Jan 6, 2012 12:45pm
Quoting the redlion
which one do you want answered first? my trading entrances and exits or the leverage that you mentioned?
entrance first please
Have I got something on my face, SOLDIER?
  • #18,131
  • Jan 6, 2012 12:56pm Jan 6, 2012 12:56pm
Quoting the redlion
it would be my honor for any one to use my ideas.

and yes a journal would be interesting, but i have tried before and gets in the way of my trading
you may consider it and post when you settle the trading days
am would be interested to follow your MM method progress later
If there was easy money lying around,no one would be forcing it into your
  • #18,132
  • Jan 6, 2012 12:59pm Jan 6, 2012 12:59pm
when trading i like to observe and analyse and always know what i am looking at now in relationship to the bigger picture


here is the monthly chart
Attached Image (click to enlarge)
Click to Enlarge Name: monthly.PNG Size: 25 KB



here is my way to look at the monthly chart by looking at the daily chart, if above monthly open= monthly candle will look green
if below open monthly candle will look red

correct?
Attached Image (click to enlarge)
Click to Enlarge Name: daily.PNG Size: 33 KB


i know that 99.33% of the time the daily candle will be either green or red, the trick is which color is most likely to happen TODAY

the moving average is just the average price over 20 days or a month (5 trading days *4 weeks =20)
the Bollinger Bands let me know normal volatility, and if the price is cheap or low according to the fair market value = the average of the month.

now they also help spot shift in direction.

this needs to be clear before i proceed to my trading charts the Hourly and Five minute
AVT INVENIAM VIAM AVT FACIAM
  • #18,133
  • Jan 6, 2012 1:05pm Jan 6, 2012 1:05pm
Quoting the redlion
no not at all, i am very discretionary, what i am trying to do is come up with a way to put a cap on my total risk exposure according to win loss ratio in case of worse case scenario hence the 1.86%

now the stops are placed at 62 due to statistical analysis over 2,856 trading days that pretty much gives me probable statistical outcomes. so for example if i am bullish, once my stop is hit, that means that i have 16% chance of being right so either i close my platform or rethink my analysis.

how do i determine the market is experiencing normal...
Thank you for clarifying those points for me.

After re-reading your post, I think your MM strategy is very conservative, since your stops are based on just your initial equity and not increased (compounded) from increases to your equity. If I'm correct then I would say you have come upon a sound method of managing your risk.

The way you treat the daily open (central pivot, CP) is somewhat similar to how the person who mentored me looks at it. I don't think he uses actual statistical values, as he came to this through many years of trading and observation.
Mark ... Everything you have been told is a LIE
  • #18,134
  • Jan 6, 2012 1:07pm Jan 6, 2012 1:07pm
This visual can make things clear hopefully, side by side comparison

Attached Image (click to enlarge)
Click to Enlarge Name: sidebyside.jpg Size: 146 KB
AVT INVENIAM VIAM AVT FACIAM
  • #18,135
  • Jan 6, 2012 1:11pm Jan 6, 2012 1:11pm
Quoting the redlion
This visual can make things clear hopefully, side by side comparison

Attachment

nice.. that helped a lot thanks - i am a visual learner so yeah that chart is great


is that why u went long on euro btw? price at lower extremes of volatility and at sort of a weekly support level...? or has nothing to do wit hthat chart?
Have I got something on my face, SOLDIER?
  • #18,136
  • Jan 6, 2012 1:12pm Jan 6, 2012 1:12pm
Quoting bumapatria
nice.. that helped a lot thanks - i am a visual learner so yeah that chart is great


is that why u went long on euro btw?
no i expected it to bounced up due to the NFP being positive = risk on, but my stop got hit and i decided.......better luck next time lol
AVT INVENIAM VIAM AVT FACIAM
  • #18,137
  • Jan 6, 2012 1:16pm Jan 6, 2012 1:16pm
Quoting the redlion
no i expected it to bounced up due to the NFP being positive = risk on, but my stop got hit and i decided.......better luck next time lol
about being like water red.. i was also expecting move up, but this little arrow i drew saved my butt. actually my remembering of u saying the be like water be flexible thing saved me. thats how i shorted oil and euro easily i guess - to be flexible and not static.



thanks as always


PS the little arrow even after drawing took a while to digest it was a bull flag afer clearing the square's range
Attached Image (click to enlarge)
Click to Enlarge Name: that_little_arrow.png Size: 14 KB
Have I got something on my face, SOLDIER?
  • #18,138
  • Jan 6, 2012 1:17pm Jan 6, 2012 1:17pm
Quoting the redlion
no i expected it to bounced up due to the NFP being positive = risk on, but my stop got hit and i decided.......better luck next time lol
Btw,so your MM rules for risk reward is 1:2 ? No ride it even there's a chance?
as for chicky is 1: 1 as i know,heard that he close 98% profits this year
If there was easy money lying around,no one would be forcing it into your
  • #18,139
  • Jan 6, 2012 1:31pm Jan 6, 2012 1:31pm
Quoting the redlion
i was hoping to get peer review and my idea ripped apart, Aaronward Suggested 10% but that would just mean up the leverage, the ranges are pretty much thought out based on statistical volatility and probabilities,

this MM is universal, leverage means leverage not lot numbers example

1,000 usd= 3000 units of currency= 3, 0.10 lots
5,000 usd= 15000 units of currency
20,000 usd= 60,000 units of currency
100,000 usd= 300,000 units of currency
and etc.....
I suggested 10% as a thought experiment or something to run statistical analysis on. Key idea is that everybody says 1% or 2%, that is is important to try something really radical to see what happens (with a demo account of course) when you do not do not follow "standard" wisdom.

I personally like PT's approach...
Kill the ego, or it will kill the mission.
  • #18,140
  • Jan 6, 2012 1:36pm Jan 6, 2012 1:36pm
Quoting AaronWard
I suggested 10% as a thought experiment or something to run statistical analysis on. Key idea is that everybody says 1% or 2%, that is is important to try something really radical to see what happens (with a demo account of course) when you do not do not follow "standard" wisdom.

I personally like PT's approach...
my trending MM is a little different i pyramid into it by using previous gains as a buffer to new position, but this MM helps with the initial positions RISK, to day trade the swing
AVT INVENIAM VIAM AVT FACIAM
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