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Trading Made Simple for Day Charts

  • #921
  • Jul 4, 2012 3:16am Jul 4, 2012 3:16am
I tired to backtest it on this pair and most of the time it's successful. The only point is SL and TP, specially TP I think.
Do you use the same SL and TP as discussed on the fist page?

Quoting Britpip7
The earlier entry was valid - this pair has had add-on signals all the way down.

Add-on can be taken just off of fractal breaks but can also be taken on pauses / mini retraces. These can be seen better on the H4 once a trend is running.

Once the DAY RSI-10 gets into the 25/75 zones, manage your stop losses carefully.
  • #922
  • Jul 4, 2012 10:50am Jul 4, 2012 10:50am
Quoting Verbal
I tired to backtest it on this pair and most of the time it's successful. The only point is SL and TP, specially TP I think.
Do you use the same SL and TP as discussed on the fist page?
Mostly when the ATR 7 is around 100pips I still use the settings from post #1.

With gb/nz, eu/nz, I do drop down to 1XATR 7 for TP1 & SL.

Running with the 2 entries does change the dynamics of the overall success but on the higher ATR pairs can mess up your money management so drop down on the amount traded to keep within the 2% to 5% rule.
"To live with Passion, it takes Courage and Grace to survive"
  • #923
  • Jul 4, 2012 3:16pm Jul 4, 2012 3:16pm
Some more hindsight analysis on the EUR/NZD, which can give some huge pip yields if you have the patience.

The Charts are intended as a training exercise so that you can run backtesting and experiment with the add-on approach to maximize the pip yield.

(not sure what happened to Chart #3 in this series - lost in space )


Chart #1

Further Analysis of EUR/NZD Day Entry
Initial heads up as the up trend stalls and sets a second Fractal with a lower high

Large wick / small body is another heads up on the final white APB
Colour change on APB and a close below the 5EMA gives a first possibility of setting the entry point below the Day low

RSI drops below 50 on the second red candle giving another entry point
Depending on how aggressive your trading style is, this makes a difference of 70 pips
With the 200EMA in play, the conservative entry is to wait until this is broken

Chart #2

As ATR 7 is higher on this pair, you have the option of setting you SL and TP1 to 1XATR7 which in this case is 180pips. The SL can be set above the previous Day H

TP2 is set to the same SL but with the TP not set (leave at 00000)

Chart #4

TP1 eventually closes at 180 pips after 8 days if you stayed with the initial SL setting. If you moved the SL to a BE point earlier, this would have closed out, but then you can always re-enter on the next APB colour change.

Once TP1 closes, move SL to BE

Add-On Candles – AOC can be taken any time there is a pause in the trend and the trend resumes and breaks the a resumption and can also be taken on Fractal Breaks

My preference is to wait until TP1 closes before adding on and increasing the exposure.

Chart #5

As you enter each new Add-On, move the SL for each entry to the previous AOC level – this should keep you from being stopped out as the trade pauses/breathes and will protect a large proportion of your profits.
Based on the current price (this would still be an active trade with the SL for all entries moved to AOC5 after AOC6 was entered)

AOC6 =70pips
AOC5 = 220pips
AOC4 = 360pips
AOC3 – 440pips
AOC2 = 590pips
AOC1 = 750pips
Original EP = 930pips
TP1 = 180pips
Best Case Scenario = 3,540pips

Total of 8 entries – TP1, TP2 and the 6 AOC’s over a time period of 32 trading days

Worst case scenario would be that this trade reverses and hits the SL set on AOC5, so the total pip yield would be 2,570.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: eur nzd chart #1.gif Size: 26 KB
Click to Enlarge Name: eur nzd chart #2.gif Size: 30 KB
Click to Enlarge Name: eur nzd chart #4.gif Size: 30 KB
Click to Enlarge Name: eur nzd chart #5.gif Size: 30 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #924
  • Jul 4, 2012 8:50pm Jul 4, 2012 8:50pm
General updates to incorporate current approach and include links to recent posts worth checking out.

http://www.forexfactory.com/showthre...75#post5255075
"To live with Passion, it takes Courage and Grace to survive"
  • #925
  • Jul 5, 2012 11:17am Jul 5, 2012 11:17am
EU is heading into historic low territory, so lots of support preventing this from going too much further, even with the fundamentals the way they are!

Trade entry was taken form the APB Colour Change - Day Low was just above the 1.2500 level, so as this is a possible stall level, the Entry point was set 25 pips lower - I would rather lose a few pips and allow the PA to be strong enough to break the BRN.

This is a trade where a 2xATR7 may not be the best approach for setting the TP due to the Support levels, so in this case the TP is set short of where we are likely to see the PA stalling.

There is nothing to stop you setting a more optimistic TP - just watch for the PA stalling and manually move your SL accordingly.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: eur usd 7-5-2012.gif Size: 37 KB
Click to Enlarge Name: eur usd month to apr 2007.gif Size: 37 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #926
  • Jul 5, 2012 12:27pm Jul 5, 2012 12:27pm
Quoting Britpip7
EU is heading into historic low territory, so lots of support preventing this from going too much further, even with the fundamentals the way they are!

Trade entry was taken form the APB Colour Change - Day Low was just above the 1.2500 level, so as this is a possible stall level, the Entry point was set 25 pips lower - I would rather lose a few pips and allow the PA to be strong enough to break the BRN.

This is a trade where a 2xATR7 may not be the best approach for setting the TP due to the Support levels, so in this case the TP is set short...
After entering on the Day chart, you can monitor (and manage) the trade on H4 and look for possible Add-On Candles.

When the trade breathes, it will have mini retraces - you can set up for new entries on the H4, or drop down to the lower time frames if you prefer (I do not!)
Attached Image (click to enlarge)
Click to Enlarge Name: eu h4 add on candle.gif Size: 35 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #927
  • Jul 5, 2012 9:02pm Jul 5, 2012 9:02pm
hi brit7,

So right now we can be looking for a long setup on the Day chart for EU since there is a strong support sitting below? if there is a colour change with good cross? is that what u mean?
  • #928
  • Jul 6, 2012 12:01am Jul 6, 2012 12:01am
Quoting Fxaddicts
hi brit7,

So right now we can be looking for a long setup on the Day chart for EU since there is a strong support sitting below? if there is a colour change with good cross? is that what u mean?
Very strong demand level, so yes, looking for a reversal here.

Currently riding it down and keeping the SL tight as it runs. As usual, PA will tell us what the market is up to, regardless of fundamentals, patterns, etc.

aud/chf looks interesting at the current supply zone.
"To live with Passion, it takes Courage and Grace to survive"
  • #929
  • Jul 6, 2012 12:26pm Jul 6, 2012 12:26pm
Quoting Britpip7
After entering on the Day chart, you can monitor (and manage) the trade on H4 and look for possible Add-On Candles.

When the trade breathes, it will have mini retraces - you can set up for new entries on the H4, or drop down to the lower time frames if you prefer (I do not!)
In preparation for NFP, I did moves SL up to cover the two entries and left the TP alone for TP1 - the Add-On was left open for TP. I was quite expecting the usual spike effect from NFP and for everything to stop out for a 20 pip profit. However, just a solid move south, which was surprising.

TP1 closed for +150 pips and the Add-On is currently at 90 pips with 25 protected. This will be left to run over the weekend with the SL as is.

The chart is H4 for managing the trade, following the initial entry off of the APB colour change.

TDI day has a very strong cross signal but is showing convergence, so maybe signs of losing momentum.

H4 TDI is heading into seriously Oversold territory on the current run - looking at the history, H4 TDI tend to pause / retrace from this level before resuming, so it would not be a surprise to see it retrace 100 - 200 pips before heading south again. If there is a retrace, I will need to see a pattern on the Day chart before going long.

Still only looking for sell signals, but watching to see if the EU is going to respect the strong Demand levels, or blow through and set up new lows.

Levels to watch for on the way down:

1.2287 - May 2012

1.1875 - June 2010

1.1640 - Nov 2005
Attached Image(s) (click to enlarge)
Click to Enlarge Name: eu 7-6-2012.gif Size: 32 KB
Click to Enlarge Name: eu h4 7-6-2012.gif Size: 43 KB
Click to Enlarge Name: eu day tdi convergence 7-6-2012.gif Size: 35 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #930
  • Jul 6, 2012 12:35pm Jul 6, 2012 12:35pm
This looks to be setting up for a push away from the 200EMA which is acting as a dynamic demand level
Attached Image (click to enlarge)
Click to Enlarge Name: gbp index 7-6-2012.gif Size: 24 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #931
  • Jul 7, 2012 11:06am Jul 7, 2012 11:06am
Quoting Britpip7
In preparation for NFP, I did moves SL up to cover the two entries and left the TP alone for TP1 - the Add-On was left open for TP. I was quite expecting the usual spike effect from NFP and for everything to stop out for a 20 pip profit. However, just a solid move south, which was surprising.

TP1 closed for +150 pips and the Add-On is currently at 90 pips with 25 protected. This will be left to run over the weekend with the SL as is.

The chart is H4 for managing the trade, following the initial entry off of the APB colour change.

TDI day has...
Brit,
Been following your thread for awhile. Wish you all the best. Would like to ask for your help in explaining how to use the TMSTDi watchdog. Can't seem to find any info on how to read the info to the right of the indie. Where and how it's calculated. Any help would be greatly appreciated. Thank you.
  • #932
  • Jul 7, 2012 4:51pm Jul 7, 2012 4:51pm
Quoting FXSwissTrader
Brit,
Been following your thread for awhile. Wish you all the best. Would like to ask for your help in explaining how to use the TMSTDi watchdog. Can't seem to find any info on how to read the info to the right of the indie. Where and how it's calculated. Any help would be greatly appreciated. Thank you.
Hi SwissTrader,

Attached are my settings for the TDI - I further simplified it to show the strength of the crosses only. this higher the number the stronger the cross. You can adjust the settings per the attachment and your TDI should look the same - pick whatever colours work best for you.

Always verify any TDI cross for the following as it is a lagging indicator.
Price Action is still supporting the signal.
Look at the higher timeframes to see if this is a trend trade or a re-trace
S/R levels - don't trade into them - same goes for 100/200ema
Attached Image(s) (click to enlarge)
Click to Enlarge Name: TMS Watchdog settings - Britpip7.GIF Size: 111 KB
Click to Enlarge Name: tms day.gif Size: 22 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #933
  • Jul 11, 2012 11:47am Jul 11, 2012 11:47am
Greetings - just as a heads up, FOMC is released at 11am PDT today.

I have closed my EU trades and will look for new entries.

If you have open positions, manage your SL accordingly - this news release often sees a spike in price.
"To live with Passion, it takes Courage and Grace to survive"
  • #934
  • Jul 11, 2012 12:40pm Jul 11, 2012 12:40pm
Although there is still a lot of downward pressure on EU, the demand level is also strong.

FOMC may tip the balance today and provide new entry opportunities.
Attached Image (click to enlarge)
Click to Enlarge Name: eu demand zone.gif Size: 29 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #935
  • Jul 14, 2012 11:56am Jul 14, 2012 11:56am
Only traded eu over the past week, so no huge pip totals. Any time you are in profit for the week - that's a good thing

EU had pulled back and set up a new entry opportunity. the 7/4 candle followed a nice reversal pattern from the previous 4 days and I was only looking for sell signals. This would also qualify as a TDI entry.

TP was set to 150 just because EU is in a very strong demand zone and the probability is more for consolidation that a strong run - unless it breaks through and then you go with the Add-On Candles.

I still avoid placing traded at Big Round Numbers - BRN, so my entry points are usually 25 pips blow, so 1.2475, 1.2375, especially if there was a mini pause at the BRN.

Just the 295 pips over the past couple of weeks, but lots of pairs setting up nicely with pauses / possible reversals
Attached Image (click to enlarge)
Click to Enlarge Name: eu closed trades.gif Size: 38 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #936
  • Jul 14, 2012 12:07pm Jul 14, 2012 12:07pm
Wonderful example of a chart tracking the 200ema - dynamic demand zone with the index showing a range of 230 pips.

Basically no good for trading off of the day charts unless you take the entries as price hits the 200ema.

The other day chart option is to wait for it to break out of the box.

Another option is to drop down to H4 and trade the current day range which is now down to 160pips.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: gbp index 7-14-2012.gif Size: 27 KB
Click to Enlarge Name: gbp index h4 7-14-2012.gif Size: 31 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #937
  • Jul 14, 2012 12:27pm Jul 14, 2012 12:27pm
Lots of pairs hovering around their 200ema with a couple breaking through - watching for whether these get confirmed or whether they are false breaks.

Still watching for sell signals on EU - month and week charts still down - approx 300pips to go before it hits the next major demand zone (or you could say that it is in a demand zone which has a 300-400 pip zone!)

Most promising 200ema breaks look to be aud/jpy and nzd/jpy

eur/aud and eur/nzd are 600 and 900 pis respectively below 200ema - it will be interesting to see if they get pulled back on a reversal or whether they stay in consolidation while the euro zone sorts itself out. Currently I am still looking for sell signals - Month and Week charts are all downhill.
Attached Image (click to enlarge)
Click to Enlarge Name: eu week.gif Size: 43 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #938
  • Jul 14, 2012 2:43pm Jul 14, 2012 2:43pm
Quoting Britpip7
Lots of pairs hovering around their 200ema with a couple breaking through - watching for whether these get confirmed or whether they are false breaks.

Still watching for sell signals on EU - month and week charts still down - approx 300pips to go before it hits the next major demand zone (or you could say that it is in a demand zone which has a 300-400 pip zone!)

Most promising 200ema breaks look to be aud/jpy and nzd/jpy

eur/aud and eur/nzd are 600 and 900 pis respectively below 200ema - it will be interesting to see if they get pulled...
Think we might have a small retracement on eurusd. However, in my opinion, eurusd is going to fall and keep falling.

GH
  • #939
  • Jul 14, 2012 3:20pm Jul 14, 2012 3:20pm
Quoting ghepburn
Think we might have a small retracement on eurusd. However, in my opinion, eurusd is going to fall and keep falling.

GH
No argument here - The fundamentals don't help the Euro's cause and the charts are screaming down, down, down.

Any pull back should probably be traded on H4 until there is a clear sign of a larger retracement.
"To live with Passion, it takes Courage and Grace to survive"
  • #940
  • Jul 15, 2012 3:10pm Jul 15, 2012 3:10pm
Quoting Britpip7
Lots of pairs hovering around their 200ema with a couple breaking through - watching for whether these get confirmed or whether they are false breaks.

Still watching for sell signals on EU - month and week charts still down - approx 300pips to go before it hits the next major demand zone (or you could say that it is in a demand zone which has a 300-400 pip zone!)

Most promising 200ema breaks look to be aud/jpy and nzd/jpy .
First of all, a Big Thank You to you and all the other contributors for creating this thread.
I was following the original TMS thread and applied those methods, but like you, I also have new time constraints that don't allow me to trade during the day anymore.

I have moved to only trading the Daily charts and mostly on Price Action, so I am really excited that I found this thread - as it seems like a perfect fit for me.

Over the weekend, I read thru the entire thread and have learned a lot from it. I have my charts setup and look forward to getting started.
It is probably not the best time to start, since summer time and especially August is often a tough market to trade. So I will start with small positions in a live account until I get more experience with this method/time frame.

Thanks again....
Mike B
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