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Swing trading with heiken ashi and stochs

  • #921
  • Edited 5:56pm Apr 25, 2012 4:48pm | Edited 5:56pm
I entered this trade after the 2nd red candle had pulled back from it's low thinking that it had already broken the bottom of the previous candle & should continue back down. The FOMC statement was released after I entered the trade and the price continued up, hitting my SL. The setup appeared to be good at the time, but not sure if you would call it "smooth". Will be interested to see if the price continues down as originally thought or if whatever fundamentals are in play push the USD higher or JPY lower.

Sydney time 08:40 26/04 - going to try this one again on a pending order (just assuming I wasn't stopped out...)
Another thought: I would still be in the trade if I used a 50 pip SL. Actual was about 37 based on previous highs. Would have worked in this case, but time will tell if it would have resulted in a larger loss or a profit...
Attached Image (click to enlarge)
Click to Enlarge Name: usdjpy.gif Size: 24 KB
Still learning - No guarantees...
  • #922
  • Apr 25, 2012 11:33pm Apr 25, 2012 11:33pm
Quoting Ozefex
I entered this trade after the 2nd red candle had pulled back from it's low thinking that it had already broken the bottom of the previous candle & should continue back down. The FOMC statement was released after I entered the trade and the price continued up, hitting my SL. The setup appeared to be good at the time, but not sure if you would call it "smooth". Will be interested to see if the price continues down as originally thought or if whatever fundamentals are in play push the USD higher or JPY lower.

Sydney time 08:40 26/04 - going to...
Although it looked like a good trade, trading just before a big news event is never a good idea.
  • #923
  • Edited 7:38am Apr 26, 2012 7:25am | Edited 7:38am
Re-entered this trade just below previous entry. Time is currently about 5 minutes before US Unemployment Claims so I'll leave it on to see the reaction. So many news items can affect the market.

Update: The poorer US jobs figures resulted in a drop of about 10 pips. Will leave trade run to see if it follows through or retraces.
Attached Image (click to enlarge)
Click to Enlarge Name: usdjpy2.gif Size: 25 KB
Still learning - No guarantees...
  • #924
  • Apr 26, 2012 8:20am Apr 26, 2012 8:20am
Quoting Ozefex

Update: The poorer US jobs figures resulted in a drop of about 10 pips. Will leave trade run to see if it follows through or retraces.
Looking good now...... should have followed you in -
Seems like most the USA announcements have been red this week - good luck.

get them pips !!
  • #925
  • Edited 4:17pm Apr 26, 2012 3:20pm | Edited 4:17pm
Quoting drzeepfx
Looking good now...... should have followed you in -
Seems like most the USA announcements have been red this week - good luck.

get them pips !!
I'm not celebrating yet! Significant reversal when I checked this morning, but will let it run.
Still learning - No guarantees...
  • #926
  • Edited Apr 27, 2012 6:28am Apr 26, 2012 11:46pm | Edited Apr 27, 2012 6:28am
Quoting Hugh Briss
Although it looked like a good trade, trading just before a big news event is never a good idea.
The following just proves the point....stopped out on FOMC news then next trade stopped out on Japanese news (several events - not sure which had the most affect).

I ran these trades on a demo account to see what would happen -

Improvements to trading strategy for next time:

1. Check for upcoming news announcements that may affect either side of the pair being traded
2. Consider NOT trading in the lead-up to announcements, or CLOSING existing trades that may be affected

I certainly had the opportunity to close these trades before the announcements and still be in +ve.

Any comments welcome.
Attached Image (click to enlarge)
Click to Enlarge Name: usdjpy2.gif Size: 27 KB
Still learning - No guarantees...
  • #927
  • Apr 27, 2012 7:56am Apr 27, 2012 7:56am
Quoting Ozefex
2. Consider NOT trading in the lead-up to announcements, or CLOSING existing trades that may be affected

I certainly had the opportunity to close these trades before the announcements and still be in +ve.

Any comments welcome.
My 2 cents....

I have traded with other systems that preach staying out of any trade that might be impacted by upcoming announcements - And with this system there are plenty of pairs to watch..... For now I think I will learn from you and stay away from or modifey trades that might run into a red announcements.

Pips are headed our way.......
  • #928
  • Apr 27, 2012 12:26pm Apr 27, 2012 12:26pm
Quoting Ozefex
The following just proves the point....
Any comments welcome.
Well now you know and won't do it again!
  • #929
  • Apr 27, 2012 12:47pm Apr 27, 2012 12:47pm
Here's an idea for a possible improvement to the system. Let me say first that the original system works fine on any timeframe and has made me some good pips since I've been using it. What I am presenting here is just another way to look at the markets which may or may not improve your returns.

Rather than following the current trend on the timeframe we are looking at we are trading with the momentum of the next timeframe up. Also we are incorporating support and resistance into the mix, albeit arbitrary round numbers. To do this we are using the main chart with heiken ashi and a round number indicator which simply draws lines at whatever levels you want. For most pairs I have this set to 50 pips but for some Jpy and Nzd pairs I have changed it to 100 pip lines to make it easier to see. Below the main chart there is 8,3,3 low/high stochs as before. Then we are adding the heiken ashi chart from the daily timeframe and the daily stochs. This allows us to see from the 4 hour chart exactly what is happening on the daily chart and then we can take trades to the longside when the 4 hour chart turns long at the same time as the daily or the daily stochs are moving one way with the heiken ashi's the right colour.

I have attached a chart to this post with an example of two trades that you could have taken with this idea. An important thing to remember is always to buy at support and sell at resistance. In the next post I will provide indicators and a template. Also I will post an expert adviser which you can use to trail your stop loss behind a moving average. The ma you can see on the chart is an 8 ema of the close. Notice how in a good heiken ashi trend the ma tends to follow the tops/bottoms of the candle.

An initial stop behind s/r can be used and then as the trade progresses you can reduce the stop loss to closer and closer behind the ma until you are stopped out. Usually a stop of about 50 pips makes sense on a 4 hour chart, once the trade gets moving you can move to a stop 20 pips behind the ma, then reduce that to 5 pips behind the ma. Another idea I have had is to add on to a trade every time the price closes the other side of a s/r level. This would maximise your gains on a good trend but also would lose you more if the trade reverses in the first two or three candles. It's swings and roundabouts and something I need to test further.

Please use the template and indicators and set your charts up and let me know what you think. There is a lot of information above so please read it through a few times and then please do ask questions.
Attached Image (click to enlarge)
Click to Enlarge Name: eurnzd tweak example.gif Size: 24 KB
  • #930
  • Apr 27, 2012 12:52pm Apr 27, 2012 12:52pm
I agree with your decision of using D1 instead of W1 as an additional filter as I think it allows for more trading opportunities without sacrificing too much accuracy
  • #931
  • Apr 27, 2012 12:59pm Apr 27, 2012 12:59pm
The indicators needed that are not already in metatrader. Also the ea and the template.

If you don't know what to do with these, put the first 5 files in your metatrader/experts/indicator folder (it's in program files, if you can't work it out the information is all over the web or ask me if you really have to!). Put the 6th file in the experts folder and put the last file in the metatrader/templates folder. Restart your platform and the template should be available in the list. If it isn't you may have put the template in the wrong templates folder. The templates folder in the experts folder doesn't show up in the platform but all you have to do is click load and then browse to that folder to find it.
Attached File(s)
File Type: mq4 #MTF Stochastic v2.0.mq4   6 KB | 830 downloads
File Type: mq4 Heiken_AshiH_sw_mtf.mq4   6 KB | 885 downloads
File Type: mq4 quick draw.mq4   2 KB | 737 downloads
File Type: mq4 P4L CandleTime.mq4   16 KB | 691 downloads
File Type: mq4 Tick Value Modified 3.mq4   2 KB | 782 downloads
File Type: mq4 Trail Order SL to MA EA.mq4   4 KB | 737 downloads
File Type: tpl 4 hour daily ha and stochs.tpl   156 KB | 886 downloads
  • #932
  • Apr 27, 2012 1:01pm Apr 27, 2012 1:01pm
I will try and post more examples with charts as and when (or preferably before) trades set up so that you can see what I am seeing. Until then, have a good weekend.
  • #933
  • Apr 27, 2012 1:02pm Apr 27, 2012 1:02pm
Quoting neuron
I agree with your decision of using D1 instead of W1 as an additional filter as I think it allows for more trading opportunities without sacrificing too much accuracy
Good to know we're on the same page, try the template and let me know what you think, I would value your opinion.
  • #934
  • Apr 27, 2012 2:43pm Apr 27, 2012 2:43pm
Quoting Hugh Briss
Here's an idea for a possible improvement to the system. Let me say first that the original system works fine on any timeframe and has made me some good pips since I've been using it. What I am presenting here is just another way to look at the markets which may or may not improve your returns.

Rather than following the current trend on the timeframe we are looking at we are trading with the momentum of the next timeframe up. Also we are incorporating support and resistance into the mix, albeit arbitrary round numbers. To do this we are using...
Very, very nice!
  • #935
  • Apr 27, 2012 2:47pm Apr 27, 2012 2:47pm
Quoting Hugh Briss
I will try and post more examples with charts as and when (or preferably before) trades set up so that you can see what I am seeing. Until then, have a good weekend.
Hi Hugh,

That will be great!

Do you think you can post the missing file on your template and the corresponding set file?

Cannot open file Trail&CloseOrderSLtoMA_EA_[EdwardMunroe].ex4' on the EURUSD,H4
  • #936
  • Apr 27, 2012 2:49pm Apr 27, 2012 2:49pm
Quoting wrenski
Very, very nice!
Thank you very much. Those few short sentences represent the culmination of a good few years of thought, failure and tears (with some joy too of course!).
  • #937
  • Edited 3:03pm Apr 27, 2012 2:53pm | Edited 3:03pm
Quoting migmac
Hi Hugh,

That will be great!

Do you think you can post the missing file on your template and the corresponding set file?

Cannot open file Trail&CloseOrderSLtoMA_EA_[EdwardMunroe].ex4' on the EURUSD,H4
My apologies, that is a modification of the original ea that I had coded. Here is the modified ea. It has the extra function of being able to close the trade if the price closes the other side of the ma but without hitting the stop loss so you could use a larger stop loss as an emergency so you don't get taken out by price spikes but the trade closes if the price closes the wrong side of the ma. It also has the function of being able to close on the change of the heiken ashi candles. Up to you which you might want to use?

Can't attach the set file as it's not a valid file type but it's fairly straight forward to work out, any problems ask me.
Attached File(s)
File Type: ex4 Trail&CloseOrderSLtoMA_EA_[EdwardMunroe].ex4   7 KB | 409 downloads
  • #938
  • Apr 27, 2012 3:30pm Apr 27, 2012 3:30pm
still pretty early to make any decisions but I'm eyeing these charts

long USD/CHF

short AUD/JPY

short GBP/CAD

what do you think?

all depending on the D1 HA candle, it looks like the current ones are slimming down
Attached Image(s) (click to enlarge)
Click to Enlarge Name: swingtradeha.jpg Size: 137 KB
Click to Enlarge Name: swingtradeha2.jpg Size: 144 KB
Click to Enlarge Name: swingtradeha3.jpg Size: 145 KB
  • #939
  • Apr 27, 2012 3:39pm Apr 27, 2012 3:39pm
Quoting neuron
still pretty early to make any decisions but I'm eyeing these charts

long USD/CHF

short AUD/JPY

short GBP/CAD

what do you think?

all depending on the D1 HA candle, it looks like the current ones are slimming down
Yep, I like the look of it when the daily stochs are high and turning down, the daily ha is changing and you get a clear sell signal on the H4.
  • #940
  • Edited 11:35pm Apr 27, 2012 6:03pm | Edited 11:35pm
I lot of activity since I called it a day! Thanks Hugh, I was looking at a similar but very simple method with daily charts and 10 SMA but this one looks promising. The semi-automation should help too. Regards, Ozefex.
Still learning - No guarantees...
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