Stairstep trading using the SQ dynamic indicator

Well well well seems that things have agian heated up in teh SSBO debate. So maybe its time I started posting. No i did not give up on the thread. Truth be told it took 3 attempts to start the thread befvore the moderators finnaly stepped in. The drama associated with starting the threads just didnt make it worth it to continue since it was interferring with my my personal goals. I guess some could say without fault that yes I did abandon the thread. For that I apoligize but Just to set the record straight

1) There is nothing hard about trading breakouts and you can really only take it so far.

2) I think I mentioned that my goal was to become a licensed professional trader and at the time I started the thread (for the 3rd time after being hijacked on 2 previous attempts). I was working towards that goal. I started the thread because it seems that the author of another thread refuses to take critism and will do evrything in his power to get those that threaten to expose his methid for not really being a method or an accomplished professional trader banned.

Now for the update

I have achievd my series 34 license and am about a 2 months away form my series 3 at which time i will be a licensed professional trader an 1 step closer to my ultimate goal of opening and running my own Forex fund.

I have taken another step towards that goal and became a Zulu trader in July. So that I have a track record.

I guess before we go on I should give my view and background. I am a technical trader not really tied to one specific system. I prefer Ichimoku Darvas and Fibonnaci. I have recently started studying EW.

I do like range trading but feel trading it alone can lead to problems. Therefore what I have done is combine a couple indcitors that I found along with traditonal technical anaylsis and a money managemnet system to form a COMPLETE METHOD to trade breakouts and price action.

I beleive in order to have an ACTUAL METHOD THERE NEED TO BE 3 KEY ELEMENTS or you might as well flip a coin.

This is based on one thing. Its not the enrtry its the exit that leads to success.

So to actually have a system YOU ABSOLUTELY NEED THESE 3

1) An Entry Strategy

2) An Exit strategy

3) A money managemnet system.

As near as I can tell its been 14 months and a certain other thread is still trying to come up with the last 2. Kudo's to teh programmers who are working on that the new indicator looks promising.

Ok so this methid has all 3 of those elements.

Step 1) Get ready to trade and pick a pair to trade to do this there are a couple of steps

a) determine teh bias
b) detremine teh trend

The strongest trades are with trend and bias matching


To find teh bias we use a 30 minute time frame and the 50 ane 100 ema's


We prefer and have the best chances when we trade with the bias. If bias is mixed find another pair to trade or you may want to sit it out till it changes.

Bias is defined in the following ways

Bullish Bias: 50 is above 100 and price is above both

Bearish Bias: 50 is below 100 and price is below both

Mixed Bias: price is above teh set of EMAS opposite of teh bias

See example bias chart.

Ok great step 1 is complete. The prefered pair is a pair where you can find a trend as well as confirming bias. you do not howevere have to have both.
To do this step everyday should take you abouut 1 minute.

It is also not neccesary to have teh ema's on your trading chart.

Step 2)

Once you have determined what pair you want to trade apply the indicators.

I have been using 3 differnt indicators and alternate based on market conditions.

The indicators are attached and are:

1) The No trade zone Filter- helps take profits using teh SQ indicator or can be traded alone.

2) The second is a break out startegy with projected profit points. It is the tpr mod indicator that is attached. It resets everyday at the start of teh asian session and the projections and sell/buy area are good for all 3 sessions.

3) The thrid would be teh sq indicator but I intedn to try using the the new one posibly.

The indicators are exteremly easy to read and I think helpful

Lets deal with the filter indicatior.

Leave teh settings at default but change the colors as follows

0 medium blue dotted line
1 red dotted line
2 medium blue dotted line
3 red dotted line
4 medium blue dotted line.

The result should look like teh filter chart attached to this thread

Teh TPR mod indicator is based purely on fibonnaci. Teh theory is sell or buy off teh 61 and 38 fibs based on teh previous days range. Targets are calculated automatically. In my use of this indicator the 3rd tier is rarely hit.

The idnocator also plots teh daily high low and previous high low. I find these to be annoying and that they clutter the charts so I just switch teh colors to none. I also turn off teh comment in the inputs.

See the attached chart labeled fib trader

Finnaly the 3rd indicator is of course the one that started the reasearch in this thread and it is teh SQ indicator. I like this indicator and have not yet ttried the new one.


Trading these is pretty self explanatory but I will discuss each in a seperate post to keep it from getting confusing. I am currently trading tonight so it may be tommorw when I get it all written up buit they are attached and ready for any and all to experiment with.

Sorry I pulled a Houdinni for a while but I think you will find teh wait was worth it
Calstar

hey calstar on the fibtrader the buy level is on top of the sell level so I'm guessing the system figures there will be a pullback to that level? please correct me if im wrong looks good by the way

Thanks
We might as well start with teh Fibtrader indicator.

There are 3 elements to this method.

The entry element( the buy line and teh sell line )

The exit element ( the profit take points)

( I will get to my MM startegy in a later post if thats ok so that we can undertsand the indicators first.)

The indicator resets each day at the start of the asian session. It does not matter what time frame you have it set on the figures will not change. I prefere the 5 or 15 minute.

The indicator essetially creates a CZ for the entire day and that CZ changes each day at the close on the open of teh Asian session. The CZ as I will refer to it is based on the previous days trading range.

The rules for trading are similar to other break out rules. If price breaks thru a support or resitance line (buy/sell lines) we trade in the direction of the corresponding break.


So in using that senario if price retraces to the buy line then you would want to buy with a stop below the sell line..

If price retraces to the sell line we sell and put the stop above teh buy line.

Targets for exit are labeled as such remmebre the 3rd target is seldom hit.

Then there is the CZ way of trading. The area between the buy and sell line is teh chop zone. When price is in that area we dont trade we wait for a break. Using the rules listed above.

It should be noted that teh buy and sell line are projected support and resitance for the day.ON A RETRACE PRICE CAN JUST CONTINUE THRU THE CHOP ZONE SIGNALING A TRADE.

For this reason I use the following rules

I wait for a close/bounce above the line after a retrace to the line

I apply the filter to the chart ( I will get to that in a later post )

Please see the attached chart Chart A

In this chart ( which is current ) price continued thru the buy line into teh chop zone it never bounced off teh line so we now wait for it to exit tyhe chop zone and rise back above the buy line or sell a break of the sell line.

Given that a down trend just started to form and we are testing the up trend we are in a mixed situation. As you can see we are in teh chop zone so there is no trade yet.

How would I play this well thats were logic comes in. I have a triangle forming. and price is clearly in a small tight range. If I break out to the top side it validates teh support and the trendline. My stop would be set belwo the sell line (about 5 pips) which also puts it below the upward trendline. 2 supportive points for taking a trade.

If it exits south thru the sell line the same is true I have broken the uptrendline and validated the short term trendline to the downside. I would set the stop above the buy line.

There we go with a couple of trend lines and the indicator we were able to write a trade plan in about 5 minutes. I can now follow that plan. I can justify the trade when I take it and feel good about why I took it. The trade plan can help keep my emotions in check should the trade go wrong. I cant enter another trade without the opposite reason being valid.

I am still naked trading price action. I am just being smart about it and not blindly pulling the trigger. I can also look at the projected price targets analize the projected stop and apply the proper risk %

I hope that makes sense to everyone. I am new at trying to teach. It is also more difficult to explain how you trade then one would think. Especially when you cannot type.

Questions let me know

The zones that are drawn are for the current day only so the extension back to Fridays action is not a valid zone. If you dont understand that let me know. The period in teh above chart that has teh actual text "chart a". Shows a buy off the blue line and a sell off teh red. Thise would not have been there since the projected support/resitance would have been based off thursdays range.

If you simply dont have time to sit and watch it I suggest marking each area and looking at previous areas that way

Ok so I have attached teh chart from the overnight EUR/JPY trade plan. Looks like the long resulted ina 18 pip loss but the short from 99.90 is currently looking good. The indicator has now reset for the day so the new targets and CZ should be respected and used.

Since you are no longer using my custom SSBO indicator, and since it appears you are no longer trading breakouts, much less my Stairstep Breakouts, I think now would be a good time to get Twee to change the title of this thread to something more appropriate. I'm trusting a licensed professional trader using OPM to understand and agree on principle.

First I dont think it is your indicator.
Next I will be trading breakouts but am introducing the indicators 1 at a time and giving readers the opp to get each stage down.

I am undecided if I will use the indicasstor or manual channels to trade as some people are using teh indicator already and are reading both trhreads it would I think be beneficial for me to teach my theories on both.

As for an understanding if that was a peace offering you have me banned from your thread I dont have you banned from mine.

Its a shame really because the more who colaborate the more that could succeed.

If you had read teh whole thread you will see in the firsat post that I say

This thread is specifically for the development of a tradeable strategy using the SQ dynamic box indicator. The purpose of this thread is to develop rules of entry and exit as well as default settings for the indicator. It is asked that discussions be limited to these parameters.


I have not yet finished introducing all teh indictors that will be used with teh SQ indicator or how each will fit the puzzle. I wll do that as soon as I have given people a chance to understand and build trust in the components of the method. Good luck with your new indicator.


Thanks for the post

Ok valid signal on GBPUSD slight uptrend forming filter is bullish and we have crossed teh buy line

I will be covering the filter hopefull in a day or two. Here is how it works for directional breakouts as well as a take profit trailing stop.

The channels are formed using the SQ dynamic break out indicator

Calstar, The only reason you started this thread was because you had 2 other SSBO copycat threads get deleted on the same day 6 months ago. (I still wonder why the mods left this one up, but so be it.) And the only reason you started those other 2 threads, was because you got banned from my thread. And the reason you got banned, was because you attempted to hijack the system and twist it into something very different, and continued trying after being asked not to. Only then did you get banned, and only then did you start your knock-off threads; you couldn't dilute my thread from the inside any longer, so you attempted to do so from outside. Your (3rd attempt at this) lasted a whole 10 days before you abandoned the thread. And as you just stated, you only revived it out of spite when Kickme tried the exact same thing 2 days ago. Meanwhile, while you've been away the original SSBO thread has never stopped, and never stopped growing.

The indis in question are copywrited to me and the SSBO coding team, and I know that the 4 of us never gave you permission to use them.

Meanwhile, you are reviving a dead copycat thread for no reason whatsoever besides something to do with your ego, and you won't even agree to have it renamed. Typical. I can't wait for you to present something original around here, and risk having it hijacked from under your nose by some egotistical bastard who thinks his shit don't stink.

For those playing at home there is a channel that has also formed its smallat 16 pips

trying to point out things you can use to help you justify trades incase they go haywire oir start to whip saw

First this thread has over 2000 views in less then 24 hours so I think people do want to see what I have to offer.


I am not using your new indicatyor I am using the SQ dynamic one which was offered tothe public with out copyright. I explained why I left and you are trying to do it agian.


I think I made 2 posts in the thread total



yes I object to you kicking people out who ask simjple questions you call yourself a mentor yet have no pateince or tolerance for those that want to learn.

How do you know that kickme didnt read the thread. Didnt seem to me that the question was about how to draw CZ's but to how use an indicator. As well as why the indicator drew boxes teh way it did.

Kick me I think apoligized in advance and stated that he/she was new to forex. Isnt it then logical that they might have questions.


In your first posting in the thread you give the bring me your tired your weak and weary and you will save them. Did it ever dawn on you that they may be so confused, so beat up, so out of hope that they have no confidense at all and trueluy are looking for hope that they can succeed.

That maybe the indicator seems to good to be true or that you really do have an alternative motive, and that is the reason why they seem to ask "annoying questions".

What entiles you to call people names? How about providing a test that people must take before posting a question and sending you the results that way you know they are doing what you want them to instead of flying off and assuming. I read teh KM post looked to me like he/she read it they certainly were able to qoute a bunch of stuff.



I started the thread again for a number of reason the main being that people do want to learn and I have developed what I feel is a good way to trade breakouts.


I have a question for you?


Accordingt to your first poist you spent years of your life and are succesful trading this method. The method was so succesful that you spent thousands of dollars developing an EA based on what you had developed.


Now you are redeveloping another EA and from what you say working hard at it. WHY? Does the first one not work meaning that the method didnt work and you had everyone hellp you develop teh method further. IS that why everyone must read teh thread.


With an indicator that works there is no reason to draw CZ's by hand Should I calculate a bolinger band range by hand as well? Or do teh math for a Fibonnaci. I dont have to all I need to know is teh premsie of why and how and use the indiicators which are supposed to help make trading easier. So why do they need to readteh whole thread you have gone away from what you started which was finding CZ's by hand and teaching the method now you are testing an indocator not teaching how to find CZ's


Ill tell you what you provide proof that years ago you were successful with this method before the start of the thread and I will ride off into teh sunset.


As for adbandoning it I spent more time defending it because you and your cronies couldnt leave it alone then I did working on it.


I dont have an ego if someone comes up with a better way to trade "CZ"'s then I welcome it because it will only make me a better trader and more money.


If my method or technique fails what do you care you will in the end be proven right.


Heres another idea. How about providing teh name of teh company you hired to produce the first EA. They would have provided you with a non disclosure agreement protecting you.


Its pretty simple to provide that.

You are going to alot of trouble to not offer any proof that you did in fact do what you say you did before starting the thread. All of which you could debunk by showing any shread of proof that what you said is what you did.

Ok attached is teh eurjpy current chart it might be a good idea to close this one or at least tighten a stop if you were short from yesterdays levels.

Why would we do this when its still below the sell line which indicates bearish.

Close a trade whenthe reason you entered is no longer vaild.

There is no longer a down trend so thats a bad sign.

The filter has started to indicate bullish intent.

There is a CZ that has formed and it also looks bullish.

Currently there is about 8 pips profit and as you will see in my next post you dnt need alot of pips to get to where we all want to go.

You're posting under an alias and I'm supposed to just hand over all my private details and the names of my private business contacts because you are curious about who I am. And then you will ride off into the sunset. This is maybe the craziest thing I've ever heard here at the Factory, but it perfectly sums up the type of attitude that got you banned in the first place. You have the mind of a spoiled brat 8-year-old, demanding everyone do things his way on the playground or he'll take his ball and run home to mommy.

Again, you had 2 other copycat threads binned on the same day, and this one was your third, which you abandoned after 10 days. Who in their right mind would ever put their trust in you?

Here is something else that is bugging me and I guess this is directed at the moderators (with all due respect)

Why if FXH not banned or sanctioned? I guess I have never really read the rules for posting I think I have a general idea of what is and is not acceptable.

I would think that since teh purpose of a forum is to help each other. That decorum and commen sense would dicatie that it would go without saying that all members should treat and show others respect.

How is it respectful to swear, brow beat ,lambast, slander and generally treat people like crud.

I do not know the circumstances as to why KM has been banned but I would implore Twee to look at the post and teh comment that caused he/she to become inflamed.

Then please look at others who FXH has banned and the reason why. There is always a flippant comment afterwards.

Really why is he not sanctioned or banned? Is that helping ones fellow trader? Its not a one time event its constant and unproductive.

Now to FXH I would say this. At this point in your thread maybe it should be renamed as well since you are no longer exploring how to trade or find CZ"S but developing an EA which removes the trade aspect from the method at all. There is no trading involved with an EA you turn it on and pray.

If one has to watch the EA then it really isnt an EA is it. I guess thats what Knight Capital found out when there bot went nuts and lost them 400 billion.

It's not slander if it's true. It's not lying if it's true. It's not bad manners to point out a liar and a thief, if it's true. And if banning trouble makers was not allowed, then why does the Factory have the ignore button in the first place?

Everything I have said about you is 100% verifyably the truth: You posted badly in my SSBO thread, for which you were banned; you then proceeded to open THREE copycat threads on the same day, one after the other as they got binned by the mods; this one was left open, but after 10 days it was abandoned; you admit a few posts back that the only reason you came back to it, was because someone else was recently confronted for doing the exact same thing, so out of some weird solidarity you decided to bring it back to the top.

Does all of this reflect badly on you? You bet it does! BUT IT'S ALL 100% THE TRUTH. So if you don't like how it all sounds, then it's time to look at yourself and ask why you can't seem to stop stalking me and my system, and let this copycat thread die once and for all.

Calstar
Could you post your template?

Many traders/investors get caught up in the hype of the Forex market. Its understandable everytime you turn around you get an email or pop up saying how people turned just $100 into $100k in just 14 short weeks etc.

Most traders have teh same goal to trade fulltime, realize their dreams and live happily ever after. Sadly they fall for the hype get impatient and never get there. In reality they never realize if they are patient they could possibly get there in as little as a year.

I SAID COULD----- FX TRADING IS RISKY AS HELL AND YOU COULD LOSE ALL YOUR MONEY AS WELL. OF COURSE MANY READING THIS WILL ALREADY KNOW THAT. SO THIS IS IN NO WAY AN ATTEMPT TO SELL A FINACIAL PRODUCT OF ANY KIND.

My goal is to work to the point where you trade less get less pips and make more. In order to do that you need to take the right approach. i trade and live by the following rules:

1) patience equal profits
2) Greed Kills

I also have no more than 1/2 of my total trading capital in my trading account at any time.

The reasons for this are simple.

If a broker goes under I am not wiped out.

If the market goes crazy like it did the black friday that ended guarenteed fills and NFP straddle trades ( ah the good old days) I am not wiped out.

If I blow out the account I am not wiped out AND it forces me to think. It also give me a good reason to wait to trade agian and then at least try and find out what the heck went wrong.

If I get on a losing streak it forces me to leverage less each time and acts as a built in mesaging system If your constantly having to trade less per pip against your will there is a PROBLEM STOP TRADING.

I trade no more then $1 for every thousand dollars of equity

I prefer to trade no more then $.50 per thousand dollars of equity.

I dont subscribe to the 2-1 ratio and I dont subscribe to the 2% risk system either.

If I risk 30 pips on each trade on average and I am leveraged at $1 per thousand I can be wrong 33 time in a row before I am out of the game.

If I am wrong that many times I need a new system as well as a good resume so I can find a new job.

If I leverage at $.50 per thousand I can be wrong 66 times in a row. if I am wrong that many times in a row without stopping its time to call traders anonomous.Get my head examined, update my new resume and never ever ever trade again.

The point of trading and investing is to make life easier and to be able to do the things you want to do when the time comes. There was an ad that used to run a while back that asked "whats your number" So ask yourself that. Whats your number, whats the amount you need to make a year to do the things you want? Lets say that number is $250k a year

There are 52 weeks in the year so you need to make $4800 a week. So lets break that down into trading terms. Lets say you have 10k in an account. Using my leverage technique you can leveage a maximum of $10 a pip at that leverage you would need 480 pips a week 80 a day. Thats alot of pips and unlikely because the more you trade the greater the chance you will lose money. The average currency only moves in a 100 pip range so to hit that goal you need to get 80% of a currencies daily move, Highly highly unlikely.

Lets say you have a 100k in your account now you can leverage $100 per pip and now only need 48 pips a week which is only 12 pips a day. A much more attainable figure. So lets say you start making 4800 a week and you bank half of that into your account in 1 year that 100k becomes 224k.

Now you can trade $224 per pip and need only 21 pips a week 4 pips a day to make your 250k a year. In other words you are trading maybe 1 or 2 days a week thats it.

To be successful in the FX markets you need to be in a position where you trade on your terms where you wait for the trades to come to you. If you are patient you can get there and it doesnt take as long as you think. In fact using the compound method ( which I do ) getting just 100 pips a week you can turn $1000 into 100k in a year. This requires some work but think about it 100 pips a week is just 17 pips a day.

The compound method has its problems. If you lose it sets you back and you have to back off your leveage when you drop to the previous level, but even if it took 2 years to get to that 100k is that really that long? 50 pips a week 10 a day.

This is also not a martingale approach the trade amount is the same till the next level is reached and leverage is dictated by the level you are at. If you are losing money you back off the amount you are trading.

I dont go for the homerun anymore I will take it but I dont seek it. If you get a chance watch the movie Money Ball. The Redsox and A's dropped going for the long ball they went after runs and eventually won.

We want runs not homeruns.

Patience equals profits and Greed Kills

I have an excel spread sheet that will help you manage this type of approach but dont know how to attache help on that would be apprecited other wise I will convert to a pdf and attach that way.

xiltang I dont have a template. I just use the TPR and the filter at standard settings. I guess I could make a template how do I post it stupid I know but never used them before..

Oh and

Truely I tell you, If you have faith as small as a mustard seed,you can say to this mountain,move from here to there and it will move. Nothing will be impossible for you.

Mathew 17 verse 20