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Simple, Non-subjective, Consistent, Effective

  • #21
  • Dec 26, 2013 4:33pm Dec 26, 2013 4:33pm
hi Ap3,

Just started reading ur thread and indeed it is simple and easy to follow...i was looking at Eur/Usd on 1hr chart and wanted to clarify a few things if u could spare me a few minutes.....i managed to find a bullish Engulfing bar breaking the previous daily high(marked with an arrow), price was above daily open and above 50ema, i thought of entering long on the retest bar which happened to be the next bar...could please have a look and advice me if i am doing something wrong.....chart attached


Regards

Dennis
Attached Image (click to enlarge)
Click to Enlarge Name: eurusd.png Size: 157 KB
  • #22
  • Edited 9:56pm Dec 26, 2013 9:02pm | Edited 9:56pm
Quoting dennis4u15
hi Ap3, Just started reading ur thread and indeed it is simple and easy to follow...i was looking at Eur/Usd on 1hr chart and wanted to clarify a few things if u could spare me a few minutes.. {image}
I'm personally not trading until the new year or when things start to pick up. Volume is thin and price action mostly choppy. I don't trust any signals this time of year.

But yes, that is essentially what to look for. That could've been a potential signal to add to the 'stack.' Price was above daily open and broke previous day's high. That is a good sign for more upward directional bias. A couple things to take into account:

1. The size of the signal engulfing bar in relation to the engulfing bars around it. Is the signal engulf significantly smaller than some of the recent engulfs? Is it significantly bigger? In general, are the upward engulfs bigger than the downward engulfs? Do upward engulfs outnumber downward engulfs? The other way around? (Ask yourselves these questions)

2. It is not wise to blindly take all H1 engulfs (not implying you did). What is happening on the H4 and D1 chart in relation to the H1?

Also, you mentioned a 50ema. Is that something you like to trade or are adding as a filter? This strategy uses no indicators and no MAs.

Attached Image (click to enlarge)
Click to Enlarge Name: eu h1 stack.png Size: 38 KB

From the screen shot, you could've potentially added two positions to your long stack, noted by yellow arrows. The first signal was a little iffy, the second much more dominant. This is what I mean by the size of the signal compared to the recent rest. Price shot up a bit after the second signal. The yellow horizontal lines indicate potential stop areas, one more conservative than the other.

But with all that said, in my personal opinion I would not trade over the holidays. Enjoy your free time, family, and friends. Plus, it's always good to take a break from trading and the screens every now and then. You come back with fresh eyes and renewed inspiration. Some of my best trading and most memorable insights have come after taking a couple weeks off, or even a couple months.
  • #23
  • Dec 26, 2013 9:24pm Dec 26, 2013 9:24pm
Hi Ap3,

Thank you heaps for the reply...yes the second signal looked much better with more confirmation in terms of the size of the engulf...i just use the EMA to look for trend...if price is above it then i look for buys and opposite for sells....at times it does get choppy so i try to stay out but as u have said the highs and lows r more than enough...i will definitely look for the size of engulfs in the surrounding area and also the direction of the engulfs....i did not know much about stacking as i am new but yeh its a good way to maximise profits...i am learning slowly and i am looking forward to ur posts and ur guidance. Once again thank you for taking ur time out to help out..


Regards

Dennis
  • #24
  • Edited Dec 27, 2013 2:59am Dec 26, 2013 9:41pm | Edited Dec 27, 2013 2:59am
Quoting dennis4u15
Hi Ap3, Thank you heaps for the reply...yes the second signal looked much better with more confirmation in terms of the size of the engulf...
Stacking is a key component to the strategy for maximizing profits when price really starts trending. You can never really 'know' which signals will turn out to be homeruns and which will be duds. The best we can do is put ourselves on the right side of the probabilities. Stacking will increase profits exponentially when things are going well, and it will give you confidence through a string of losers.

First, start to break yourself away from the 'one trade in, one trade out' mindset. Start thinking in terms of 'multiple trades in, all out at once.'
  • #25
  • Dec 27, 2013 1:54am Dec 27, 2013 1:54am
Attached Image (click to enlarge)
Click to Enlarge Name: gj h1 stacking.png Size: 28 KB


This is a perfect visual example of how stacking works, and should've been the screenshot used in post 1. In the last 2-3 days there were potentially 5 stacking signals on the GJ H1 chart so far. All signals triggered above their respective daily opens, and all triggered on the next candle. The only exception is signal #3, which I would consider more of a 2-bar engulf pattern (the yellow arrow being on bar 2). Price has also recently broken its previous weekly high, while also breaking previous day's high at least the last 3 days in a row. Both are excellent indications of further upward bias.

Take note of the Multi-meter in the top right corner. H1 through MN1 are all up relative to their current opens. If you had taken any or all of these signals, there would be absolutely no reason to exit any of them at this point. Quite the opposite. You'd be looking to stack as many valid positions in this direction as you can, until the market proves your positions wrong.

You are also looking to do this on the H4 chart at the same time, in the same direction. Stack H4 and H1 together. Be more selective on the H1 signals.

As mentioned before, I personally don't recommend trading over the holidays.
  • #26
  • Dec 27, 2013 2:18am Dec 27, 2013 2:18am
hi Ap3,

i was going through the aud/usd 4 hr chart and identified a bullish engulfing bar which was in the direction of the trend but it did not really work out....i was just trying a paper trade as u mentioned that its not a very gd time to place trades...it did break the open day price and as stated was in the direction of the trend....could u please have a look....i have attached the chart...

regards

dennis
Attached Image (click to enlarge)
Click to Enlarge Name: audusd.png Size: 165 KB
  • #27
  • Dec 27, 2013 2:38am Dec 27, 2013 2:38am
Quoting dennis4u15
hi Ap3, i was going through the aud/usd 4 hr chart and identified a bullish engulfing bar which was in the direction of the trend but it did not really work out
Attached Image (click to enlarge)
Click to Enlarge Name: 122713 au h4.png Size: 31 KB
  • #28
  • Dec 27, 2013 2:39am Dec 27, 2013 2:39am
Quoting dennis4u15
hi Ap3, i was going through the aud/usd 4 hr chart and identified a bullish engulfing bar which was in the direction of the trend but it did not really work out....i was just trying a paper trade as u mentioned that its not a very gd time to place trades...it did break the open day price and as stated was in the direction of the trend....could u please have a look....i have attached the chart... regards dennis {image}
IMO The trade you marked with a red arrow didn't trigger on the next candle so you need to delete it.

Just my 2 cents
  • #29
  • Dec 27, 2013 3:25am Dec 27, 2013 3:25am
This indicator can be useful for you ... ups and downs in any tf
Attached Image (click to enlarge)
Click to Enlarge Name: eurjpyh4-.-.-.png Size: 57 KB
Attached File(s)
File Type: ex4 _MTF_High_Low.ex4   3 KB | 936 downloads
  • #30
  • Dec 27, 2013 3:40am Dec 27, 2013 3:40am
Quoting porfirio
This indicator can be useful for you ... ups and downs in any tf {image} {file}
Clean charts only please. And this indicator is the exact same one already in Post #5. Thank you.
  • #31
  • Dec 27, 2013 4:05am Dec 27, 2013 4:05am
nice post AP3!

and glad it attracted 60mm's attention

Happy new years to you both!

I like this strategy as much as I like 60mm's, and I would say you got some additional seasoning, stacking while moving existing positions to BE, very similar to pipsEASY's idea in his great thread, Building an equity millipede, http://www.forexfactory.com/showthread.php?t=245149

I have a very similar strategy, good to see like minded traders around.
  • #32
  • Dec 27, 2013 4:31am Dec 27, 2013 4:31am
Quoting zxdtrader
nice post AP3! and glad it attracted 60mm's attention Happy new years to you both!
Thank you zxdtrader, and same to you. Yes, Millipede is another fantastic thread. There is a reason it's in the top ten all-time viewed system threads on Forex Factory. Over 2.3 million views. If you've never heard of the thread, it's worth a glance.
  • #33
  • Dec 27, 2013 5:44am Dec 27, 2013 5:44am
Some examples of recent H4 signals and stacking...

Attached Image (click to enlarge)
Click to Enlarge Name: 122713 uchf h4 engulf.png Size: 38 KB


Attached Image (click to enlarge)
Click to Enlarge Name: 122713 gu h4 stacking.png Size: 37 KB


Attached Image (click to enlarge)
Click to Enlarge Name: 122713 ej h4 stacking.png Size: 31 KB
  • #34
  • Dec 27, 2013 9:00am Dec 27, 2013 9:00am
Quoting Ap3
{quote} You don't 'need' the indicator. These levels are easily identifiable and require no discretion. They take but a few minutes to go through and draw them for multiple pairs. In fact, if you consider yourself newer in the game, I would strongly suggest you do manually draw them for awhile. This will greatly focus your attention on the overall big picture, and put your signals into better context. You will start to internalize and see price in relation to the bigger picture, and signals in relation to price. Then after awhile you won't need...
here one version of the same indicator without disturbing labels
Attached File(s)
File Type: ex4 #Daily-Weekly-Monthly Hi-Low.ex4   12 KB | 815 downloads
File Type: mq4 #Daily-Weekly-Monthly Hi-Low.mq4   17 KB | 1,034 downloads
  • #35
  • Dec 27, 2013 9:02am Dec 27, 2013 9:02am
Ap3, do you exit all trades in case of opposite engulfing ?

I think I saw this rule somewhere in one of your posts but can't find it now !!!
MT4/MT5 EAs/Indicators/Alerts coder
  • #36
  • Dec 27, 2013 2:46pm Dec 27, 2013 2:46pm
Quoting tmg
{quote} here one version of the same indicator without disturbing labels {file} {file}
Thanks tmg, that's a big help. I'm all for de-cluttering the charts as much as possible.
  • #37
  • Dec 27, 2013 2:52pm Dec 27, 2013 2:52pm
Quoting FerruFx
Ap3, do you exit all trades in case of opposite engulfing ? I think I saw this rule somewhere in one of your posts but can't find it now !!!
The original screenshot example in the first post had an engulfing bar exit, but that was just coincidence. I edited the example to show how stacking works. Exits do not have to be engulfing bars in the opposite direction. Just make sure you're not taking profit anything below 2:1RR. There should only be three potential results to a trade. Stop out, flat, or 2:1RR and above.
  • #38
  • Dec 27, 2013 3:13pm Dec 27, 2013 3:13pm
Hey Ap3, What pairs will we trade? Just majors or also cross pairs?
  • #39
  • Edited 3:48pm Dec 27, 2013 3:32pm | Edited 3:48pm
Quoting lucariga
Hey Ap3, What pairs will we trade? Just majors or also cross pairs?
Trade whatever pairs you want. Doesn't matter the chart, these signals 'mean' the same thing. A dominant H4 engulf means that for essentially half of a trading session, one side completely swallowed previous price action in the opposite direction. This carries weight. This is why anything below H1 is irrelevant. Team that with directional bias (above or below previous monthly, weekly, daily high/low), and you're in business.
  • #40
  • Dec 27, 2013 5:22pm Dec 27, 2013 5:22pm
Quoting Ap3
{quote} The original screenshot example in the first post had an engulfing bar exit, but that was just coincidence.
Fine ... thank you.
MT4/MT5 EAs/Indicators/Alerts coder
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