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Nb 10.0 trend trading system

  • #1,701
  • May 11, 2012 11:29am May 11, 2012 11:29am
Quoting Binyamin
Hi all I have read the manual 3 times and have read this thread concerning 10.2. It looks really good. I will be doing my backtest.

I have a question to NNbob. I notice sometimes that your direction bias comes from the news. I know there are no formulas to quantify how you interpret the news to form your bias. So could you give a headstart on what you look for when you read the news and how it relates to the trend properties of a certain pair.

Thanks!

PS: Congratulations on your daughter's success! You sound like a very good father too her. ...
There are news stories and then there are fundamentals. I count them as two different things. News stories generally will affect price for only several hours maybe even a day or two and then the action stops. I do not consider them fundamentals.

Fundamentals will affect a currency move for days, weeks, even months at at time. For example interest rate changes can affect a currency pair for months. When the Aud raised its rates and became the highest interest rate among major countries, people will deposit their money there thereby strengthening the currency We have seen months of rising value of the AUD. However, now that China's economy has slowed down some they have had to cut interest rates and it has started a decline that has gone for about 6 weeks now. That is a fundamental.

Another fundamental is govt/bank action to support or depreciate a currency. For example the CHF bank has sworn to defend the 1.20 line on the eur/chf pair. It would be foolish to do a sell in that area knowing that the bank is going to support that price and not let the price go down. So no matter what an indicator or news story is doing the SNB is the big fundamental playing on that pair. Because of this price action is almost non-existent ranging within an 90 pip range for almost 2 months now. You could go to the 5M chart and pick off 10-15 pip pops all day long on a set of BB.

So trading the higher end charts news stories affect overall price very little but you do want to keep an eye on fundamentals there. The basic assumption of my system is the monthly pivot will show you a fundamental in action without you knowing the actual fundamental.
  • #1,702
  • May 11, 2012 11:32am May 11, 2012 11:32am
Bob

I think all the improvements are great, but there are many features of the S/R levels in the 10.1 that I still like.

One thing I have noticed is that if you cross a level on the H4 you can treat it as a definite buy or sell depending on the level of the TMA slope. Above/below 0.8/-0.8 it's 100%. Above/below 0.4/-0.4 it's still a very good bet.
  • #1,703
  • May 11, 2012 11:49am May 11, 2012 11:49am
Quoting nanningbob
There are news stories and then there are fundamentals. I count them as two different things. News stories generally will affect price for only several hours maybe even a day or two and then the action stops. I do not consider them fundamentals.

...
Excellent post Bob.

One question about news stories.

This week's news presented to aud and cad of Employment Change and Unemployment Rate moved enough that these currencies. I had some open orders that were affected by this news. For example, today a buy order in GBPCAD was closed by Stop Loss due to the news.

Do you prefer to close the orders before some news? Or do we advise on this?

Thank you very much.
Enter Signature
  • #1,704
  • May 11, 2012 3:51pm May 11, 2012 3:51pm
Quoting cmeade2
Bob

I think all the improvements are great, but there are many features of the S/R levels in the 10.1 that I still like.

One thing I have noticed is that if you cross a level on the H4 you can treat it as a definite buy or sell depending on the level of the TMA slope. Above/below 0.8/-0.8 it's 100%. Above/below 0.4/-0.4 it's still a very good bet.
Those were based on Fractals. Fractals are very good but have one issue. They are not set as a line until several bars happen. By then the information maybe too old to use. Regular type S/R lines project out and seen in advance. Interesting though to see how using that with the slope would turn out.
  • #1,705
  • May 11, 2012 3:55pm May 11, 2012 3:55pm
Quoting nanningbob
Those were based on Fractals. Fractals are very good but have one issue. They are not set as a line until several bars happen. By then the information maybe too old to use. Regular type S/R lines project out and seen in advance. Interesting though to see how using that with the slope would turn out.
It's interesting. I had no idea how they were calculated. Based on visual inspection, it looked to me that they were keyed off of long wicks on the daily and 4H timescales, which are pretty well established as areas of resistance and support.

My comment was triggered by the fact that there was a lot of discussion in the 10.1 days of when to take a trade across one of these levels.

Now it seems pretty straightforward.
  • #1,706
  • May 11, 2012 4:06pm May 11, 2012 4:06pm
Quoting maudur
Excellent post Bob.

One question about news stories.

This week's news presented to aud and cad of Employment Change and Unemployment Rate moved enough that these currencies. I had some open orders that were affected by this news. For example, today a buy order in GBPCAD was closed by Stop Loss due to the news.

Do you prefer to close the orders before some news? Or do we advise on this?

Thank you very much.
You will notice I dont say a whole lot about SL other than placing them beyond swing highs or other side of S/R lines. My SL are very big because as long as trades are with the weekly trend I keep them wide. There are times, I will multiple level trades and enter several positions. Most of the time I dont. I believe of instead of trading .10 lots at one time, I will break it up into 3 parts like .3 first, .3 later, and a final .4 which equals the .10. Some of my beliefs are very controversial and i dont want to carry those parts into this thread. I keep them to my self inside this thread. My SL are based on a % of my account. I like to use 1% max into any trade with an occasional exception to that rule.

So because I use large SL positions news stories dont mean anything to me, they are just blurbs. I am only concerned with the fundamental stories that would change the direction of the trend. I am not concerned with rallies in the DT. I am only concerned with rallies that turn into UT. I dont wish to be so vague but I will give losing trades a chance to become winners. However, I am not afraid to close a trade that is not going where I think it will go. My SL is very variable and I dont know how to teach that except it comes from experience. But no I dont close trades before news stories.
  • #1,707
  • May 11, 2012 7:59pm May 11, 2012 7:59pm
Quoting nanningbob
...So because I use large SL positions news stories dont mean anything to me, they are just blurbs. I am only concerned with the fundamental stories that would change the direction of the trend... My SL is very variable and I dont know how to teach that except it comes from experience. But no I dont close trades before news stories.
BOB

First I would like to join my fellow traders in offering my sincerest congratulations on the great achievement of Daddy`s Girl. It is obvious from where she inherited her intelligence. I am sure that she will be source of constant pride and joy for many, many, years to come. I wish her good health and great happiness in life.

I have witnessed numerous times your advise regarding the lot size and SL and as you quite rightly say experience is something which has to be gained. It can not be taught. The best advise I can give anyone who has recently come across your systems is to open a penny account with a modest capital and trade it for at least a year to master it properly and gain the all valuable EXPERIENCE. I have traded your systems (have not tried 1.0 and 10.0)for the last 3 years and all of them have been profitable. IMHO 10.2 promises to be the best yet.

Kind Regards
  • #1,708
  • May 11, 2012 8:34pm May 11, 2012 8:34pm
Quoting nanningbob
You will notice I dont say a whole lot about SL other than placing them beyond swing highs or other side of S/R lines. My SL are very big because as long as trades are with the weekly trend I keep them wide. There are times, I will multiple level trades and enter several positions. Most of the time I dont. I believe of instead of trading .10 lots at one time, I will break it up into 3 parts like .3 first, .3 later, and a final .4 which equals the .10. Some of my beliefs are very controversial and i dont want to carry those parts into this thread....
Thank you very much by your answer.

I would like to receive more details about your money management, but I will not alter the main purpose of this thread. If you can help me, I recommend a PM or how do you create what could be better?

Thank you very much.
Enter Signature
  • #1,709
  • May 11, 2012 8:45pm May 11, 2012 8:45pm
Bob,

Thanks for sharing your approach to SL. What you are saying makes a lot of sense and is a new way of approaching SL for me. So if I understand this correctly, you place your SL safely out of the way of a possible temporary price correction as the trend continues per your indicators. And, the key is to determine base your trade size on the pre-determined % of equity. This way you build slowly, but surely. Let me know if I miss-understood.

Congratulations on your daughter's graduation. I have 3 daughter who are now out of college. I'm proud beyond description. I know you must feel the same way. We are so blessed!

That's for all your hard work that has lead to 10.2. I'm honored to be a member of this forum and I look forward to learning, contributing and prospering for myself and my family.

John
  • #1,710
  • May 11, 2012 8:56pm May 11, 2012 8:56pm
You both have a good grasp. I trade low leverage low lot size to account size. I go for 10% average return on my account every month. Some months lower some higher. I have had an occasional losing month (2 last year) but overall upward equity curve. 10.2 I am hoping for no losing months (which is unrealistic but a nice goal). Once I get a better grasp of my own system and its nuances I am hoping to increase my return every month but for now 10% until I get better at it. There will be other traders who will do better but I am conservative with my money but aggressive as a trader.

I have wanted to write a booklet on MM and that is one of my goals for the summer after school is out. It will try to show a flexible but sensible approach to handling trading funds.
  • #1,711
  • May 12, 2012 12:54am May 12, 2012 12:54am
Hi Bob,

Thanks for sharing your great system. Was wondering whether you considered the following, as it may add further value to your system. Some traders are using a mid week reversal as part of their strategy:

http://www.forexfactory.com/showthread.php?t=349180
http://www.forexfactory.com/showthre...276971&page=44

Have attached a few examples of how I see it - often the market will reverse midweek on Tuesday/Wednesday and sometimes back again on Friday.

Regards
Attached Image(s) (click to enlarge)
Click to Enlarge Name: audusd.jpg Size: 156 KB
Click to Enlarge Name: cadchf.jpg Size: 146 KB
Click to Enlarge Name: gbpjpy.jpg Size: 155 KB
Click to Enlarge Name: nzdusd.jpg Size: 142 KB
  • #1,712
  • May 12, 2012 6:20am May 12, 2012 6:20am
Quoting nanningbob
You both have a good grasp. I trade low leverage low lot size to account size. I go for 10% average return on my account every month. Some months lower some higher. I have had an occasional losing month (2 last year) but overall upward equity curve. 10.2 I am hoping for no losing months (which is unrealistic but a nice goal). Once I get a better grasp of my own system and its nuances I am hoping to increase my return every month but for now 10% until I get better at it. There will be other traders who will do better but I am conservative with my...
Cannot wait to learn your MM strategy, I think that is the most important part of trading.
LISTEN TO MR FUNDAMENTAL AND MR TECHNICAL
  • #1,713
  • May 12, 2012 7:53am May 12, 2012 7:53am
Quoting ben2011
Hi Bob,

Thanks for sharing your great system. Was wondering whether you considered the following, as it may add further value to your system. Some traders are using a mid week reversal as part of their strategy:

http://www.forexfactory.com/showthread.php?t=349180
http://www.forexfactory.com/showthre...276971&page=44

Have attached a few examples of how I see it - often the market will reverse midweek on Tuesday/Wednesday and sometimes back again on Friday.

Regards
You have some good pics there. I think if you look at my comments on SRF trades (Support/Resistance Failure) You will see that price does not reach the S/R line and then breaks through the pivot to hit the other S/R line. So in a sense we are going to be looking at the same kind of trades but from a little different perspective. If you look at weekly candles these will be the weeks of small bodies and large wicks. So finding these are excellent trades. Thank you for bringing them up and I would encourage you to post them when you see them.
  • #1,714
  • May 12, 2012 8:13am May 12, 2012 8:13am
Good article here. 39% of traders are profitable. More are winners than were imagined.

http://blog.fxcc.com/39-of-forex-tra...re-profitable/
  • #1,715
  • May 12, 2012 10:20am May 12, 2012 10:20am
Hi Bob & others
This is my first contribution to any Forex thread.
Whilst new to forex I am a mathematically fluent and written many packages in Excel(VBA) & now learning MQL.
I don't believe the problem re differing histograms can be solved by any method suggested here.

Our broker (Axi) was a GMT broker and changed to NY close (GMT+3) for a very good reason.
UTC/GMT time is great for continuous services such as airlines, but forex is not continuous.
In Australia we know Forex actually starts 1/2hr before NZ open to synch with 4hr lots for the week.
http://www.forex4noobs.com/forex-tools/forex-clock/
Forex closes 1700 FRIDAY EST-US & opens 0600 MONDAY NZST (1700 Sunday EST-US).

The real problem with UTC/GMT charts is 3Hrs differing, or 3/4 of a 4H candle from close. Traders should realise that GMT+3(GMT+2 EDT), NY close brokers are the ones with accurate Forex clocks when looking at and dealing with 4H candles & charts.
GMT brokers can never have correct 4H candles, with 4H all week then 3 Hr + 1 Hr straddling the weekend.
Only changing to NY close (GMT+3) brokers will solve the histogram/pivot problem.
The problem is not with the pivot indicators/histograms but some brokers time settings not a multiple of 4 from week Open & Close.
Thanks for all you people are doing, I am learning a great deal.
  • #1,716
  • May 12, 2012 11:26am May 12, 2012 11:26am
Quoting nanningbob
Good article here. 39% of traders are profitable. More are winners than were imagined.

http://blog.fxcc.com/39-of-forex-tra...re-profitable/
Dear Nanningbob,

Here you can see most brokers profitability :

http://forexmagnates.com/us-forex-br...fitability-up/

And thanks a lot for your fabulous system ! AMAZING !
  • #1,717
  • Edited 12:52pm May 12, 2012 12:38pm | Edited 12:52pm
HI Kelisa nice to see you pip-ing here too.

Thanks NNbob it makes sense. I will be studying about currency fundamentals.(your assumption concerning monthly pivot and fundamentals is interesting)

I like your idea of trading many pairs but with lower risk per trade and bigger SL because you are using the law of large numbers to your advantage which will result in smoother and more predictable equity curve that way. It also reduce the impact of any black swan events. I love it. The only disadvantage is there will be more work involve.

But trading 25 pairs???????
I will start with 10 pairs first and add more as I progress. Record keeping in a diary is a must I suppose.
Riding the order flow
  • #1,718
  • May 12, 2012 3:09pm May 12, 2012 3:09pm
Quoting Binyamin
HI Kelisa nice to see you pip-ing here too.

Thanks NNbob it makes sense. I will be studying about currency fundamentals.(your assumption concerning monthly pivot and fundamentals is interesting)

I like your idea of trading many pairs but with lower risk per trade and bigger SL because you are using the law of large numbers to your advantage which will result in smoother and more predictable equity curve that way. It also reduce the impact of any [url="http://en.wikipedia.org/wiki/Black_swan_theory"]black...
I started trading a lot of pairs because I got tired of trading the aud/usd and it would go 20 pips and the aud/jpy would go 100. Then I would trade the aud/jpy and it would go 20 pips and the aud/usd would go 100. Etc etc. So I said heck with it and I traded them all. What I learned was how the market breathed in and out like a unit and everything was kind of connected. If something goes on a run as a sell something else goes on a buy run. So last week aud and nzd went south and some of the gbp some usd went north. So now i look for that. The market must always stay in balance. I got my theories and thoughts by watching and trading all the major pairs. It may not be the most profitable way to do it but I find it a great education.

I found this out. The best time to TP was 2-3 hours into the jpy session. 1-2 hours before the usd session, 3-4 hours into the usd session and then if there is anything left a couple of hours before the jpy session. These seem to be the peak times for price movement and then afterwards a holding pattern or retracement. I will take whatever the market offers to me at that time and then look for my best entrance after these re-tracements. So using China time which is 12 hours from EST USA my trading day looks like this 6 am set up trades for the day. 10-11 am take profit, 1230 look for trade setups, 6-7 pm take profits, 10-11 pm take profits, go to bed. Wash rinse repeat. That trading schedule fits trading the 4H charts perfectly, I am catching them towards the end of what ever move happens on the 4h candle and it also fits my teaching and living schedule as a teacher. My wife is happy because i can spend hours with her every evening after dinner so it limits its impact on my social life and work schedule. It only takes 5 minutes to look at all my TP and trades and maybe 15 minutes in the morning to set the trades up i want to take. 30 minutes to type out to you guys my thoughts if I have the time. I dont always have the time in the morning. Sorry. Once you get the feel of the system and my schedule you will get the feel of the market and me. Obviously I dont subscribe to the typical risk to reward system taught by a lot of people. I kind of take the football approach to trading. I take what ever the market (defense) is giving me whether it is big or little. I got tired of seeing those 20-40 pip pops showing on my screen and then disappearing in the jpy session. I just take them now and try to re enter later in the day if the opportunity shows itself. If you look at daily candles they almost always have a wick at the end. Well that is the last move of the JPY session before retracing back to the close every day. So I have learned to just take them and see what the new daily candle will do.
  • #1,719
  • May 12, 2012 3:31pm May 12, 2012 3:31pm
Got this from Al's thread. If they only learned how to range trade they wouldnt have this problem. Wonder if they every heard of the Bollinger Bands. More range trading coming up, which means for us, trades crossing back and forth across the main pivot lines so look for them and profit while the big trend traders sit on their hands. They will be called SRF trades and they are my latest twist to range trading. If prices do break out the S1R1 lines will let us know and the slope will tells us how strong of a run it will be. We will be on top of it.
Attached File(s)
File Type: pdf Resilience of euro frustrates forex trade - FT.pdf   165 KB | 687 downloads
  • #1,720
  • May 13, 2012 2:36am May 13, 2012 2:36am
Quoting nanningbob
My daughter graduated with a 4.0 average and got to wear all sorts of neat extras on her graduation gown. For her final two years of college she gets an almost free ride with scholarships and grants. I am very proud of Daddy's girl.
Congratulations on your daughter's excellent performance!

This is evidence of many a long-past day of diligent effort and sustained positive influence that unfailingly exerts a powerful influence on the later lives of our children.

It is the same influence you exert here in FF, and from which so many continue to benefit. So much credit to you Bob.
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