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Extreme TMA System

  • #6,661
  • Mar 22, 2012 8:31am Mar 22, 2012 8:31am
i agree
  • #6,662
  • Mar 22, 2012 8:34am Mar 22, 2012 8:34am
Here is an Excel spreadsheet to help calculate entries and break even points for your recovery trades. It's easy to use:

First, select a sheet (tabs at the bottom): use the '4 decimals' sheet for standard pairs such as EURUSD, or '2 decimals' for JPY crosses.

Change the values in the blue cells to match your entry price (i.e. the value of your first trade), the number of pips between recovery trades (Al suggests 100) and the spread.

The blue cells marked 'L2 units' etc. represent the size of the position for each recovery level. These are multiples of your original trade. Sensible options would be 1.1.2.4 (Al's default) or 1.1.3.3. Note that L1 should always be 1 as it represents the size of the first trade. Also note that I've included a 5th level trade. Going this far isn't recommended by Al or Nanningbob, but I've included it in case anyone is using very small positions sizes and wants to push their recoveries out this far. Bear in mind that Nanningbob also suggests closing the 1st level position at a loss if recovery runs to level 5. If you do that, clearly the break even figure will no longer be accurate.

For each level the calculator shows your entry price and the price at which the sum of the trades will break even (also factoring in the spread). If you are not using an EA to manage recoveries you will have to manually change the TP of all the trades to the figure in the last column as each recovery trade is entered.

I don't claim to be the world's best mathematician or Excel wizz, but I'm pretty sure the calculations are correct. I would appreciate it if someone with a eye for numbers had a look over it. If they're not accurate, don't blame me! I take no responsibility for trades which bugger-up or losses incurred due to this calculator!

If you're interested...

I think the best way to picture recovery trades is in 'gap-units'. A gap-unit is a loss equal to one unit (the size of the original trade) that has moved by the value of the gap. When you think like that, it's easier to picture what's going on. So for instance, if you take a 1.1.2.4 recovery, at the point the level three trade hits, your L1 trade is running at a 2 gap-unit loss and your L2 trade has a 1 gap-unit loss, for a total loss of 3 x gap-units. At the moment the L3 trade hits you have 4 units in play, so to make up the loss those 4 units only need to move 0.75 of a gap to break even (3/4). If the gap is 100 pips, it's a 75 pip retrace.

Enjoy!
Attached File(s)
File Type: xls RecoveryCalculator.xls   31 KB | 524 downloads
  • #6,663
  • Mar 22, 2012 8:37am Mar 22, 2012 8:37am
AL - Woke up to +50.1 pips on Eur/Usd but carried over a long trade on U/J. I am currently in recovery mode. Totally my fault - did not read your post on the U/J until this morning plus did not know that traders considered it such a safe haven. Really have to do more reading on all aspects to be totally successful.
By the way - my account has increased almost 30% since following your thread. I am not only thankful for that but for the example you set in communicating and the lessons you teach daily. Tom

PS - I was short G/J (The Beast) all week long. It finally cleared my recovery efforts last night. I was over -280 pips but wound up -11 and then only because my math was incorrect. Recovery Works.!!!
  • #6,664
  • Mar 22, 2012 8:37am Mar 22, 2012 8:37am
Quoting Alorente
I believe we have now started our second leg down on EU and GU.
I with you.
  • #6,665
  • Mar 22, 2012 8:38am Mar 22, 2012 8:38am
AL what u think about short USDCAD?
  • #6,666
  • Mar 22, 2012 8:40am Mar 22, 2012 8:40am
Quoting pixelboy
Here is an Excel spreadsheet to help calculate entries and break even points for your recovery trades. It's easy to use:

First, select a sheet (tabs at the bottom): use the '4 decimals' sheet for standard pairs such as EURUSD, or '2 decimals' for JPY crosses.

Change the values in the blue cells to match your entry price (i.e. the value of your first trade), the number of pips between recovery trades (Al suggests 100) and the spread.

The blue cells marked 'L2 units' etc. represent the size of the position for each recovery level. These are multiples...
Hooray for PB !! Thank you man. I would ask that you post the excel with only 4 levels, so the BE is accurate. A 5th level is hopium as far as I´m concerned. Thanks a lot for your wok !!!
Observation is the path to discovery.
  • #6,667
  • Mar 22, 2012 8:43am Mar 22, 2012 8:43am
Quoting tomthepoppop
AL - Woke up to +50.1 pips on Eur/Usd but carried over a long trade on U/J. I am currently in recovery mode. Totally my fault - did not read your post on the U/J until this morning plus did not know that traders considered it such a safe haven. Really have to do more reading on all aspects to be totally successful.
By the way - my account has increased almost 30% since following your thread. I am not only thankful for that but for the example you set in communicating and the lessons you teach daily. Tom

PS - I was short G/J (The Beast) all week...
It works but only if the technical aspect of your trade is still intact. You may have made a mistake initially with your trade and in that case I would give Recovery only a 50/50 chance of success with the other 50 being a huge loss. If you realize it was a mistake to begin with, be brave and accept the loss by closing the trade. How do you know if it was a mistake? You know...All you have to do is admit it to yourself, then do the right thing, close the trade and live to fight another day.
Observation is the path to discovery.
  • #6,668
  • Mar 22, 2012 8:49am Mar 22, 2012 8:49am
Quoting pixelboy
I don't claim to be the world's best mathematician or Excel wizz, but I'm pretty sure the calculations are correct. I would appreciate it if someone with a eye for numbers had a look over it.
Nice work! I have an engineer's education so am decent at math and used EXCEL for years. If you change your entry price to 1.000 its easy to see you are correct.

Actually, recovery is so easy to visualize after studying it. There's no need for a calculator. But the calculator is nice to help us discover this.

Thanks again!

Steve
  • #6,669
  • Mar 22, 2012 9:03am Mar 22, 2012 9:03am
Quoting starola
I with you.
Al,
Are you in short of GU and EU yet?
Follow me to the Promised Land
  • #6,670
  • Mar 22, 2012 9:03am Mar 22, 2012 9:03am
a little scalping after lunch

http://i39.tinypic.com/pvdxx.jpg

eurjpy 15 min chart
MY telegram channel: https://t.me/https://t.me/tnavieurusd
  • #6,671
  • Mar 22, 2012 9:03am Mar 22, 2012 9:03am
Here is the UsdIndex chart right now. Usd is headed to test the swing high at 81.15. I believe it will break it and head to test the 82 high. Look at the Doji formed by yesterday´s bar. That was very indicative of today´s action.
Attached Image (click to enlarge)
Click to Enlarge Name: UsdIndex.jpg Size: 105 KB
Observation is the path to discovery.
  • #6,672
  • Mar 22, 2012 9:04am Mar 22, 2012 9:04am
Quoting xlitang
Al,
Are you in short of GU and EU yet?
Of course...
Observation is the path to discovery.
  • #6,673
  • Edited 9:15am Mar 22, 2012 9:07am | Edited 9:15am
Quoting Alorente
Incorrect. The first 1 is your initial position.
Worksheet revised to reflect Al's method.

It's also my 100 posting...horay
Attached File(s)
File Type: xls 1-1-2-4 Recovery System (a).xls   28 KB | 633 downloads
  • #6,674
  • Mar 22, 2012 9:10am Mar 22, 2012 9:10am
Quoting Alorente
It works but only if the technical aspect of your trade is still intact. You may have made a mistake initially with your trade and in that case I would give Recovery only a 50/50 chance of success with the other 50 being a huge loss. If you realize it was a mistake to begin with, be brave and accept the loss by closing the trade. How do you know if it was a mistake? You know...All you have to do is admit it to yourself, then do the right thing, close the trade and live to fight another day.
Thanks Al - advice taken, analyzed and implemented. No looking back. Onward and Upward - Plenty more trades just awaiting for me.
  • #6,675
  • Mar 22, 2012 9:13am Mar 22, 2012 9:13am
Quoting fxtrader2k7
Worksheet revised to reflect Al's method.
Just reviewed it and looks like you done good. Should be a big help. Thanks fxtrader2k7.
  • #6,676
  • Mar 22, 2012 9:14am Mar 22, 2012 9:14am
Quoting Alorente
Hooray for PB !! Thank you man. I would ask that you post the excel with only 4 levels, so the BE is accurate. A 5th level is hopium as far as I´m concerned. Thanks a lot for your wok !!!
Here you go Al. An 'official' version with just 4 levels :-)

PB
Attached File(s)
File Type: xls RecoveryCalculator4level.xls   30 KB | 531 downloads
  • #6,677
  • Mar 22, 2012 9:14am Mar 22, 2012 9:14am
Quoting jaau
Big Al,

Short on usdcad sounds good?

L.
i made a short scalp from 1.0001, close with +10 pip
  • #6,678
  • Mar 22, 2012 9:18am Mar 22, 2012 9:18am
Quoting lucatony29
i made a short scalp from 1.0001, close with +10 pip
I just watching!!

The tma dont lie!

L.
  • #6,679
  • Mar 22, 2012 9:22am Mar 22, 2012 9:22am
Quoting stevewide
Actually, recovery is so easy to visualize after studying it. There's no need for a calculator. But the calculator is nice to help us discover this.

Thanks again!

Steve
You're right, it is simpler than it first looks and makes total sense after you have traded it a few times.

I had a basic version of the calculator set up (with fixed levels and no 2 digit version) last week and I found it useful with my GBPUSD trade because I missed the L2 entry and ended up with something like a 114 pip gap rather than 100. I know it's all simple maths, but working out percentages of 114 gaps makes my brain ache a bit!

PB
  • #6,680
  • Mar 22, 2012 9:34am Mar 22, 2012 9:34am
Quoting pixelboy
Here you go Al. An 'official' version with just 4 levels :-)

PB
When you go ito Recovery,please take ito consideration swaps,its may be great, depeds of pairs, lot sise and what operation You use-Sell or Buy.
Best Regards
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