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Trading Made Simple for Day Charts

  • #541
  • Jan 24, 2012 1:00pm Jan 24, 2012 1:00pm
Just wanted to check in and give you my update.

I continue to enjoy using the TMS method to trade and I have changed my approach a little since I started trading this method towards the end of December last year.

For me the daily chart gives the best view of the 'big picture' per currency pair - on this time frame I find the TDI indicator and synergy bars to be very helpful in determining what the trend is doing etc.

I do check the weekly chart from time to time to give me confidence when required before I enter a trade.

My main chart for entries and exits however is the 4hr chart - I don't enjoy the discomfort of having to endure the possibility of relatively large moves against me that sometimes happens when taking trades off the daily chart. I still use TDI and synergy bars on the 4hr chart to pick solid entries with fairly tight stops (typically 30 - 60 pips) and then I use an 28ema as a trailing stop and this works very effectively to keep me in trades while the trend is strong, plus it allows the opportunity to move the stop to BE relatively quickly - which I like!

I will continue to subscribe to this thread as I enjoy the contributions of Britpip7 and others but I will not post stuff that is off topic.

Good trading everyone!
  • #542
  • Edited 4:15pm Jan 24, 2012 2:59pm | Edited 4:15pm
Quoting fxjourney
Just wanted to check in and give you my update.

I continue to enjoy using the TMS method to trade and I have changed my approach a little since I started trading this method towards the end of December last year.

For me the daily chart gives the best view of the 'big picture' per currency pair - on this time frame I find the TDI indicator and synergy bars to be very helpful in determining what the trend is doing etc.

I do check the weekly chart from time to time to give me confidence when required before I enter a trade.

My main chart for entries...
Thanks for the post - although the main goal is to stay true to the TMS approach, I am adding in my own approach as well as bringing in some of the older posts, as they are worth reading, so all posts relative to the approach are welcome.

When it comes to managing the trades I often switch back and forth, although my usual approach is to moe my SL to the las L for longs, H fo shorts. I always find if I futz with the SL too much I get taken out and then whoosh - off it goes again.

Here are some of Big E's posts from the time when he was really active and running the CH stochs thread. He had several approaches and this one uses the 21ema and 233ema. If this looks to be of interest, I suggest running some back tests on day charts and experimenting with the entries / add-ons. You may find that adding in the Fractals will also help. These are nice and clean charts - For the day charts I don't generally use the stochastics, but give it a try. It is always useful to have alternative approaches in the tool bag

http://www.forexfactory.com/showthre...44#post4305744

http://www.forexfactory.com/showthre...61#post4073561

http://www.forexfactory.com/showthre...79#post4094079

http://www.forexfactory.com/showthre...01#post4114501

http://www.forexfactory.com/showthre...55#post4114755

http://www.forexfactory.com/showthre...68#post4114768

http://www.forexfactory.com/showthre...57#post4146957
"To live with Passion, it takes Courage and Grace to survive"
  • #543
  • Jan 24, 2012 3:35pm Jan 24, 2012 3:35pm
Once again the markets ability to continue to move against me has out lasted my solvency....

I'm going to have to reload my mini account.
If you want to pick up a lot of pips..... Hedge my trades!
  • #544
  • Jan 24, 2012 4:04pm Jan 24, 2012 4:04pm
Quoting taylor4law
Once again the markets ability to continue to move against me has out lasted my solvency....

I'm going to have to reload my mini account.
As I've done with other traders - time to share the pain.

For lessons learned, what went wrong?

How was the TDI set up?

Candle strength of the move?

Signal Candle

Entry Candle

Or, was this a WTF moment?

Please post some charts so that we can review and learn
"To live with Passion, it takes Courage and Grace to survive"
  • #545
  • Jan 24, 2012 6:52pm Jan 24, 2012 6:52pm
Looking at the charts, this looked ike a good sample of set-up candles for APB - nice sized candle body with upper and lower wicks and in each of the highlighted candles, the candle size was larger then the ATR(7). No dojis / spinning tops, etc.
Also, there is nothing wrong with a signal candle that only has an upper wick for longs ans a lower wick for shorts.

To be a valid signal candle for a reversal signal I am looking for the candle size to be at least 75% of the ATR(7), with the candle body around 50pips or larger.
Attached Image (click to enlarge)
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"To live with Passion, it takes Courage and Grace to survive"
  • #546
  • Jan 24, 2012 7:19pm Jan 24, 2012 7:19pm
Quoting Britpip7
As I've done with other traders - time to share the pain.

For lessons learned, what went wrong?

How was the TDI set up?

Candle strength of the move?

Signal Candle

Entry Candle

Or, was this a WTF moment?

Please post some charts so that we can review and learn
All very important points, but no mention of Money Management, Position Sizing, also very important when trying kill an ELEPHANT with a pellet gun

It takes a lot for me to IGNORE you, but you can try.
  • #547
  • Jan 24, 2012 7:26pm Jan 24, 2012 7:26pm
Quoting Erebus
All very important points, but no mention of Money Management, Position Sizing, also very important when trying kill an ELEPHANT with a pellet gun

For these examples what would you suggest for Money Management, Position Sizing?
"To live with Passion, it takes Courage and Grace to survive"
  • #548
  • Jan 24, 2012 8:03pm Jan 24, 2012 8:03pm
Quoting Britpip7
For these examples what would you suggest for Money Management, Position Sizing?
Without the exact details of each setup, this cannot be answered, HOWEVER ------

Money Management with Position Sizing is EASY, the only thing you have control of in ANY trade is the RISK.

Basic procedure for every trade should be to know, ---

1. Trigger, why you are enter this trade? Do you have logical reason or are you just shooting like wild west?

2. Stop Loss, what will I accept as the point which invalidates #1?

3. Entry point, where to place a pending order that triggers when PRICE moves in the desired direction?

The way to control RISK is to change the Position Size depending on the distance to the Stop Loss, use a calculator for this.

Not the 2 examples, the stop distance has doubled, position size is approximately half but the RISK is always $200 or 2% of account size.

This is DAY trading thread, so no reason why anyone can not plot these trades well in advance, price action ( just going up or down ) is the same for every time frame, this is 15 min but could be a daily chart.
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It takes a lot for me to IGNORE you, but you can try.
  • #549
  • Jan 24, 2012 8:12pm Jan 24, 2012 8:12pm
Quoting Erebus
Not the 2 examples, the stop distance has doubled, position size is approximately half but the RISK is always $200 or 2% of account size.
Just wondering if you always risk 2% of account size regardless of setup ??
Forex is boring but profitable with patience and discipline
  • #550
  • Jan 24, 2012 8:21pm Jan 24, 2012 8:21pm
Quoting prftablefool
Just wondering if you always risk 2% of account size regardless of setup ??
Yes, a trade signal is a trade signal to my method; there are no degrees of probability, which I where I figure you are going with this line of questioning. See below ----

Trading in the Zone: The 5 Fundamental Truths

by Trader Rich

I finished reading "Trading in the Zone" by Mark Douglas yesterday. For those of you who haven’t heard of it or read it, I would highly recommend it. Douglas doesn’t offer any specific strategies to becoming a successful trader but advises that the first step to becoming a successful trader is to accept the psychological realities of trading.

A lot of what he advises, I have consciously accepted but the goal is for my subconscious to fully accept it so that it actually becomes part of who I am. Our beliefs are engrained in our minds and a lot of these beliefs don’t allow us to think like successful traders. The process by which we can start to think like successful traders involves "deactivating" these engrained beliefs and activate new beliefs. The new belief will take form and become part of our subconscious.

He mentions the importance of the 5 fundamental truths which we must train our minds to accept:

1. Anything can happen

2. You don’t need to know what is going to happen next in order to make money

3. There is a random distribution between wins and losses for any given set of variables that define an edge

4. An edge is nothing more than an indication of a higher probability of one thing happening over another

5. Every moment in the market is unique

Here are his 7 principles of consistency:

1. I objectively identify my edges

2. I predefine the risk of every trade

3. I completely accept the risk or I am willing to let go of the trade

4. I act on my edges without reservation or hesitation

5. I pay myself as the market makes money available to me

6. I continually monitor my susceptibility for making errors

7. I understand the absolute necessity of these principles. I never violate them.
It takes a lot for me to IGNORE you, but you can try.
  • #551
  • Jan 24, 2012 8:38pm Jan 24, 2012 8:38pm
Quoting Erebus

He mentions the importance of the 5 fundamental truths which we
must train our minds to accept:


5. Every moment in the market is unique
I read this book therefore I keep changing my predefined risk based on that particular moment, for instance, I will risk 2% when both the fighters are of equal strength but in case if one fighter is already injured I will probably raise the stake to 4% but again it is a personal choice.

Trade well.
Forex is boring but profitable with patience and discipline
  • #552
  • Jan 24, 2012 9:52pm Jan 24, 2012 9:52pm
Quoting prftablefool
I read this book therefore I keep changing my predefined risk based on that particular moment, for instance, I will risk 2% when both the fighters are of equal strength but in case if one fighter is already injured I will probably raise the stake to 4% but again it is a personal choice.

Trade well.
I have a similar view on this.

If one demonstrates that a repeatable success rate is achieved over a pre-determined time, then you already have limited the risk associated with a trade entry.

You must then understand what happens if within your probability of success, you experience a consecutive series of failures and the impact that would have on your account.

I tend to scale up after a repeated series of successes, then if I have a failure I scale back until I have a succession of 3 successes and then it is back to the plan... Initiially I start out with 2% per entry and go from there.

At the end of the day, it is all down to the trading plan and the money management / risk tolerance. You must accept that there will be losses and have an action plan to deal with the loss. That's why there is always cognac in the cupboard
"To live with Passion, it takes Courage and Grace to survive"
  • #553
  • Jan 25, 2012 2:09pm Jan 25, 2012 2:09pm
Quoting Erebus
All very important points, but no mention of Money Management, Position Sizing, also very important when trying kill an ELEPHANT with a pellet gun

There wasn't any real technical mistakes. Basically I got consumed with the greed and gambling feeling. I started jumping in every entry that looked good. I ended up running out of margin on a small move against me and my broker closed me out down 40 pips on one 70 pips on another. Both of which never reached my SL but went on to be positive trades just by then I was out. So then I loaded up and went for broke. The correct SL should have been 100 pips out but I could only let it move 20 pips against me. Which of course it did. I have $16 left. I hate demo trading. I have to trade with real money or I don't bother trading at all. This is NOT the first time I've done this since 2007. But I will say each time I reload it's with a lot less money than my first time in 2007.

I used to think well at least I'm not . But that attitude is getting expensive.
If you want to pick up a lot of pips..... Hedge my trades!
  • #554
  • Jan 25, 2012 4:38pm Jan 25, 2012 4:38pm
So once again after moving my stop loss i ended up getting stopped out for +100 pips on the Eur/Usd trade only to see that i would be at +250 pips if i was still in it lol.

Also my five demo trades are up 1,200 pips
  • #555
  • Jan 25, 2012 5:56pm Jan 25, 2012 5:56pm
Quoting kingclarence
So once again after moving my stop loss i ended up getting stopped out for +100 pips on the Eur/Usd trade only to see that i would be at +250 pips if i was still in it lol.

Also my five demo trades are up 1,200 pips

May I suggest to try on demo of leaving the trade alone after setting SL and TP which means nothing less will be accepted than TP or SL.

You will probably be surprised with the end result however every once in a while the trade will miss the TP by few pips and hit the SL out of nowhere.

It is worth giving a try.
Forex is boring but profitable with patience and discipline
  • #556
  • Jan 25, 2012 6:14pm Jan 25, 2012 6:14pm
Quoting kingclarence
So once again after moving my stop loss i ended up getting stopped out for +100 pips on the Eur/Usd trade only to see that i would be at +250 pips if i was still in it lol.

Also my five demo trades are up 1,200 pips
What did you set your SL to - how much breathing space?

ATR on EU has been running between 100 and 140 pips over the past few weeks.

If I move my SL, I will only move to the previous candle L for longs, H for lows - I do also look at recent ATR / candle sizes. If I run with a TS I currently use 1.25XATR(7).

If I follow my trading plan, the TP1 either hits or it doesn't - at worst case on some trades I may move to B/E once I have some space from the entry point and the momentum looks good.
"To live with Passion, it takes Courage and Grace to survive"
  • #557
  • Jan 25, 2012 6:19pm Jan 25, 2012 6:19pm
Took this trade yesterday morning when it closed firmly above 100.0. Added further position along the way and now in a waiting mode.

Time will tell how much ammo is left in this trade.
Attached Image (click to enlarge)
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Forex is boring but profitable with patience and discipline
  • #558
  • Jan 25, 2012 6:41pm Jan 25, 2012 6:41pm
Quoting prftablefool
Took this trade yesterday morning when it closed firmly above 100.0. Added further position along the way and now in a waiting mode.

Time will tell how much ammo is left in this trade.
Nice BRN approach - and this matches my approach for waiting for candles to close above S/R levels before entering. I had R at 100.32 which is where the last push fell over. 100.70 should now be the new support level.
"To live with Passion, it takes Courage and Grace to survive"
  • #559
  • Jan 25, 2012 7:30pm Jan 25, 2012 7:30pm
The story of beast is the same as EURJPY, closed above 120.0 firmly and now seems to catching up the breath after yesterday's run. If clear 122.75 the next stop will probably be 125.0
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Forex is boring but profitable with patience and discipline
  • #560
  • Jan 25, 2012 11:29pm Jan 25, 2012 11:29pm
Here's one to check out. The TDI has crossed and is below the Md Zone and below 50 - heading into 32 and PA is driving lower.

Weekly and monthly charts are both down.

If this breaks through the current support and BRN @ 1.4700, this is into new territory and has clear water underneath.

With ATR(7) at 101, SL should be at least 200pips, although the recent high would give you 270pips.

TP1 @ 200pips would not be a bad outcome and TP2 can be left to run - set to BE once TP1 is triggered.

The last 3 candles were 128 / 159 / 195 oldest to newest. The most recent can be classified as bearish engulfing.
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"To live with Passion, it takes Courage and Grace to survive"
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