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Sonic R. System

  • #65,441
  • Edited 8:12pm Feb 10, 2014 7:52pm | Edited 8:12pm
I think the readers here will really appreciate if more comments about when to cut losses and when to exit losing positions can be given. I don't see any risk management except: "use small lots" which in itself doesn't solve the problem if the market keeps moving against you.

The size of the loss is the only thing traders can really control, so would really appreciate more sharing on how to manage losses, cut losses, exit losing positions based on PVRSA instead of keep adding because "it's just MM accumulating orders."

Taking a loss is always painful, but that doesn't mean we should avoid talking about it because the alternative is worse.

Me personally, I have went down that path of putting on small positions. It works, but only if you have a super large account and you are using super small lots. You can do well if you filter your entries to only take trades that align with the 4H trend, and to cut losses once these trends end, but I guess that is not the PVRSA way. But you know what works better, actually predefining your losses/risk and trading classic set-ups with maybe 1 or 2 scouts with SL. I just think it's time to stop pretending that the price risk (i.e. a move against you that could potentially margin call you) isn't there, because it is very real.

I believe if we put our minds to it we can finds creative ways to use PVRSA to manage losses very effectively, and get out losing positions before they grow large + protect profits before they disappear, because let's face it, making money is darn easy, any idiot can make a winning trade, it is keeping it that is hard.

Please think about this; let's not leave it to luck.

just some honest thoughts and hope that everyone here can really do well.
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  • #65,442
  • Edited 9:03pm Feb 10, 2014 8:26pm | Edited 9:03pm
Quoting shellsnail
I think the readers here will really appreciate if more comments about when to cut losses and when to exit losing positions can be given. I don't see any risk management except: "use small lots" which in itself doesn't solve the problem if the market keeps moving against you. The size of the loss is the only thing traders can really control, so would really appreciate more sharing on how to manage losses, cut losses, exit losing positions based on PVRSA instead of keep adding because "it's just MM accumulating orders." Taking a loss is always painful,...
Personally everytime I enter a trade on a specific currency pair I will allow for my maximum drawdown on that trade to be between 1-3%. Of course how much I can afford for price to move against me depends on how many positions I put on. I feel comfortable however doing it this way since can I avoid blowing my whole account on a single trade gone wrong. I think its crucial if something goes so wrong its best to just accept it and move on to the next trade..Always more opportunities. In addition, the market is always changing which is why I like to have an overall view of what PVSRA is indicating on the larger TFs to give me an idea of if my M15 analysis for entering still is on a sound overall basis. Basically all in all, my main message I am trying to get across is I use PVSRA on the larger TFs to give me a clearer picture of what is happening overall so that M15 entries are valid and do my best to allow my position building not to exceed 3%. This of course is just me and how I do things. I'm still relatively new on position building and things can change over time with more experience.
  • #65,443
  • Edited 9:01pm Feb 10, 2014 8:27pm | Edited 9:01pm
I think it's great that TAH is very honest about the system's shortcomings, as he posts his own results for all to see - there's a lot we can learn from his stats.

These are stats taken from Prof TAH's trading records.

This was his largest weekly gain:

Week ending 07/12
14,143 pips gained, 11 trades totaling 125 parts (115 parts winners), averaging 113+ pips per each of all parts

Largest weekly loss:

Week ending 09/20
64,268 pips lost, 8 trades totaling 107 parts (6 parts winners), averaging -600 pips per each of all parts

2nd largest loss:

Week ending 10/18
19,611 pips lost, 6 trades affected, 76 parts involved (14 parts gain, 62 parts lose), averaging -213 pips per each of all parts

3rd largest:

Week ending 10/25
14,401 pips lost, 8 trades affected, 77 parts involved (0 parts gain, 77 parts lose), averaging -66 pips per each of all parts

So the largest weekly gain is smaller than the 3rd largest loss. If the largest loss is 65k pips, I would imagine the largest drawdown is probably even larger - so before you decide to trade this way, please think about whether your account is large enough to sustain a 65k pip drawdown and survive?

His average weekly gain is at slightly 963 pips. As a percentage of his largest loss that is = 963/65,000 = 1.4%

An analogous system will be one with a largest drawdown 50% of your account that makes 0.7% per week, requires you to trade everyday at the charts, and requires a minimum account balance of 15,000USD (using 0.01 lots) to trade, make 36% uncompounded p.a., with a hidden black swan risk where you may be wiped out with a margin call. Will you trade that system? (well if you had 150,000 you can trade with 5% drawdown (quite safe) to make 3.64% p.a. just enough to cover inflation )

To me these are data-points that should be considered before jumping into any system. So my question here is, are we trading here to have fun, make punts about the market, speculate about what MM is doing (when in fact MM is sell side and don't take on large positions) or are we here to actually practice using a good system, use good risk management and make money?

Classic Sonic R, with an occasional scout entry with SL is a great system (with PVRSA/Technical analysis to guide the scout entry and to analyse the higher time frame context and 1min action), please learn how to use it and apply proper risk management! Don't get it mixed up with this system above which is clearly not Sonic R.

Now you may say this is just one example of the system in action, and that you are more talented and will do better than this - well then go ahead and try.

Take care.
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  • #65,444
  • Edited 9:41pm Feb 10, 2014 9:04pm | Edited 9:41pm
Quoting SaiLyfee
{quote} Personally everytime I enter a trade on a specific currency pair I will allow for my maximum drawdown on that trade to be between 1-3%. Of course how much I can afford for price to move against me depends on how many positions I put on. I feel comfortable however doing it this way since can I avoid blowing my whole account on a single trade gone wrong. I think its crucial if something goes so wrong its best to just accept it and move on to the next trade..Always more opportunities. In addition, the market is always changing which is why...
Hey this is great. I like your approach of setting a fixed risk per trade and not deviating from it. For me I just enter on the shorter time frames with a 15-20 pip hard stop, and a mental stop of around 7-10pips (i like to close trades at small losses/breakeven if I don't see them working). A lot of my trades on the shorter time frames are scalps, but I turn some of them into intra-day trades, like the GJ one I showed earlier, if I see that they are good entry points. To do that I just scale in with a larger lot and use a trailing stop or fixed SL based on S/R -> this is typically the classic sonic R entry.

~~~~

Thought experiment.

Suppose you actually learn Sonic R and you manage to get a 50% win rate with 1:1.5 RR. Risking 1% per trade and making 5 trades per week, you can expect to make 0.75% per week. Your max drawdown really shouldn't exceed 10% unless you are super unlucky.

Oh wait, this is the same expectancy as TAH's system with 1/5 of its max drawdown and absolutely no chance of account blow and you can do this even with a 50$ account...

Edit: No, it's actually slightly higher by 0.05% per week.

Please start learning how to actually trade, and no, not from me, I am just learning like all of you. But we can learn from each other. Let's do away with the worshipping and actually filter what works and what doesn't with facts.

~~~~

Caveat: I have seen others who trade using the small lots approach too, but they don't average into a position and there's typically some sort of rescue where they put a very large trade to try to come to break-even for the losers (highly dangerous and not recommended for most at all) It works until it doesn't, but if you have a lot of experience you can probably make it work for you. There're others that use small lots + fixed SL and risk-reward ratio of 1:1 or better, it works too. Small lots help to relieve the stress of trading and the pain of losing.

~~~~

One more thing...

In case anyone missed it,

We should all study this picture, it's basically how a trend turns around. The comments and annotations made by SaiLyfee are very good, imo.

By 'start' I think he (or is it she?) means start accumulating a scout order(s), with predefined risk. This approach will actually make money with limited risk.

Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 92 KB
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  • #65,445
  • Feb 10, 2014 10:05pm Feb 10, 2014 10:05pm
Quoting shellsnail
{quote} By 'start' I think he (or is it she?) means start accumulating a scout order(s), with predefined risk. This approach will actually make money with limited risk. {image}
He is good
Yes what I mean is the opening of a trade. I personally prefer the supporting scout rather than the pre-classic scout so only use them after I've had a classic set up. If I were looking to go long like in this GJ picture I would wait for price to find support as it did in the purple box and then seek to go long with an M15 classic coming off of high volume at the lows with the dragon beginning to lift its head up. If MM's pushed price back down for more accumulation I'd look to add scouts on notable volume at key S/R. (1/4,/1/2,1/1) numbers. Also if another classic happened below my initial classic entry I'd take another entry there. If for whatever reason price carried on and on to the point my trade was at a 3% loss it would begin to start getting out of my "comfort zone". I think whenever looking to open a trade its so important to look at price resistance and support zones on the higher TFs and consider them as potential targets price may go before the MM's are done with it and before initiating their run for profits. I also find PVSRA great at clearly identifying head fakes both to the upside and downside and can give some really nice entries. That's my personal opinion of EU right now. Although of course how long will they hike price up for to coax in more longs (liquidity) to add shorts for? That we can't know.
  • #65,446
  • Feb 10, 2014 10:07pm Feb 10, 2014 10:07pm
EU: 1.370xx seems to be a strong resistance area. If it sustain that level, it may reach up to 1.385x, not so far then. I will decide my entry at 1.370xx only. But trend clearly says DOWNTREND before 1.370xx
  • #65,447
  • Feb 10, 2014 10:14pm Feb 10, 2014 10:14pm
Quoting SaiLyfee
{quote} He is good Yes what I mean is the opening of a trade. I personally prefer the supporting scout rather than the pre-classic scout so only use them after I've had a classic set up. If I were looking to go long like in this GJ picture I would wait for price to find support as it did in the purple box and then seek to go long with an M15 classic coming off of high volume at the lows with the dragon beginning to lift its head up. If MM's pushed price back down for more accumulation I'd look to add scouts on notable volume at key S/R. (1/4,/1/2,1/1)...
Yup it does, but sometimes there's a trade-off between trying to get the best entry/catch the low v.s. the risk you must take to find out if you are right. Can be quite a lopsided trade-off at times. I think even if you only focus on getting the entries after the trend has evidently changed, you would still do very well using Sonic R, like you've shown in the picture...

I think the key is to watch the H1 and above for trend/potential contextual setups and then use 15m and below to enter to limit risk and get sharper entries
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  • #65,448
  • Feb 10, 2014 10:22pm Feb 10, 2014 10:22pm
Quoting shellsnail
{quote} Yup it does, but sometimes there's a trade-off between trying to get the best entry/catch the low v.s. the risk you must take to find out if you are right. Can be quite a lopsided trade-off at times. I think even if you only focus on getting the entries after the trend has evidently changed, you would still do very well using Sonic R, like you've shown in the picture... I think the key is to watch the H1 and above for trend/potential contextual setups and then use 15m and below to enter to limit risk and get sharper entries
I totally get what you mean by that trade off. What I have been trying is when entering a classic I use double my scout size and if it runs, great. If it comes back down thats where I add supporting scouts (at half classic size). This way I kind of get a mix of both. I fully agree the key is looking at the higher TF's to understand where price is within the overall picture so that on the M15 the entries are placed in context.
  • #65,449
  • Feb 10, 2014 10:57pm Feb 10, 2014 10:57pm
AU short scout opened.
Attached Image (click to enlarge)
Click to Enlarge Name: aube.png Size: 104 KB

Price taken above 0.90000 on high vol occurring at the highs. It is possible MM's may mark price up higher closer towards the higher resistance area marked on H4 near RWH ahead of the high impact news releases (Unemployment Rate & Employment Change) though of course so if that happens I intend to add some more scouts then. My bet is AU goes down following these news releases as indicated by PVSRA. Time will tell
  • #65,450
  • Feb 11, 2014 12:13am Feb 11, 2014 12:13am
Quoting SaiLyfee
AU short scout opened. {image} Price taken above 0.90000 on high vol occurring at the highs. It is possible MM's may mark price up higher closer towards the higher resistance area marked on H4 near RWH ahead of the high impact news releases (Unemployment Rate & Employment Change) though of course so if that happens I intend to add some more scouts then. My bet is AU goes down following these news releases as indicated by PVSRA. Time will tell
very possible, but I think today will close around 0.91 to take out the previous swing high... tmr news release it might spike up and then go down or it might go down straight, but a pullback should be in order.

I posted about it there...

http://www.forexfactory.com/showthre...51#post7272851

don't forget there's yellen later...
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  • #65,451
  • Feb 11, 2014 12:54am Feb 11, 2014 12:54am
Quoting SaiLyfee
{quote} I totally get what you mean by that trade off. What I have been trying is when entering a classic I use double my scout size and if it runs, great. If it comes back down thats where I add supporting scouts (at half classic size). This way I kind of get a mix of both. I fully agree the key is looking at the higher TF's to understand where price is within the overall picture so that on the M15 the entries are placed in context.
hmm do you think there's a concern that you might be selecting to add to the losers? Maybe do a backtest/forward test to see, given that price has retraced after a sonic entry, what is the probability that it'll be a winner, because there might be many trades that just take off w/o giving you a chance to add.

Scout has some advantages in that it can become a risk-free trade hence drastically improving your reward:risk ratio if you do it right.
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  • #65,452
  • Edited 2:34am Feb 11, 2014 1:21am | Edited 2:34am
Quoting shellsnail
GJ setting up for potential down move.
again.

Edit: TDI < 20 -> strong momentum.. bounce off sonic wave, see separation between 89EMA and wave..
Attached Image
TP 167. RR 8:1

edit: Price went down after LO and then retrace back up to test Sydney Open (DO) price - the first level tested after LO.

Edit: want to go for BREAKfast, but trade still requires babysitting before BREAKeven stops are used.. :/

edit: closed for -7 pip and reversed..
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  • #65,453
  • Edited 6:22am Feb 11, 2014 3:04am | Edited 6:22am
AU, EJ and GU long trade.

Ps... First peak to heavily Sonic based SUPATREND Template

I'm trying to make classic Sonic R template even more better. Cleaner signals, easy to see S/R, ability to avoid ranges.
So basically taking Sonic R template and excellent Professor TAH's indicators to whole new level with all original rules with slight modifications to get most R/R out of trades and ability to ride trends to very last point before rewersal. Working on it and will be posting some samples if Master Sonicdeejay and Professor TAH just approves this..?

If iT's not cool, I will not post with this new template anymore.

Just want to give my part to the template and indicators also
Attached Image (click to enlarge)
Click to Enlarge Name: SUPA_AU.png Size: 111 KB

Attached Image (click to enlarge)
Click to Enlarge Name: SUPA_EJ.png Size: 115 KB

Attached Image (click to enlarge)
Click to Enlarge Name: SUPA_GU.png Size: 110 KB


TP:
at next good old S/R level, or when candle touches or closes below S/R1 or just keep adding every signal and keep SL below S/R2 and ride it until it rewerses.

After first classic entry, SL to BE as soon as it's possible to avoid range. When the trend starts, it won't come back to starting point.

Edit:
All remember last years long run on YEN pairs?
See how it would be have been handled with this template:
Attached Image (click to enlarge)
Click to Enlarge Name: SUPA_UJ_LONG.png Size: 95 KB

So this template eliminates totally large drawdown risk and is pretty clean and visually easy not to enter trades too early.
Basically SUPATREND follower
I know the secret...
  • #65,454
  • Feb 11, 2014 4:26am Feb 11, 2014 4:26am
This is an 0-open position indicator for mt4 v600. Displays on the second existing window
Attached File(s)
File Type: mq4 0 - Open Positions v3-L.mq4   14 KB | 407 downloads
  • #65,455
  • Feb 11, 2014 4:38am Feb 11, 2014 4:38am
Quoting JRissa
Oh, what a day! I'm excited to share with all of you that today I had a lightbulb turned on. Mr Amazing inspired me to try scalping once again. I begun to think little differently about volumes at different price levels and S/R zones and tried to develop quickie scalping method with high accuracy using only volumes and S/R levels. Tested this idea with couple of pairs with new fresh demo account to see how it performs and this day was great test day as there was a lot of movement with especially EU. I will continue this testing with this demo account...
Volumescalper
Update; demo account grown 84%

Next I will be consentrating to entries more, cause drawdown has been repeatingly more than profit from trades.
Maby try using Supatrend template for entries
Attached Image (click to enlarge)
Click to Enlarge Name: image.jpg Size: 82 KB
I know the secret...
  • #65,456
  • Feb 11, 2014 6:37am Feb 11, 2014 6:37am
Quoting JRissa
AU, EJ and GU long trade. Ps... First peak to heavily Sonic based SUPATREND Template I'm trying to make classic Sonic R template even more better. Cleaner signals, easy to see S/R, ability to avoid ranges. So basically taking Sonic R template and excellent Professor TAH's indicators to whole new level with all original rules with slight modifications to get most R/R out of trades and ability to ride trends to very last point before rewersal. Working on it and will be posting some samples if Master Sonicdeejay and Professor TAH just approves...
Supatrend template
Managing trades:
Attached Image(s) (click to enlarge)
Click to Enlarge Name: SUPA_AU_SL.png Size: 73 KB
Click to Enlarge Name: SUPA_EJ_SL.png Size: 73 KB
Click to Enlarge Name: SUPA_GU_SL.png Size: 97 KB
I know the secret...
  • #65,457
  • Feb 11, 2014 6:40am Feb 11, 2014 6:40am
GU: TP set @ 1.659x. 400+pips already in.

Sonicers: is this TP reachable as per your analysis?
Attached Image (click to enlarge)
Click to Enlarge Name: GU.png Size: 63 KB
  • #65,458
  • Feb 11, 2014 6:51am Feb 11, 2014 6:51am
[quote=JRissa; [/quote]
would you mind to share your template and indi pls? thanks
  • #65,459
  • Edited 7:37am Feb 11, 2014 7:03am | Edited 7:37am
Quoting ozboy
{quote} would you mind to share your template and indi pls? thanks
Too soon for that sorry...

Template is mostly using Professor TAH's 2014 beta indicators that haven't been released yet.
Also I want confirmation from both Master Sonicdeejay and Professor TAH that this is not violating Sonic R thread rules and is not misusing Professors hard work coded indicators.

Also some of the indicators are not opencoded.

As you see; template is very much the same that everyone is using here, but dragon and trend are removed. That's the main reason I'm conserned about approval of this template, cause dragon and trend are main pieces of Sonic R thread. I say that this new replacement is very much the same dragon with new visual appearance, but still not the same..?
It plots S/R levels little to future and makes it easier visually to apply trade rules on chart...
Attached Image (click to enlarge)
Click to Enlarge Name: supa_sonic.png Size: 76 KB
I know the secret...
  • #65,460
  • Feb 11, 2014 7:19am Feb 11, 2014 7:19am
Quoting traderathome
It is Time to Reflect and Renew, Not Re-invent! Sonicers, Last week began a new era for traders. For one thing, February more than January starts off the new year since January is a "slow" month. For another thing, MetaQuotes introduced its new MT4 platform upgrade that is not automatically backwards compatible. The former says "Get ready to Rumble!" and the latter says "Not without some difficulties, you don't!" So, amidst all of this, as well as the influx of new folks to this Sonic R. System thread, it is understandable I guess that things might...
kudos Sir TAH. Very well said and ultimately right. Keeping things elegantly simple. It is best not pay attention to any new stuff being tried to be added that has nothing to do with Sonic R. System. Thanks for another great piece of advice Sir TAH.
Patience and Discipline, these are the Holy Grail.
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