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  • #2,921
  • Jul 30, 2012 4:26pm Jul 30, 2012 4:26pm
Here is the mother of all CZ's. Curiously, it's exactly 100 pips tall even though it is almost 72 hours old.
Attached Image (click to enlarge)
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To improve is to change. To perfect, is to change often.
  • #2,922
  • Jul 31, 2012 2:28am Jul 31, 2012 2:28am
I'm watching the GU as well. I on my IG chart I have a 22 high 30 long CZ this morning. But My MT4 only managed 29 long but I'm still interested.

I'm also long on the below EJ CZ
Attached Image (click to enlarge)
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I never know what's gonna happen, so how can I be wrong?
  • #2,923
  • Jul 31, 2012 8:48am Jul 31, 2012 8:48am
GU
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  • #2,924
  • Jul 31, 2012 11:48am Jul 31, 2012 11:48am
Cable has been working for me as well.

More about the indi: Notice the 3 values I've highlighted: 35p/35p/51p. The 35p value is the Quick Take Profit. This can be set to anything you like. And this value will be the TP for when there is a clean breakout that goes straight into profit without touching the far side of the CZ and stopping out. And if you are stopped out then that Stop Loss value (CZ height + Buffer) now becomes the 1:1 TP/SL value(s) for the remaining trades of the set.

In this pic the first 2 breakouts went straight into profit and no stops, so they each got 35p. The 3rd trade stopped out at -26p, so 26p became the TP and the SL until the set closed one way or another. In this case it closed in profit on the second breakout of the set. This reduction in value (from 35p down to 26p) is intentional. The idea is to take a larger profit when price action allows, but to have limited exposure when it doesn't. Those extra pips add up.

The indi itself is still too buggy to release, and I'm waiting on Spin to send me the next update when he has time.
Attached Image (click to enlarge)
Click to Enlarge Name: gu.gif Size: 62 KB
To improve is to change. To perfect, is to change often.
  • #2,925
  • Jul 31, 2012 12:53pm Jul 31, 2012 12:53pm
Quoting forexhard
Cable has been working for me as well.

More about the indi: Notice the 3 values I've highlighted: 35p/35p/51p. The 35p value is the Quick Take Profit. This can be set to anything you like. And this value will be the TP for when there is a clean breakout that goes straight into profit without touching the far side of the CZ and stopping out. And if you are stopped out then that Stop Loss value (CZ height + Buffer) now becomes the 1:1 TP/SL value(s) for the remaining trades of the set.

In this pic the first 2 breakouts went straight into profit...
Thanks for the update on the indicator. It looks very interesting.

Nice trading on GBPUSD today. I had a small running loss from yesterday's CZ long trade, then I reversed short from this morning's CZ and took about 40 pips. The set of trades giving me +1.5%.

This system is still working really well for me. Steady gains with little to no draw-down, and it's consistently making 2 to 3 times the profit of my longer term trend-following system. In fairness, it takes maybe three or four times the 'screen time' to trade these breakouts compared to trading the H4 and D1 bars, but the profits are more than worth the effort for me.

Sue
  • #2,926
  • Jul 31, 2012 1:03pm Jul 31, 2012 1:03pm
Hey FXH, Thanks for the tip, I'll have to back test this. I've been toying with how to run the trades. This for me is the hardest bit to get right. Everything else is simple.

I can't afford to run any sort of martingale system as my pot isn't anywhere near large enough.
I've been taking 1/3 at 10 pips (unless it shoots up quick I can leave it later) to try and limit exposure if it does turn back. As you said before the breakouts usual give at least 10 - 15 pips regardless.

1/3 at 1:1 RR. to lock in some profit.

and letting the remainder run with a final take profit aim of either what the average that the indi shows, or possibly a trailing stop (still undecided on this part)

It definitely looks like some sort of martingale system would suit this best. But I can't face a long set that blows me out.

I still feel with this trade mngt I will be profitable in the long run, but I'm always open to any advice should anyone think I'm missing something.

Thanks

Casey
I never know what's gonna happen, so how can I be wrong?
  • #2,927
  • Jul 31, 2012 2:06pm Jul 31, 2012 2:06pm
Quoting caseypin
Hey FXH, Thanks for the tip, I'll have to back test this. I've been toying with how to run the trades. This for me is the hardest bit to get right. Everything else is simple.

I can't afford to run any sort of martingale system as my pot isn't anywhere near large enough.
I've been taking 1/3 at 10 pips (unless it shoots up quick I can leave it later) to try and limit exposure if it does turn back. As you said before the breakouts usual give at least 10 - 15 pips regardless.

1/3 at 1:1 RR. to lock in some profit.

and letting the remainder...
Hi Casey - I do increase my position size if I need to reverse the trade, but I do what I call my 'gentle martingale': I don't double up, but maybe add 25% or so, but then tighten the stop and widen the take profit to effectively create double the trade. I think the worst set of reversals I've had in the last few months has been four trades. When I hit trade four I aimed for roughly break-even and came away with a small loss (less than 0.1% which was probably my mis-calculation due to spread).

I'm trying to refine the method every time I trade, but it just keeps working, so the trade is usually over before I get a chance to do much tweaking! :-)

If you are struggling with a small account, I would recommend OANDA as you can trade with a very precise position size and at very small amounts. It means you can test trades with real money but very little risk and can trade with a precise % of your account.

Sue
  • #2,928
  • Jul 31, 2012 4:08pm Jul 31, 2012 4:08pm
Quoting sue23
Hi Casey - I do increase my position size if I need to reverse the trade, but I do what I call my 'gentle martingale'....Sue
I am so thankful that we have so many sensible and professional members in here...
To improve is to change. To perfect, is to change often.
  • #2,929
  • Jul 31, 2012 4:53pm Jul 31, 2012 4:53pm
Quoting forexhard
I am so thankful that we have so many sensible and professional members in here...
Shouldn't be a surprise FH, this is still one the best and most sensibly managed threads threads here. I don't visit FF much nowadays, but am glad this thread is still going strong. In some ways it's surprising since you pretty much said it all in the first dozen or so posts...

Keep well.
  • #2,930
  • Jul 31, 2012 6:24pm Jul 31, 2012 6:24pm
There is a CZ forming on GU, it's 25p high and 30 bar wide. I didn't attach the indicator to my chart, because I draw the CZ box and the buffer lines manually.

Attached Image (click to enlarge)
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Helena
  • #2,931
  • Jul 31, 2012 7:02pm Jul 31, 2012 7:02pm
Nice catch Helenaberg! Be sure to come back and show us how your trades went...
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To improve is to change. To perfect, is to change often.
  • #2,932
  • Jul 31, 2012 7:46pm Jul 31, 2012 7:46pm
on gbpusd

i put
buy stop and sell stop

st 30
be 20
1 tp 30
2 tp 60
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  • #2,933
  • Aug 1, 2012 1:19am Aug 1, 2012 1:19am
Quoting sue23
Hi Casey - I do increase my position size if I need to reverse the trade, but I do what I call my 'gentle martingale': I don't double up, but maybe add 25% or so, but then tighten the stop and widen the take profit to effectively create double the trade. I think the worst set of reversals I've had in the last few months has been four trades. When I hit trade four I aimed for roughly break-even and came away with a small loss (less than 0.1% which was probably my mis-calculation due to spread).

I'm trying to refine the method every time I trade,...
Thanks Sue, I'll look again at this then. It may be something in my mind still see's a stigma from all the times you read don't do it.

Can you work the 25% increase to break even over 4 trades, or do you need to increase this number by a small amount each time?

I've been playing with the m/g idea but when I look at it at some point I always need to up the increase. But that said my stop was always the same.

Ok with what you've told me and FH's advice I may be able to sort this. I guess the key tip was I'm now aiming for BE on the trade set. So don't be greedy.

Cheers, I agree this thread is excellent. Really helping me.

Casey
I never know what's gonna happen, so how can I be wrong?
  • #2,934
  • Aug 1, 2012 2:12am Aug 1, 2012 2:12am
Quoting jucaorma
on gbpusd

i put
buy stop and sell stop

st 30
be 20
1 tp 30
2 tp 60
Hey jucaorma, Firstly the CZ this morning is definitely valid, and the GU is throwing up allot of CZ's at the moment. (it's been stuck in a 140 pip range since the big move up Thursday) But you're chart does seem to have allot of CZs. There's been lots of good info on how to tighten the settings so you can cherry pick the best ones. The longer the CZ, the better. You want to get the average weekly number down, and you'll also see the average number of pips per CZ breakout increase (Happy Days).
No point taking needless hits.
Anyway I've attached my GU, but take a look at some of FXH's previous posts and there's a description on how to find the best settings for you.
Cheers
Casey
Attached Image (click to enlarge)
Click to Enlarge Name: gu cz.gif Size: 14 KB
I never know what's gonna happen, so how can I be wrong?
  • #2,935
  • Aug 1, 2012 3:51am Aug 1, 2012 3:51am
Quoting caseypin
Thanks Sue, I'll look again at this then. It may be something in my mind still see's a stigma from all the times you read don't do it.

Can you work the 25% increase to break even over 4 trades, or do you need to increase this number by a small amount each time?

I've been playing with the m/g idea but when I look at it at some point I always need to up the increase. But that said my stop was always the same.

Ok with what you've told me and FH's advice I may be able to sort this. I guess the key tip was I'm now aiming for BE on the trade...
Hi Casey,

I work a small increase into each subsequent trade and also change the SL and TP so that when take profit is hit it covers the earlier loss/es and gives me a profit (or breaks even if there have been a lot of reversals). I wish I had details of each trade so I can show you exactly what I changed, but I'm usually too busy with the trade and trying to deal with a small child harassing me at the same time to keep proper records! The best I can do is give you an example (I've just made up these figures, so the calculations won't be spot-on, but you get the idea):

Trade 1: Box size 30 pips, SL and TP = 30 pips (0.75% risked), 2 lots. Gives a profit or loss of 0.75%

Trade 2: Lots increased to 2.5 (25% increase). Stop loss reduced to 27 pips. Take profit increased to 41 pips. This roughly doubles the profit created by the trade giving a 0.75% profit and covering the earlier loss.

Trade 3: Lots increased to 3.1 (25% increase). SL = 23, TP = 45. Etc.

The idea is that you work out the 'profit factor' for each trade (I'm sure there is a real trading term for this!) and make sure this doubles for each reversal. Standard Martingale does this doubling by only changing the lot size, but my 'gentle martingale' does the same thing by altering the position, SL and TP.

For trade 1 above my profit factor is 0.75, calculated as: Risk % * (TP/SL). The idea is that the profit factor for trade 2 would be 1.5, trade 3 = 3, trade 4 = 6 etc. (although I usually stop at trade four or five and aim to break even).

Sue
  • #2,936
  • Aug 1, 2012 3:59am Aug 1, 2012 3:59am
Quoting sue23
Hi Casey,

I work a small increase into each subsequent trade and also change the SL and TP so that when take profit is hit it covers the earlier loss/es and gives me a profit (or breaks even if there have been a lot of reversals). I wish I had details of each trade so I can show you exactly what I changed, but I'm usually too busy with the trade and trying to deal with a small child harassing me at the same time to keep proper records! The best I can do is give you an example (I've just made up these figures, so the calculations won't be spot-on,...
Hey Sue, Thanks for the advice (and example - really helpful). It does make perfect sense. Plus it seriously reduces the DD of most martingales.

Thanks again

Casey
I never know what's gonna happen, so how can I be wrong?
  • #2,937
  • Aug 1, 2012 4:22am Aug 1, 2012 4:22am
Casey - My GBPUSD trade this morning has just hit take profit, so here's an example of a real trade while it's still fresh in my mind:

1. I went long at 1.5689 with 4.3 lots, a SL = 30 pips, TP = 30 pips

2. Stopped out and reversed at 1.5659

3. Changed my position size to 5.4 (roughly 25% increase), SL to 25 pips and TP to 39 pips (I targeted 39 pips on purpose because it was the bottom edge of an earlier CZ. Stop loss was tweaked to give the correct value based on this TP price).

4. Trade hit TP at 1.5620. The profit on the trade covered the earlier loss and gave me roughly the same profit that I aimed for in trade 1 (I came away with a little less due to spread).

If trade 2 had been a loss I would have pushed the position up to 6.8 lots and looked for a sensible TP position based on earlier CZs, support and resistance etc, then tweaked the SL so that it doubled the profit factor.

If trade 3 had been a loss, I would most likely have just been looking to break even or take a small loss and live to fight another day :-)

Also, I think it's worth saying that when it's written down like this it seems very mechanical and simple, but the reality is more complex. For instance last week, one of my trades missed TP by about 5 pips, but I didn't just leave it to reverse and hit my stop. I took a partial profit and tightened my stop. When it eventually stopped me out it was late in the day (past London close), so I just came away with a very small profit and waited for another CZ to form.

These breakout trades are hugely powerful, but (like one of my flying instructors used to say when talking about GPS) they're not a substitute for a brain in your skull! ;-)

Sue
  • #2,938
  • Aug 1, 2012 5:01am Aug 1, 2012 5:01am
Quoting sue23
Casey - My GBPUSD trade this morning has just hit take profit, so here's an example of a real trade while it's still fresh in my mind:

1. I went long at 1.5689 with 4.3 lots, a SL = 30 pips, TP = 30 pips

2. Stopped out and reversed at 1.5659

3. Changed my position size to 5.4 (roughly 25% increase), SL to 25 pips and TP to 39 pips (I targeted 39 pips on purpose because it was the bottom edge of an earlier CZ. Stop loss was tweaked to give the correct value based on this TP price).

4. Trade hit TP at 1.5620. The profit on the trade covered...
Hi Sue, This does seem to work nicely. I'm just having a look back at some previous trade sets. I think the TP level is always going to be subjective. But with some common sense (and no greed) this could be a great way to maximize the trades. I agree this is such a powerful tool for getting into a trade set, mainly the simplicity.

Also I've PM'd you a Q I didn't want o post on the thread. But my sent items says 0. I'm pretty new to this site so don't know if you received it?

Cheers

Casey
I never know what's gonna happen, so how can I be wrong?
  • #2,939
  • Aug 1, 2012 1:00pm Aug 1, 2012 1:00pm
It seems that my settings are only off from Sue's by 2 or 3 pips.

Here's how the indi handled my last CZ on Cable. Two stops and a win, or 1+2 (original trade plus 2). Out with 26p. This is a typical scenario, and is still only half as far as I am willing to go with this system (or 1+5).
Attached Image (click to enlarge)
Click to Enlarge Name: gu.gif Size: 115 KB
To improve is to change. To perfect, is to change often.
  • #2,940
  • Aug 1, 2012 1:11pm Aug 1, 2012 1:11pm
Quoting forexhard
It seems that my settings are only off from Sue's by 2 or 3 pips.

Here's how the indi handled my last CZ on Cable. Two stops and a win, or 1+2 (original trade plus 2). Out with 26p. This is a typical scenario, and is still only half as far as I am willing to go with this system (or 1+5).
Still turned into a nice trade.

I've been stopped out on 2 trades on the EU, been stuck in the CZ for a while. just hoping something happens before I go to bed. Maybe the FOMC will help me out.
Attached Image (click to enlarge)
Click to Enlarge Name: eu cz.gif Size: 18 KB
I never know what's gonna happen, so how can I be wrong?
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