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Buy sell line trading

  • #2,441
  • Jan 17, 2013 10:44am Jan 17, 2013 10:44am
Quoting Olarion1975
Nice trade, congrats! I cannot trade oil with my broker...
+300 pips a day is awesome, mate!
Agreed !

I only did 4.2 R today

I am targetting 5R a week, so more than happy with how this method is progressing. Just got to keep to the rules and choose exits carefully whilst keeping a reign on money mgmt.
Simplicity is the ultimate in sophistication ~ Leonardo Da Vinci
  • #2,442
  • Jan 17, 2013 10:49am Jan 17, 2013 10:49am
Quoting fisheggs
Agreed !

I only did 4.2 R today

I am targetting 5R a week, so more than happy with how this method is progressing. Just got to keep to the rules and choose exits carefully whilst keeping a reign on money mgmt.
"Only" 4.2R?? Don't hide your light under a bushel!
This is absolutely excellent trading!
  • #2,443
  • Jan 17, 2013 1:21pm Jan 17, 2013 1:21pm
Hi Guys,

Some very nice results again today, way to go!! This morning spotted a nice cad/jpy RR2 trade on the 4h.
Tonight is spotted this potential setup, i like how it is in confluence with the trend and it broke the big round number. Let see how it unfolds while i sleep!

What do you guys think of the setup?
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  • #2,444
  • Jan 17, 2013 1:55pm Jan 17, 2013 1:55pm
Quoting mijnmail
Hi Guys,

Some very nice results again today, way to go!! This morning spotted a nice cad/jpy RR2 trade on the 4h.
Tonight is spotted this potential setup, i like how it is in confluence with the trend and it broke the big round number. Let see how it unfolds while i sleep!

What do you guys think of the setup?
I would not take this trade, the engulfing has not happened at a swing point.
  • #2,445
  • Jan 17, 2013 2:05pm Jan 17, 2013 2:05pm
Quoting Olarion1975
I would not take this trade, the engulfing has not happened at a swing point.
Yes....that and price is quite far away from the B/S line.
  • #2,446
  • Jan 17, 2013 2:23pm Jan 17, 2013 2:23pm
Quoting Mr_D1
Yes....that and price is quite far away from the B/S line.
agree... no retrace, long way from the ma's... low probability trade there
tradewith60
  • #2,447
  • Jan 17, 2013 7:37pm Jan 17, 2013 7:37pm
I have a question about trade management...mainly where to set the stop. I've had three trades this week that price has gone right up to my stop, taken me out, and then price has reversed as anticipated. I'll attach this latest example. My question is...I typically set my stop at the high or low of the previous bar, +1. It seems if I set my stops +4 or +5...my stops wouldn't be getting hit. Frustrating when this happens as I watch the trades go right back in the direction I need them to. It's as if the broker knows my exact stop...takes me out...then price reverses. Any thoughts would be greatly appreciated! Thanks!! Here's the latest incidence of this happening tonight.
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  • #2,448
  • Jan 17, 2013 11:17pm Jan 17, 2013 11:17pm
Quoting SMcGuire45
I have a question about trade management...mainly where to set the stop. I've had three trades this week that price has gone right up to my stop, taken me out, and then price has reversed as anticipated. I'll attach this latest example. My question is...I typically set my stop at the high or low of the previous bar, +1. It seems if I set my stops +4 or +5...my stops wouldn't be getting hit. Frustrating when this happens as I watch the trades go right back in the direction I need them to. It's as if the broker knows my exact stop...takes me out...then...
I set my SL 1 pip (+spread for Sell) above the signal candle. If it is not a swing, I might set the SL a bit higher above the previous swing point.

Regarding your example, my trade wouldn't be stopped out...but price came 0.1 pip close to it.
For the H4 charts, this is of course a bit broker dependent caused by the different server times.

I know it can be frustating watching price taken out your stop and continue in the right direction - but you should not bother and stick to your MM rules. There is always another trade round the corner...
  • #2,449
  • Jan 18, 2013 1:03am Jan 18, 2013 1:03am
Quoting SMcGuire45
I have a question about trade management...mainly where to set the stop. I've had three trades this week that price has gone right up to my stop, taken me out, and then price has reversed as anticipated. I'll attach this latest example. My question is...I typically set my stop at the high or low of the previous bar, +1. It seems if I set my stops +4 or +5...my stops wouldn't be getting hit. Frustrating when this happens as I watch the trades go right back in the direction I need them to. It's as if the broker knows my exact stop...takes me out...then...

looks like you are not allowing for spread... When you place a stop loss you are in fact saying, this is the S/R line +1/-1 that will not be breached, If you are right there is still a possibility it will make a double top/bottom/ So just allow a little for that to happen and stay in the trade.

2. your broker will not be moving the market... and certainly not moving the market just to take out your position.
tradewith60
  • #2,450
  • Edited 1:45am Jan 18, 2013 1:28am | Edited 1:45am
Here is my recent AU trade on H1 after a nice Outside Bar...+36 pips profit with a risk of +15 pips...a 2.4 R win.
I set my SL above the last swing + a few pips, because my order EA set the SL automatically and I did not adjust to fit the rule "signal candle + 1 pip".
Had I set the SL above my signal candle, I would have been stopped out.

Exit was manually as price stalled at the round number.

Not a textbook example, as I broke my own rule not to trade after london close...
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  • #2,451
  • Jan 18, 2013 1:44am Jan 18, 2013 1:44am
Great trading Olarion, Good stop placement too!

Quoting Olarion1975
Here is my recent AU trade on H1 after a nice Outside Bar...+36 pips profit with a risk of +15 pips...a 2.4 R win.
I set my SL above the last swing + a few pips. Had I set the SL above my signal candle, I would have been stopped out.

Exit was manually as price stalled at the round number.

Not a textbook example, as I broke my own rule not to trade after london close...
Simplicity is the ultimate in sophistication ~ Leonardo Da Vinci
  • #2,452
  • Edited 9:49am Jan 18, 2013 1:51am | Edited 9:49am
Quoting fisheggs
Great trading Olarion, Good stop placement too!
Thanks. I would say I was lucky with my stop. Normally this would be a loss, because price spiked up an hour after the entry...
  • #2,453
  • Jan 18, 2013 3:04am Jan 18, 2013 3:04am
Today GU 1H 2RR 52 pips.

closed - confluence round number and pivot level
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  • #2,454
  • Edited 5:02am Jan 18, 2013 3:35am | Edited 5:02am
EURUSD is a type 2 and not far off being an engulfing and OB hmmmmmm

In this and target is 1.3490

Edit:Stopped. Next...
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Simplicity is the ultimate in sophistication ~ Leonardo Da Vinci
  • #2,455
  • Jan 18, 2013 12:29pm Jan 18, 2013 12:29pm
New to this thread and figured I would try the system out. What intrigued me was the engulfing candles as I use them myself for my other method of trading. I tried this on demo. I didnt do good with it at all. I would like some feedback from some of the vets on this site with the uploaded pics when ever someone has time. I will say it could of been just one of those days. Thanks
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  • #2,456
  • Jan 18, 2013 8:11pm Jan 18, 2013 8:11pm
Thanks for the additional info Olarion and 60MM. Next week I won't be so tight with my stops and give my trades some breathing room!
  • #2,457
  • Jan 19, 2013 5:27am Jan 19, 2013 5:27am
Quoting nawlins51
New to this thread and figured I would try the system out. What intrigued me was the engulfing candles as I use them myself for my other method of trading. I tried this on demo. I didnt do good with it at all. I would like some feedback from some of the vets on this site with the uploaded pics when ever someone has time. I will say it could of been just one of those days. Thanks
IMHO your trades were against strong support areas at round numbers, USD red news and friday afternoon are three reasons why not take these trades. Sorry for my bad english
  • #2,458
  • Edited 11:11am Jan 19, 2013 7:52am | Edited 11:11am
[quote=nawlins51;6377921I would like some feedback from some of the vets on this site with the uploaded pics when ever someone has time. I will say it could of been just one of those days. [/quote]

Nawlins

We know that one cannot simply trade every engulfing pattern and expect to be a successful trader. If it was that easy, everyone would be successful. Like most strategies, there is a certain amount of trader discretion needed. You must roll your sleeves up and put in some time studying past charts to see what the winning trades had in common with each other, and what the losers had in common with each other. You do not say how many setups were in your backtest sample. 10? 15? This is not enough to know whether a strategy has an edge.

1) At least two of your setups contained wide-range signal bars. While the signal bar should have a sense of power, too much of a good thing means that too much of the thrust in the direction of the trend will be spent in just the signal bar, leaving very little power left for the follow-through post-entry.

2) The best signal bars close in the lower quartile of the bar's range (for shorts). This implies strength in the trend.

3) This is a retracement setup. There should be an ongoing trend, followed by a pullback (retracement) in the trend, followed by the two-bar engulfing pattern. In other words, if the signal bar appears amid congestion (a sideways range), this will have a lower probability of success.

4) Probability of success increases when the pattern appears in conjunction with a support/resistance level or round number.

5) The average trend has three retracements. Some have one and some have eight or more. Entering on the first retracement in a trend is your highest probability entry, followed by the second retracement. Many times I will not enter on the third retracement or later.

Consider doing this: Look at your past charts and place a vertical line on every signal bar going back a few years. Calculate win% using a simple reward:risk of 1:1. This can be done quickly. Then eliminate the trades that were lower probability, i.e. they were in congestion, had wide range signal bars, had long tails, etc. See what you come up with. Also, don't be afraid to look at Type 2 and commando setups discussed in post 1.
  • #2,459
  • Jan 19, 2013 8:28am Jan 19, 2013 8:28am
Thanks for the tips on my last post!

This weekend I have studied the thread a little bit more and came up with the following paramters to select A+ trades on 4h charts:
- Price is relative close to the MA
- Price has retraced from a previous high/low
- Price has room to reach the TP (no big S/R levels or big round numbers in the way)
- The signal candle reacts of support (big S/R levels or big round numbers)
- Very large engulfing bars are not likely to continue
- No news trades
- Watch out for friday afternoon

Do you guys use any other paramters to make your decisions?

Have a nice weekend!
  • #2,460
  • Jan 19, 2013 8:32am Jan 19, 2013 8:32am
Very good post California!
The excersise you suggest looks like a very usefull one, will try it tonight or tomorrow.
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