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  • #901
  • Mar 24, 2012 4:22pm Mar 24, 2012 4:22pm
Quoting rpvrpv
I know it might sount theoretical but how would you handle this setup.
I have tried to find a chart example but could not find one.
Therefore please see my drawing, request is on the drawing.
Definitely not open a new trade....

you already have a position in the market with a healthy profit, the trade is moving in your direction, so just follow through with the plan.

just my opinion...
tradewith60
  • #902
  • Mar 24, 2012 4:26pm Mar 24, 2012 4:26pm
Quoting rpvrpv
I know it might sount theoretical but how would you handle this setup.
I have tried to find a chart example but could not find one.
Therefore please see my drawing, request is on the drawing.
The simple thought process for me is :
assuming your trade plan allows only 2 % per trade
A: is trade 1 at BE so your risk is off of the trade so you have the 2% back to re invest

B: Does YOUR trade plan allow for add on's back to back like the illustration

A is the important one for me, if I have only given myself permission to risk 2% I have to be at BE on the first

PS. What 60MM Said
Always Learning
  • #903
  • Mar 24, 2012 5:22pm Mar 24, 2012 5:22pm
Quoting rpvrpv
I know it might sount theoretical but how would you handle this setup.
I have tried to find a chart example but could not find one.
Therefore please see my drawing, request is on the drawing.
I was wondering the same thing. I have chart example that I can post for you.
  • #904
  • Mar 24, 2012 5:30pm Mar 24, 2012 5:30pm
Quoting rpvrpv
I know it might sount theoretical but how would you handle this setup.
I have tried to find a chart example but could not find one.
Therefore please see my drawing, request is on the drawing.

Here's a few examples of what you are talking about on the USDCHF currency.
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  • #905
  • Mar 24, 2012 5:37pm Mar 24, 2012 5:37pm
During not-so-lazy weekend I found this fragment of chart (GBP/USD, 18th Jan and next 3 weeks).

My first impression was "Oh, what a nice trend, with many entry points, it should turn into decent profits". But when I started to check it, it turn out to be not that profitable. In fact, it may be flat when using standard trade management.

I've included only type 1 (engulfing) setups. I can see at least 2 type 2 setups too, one ending with SL, and one with TP, so no gain here as well.

Can anyone comment on this?
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  • #906
  • Mar 24, 2012 6:24pm Mar 24, 2012 6:24pm
Quoting reuptake
During not-so-lazy weekend I found this fragment of chart (GBP/USD, 18th Jan and next 3 weeks).

My first impression was "Oh, what a nice trend, with many entry points, it should turn into decent profits". But when I started to check it, it turn out to be not that profitable. In fact, it may be flat when using standard trade management.

I've included only type 1 (engulfing) setups. I can see at least 2 type 2 setups too, one ending with SL, and one with TP, so no gain here as well.

Can anyone comment on this?
yeah just the way it goes sometimes... you just have to keep consistently following the rules and allow for steady account growth...

A period of trading and breaking even isn't a bad thing...

We can never guarantee anything in trading, we can just trade with an edge and discipline and in the long run we will make our profits... have you tried checking EU for the same period? bearing in mind you would never just trade 1 pair for the week it is always a good idea to check multiple pairs over a period of time to get more realistic results.
tradewith60
  • #907
  • Mar 24, 2012 7:30pm Mar 24, 2012 7:30pm
Quoting JayCee007
Here's a few examples of what you are talking about on the USDCHF currency.
First thing to note is how flat the ma is...

then after taking the first entry you would of sat in a few pips profit for a long time, so i would just wait for price to move, there's nothing in that price action that would make me consider a 2nd entry...is there?
tradewith60
  • #908
  • Mar 24, 2012 8:25pm Mar 24, 2012 8:25pm
I know i have said it before, but i think it is worth repeating...

If you think this strategy might suit you, but you perhaps have some doubts because its simple and "surely there's got to be a catch" then you will have poor results trading it, in fact you will with any strategy.

Trading is an emotional journey and you have to believe in what you are doing, you will never follow the rules and be consistent after a few losses if you don't believe, and then the whole thing will unravel before your eyes.

So, how do we get that belief? well for me personally I use a little exercise

pull all the charts for the week that has just ended, trade every set up and follow the rules to the pip... make notes of your results...

now what you have is FACT that if you traded as you were supposed to then you would of won or lost x amount from your account. Now you have to repeat this exercise for a period of time. how long is upto you, I did 2 months, and continue to do it every week now...

Two things will then be obvious, 1. this strategy doesn't work based on the plan I am following, or 2. During this current period this strategy does work as long as I follow the plan...

Does this all sound obvious? Do you agree? or do you think it would be a waste of time..... it's just something that works for me..

One final point....THERE WILL BE LOSING WEEKS... expect it, accept it... if you can't then you will probably never make it as a trader until you can..

So i will be waiting for your results... some have done it already and im expecting their results to improve in forward trading now, dramatically..
tradewith60
  • #909
  • Mar 24, 2012 9:13pm Mar 24, 2012 9:13pm
Nicely said, I saw that chart earlier where he said there was no profit for the chart period. Why would he exit the first buy? And, looking at a 45 degree angle 50 MA... I'm not losing pips on that one....unless I enter at the top at a reversal... Very nice thread 60.

Quoting 60minuteman
I know i have said it before, but i think it is worth repeating...

If you think this strategy might suit you, but you perhaps have some doubts because its simple and "surely there's got to be a catch" then you will have poor results trading it, in fact you will with any strategy.

Trading is an emotional journey and you have to believe in what you are doing, you will never follow the rules and be consistent after a few losses if you don't believe, and then the whole thing will unravel before your eyes.

So, how do we get that belief? well...
  • #910
  • Edited Mar 25, 2012 12:06pm Mar 24, 2012 9:53pm | Edited Mar 25, 2012 12:06pm
Quoting 60minuteman
I know i have said it before, but i think it is worth repeating...

If you think this strategy might suit you, but you perhaps have some doubts because its simple and "surely there's got to be a catch" then you will have poor results trading it, in fact you will with any strategy.

Trading is an emotional journey and you have to believe in what you are doing, you will never follow the rules and be consistent after a few losses if you don't believe, and then the whole thing will unravel before your eyes.

So, how do we get that belief? well for...
Excellent post!

I've been on this "journey" for over 5 years now. There's so many different factors in trading and in one's personal life that I won't get into, but the most important thing, or at least I feel it is one of the absolute most important things is finding a strategy that suits you as a person, your personality and your lifestyle. Maybe I've finally found mine...? Who knows? It certainly seems to fit my hectic lifestyle way more than the previous strategy I've spent years working on. Only time, dedication and patience will tell.
  • #911
  • Mar 25, 2012 3:52am Mar 25, 2012 3:52am
Quoting 60minuteman
We can never guarantee anything in trading, we can just trade with an edge and discipline and in the long run we will make our profits... have you tried checking EU for the same period? bearing in mind you would never just trade 1 pair for the week it is always a good idea to check multiple pairs over a period of time to get more realistic results.
Well, I'm not judging the strategy basing on one example, I know there probably would be some profitable setups in other pairs, maybe even at the same time. And I'm not looking for any guarantees.

Just wondering why, when trend is so obvious, it didn't yield better result. Maybe we shouldn't move SL to BE at 50% TP? Did anyone backtested different trade management styles? Looks like entries here were correct, just exist done little prematurely.
  • #912
  • Mar 25, 2012 4:15am Mar 25, 2012 4:15am
Quoting reuptake
Well, I'm not judging the strategy basing on one example, I know there probably would be some profitable setups in other pairs, maybe even at the same time. And I'm not looking for any guarantees.

Just wondering why, when trend is so obvious, it didn't yield better result. Maybe we shouldn't move SL to BE at 50% TP? Did anyone backtested different trade management styles? Looks like entries here were correct, just exist done little prematurely.
Hi Reputake,

yeah there are 2 strategies for money management, I have presented here the conservative approach because I didnt want people to have a run of 4 trades hit their stop loss, lose heart and then start messing with the rules.... because thats a recipe for disaster... The conservative mm rules will avoid that most times.

as with everything I do the aggressive money management technique is super simple too... you dont move your stop at all, you trade tp or sl... until 1/1 is hit then you either remove risk, or take profits...

I did it with AU short on thursday last week, I had to watch AU retrace 59 pips of profit away and go -20 for a few hours, but the next day it turned back into the trend and went to 2/1 for me.... but I did this because price action and the ma was telling me the trend was strong..
tradewith60
  • #913
  • Mar 25, 2012 4:38am Mar 25, 2012 4:38am
Quoting reuptake
During not-so-lazy weekend I found this fragment of chart (GBP/USD, 18th Jan and next 3 weeks).

My first impression was "Oh, what a nice trend, with many entry points, it should turn into decent profits". But when I started to check it, it turn out to be not that profitable. In fact, it may be flat when using standard trade management.

I've included only type 1 (engulfing) setups. I can see at least 2 type 2 setups too, one ending with SL, and one with TP, so no gain here as well.

Can anyone comment on this?
If we look on that chart only, it is obvious that placing the SL at the last
SwingLow (fractal) would give us only winners (except at the exhaustion of a trend when trend changes direction, then SL is hit )

Since the rules say: SL 1Pip below signal candle, on this chart we make no profit with these rules.

Next thing to do would be: backtesting the strategy
on many pairs over a period of some weeks or better months
with the modified SL rule.
SL not below/above the Signal Candle, but at last Swing High/Low.

Maybe that would give better results cumulated on all pairs ?

It could be .... or not.

We only can give the answer if we do the extensive backtest.

If 60mm has already done this, he could save us much work by revealing his findings.

On the other hand, even if he did it and told us which SL is the best,
then everybody would have to trust 60mm, right ?

Maybe a different MovingAverage would yield better results too ?
Or another trend-indicator ?
Or maybe the GannHighLow as a filter ?
Or T3-Clean ?
Or Adaptive Laguerre ?

There are so many indicators which could be applied and
I am sure one or more of them would indeed increase the overall profits
.... but ..... but ....
testing them will take tons of time and all of us have limitations
in our lives.

These limitations will not allow most of us to do the extensive work
of backtesting and optimizing this method .
( and please, nobody should simply call us "lazy" or "dumb" because
of our individual limitations, that is only arrogant and wrong)

It seems to end always in the same advice:
Backtest the strategy as much as you can.
Forward test it on demo.
If it fits you and you make profits on demo and you feel that you got the rules correctly and you feel confident, go live with small risk first etc.
  • #914
  • Mar 25, 2012 5:01am Mar 25, 2012 5:01am
Quoting fxtr51
Maybe a different MovingAverage would yield better results too ?
Or another trend-indicator ?
Or maybe the GannHighLow as a filter ?
Or T3-Clean ?
Or Adaptive Laguerre ?
If I only could I would backtest this. Maybe I'll try to code this in AmiBroker (it's much easier to do this in AmiBroker as the programming language is simplier).

What about setting a SL not at the low of signal candle but at the low of previous/signal candle (whichever is lower)?
  • #915
  • Mar 25, 2012 5:19am Mar 25, 2012 5:19am
Quoting fxtr51
If we look on that chart only, it is obvious that placing the SL at the last
SwingLow (fractal) would give us only winners (except at the exhaustion of a trend when trend changes direction, then SL is hit )

Since the rules say: SL 1Pip below signal candle, on this chart we make no profit with these rules.

Next thing to do would be: backtesting the strategy
on many pairs over a period of some weeks or better months
with the modified SL rule.
SL not below/above the Signal Candle, but at last Swing High/Low.

Maybe that would give better results...
Hi Fxtr,

good post... and yes to truly prove without a doubt we have enough of an edge or edges here to guarantee we have a profitable system would be a whole new career in itself, we would no longer be traders, we would be data analysts...hahahahaa

the exercise I suggested will take less time and should give you enough of a hint that it will over time be consistent..

but lets say we still want data but can't afford the time to test it...

well approach the problem from a different angle...

1. do we believe that buying into a trend will be successful over a period of time?
do trends continue in the direction of the first impulse move more often than not?
can we recognize them on a chart when they exist?

2. do we believe that price action works? pin-bars, engulfings, etc do they really give a clue to market sentiment? do they indicate wether buyers or sellers are in control?

3. do we believe that in the long term we would have better results if we used discretion on every trade to decide when to exit or move our stops, or do we believe that strict rules that tell us what to do and when will make us consistent.... do we even need a plan? surely we will just make the right decisions when we are experienced at trading?

What if we put all of this together...

1. i am only going to trade in the direction of a trend
2. i am only going to enter after a retrace
3. i will wait for price action to signal the retrace may of ended
4. if price continues in that direction i will enter the trade
5. if price then continues to retrace lower i will accept im wrong and exit the trade.
6. if i have made a reasonable profit, at least equal to my risk i will exit the trade.

So just using logic and no data.. what do you think? could this work?

For me it does, maybe it sounds like bullshit, but thats just how my mind works...

If you still need data, look at the bigger picture and get data on trend and engulfing bars only, its all out the on the net, google it...
tradewith60
  • #916
  • Mar 25, 2012 5:48am Mar 25, 2012 5:48am
Quoting 60minuteman
well approach the problem from a different angle...

1. do we believe that buying into a trend will be successful over a period of time?
do trends continue in the direction of the first impulse move more often than not?
can we recognize them on a chart when they exist?

2. do we believe that price action works? pin-bars, engulfings, etc do they really give a clue to market sentiment? do they indicate wether buyers or sellers are in control?

3. do we believe that in the long term we would have better results if we used discretion on every...
I do believe in all the above points, but still backtesting still gives me more confidence. And what I also believe is optimizing, testing "what-if" scenarios ("what if I won't move SL to BE when 50% TP reached? maybe on 1000 samples it would give better results if I move SL to BE when 70% TP reached." or "what if I won't enter all trades when signal bar just barely engulfs previous one" and so on.
  • #917
  • Mar 25, 2012 6:14am Mar 25, 2012 6:14am
Quoting reuptake
I do believe in all the above points, but still backtesting still gives me more confidence. And what I also believe is optimizing, testing "what-if" scenarios ("what if I won't move SL to BE when 50% TP reached? maybe on 1000 samples it would give better results if I move SL to BE when 70% TP reached." or "what if I won't enter all trades when signal bar just barely engulfs previous one" and so on.
yeah i notice that on some trades too, rather than moving to break even just leaving some risk on the table, because even if we retraced to s/r I would still be in the trade.. so many variables its mind boggling...

But for the purposes of this thread, as much as the trading strategy I wanted to get across to people what a huge difference the other elements can make to your trading....

writing a plan down, sticking to it, and having no discretionary rules...

I wanted to try and prove that just having a very slight edge and a plan could make you profitable...

I guess time will tell...

My only concern is that with a lot of threads on FF people perhaps try and over-optimize and the original edge that the system had gets lost...

Anyway testing different money management set ups is fairly simple and you may just find a gem of an idea, just let me know when you do
tradewith60
  • #918
  • Mar 25, 2012 6:54am Mar 25, 2012 6:54am
Quoting reuptake
I do believe in all the above points, but still backtesting still gives me more confidence. And what I also believe is optimizing, testing "what-if" scenarios ("what if I won't move SL to BE when 50% TP reached? maybe on 1000 samples it would give better results if I move SL to BE when 70% TP reached." or "what if I won't enter all trades when signal bar just barely engulfs previous one" and so on.
I think we somehow agree all, except that 60mm has traded this live and has seen a steady growth of balance in his account.

Another trader told me:

If you think your manual strategy has an edge,
pay for a professional coder to create an EA .
Makes only sense if the strategy is not discretionary.
Then backtest with the EA for at least 5 to 10 years data.

If you see profits, then you have found an edge and you can trade it live.

Even if you pay $300 or $500 for the EA, that investment is worth the effort, because if you just go live because you think you have found an edge without intensive backtest,
you might lose thousands of Dollars live and it might take you many months to find out that your "edge" isnīt one.

What do you think ?
Is that a good advice or rubbish ?

I am afraid 99% of all threads in Trading System section would go to the recycle bin if that advice would be set as requirement before
a thread could be opened.

Instead I see lots of threads with "I traded this method for 1 week (on demo) and it looks good ".

60mm, I hope you donīt feel offended, it is not my intention at all.
Your method sticks out from most of the other threads because you traded it live for months ( and I just believe you that. Point ).

Therefore you have my big thanks and respect.

Nonetheless in a general sense optimizing and backtesting a manual strategy the way I described it holds water although almost nobody will follow the advice.
In a perfect world we all would though .... or not ?
  • #919
  • Mar 25, 2012 7:16am Mar 25, 2012 7:16am
Quoting fxtr51
I think we somehow agree all, except that 60mm has traded this live and has seen a steady growth of balance in his account.

Another trader told me:

If you think your manual strategy has an edge,
pay for a professional coder to create an EA .
Makes only sense if the strategy is not discretionary.
Then backtest with the EA for at least 5 to 10 years data.

If you see profits, then you have found an edge and you can trade it live.

Even if you pay $300 or $500 for the EA, that investment is worth the effort, because if you just go live...
not offended at all fx, what you are saying is completely true... if it truly is non discretionary and works then you should be able to test it and prove it...

But if we accept the market is random in general, the previous 10 years data gives no guarantee it will work tomorrow...

and although I am putting this forward as a completely no discretionary strategy, ultimately there are occasions when you wouldn't take a set up, and to program all of those variable would be a mammoth task indeed..

here's an example... GU H4, the signal candle fits all the rules, but massive wick on top, choppy price action, 12 hours until the end of the week, if this set up gave an entry, i would of left it, as i'm sure you would of...

so an element of common sense has to come into it to a small degree..
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tradewith60
  • #920
  • Mar 25, 2012 7:51am Mar 25, 2012 7:51am
Quote
But if we accept the market is random in general, the previous 10 years data gives no guarantee it will work tomorrow...
I agree.

Quote
so an element of common sense has to come into it to a small degree..
Yes, please . I agree 100 %

Quote
and to program all of those variable would be a mammoth task indeed..
Oh yes, indeed.

But using some tools is convenient.
e.g. - indicator which alerts and displays the entry levels
- dashboard for multiple pairs and timeframes
- TradeManagement_EA ( does not take trades, only if trader activates it)

I have worked on these tools and will post them soon.
Just have to clean up the code and test some more ....
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