Max's Simple Ride the Wave System

More backtesting further back from last pic.

The way I backtest is to pick the crossover and go forward 1 candle at a time not being able to see the following candles and try to get as accurate a decision as possible as though each day was unfolding as I scroll forward.

https://lh5.googleusercontent.com/-1...thewavev2b.jpg
https://picasaweb.google.com/lh/phot...eat=directlink

Since 1 June 2012, we would have picked up 13 trades for 1 loss and 12 wins and a total gain of +2161p.

MONDAY 8 OCT 2012

AUDUSD triggered late Friday night and is currently heading in the right direction for us. Let's see where this guy goes. This was a classic SELL entry order placed at the low of the retracing long candle during a nice down trend.
CURRENTLY +21p
https://lh3.googleusercontent.com/-j...20121008AU.jpg

GBPUSD is still going nowhere and is hanging around the EMAs which are still supporting an uptrend. According to the rules I need to place a BUY order at the top of 2 candle high so I have done that. The stop of 2 candle low is -196p so I chose 1.5 candle low of -125p instead. Hopefully that gives us room if the move north resumes.
https://lh5.googleusercontent.com/-1...20121008GU.jpg

GBPAUD is in strong up trend but too risky and too late to join. Need to wait for pullback (short candle) to place an entry.

EURGBP is making another attempt at 0.8100. Again we need to wait for a pullback to entry, although the entry may be too close to the round number line to make much profit.

EURUSD had a new candle from Friday fully above the 2 EMAs suggesting the resuming of the trend. BUY order is placed at the high of the full candle with 2 candle low as stop of -169p.
https://lh6.googleusercontent.com/-6...20121008EU.jpg

EURAUD another big up move and again we need to wait for retrace candle to enter on.
https://lh3.googleusercontent.com/-T...20121008EA.jpg

USDCAD crossed EMAs for long a few days ago but could not sustain it and has fallen back down following its long short trend earlier. we have a full candle below the 2 EMAs in the order we want them and therefore a good SELL signal. A SELL order is placed at the low of that signal candle with a 1.5 candle stop of -98p.
https://lh4.googleusercontent.com/-0...20121008UC.jpg

AUDNZD continues to drop and so with a retrace candle a few days ago, we have a location to place a SELL order with a 1.5 candle stop of -94p.
https://lh4.googleusercontent.com/-G...20121008AN.jpg

On all of the pairs where there is a nice trend and we are waiting for retrace, we could go aggressive and enter on the high of last candle or even open immediately today but that can open us up to today being the retrace candle and therefore is a little too risky to enter off. What if these last 4 or 5 good candles were all that this move has? Better to be safe than sorry. Another idea here is to place the entry at 1.5x last candle high but then again this could be the end of the good move and a retrace is due.

TUESDAY 9 OCT 2012

GBPUSD continues down and across both EMAs. BUY order moved down to new 2 candle high with 1.5 candle low as stop.
https://lh3.googleusercontent.com/-u...20121009GU.jpg

GBPAUD completed a nice retrace candle thereby giving us a good place to add a BUY order, the top of that candle. EMAs are still well separated so lets see where PA goes now.
https://lh5.googleusercontent.com/-b...20121009GA.jpg

EURGBP is approaches significant round number line so we keep watching.

EURUSD continues down but still shows long so BUY order stands were it was placed.

EURAUD completed a nice retrace candle yesterday and so gives us a nice BUY order entry placement with 1.5 candle low as stop.
https://lh6.googleusercontent.com/-p...20121009EA.jpg

USDJPY order triggered yeterday but is running against us at -25p. Looks good to continue south.
https://lh4.googleusercontent.com/-I...20121009UJ.jpg

USDCAD has not yet triggered our SELL order so it stays.

AUDUSD is currently running against us after 2 days at -11p. Yesterday was a nice retrace candle so following the rules, I place another SELL order at the low of that candle with a 1.5 candle high as stop. Lets see if we get with the market today.
https://lh3.googleusercontent.com/-g...20121009AU.jpg

AUDNZD continues sideways so our SELL order stands.

WEDNESDAY 10 OCT 2012

GBPUSD is looking like a detirmined cross to go short so I remove my entry order altogether and wait for the EMAs to complete their cross.
https://lh6.googleusercontent.com/-C...20121010GU.jpg

GBPJPY looks like a cross short soon as well.

GBPAUD continues short even though the EMAs are still well spaced for long. Seeing as the candle where my order is located is so large, I move my order half way down so it sits at the high of 1.5 candles with the low of that as the stop.

EURGBP has completed a nice double top in its attempt to get through 0.8100 line. I expect this to fall away but am not confident enough just yet to place an order.

EURUSD continues retrace so I move my BUY order down to the high of 2 candles with low as stop.
https://lh6.googleusercontent.com/-5...20121010EU.jpg

EURJPY is same as EURUSD with retracement candles but no cross yet of EMAs. Move BUY order down.

EURAUD is the same as well. Order moved down a little.

USDJPY is a problem. We have a successful signal to go Long. EMAs crossed and got a full candle above the cross. All good. We place BUY order at high of signal candle. The problem is we are already in a Short position from a few days prior to the cross and price is going nowhere. Do we close this position? No. We let our stop do its thing. Afterall if the long changes back to the short, then we are in a really good position already in the short market with our long order untriggered. If it moves long we stop out our short position and trigger our long position and hopefully the long move will be more than double the value of the stop from the short position lost.
https://lh6.googleusercontent.com/-n...20121010UJ.jpg

USDCAD is still good short bias so entry stays as is.

AUDUSD produced another retrace candle yesterday but not lower than the candle the day before. 2 days ago is our additional short order. We already have 1 short position in play here which is currently at -21p. I expect price to move short today and get our current to BE and beyond and maybe even trigger our 2nd position.

AUDJPY had a nice doji yesterday in a nice new down trend. I placed a SELL order at the low of 2 candles with 1.5 as stop.
https://lh6.googleusercontent.com/-L...20121010AJ.jpg

AUDNZD made a new sideways candle again yesterday. Price is going nowhere but bias is still short. I have an entry to go Short earlier last week but moved it today up a little to new 2 candle low. This will trigger earlier is move goes south but should give enough room for further ranging or moving north.

Hi all, thanks for sharing the system. I must admit, I love daily systems. But I`m a lazy guy as well. So I wonder if there is not an EA, which could be modified according to the rules. Not for trading, just for generating a dashboard or signals.

Regards

Dear Max,

Thank you for the detailed write up on your system. I believe it benefited many people reading the thread.

I would be testing this manually to hopefully give some constructive comments.

Would also like to confirm that you are using a 5 day new york close for your daily charts and also, what platform and provider are you using?

Thank you

On your post 139 you have your diagram. Between the 14th and 24th you didn't move your stop. I saw where you say you do a count back but why did you not move it when the price was retracing back. There were red candles and I thought it would be moved up as those higher red candles were retracing.

I use Trading Station II through FXCM. I am in Brisbane Australia so it shows me 5 daily candles in a week and each candle closes and begins a new candle at 0700hrs local time.

I did mark every single position of the stop. You are right though. As price encroaches into the stop zone, the stop does not progress until a higher low results. But on the 19th the stop would still be as it was at open. Then the next 2 candles are very close lows so I would have kept the stop still or maybe moved it up 1/2 a candle. Then on the 24th we have a decent rise in the low so the stop moves to the low of 22nd.

Let me know if that still does not make sense.

THURSDAY 11 OCT 2012

All still relatively quiet with only 2 trades opened this week and both are slightly in the poo. When things move though they will move in a big way and we will be in with it.

GBPUSD crossed short yesterday witha full candle below both EMAs but that candle was a nice doji so caution is required.

GBPJPY also crossed short with a candle below. Only this one looks like it can continue south. SELL order placed at low of previous candle.
https://lh3.googleusercontent.com/-l...20121011GJ.jpg

GBPAUD is still showing long signal but with price currently playing between the EMAs. Keep the order moving down the lower highs using 2 candle count back as the entry point. So it moves down another candle today. Stop is now smaller being 80p.
https://lh6.googleusercontent.com/-U...20121011GA.jpg

EURGBP produced another short candle yesterday but price is still closing above both EMAs. Stalling.

EURUSD made another short candle yesterday and closed below both EMAs. I probably need a rule to ignore pairs where they closed below both but for now I will move my BUY order down to previous 2 highs.

EURJPY is the same. Order moved down.

EURAUD is the same. Order moved down.

USDJPY recently crossed above with nice long signal but is now moving back below and possibly establishing a new short signal. If it does we need to delete our BUY order and add a SELL order quickly. We still have a short position open here currently at -12p but in a good spot if new short trend begins. BUY order stands but is moved down to high of last 2 candles.
https://lh6.googleusercontent.com/--...20121011UJ.jpg

USDCAD is reverse of USDJPY. Recent short signal now being replaced by possible long signal as candles dance around the 2 EMAs.

AUDUSD currently has an open short position at -45p but signal still shows short bias. Candles retraced with long wicks for days but a breakout should occur soon. There was a 2nd position order on those retrace candles but now that the most recent candle is almost the same low and where we entered, I removed the 2nd order altogether thereby limiting the risk in case it triggered and reverse. Would rather have 1 loss than 2.
https://lh3.googleusercontent.com/-9...20121011AU.jpg

AUDJPY had 2 days of retrace but both have long wicks signalling the bears and bulls have equal pressure and both want their own way. Order is moved to low of last 2.

AUDNZD has price closing above the 10EMA but still below the 21EMA. Order moves to low of last 2 candles.

Hey Max, very nice system...
Just 1 qyestion: why, in some cases like this one, you don't wait for the pull back candle( blue candle) to place the pending order?

Sorry for my bad english

That's because entering after retrace candles are not the only opportunity in a trend. They are good opportunities but a lot of the times the initial push that establishes a new trend can be fast and strong and without any retrace until later. Using a signal candle to enter into that new trend after a number of confirmations all line up, enables us to get in a little earlier.

FRIDAY 12 OCT

A lot of sideways action yesterday. 2 new orders triggered and 1 closed for a loss.

GBPUSD shows a nice long candle yesterday after that cross down and then a doji. Still staying out until it breaks that low of that doji or crosses back up.

GBPJPY closed yesterday for -104p loss. It still closed its candle below the EMAs so I will place a SELL order on the low of that candle.
https://lh6.googleusercontent.com/-M...20121012GJ.jpg

GBPAUD almost a doji yesterday after a multi day run downwards. Moved BUY order down to high of last 2 candles.

EURGBP ran back up towards the tested 0.8100 line. I'm leaving that one alone as the space between the EMAs and that line is getting smaller and smaller.

EURUSD still stays as long bias and yesterday the price closed back above both EMAs. Moving BUY order down to high of 2 candles.

EURJPY same as above

EURAUD gave a possible pin at end of a few days of short candles signalling it may move long again. And with EMAs still with long bias I am looking for the same. Moved BUY order down to new 2 candle high.

USDJPY price action went long again yesterday triggering my BUY order. It is now back down and in between my long and short orders making both in the poo with -29p on short and -8 on long.

USDCAD price dropped yesterday but not enough to trigger my SHORT so will wait and see what happens today.

AUDUSD 4 days in a row of long candles after crossing to short bias. I moved order recently to low of 2 candles to give it room to play long if it wants to. Lets see where it goes today.

AUDJPY similar to above. Leave SHORT order on 2 candle low.

AUDNZD same again. Move SHORT order to 2 candle low.

END OF 5TH WEEK:

Week 1: 0 trades closed for 0p
Week 2: 3 trades closed for +365p
Week 3: 4 trades closed for -284p (testing range trading ideas and hedging)
Week 4: 17 trades closed for +171p (testing range trading ideas and hedging for 1st half of the week)
Week 5: 1 trades closed for -104p

TOTAL: 25 trades closed for +148p.

Still open: 7 trades currently at -116p.

NOTES: tough week as 1st half of the week went nowhere and small movements triggered orders but then reversing, although not that significantly. Hopefully this new week we get some good movements. I am thinking of using 1.5x signal candle low or high for entries instead of the normal 1 x high or low. Lets see how this week pans out.

MONDAY 15 OCT 2012

GBPUSD has been down below the 2 EMAs for a couple of days now but all candles have been longs. This tells me the short trend will not develop so I am staying out and will wait for price to clear above the 2 EMAs instead. We are looking for clear and obvious trends not so and so trends that end up never materialising.

GBPJPY had a SELL order at the bottom of a cross under candle from last week but the 10EMA is now back above the 21EMA and last few candles have been long. The order is removed and we await a full candle above the 2 EMAs.

GBPAUD has a long position triggered late last week with a 1.5 candle stop. This is currently at -30p and dropping. Well, that is what stops are for. Both EMAs are still pointing up and with a nice gap in between so lets see how the next few days progress.

EURGBP still moving up towards major resistance line where the room between is getting smaller and smaller.

EURUSD still shows long signals and current position is at -33p.

More and more I am thinking we need to place orders at 1.5x the high or low of signal candle rather than at the high or low. This is so we get in when market moves in our direction not just sideways.

EURJPY is also long with current position at -23p.

EURAUD shows long especially after nice pin bar last week. Currently at +8p.

USDJPY has 2 positions currently in opposing directions. 10EMA is still only just above 21EMA but both are flat thereby hiding where the market is going. Both positions are -36p and -7p and will stay open until the market moves.

USDCAD has 10EMA is below 21EMA but both are flat and price has not yet cleared the EMAs on either side. Still overall short so entry order is currently at 2 candle low. I moved it the lowest low since signal.

AUDUSD still signals short but after 4 long candles in a row, the short candles looks itself to be a retrace candle in a new uptrend. Lets see if it crosses above.

AUDJPY is short with untriggered short entry order. I moved it down to the lowest low since signal today.

AUDNZD still short but with a lot of recent long candles. Could be preparing to cross north. I have a SHORT order at 2 candle low but will leave it here as it gives price a nice buffer to move either way before deciding where it will go.

TUESDAY 16 OCT 2012

Some nice reversals yesterday to bring some of my trades back into the positive but overall still down -111p.

Also added Stochastic to my charts to help with whether or not to go more cautious in the positioning of my entry orders. I've added a Stoch 5,3,3 and a Stoch 20,12,12.

GBPUSD still points down with price not really going anywhere yesterday. Stochs are pointing up and down respecively so I am going to leave this alone for another day at least.
https://lh5.googleusercontent.com/-0...20121016GU.jpg

GBPJPY is still up but needs to make a new high before I can take it seriously.

GBPAUD is also still up with price hanging around the 2 EMAs but stoch points up with recent cross so lets see where price goes today.

EURGBP still points up but getting too tight between price, EMAs and the psychological line of 0.8100. Stochs are both pointing up but around the centre of each chart so not a good signal to go with.

EURUSD has been flat for a few weeks now. Its pointing up with the EMAs and we do have a long position open but its rather pathetic.

EURJPY is the one I have been backtesting the use of stochastics on. We have uptrend accoring to EMAs but long term stoch is stuck mid range and short term stoch is approaching overbought area so expect a retrace candle today. Lets see.
https://lh6.googleusercontent.com/-r...20121016EJ.jpg

EURAUD has a nice uptrend confirmed by higher highs and higher lows and placement of EMAs. I have a long position here and its growing.
https://lh6.googleusercontent.com/-Y...20121016EA.jpg

USDJPY finally picked a direction to move in yesterday which means one of out opposing positions stopped out. The short stopped for -58p. This means the long is moving and is currently +24p.
https://lh6.googleusercontent.com/-u...20121016UJ.jpg

USDCAD is another flat pair with 10EMA barely recognisable as being below the 21EMA. Both stochs are approaching overbought but high lows and lower highs are being recorded. I predict a move short but lets see.

AUDUSD is moving down slowly lower lows and lower highs and EMAs signalling short trend. Short stoch has turned down from near the top but long term stoch is pinching for reversal upwards. Lets see if short trend holds enough to get my position back to BE. Currently -67p.

AUDJPY is still short and still got lower lows and lower highs but just not pushing as south as it should be.

AUDNZD still holding short but slow with a few short candles in a row now but they are not large candles and so our short position has still not triggered.

WEDNESDAY 17 OCT 2012

The worm has turned. I now have 4 from 6 trades in the positive with the other 2 at -25p and -95p. All up I am in front by +182p.

GBPUSD still going nowhere.

GBPJPY has resumed an up trend. Stochs look okay and MACD is about to cross zero line to upside. To be a good continuation of trend, I need price to exceed previous high to prove the uptrend. Entry order placed at previous high.
https://lh5.googleusercontent.com/-6...20121017GJ.jpg

GBPAUD has a long position open for -25p but signals are all long except long term stoch which is on edge of overbought and could mean the price will fall for a while.

EURGBP has finally retested 0.8100 line and closed above it. Lets see if it can stay above before thinking about adding an order any where.

EURUSD has a long position open at +67p and all signals are still long except short term stoch approaching overbought location. This could turn a little today or tomorrow. Stop moved up.

EURJPY has exploded nicely with a long position at +114p. All looks good to continue except short term stoch which is approaching overbought. I need to keep an eye on this and close as soon as it looks like retracing. Stop moved up today.

EURAUD has a nice long position at +76p with short term stoch approaching overbought as well. Need to keep on eye on this one also. Stop moved up today.
https://lh6.googleusercontent.com/-h...20121017EA.jpg

USDJPY has a long position at +44p but short term stoch is now at overbought and MACD is up and over zero and could turn at any moment. Stop moved up.

USDCAD Has just crossed again, this time to the upside. Most recent high was higher, thereby not a new high. But then again most recent low was lower. Hard to tell where this is going. Stochs are both above 50 and pointing up and MACD is above zero but only recently. Could continue move up but without a new high, there is little to trust. No entry on this one at all for now.

AUDUSD has a short position currently at -93p. This is a worry trade and could cut into my potential wins from the others. EMAs and price is still short but MACD and long term stoch point up and short term stoch is close to crossing down from just below overbought. I think today or tomorrow should see drop in price and if so a recovery of potential loss on this one.
https://lh5.googleusercontent.com/-2...20121017AU.jpg

AUDJPY had a SELL order at most recent low but price has been steadily moving up and crossed both EMAs. While the EMAs themselves still point south along with short term stoch which is currently in overbought territory, long term stoch is low and MACD has 3 bars above zero but could begin reducing soon. Order is removed but looking to go short soon. Keep an eye on it.

AUDNZD is same only MACD has been up for 5 days and could be tiring. Keep an eye on it with no order pending.

Sorry about Thurs and Fri as I have been out of town for work.

I will write up a summary of week 6 on the weekend. Needless to say most trades turned up from Wednesday and 2 of them I closed half the positions at +100p each to lock in a little profit.

More details to come.

Currently 4 trades open at +202p

Find a demo account that does not have any weekend candles and use it just for your signals or fold the sunday into friday.