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H1 Backlash

  • #21
  • Edited 2:07pm Dec 9, 2013 12:21pm | Edited 2:07pm
Seems you've semi stumbled across a method of trading that i use on the 4h.

Maybe a look at what i do may reaffirm or add some ideas to your plan.


Pairs traded are all combinations of the Eur, Usd, Jpy, Gbp, Aud, Nzd, and Chf.

I do a quick look at all combinations of a single pair to see if there are any trends to trade in that direction. The definition of trend i use is 2 or more consecutive high or low breaks in the same direction. Europe could be under attack by technologically advanced aliens and US could be allies of those aliens but if the EU shows 2 consecutive breaks up then for me the trend is up.

The setup is just as you have it there plus i require that the move doing the pushing up or down through a recent high or low be large in comparison to the last couple. I will not trade into channel high/lows.

Stops: The highest value of ATR(36) with SMA (36) for the last 2 weeks
Target: A channel high/low or 2x stop

I may take a look at the recent news concerning some pairs but it's never an in depth study. Thats the gist of it.

Basically, the goal is to try to gauge the level of strength for each individual currency, trade pull backs on what i beleive is likely to succeed and tp into or before channel high/lows or into space.
  • #22
  • Dec 9, 2013 8:41pm Dec 9, 2013 8:41pm
Quoting Good Lookin
Seems you've semi stumbled across a method of trading that i use on the 4h.
Could you answer a few questions in relation to your method:

How long have you been trading the setup?
How many opportunities do you find a week?
Approximately how many trades have you made using your system?
Do you find much of a difference between the profitability of some pairs over others?


Cheers mate.
Enter Signature
  • #23
  • Dec 9, 2013 8:45pm Dec 9, 2013 8:45pm
Quoting Good Lookin
Seems you've semi stumbled across a method of trading that i use on the 4h. Maybe a look at what i do may reaffirm or add some ideas to your plan. Pairs traded are all combinations of the Eur, Usd, Jpy, Gbp, Aud, Nzd, and Chf. I do a quick look at all combinations of a single pair to see if there are any trends to trade in that direction. The definition of trend i use is 2 or more consecutive high or low breaks in the same direction. Europe could be under attack by technologically advanced aliens and US could be allies of those aliens but if the...
++++++++++++++++++++++++++++++++


Thanks for your input GL. Not sure I understand the synopsized version of what you're doing though.


It could be ADD or some such other modern day disease I suffer from. I look only to make this process as simple as possible. Pairs that have a spotty track record, simply don't make the cut for me. H4 UJ & GA have moderate & poor performance overall, so for now I stick with which pairs have a satisfactory record, EU, GU, & non summer EG. More to come.
  • #24
  • Dec 9, 2013 9:39pm Dec 9, 2013 9:39pm
Quoting Sarythsaya
{quote} Could you answer a few questions in relation to your method: How long have you been trading the setup? How many opportunities do you find a week? Approximately how many trades have you made using your system? Do you find much of a difference between the profitability of some pairs over others? Cheers mate.
++++++++++++++++++++++++++++++++


Hi S. Right now I would trade only 3 pairs. GU, EU & EG. EG does not look good for summer so would not use it during June, July & August.


Pairs that don't work on H4 are UJ & GA.


As I check other pairs I will update here.


The pairs that look good provide slightly less then 2 trades weekly each.


I have no live trades at this time. Back testing a method like this has very few variables since I'm just looking at bar highs & lows. With the tested pairs I see very little room for improvement or for slippage, except for spiking of spreads. The pairs I've mentioned have a minimum 3p profit for each 1p loss. The live edge of trading can always present some surprises which is also why I changed up from H1 to H4 and changed Reward to Risk from 1:1 to 2:1.


If you go to any year on GU H4 chart you will find consistent winners. The stats on GU show a return of 4p winnings to each 1p loss.


Darryl
  • #25
  • Dec 9, 2013 10:50pm Dec 9, 2013 10:50pm
Quoting Sarythsaya
{quote} Could you answer a few questions in relation to your method: How long have you been trading the setup? How many opportunities do you find a week? Approximately how many trades have you made using your system? Do you find much of a difference between the profitability of some pairs over others? Cheers mate.
How long have you been trading the setup?
Early September of this year i started trading this way specifically. I was trading slightly different before September (using an sma to gauge trend on the 1h, finding entries on the 15/5 min instead.) The only reason i changed over to taking entries from the 4h chart in this manner was a lack of availability to take trades during the day.

How many opportunities do you find a week?
7-15. Most pairs are correlated in some manner and the same move will prompt setups across different cross pairs of a single currency. I do not take them all and i mostly try to avoid trading the same move. This results in 1-3 trades per week.

Approximately how many trades have you made using your system?
37 Live, way too many forex tester. I've also tested this demo since January with 96 trades.

Do you find much of a difference between the profitability of some pairs over others?
Definately. EurChf has been giving more setups while the EurUsd has not. Go figure. I also find myself considering the aud and gbp crosses a lot.
  • #26
  • Dec 10, 2013 9:00am Dec 10, 2013 9:00am
Quoting diamonddbw
{quote} ++++++++++++++++++++++++++++++++ Thanks for your input GL. Not sure I understand the synopsized version of what you're doing though. It could be ADD or some such other modern day disease I suffer from. I look only to make this process as simple as possible. Pairs that have a spotty track record, simply don't make the cut for me. H4 UJ & GA have moderate & poor performance overall, so for now I stick with which pairs have a satisfactory record, EU, GU, & non summer EG. More to come.
Here's an example GN from last night.
Attached Image (click to enlarge)
Click to Enlarge Name: GN 13-12-09.PNG Size: 155 KB


Here's an example of a correlated trade. I saw this one 1st but decided the GN trade is more attractive.
Attached Image (click to enlarge)
Click to Enlarge Name: GChf 13-12-09.PNG Size: 151 KB
  • #27
  • Dec 10, 2013 10:10am Dec 10, 2013 10:10am
On GU I'm using a 3 pip cushion for entry. In other words, with H4 swing price @ 1.6403, my pending order is set 3p above this level (1.6406) to allow for spread spikes and broker chart variations.

GU Buy Set Up:
Attached Image (click to enlarge)
Click to Enlarge Name: GU Buy Set Up 12-10-13.png Size: 20 KB
  • #28
  • Dec 10, 2013 10:50am Dec 10, 2013 10:50am
Quoting Good Lookin
{quote} Here's an example GN from last night. {image} Here's an example of a correlated trade. I saw this one 1st but decided the GN trade is more attractive. {image}
++++++++++++++++++++++++++++++++


GL, thanks for the charts. My first question is how you are determining break levels.


On GN Chart (below) I've marked level 2 according to how I see level 1 being marked. Would you please explain why that is not your choice for level 2?
Attached Image (click to enlarge)
Click to Enlarge Name: GL Question 1.png Size: 143 KB
  • #29
  • Dec 10, 2013 12:45pm Dec 10, 2013 12:45pm
Quoting diamonddbw
{quote} ++++++++++++++++++++++++++++++++ GL, thanks for the charts. My first question is how you are determining break levels. On GN Chart (below) I've marked level 2 according to how I see level 1 being marked. Would you please explain why that is not your choice for level 2? {image}
Good question.

When i consider SR i tend to look towards the most recent highs and lows as my experience has shown me over the years. I also draw lines just as you have at point 2 but i wouldn't use that as the decision maker. Let me walk you through my thinking process on that entry.

Attached Image (click to enlarge)
Click to Enlarge Name: GL 20Question 201 - Answer.PNG Size: 125 KB


a. Price makes a new high, retraces a bit, then proceeds to strongly break above it.
Normally the return to point a would be an entry but that was a holiday.

b. After breaking above point a price strongly retraces to point b but does not close below.
Point a and point b are not next to each other. At this point i disregard point a and only focus on point b.

c. Price retested the new high and then proceeded to close below and channel next to point b.
Price broke below point b but then channeled around it. The low of this channel coincides with the low of point a signaling me that it needs to break this low. At this point i disregard point b. Also, when i see the channel high of point c match up with point a then i consider that specific sr line broken and i count it as break 1.

d. Price cleanly breaks below point c.
The break of point c was clean and normally would be considered for entry but no entry for me for two simple reasons.
One, I usually take most of my entries at between 23:00 est and 00:00 est. This move happened between 4:00 and 20:00.
Two, i prefer to see a strong break and then a sustained low and not a spike low.

e. Price makes back to the channel highs of point c and proceeds to channel a bit before revisiting the new low at point d.
Another clean break but it's a break of point e into the low of point d on the day before NFP.

f. Price bounces off point d only to turn around and break point f cleanly and strongly.
Cleanest, strongest break of the bunch and it has a sustained low. Not to mention it's break 2. Now i enter.


Usually there are 2 or more correlated pairs showing a trade from the same move. I do this type of "analysis" in order to choose which pair to enter. I won't take an entry on any if i don't like what i see.
  • #30
  • Dec 10, 2013 8:08pm Dec 10, 2013 8:08pm
Quoting Good Lookin
{quote} Good question. When i consider SR i tend to look towards the most recent highs and lows as my experience has shown me over the years. I also draw lines just as you have at point 2 but i wouldn't use that as the decision maker. Let me walk you through my thinking process on that entry. {image} a. Price makes a new high, retraces a bit, then proceeds to strongly break above it. Normally the return to point a would be an entry but that was a holiday. b. After breaking above point a price strongly retraces to point b but does not close below....
++++++++++++++++++++++++++++++++


Thanks for indepth analysis.
  • #31
  • Dec 17, 2013 9:10am Dec 17, 2013 9:10am
Update on the previously posted trade:
Attached Image (click to enlarge)
Click to Enlarge Name: GN 13-12-09 Updated 13-12-17.PNG Size: 144 KB


What happened to this thread?
  • #32
  • Dec 18, 2013 12:31pm Dec 18, 2013 12:31pm
Quoting Good Lookin
Update on the previously posted trade: {image} What happened to this thread?
++++++++++++++++++++++++++++++++


For now, I'm primarily only trading GU. Here's what's happened so far this week:
Attached Image (click to enlarge)
Click to Enlarge Name: GU 12-18-13.png Size: 21 KB
  • #33
  • Dec 19, 2013 10:15am Dec 19, 2013 10:15am
Current GU H4 trade.

I actually had 3 levels to choose from so picked the one in the middle since GU has been mostly bearish since fomc.

My stop is slightly more then 50p because of break out area from Wednesday.

Stop goes to:

• -40 @ +25

• BE @ +40

• +15 @ +50

• + 35 @ + 70 and a 35p trailing stop to target of 100.

Attached Image (click to enlarge)
Click to Enlarge Name: GU 12-19-13.jpg Size: 48 KB
  • #34
  • Dec 19, 2013 11:17am Dec 19, 2013 11:17am
GU Trade Update:

This is M15 (I use M15 to manage trades)

Stop is now at BE +1. Trade has moved nicely and I only had a 8p drawdown.

I just moved the stop to BE slightly ahead of guidelines for the following reason;
• Price has almost reached London session highs. (Yellow Line)
• Was within 5p of Wednesday London Close. (Red Line)
• Was within 7p of Asia High. (Orange Line)
• Was within 10p of Current Daily High.
• Was slightly above Daily pivot based on NY hours. (Pink Dashed Line)

In other words a confluence of reasons for price to stall or retrace.

At +50 I will move stop up to +15
Attached Image (click to enlarge)
Click to Enlarge Name: GU 12-19-13a.jpg Size: 79 KB
  • #35
  • Dec 20, 2013 8:27am Dec 20, 2013 8:27am
GU Trade out @ 1.6350 BE
  • #36
  • Dec 27, 2013 9:52am Dec 27, 2013 9:52am
Price was to choppy & broken up for trading this week, so here is review for last week.

First entry was a 40p loss. Trade was in profit 25p so moved stop to -40 and it was hit.

In the future, once price has gone to +25 I will move stop to -25. It just seems to make more sense.
Attached Image (click to enlarge)
Click to Enlarge Name: GU 12-18-13a.png Size: 23 KB
  • #37
  • Dec 27, 2013 9:56am Dec 27, 2013 9:56am
The second entry on swing high was a BE trade. Price barely traveled to +36 where stop was moved to BE slightly ahead of time because of confluence of several factors listed in post #34 above.
Attached Image (click to enlarge)
Click to Enlarge Name: GU 12-18-13b.png Size: 16 KB
  • #38
  • Last Post: Dec 27, 2013 10:02am Dec 27, 2013 10:02am
The third entry was actually the 1st one to trigger on a news day. But you had to be quick to get in if you didn't set a limit order. It was good for the full win.

Since entries are 3p from actual level a full full would be +97.
Attached Image (click to enlarge)
Click to Enlarge Name: GU 12-18-13c.png Size: 19 KB
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