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LFB System - London Fib Breakout

  • #21
  • Apr 29, 2013 3:58am Apr 29, 2013 3:58am
LONG GU from 1.5527.
  • #22
  • Apr 29, 2013 4:05am Apr 29, 2013 4:05am
Quoting pasopvirpot
LONG GU from 1.5527.
Same here but am not sure where should set the S/L?
  • #23
  • Apr 29, 2013 4:16am Apr 29, 2013 4:16am
What about SL?
  • #24
  • Apr 29, 2013 4:26am Apr 29, 2013 4:26am
Good simple system! Do u enter two candles after retracement or two candles after the break of the limit lines? What do you use to measure that price has retraced enough? Thanks for your quick reply!
I am more afraid of 100 sheep led by a lion than 100 lions led by a sheep!
  • #25
  • Apr 29, 2013 4:28am Apr 29, 2013 4:28am
Quoting sam2vt
{quote} Same here but am not sure where should set the S/L?
Just read the system description, SL is the close of a 30min candle below the range. I have just set a hard SL 30 pips below the range but you will have to watch the price now.
  • #26
  • Apr 29, 2013 4:50am Apr 29, 2013 4:50am
Quoting PIP Guru
Ideal Setup
http://www.forexfactory.com/attachme...1&d=1367181856
Where to place SL ?

In your instructions it says:
Quote
Stop loss will be close of candle on the opposite side, ie below lower limit for uptrend and vice versa.
On your ideal Setup screenshot there is no close of candle on the opposite side.
The lowest low of the 10 hours before London Open is the bottom of the range.

To which "close of candle on the opposite side" do you refer then ?

Is it the close of the first candle which broke the upper line and closed above that line ?
Would you take the low of that breakout candle as SL ?
  • #27
  • Apr 29, 2013 4:57am Apr 29, 2013 4:57am
Quoting pasopvirpot
{quote} Just read the system description, SL is the close of a 30min candle below the range. I have just set a hard SL 30 pips below the range but you will have to watch the price now.
So we have to consantly monitor the charts to exit the trade? Isn't there a fixed SL to place on trade entry?
  • #28
  • Apr 29, 2013 5:00am Apr 29, 2013 5:00am
Quoting pasopvirpot
{quote} Just read the system description, SL is the close of a 30min candle below the range. I have just set a hard SL 30 pips below the range but you will have to watch the price now.
That is your personal interpretation of the instructions.
But the instructions leave much room for different interpretations.
That´s why several members ask for clarification.
  • #29
  • Apr 29, 2013 6:52am Apr 29, 2013 6:52am
Quoting fxtr51
{quote} That is your personal interpretation of the instructions. But the instructions leave much room for different interpretations. That´s why several members ask for clarification.
No problem, lets wait for PipGuru to clarify then.
  • #30
  • Apr 29, 2013 8:11am Apr 29, 2013 8:11am
Quoting pasopvirpot
{quote} Just read the system description, SL is the close of a 30min candle below the range. I have just set a hard SL 30 pips below the range but you will have to watch the price now.
Agreed. It's clear from the description.
  • #31
  • Apr 29, 2013 9:33am Apr 29, 2013 9:33am
Quoting sidefx
{quote} Agreed. It's clear from the description.
I understand.
So then there is no SL at all because nobody on earth is able to predict on what price a 30 min candle will close on the other side of the range.
You would have to watch the trade all the time in order to catch that candle close according to the description.
Not the best thing to do. You have to be glued to the screen or use an alert which is telling you that price
went against your position and now has crossed the opposite range-line.

Or in other words: place the SL where you feel it might be best to place it.
No rule at all except it should be beyond the opposite range line.

Next question to the thread starter would be:
What risk do you take for a trade ( based on what SL distance from Entry ? ) if there is no SL known ?
  • #32
  • Apr 29, 2013 9:36am Apr 29, 2013 9:36am
This system will work no matter how does the market behave. In my experience, if your setup is based on indicators to time entry and exit, then the system would not perform good result sometimes, because it is lagging indeed. Indicator has it limitation after I did some test. By using optimal setting is not working in future due to market is ever changing.

Until I noticed that if you trade pattern or formation, you can get better result, such as this thread system, Elliott wave, Yesterday high and low, and etc. Even if market is ever changing, the pattern is not changed, but the distant/range is changed. I think you know what I am talking about.

Some indicators are the leading indicators, such as pivot point, market profile, Fibonacci tools, and etc. So these indicators are good to time your target, I have noticed many traders use these. Meanwhile these indicators are also acting a pattern too. That is why it works, like price will retrace at Fibonacci 50% and 61.8%. Honestly, I did this analysis before, so the data shock me, because it is amazing that the price would retrace at these Fibonacci level as well as the important support resistance level.

Another good breakout that I think of, is H4 range bar breakout, which is similar to this system, and it is simple. By using previous H4 high and low bar to time your entry, if you watch the chart, you will know what I am trying to say.

Alright, I am just to give my opinion and experience. And I would like to see more of this thread, as well as other thread that is related to a system that based on certain patterns. Personally I am doing the analysis of different patterns, in order to know which area or price is repeated/happened frequently.

Thanks.
  • #33
  • Apr 29, 2013 9:43am Apr 29, 2013 9:43am
Quoting fxtr51
{quote} I understand. So then there is no SL at all because nobody on earth is able to predict on what price a 30 min candle will close on the other side of the range. You would have to watch the trade all the time in order to catch that candle close according to the description. Not the best thing to do. You have to be glued to the screen or use an alert which is telling you that price went against your position and now has crossed the opposite range-line.
Precisely - unlike many break-out strategies this isn't totally set and forget! It won't suit those who can't monitor their trades every 30 minutes.

I used to trade break-out strategies for a living and it ain't easy psychologically - most BO's have excellent runs (some even into years), followed by awful drawdown periods. Newbies, be warned.
  • #34
  • Apr 29, 2013 10:13am Apr 29, 2013 10:13am
Quoting sidefx
{quote} Precisely - unlike many break-out strategies this isn't totally set and forget! It won't suit those who can't monitor their trades every 30 minutes. I used to trade break-out strategies for a living and it ain't easy psychologically - most BO's have excellent runs (some even into years), followed by awful drawdown periods. Newbies, be warned.
It depends on what kind of breakout does not work. I think if the system is based on certain pattern, it works. Like breakout at horizontal support and resistance for pattern (wave, head and shoulder, triangle and etc) is more logical and valid.

To add, non pattern based breakout is relative to market volatility. London breakout does not work forever, it work well when price happens at the right time and right scenario after i did some test.
  • #35
  • Apr 29, 2013 10:53am Apr 29, 2013 10:53am
Quoting ~bull.bear~
{quote} It depends on what kind of breakout does not work. I think if the system is based on certain pattern, it works. Like breakout at horizontal support and resistance for pattern (wave, head and shoulder, triangle and etc) is more logical and valid. To add, non pattern based breakout is relative to market volatility. London breakout does not work forever, it work well when price happens at the right time and right scenario after i did some test.
..sure, i'm commenting on the type of breakouts detailed in this thread. Volatility expansion breakouts, despite the acknowledgement to prevailing conditions, still have similar drawdown characteristics.
  • #36
  • Apr 29, 2013 5:51pm Apr 29, 2013 5:51pm
I've backtested this system for this month with a tighter SL (at 50% fibo) to have a better R:R and the results was great.

-TF 30 min EURUSD and GBPUSD
-2 orders: 1 buy at asian session's high and 1 sell at asian session's low (on breakout without waiting for the pullback)
-SL 50% fibo; TP -100% fibo
-R:R fixed to 1:2 and no trailing stop.

Just set and forget
  • #37
  • Apr 30, 2013 4:56am Apr 30, 2013 4:56am
Yesterday's Trade went to loss in GU as i did not want to wait for the trade to run today. so i closed in loss. I have also attached my trade explorer to the thread so you can monitor the systems growth.

Started to add EJ to the system which already is good with EU and GU

Cheers,
PIP GURU
Wait for the market to come to you.. then take the green pips..
  • #38
  • Apr 30, 2013 5:16am Apr 30, 2013 5:16am
Quoting PIP Guru
Yesterday's Trade went to loss in GU as i did not want to wait for the trade to run today. so i closed in loss. I have also attached my trade explorer to the thread so you can monitor the systems growth. Started to add EJ to the system which already is good with EU and GU Cheers, PIP GURU
Thanks for adding the Trade Explorer - looks great at the moment! The closing of open trades at the end of the day, can this be added as a rule or are you just using discretion?
  • #39
  • Apr 30, 2013 5:31am Apr 30, 2013 5:31am
Quoting pasopvirpot
{quote} Thanks for adding the Trade Explorer - looks great at the moment! The closing of open trades at the end of the day, can this be added as a rule or are you just using discretion?
This is my discretion, these are finer points i learned with the system. Trade from London start to 4 hrs in to Newyork. if you want to stick to the rules, yesterdays GU trade is still on with small loss.

You could get used to the system as you roll on.
Wait for the market to come to you.. then take the green pips..
  • #40
  • Apr 30, 2013 10:15am Apr 30, 2013 10:15am
Isn't it ironic that the day one adds a trade explorer the market decided to mess up your chart
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