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Trading Made Simple

  • #33,501
  • Mar 23, 2014 5:46am Mar 23, 2014 5:46am
Quoting camron
Position sizing and risk management were the topics that made me think these days. I had this inner fight between trading a smaller position size and thinking about getting a more precise entry? I noticed when there appears a breakout candle (#1 TMS) then in most cases the 2nd candle touches the 38-50% Fibs of the #1-candle. I just want to know from you guys if I can just place limit orders to get a better fill, reduce risk and make more pips. I backtested it on different timeframes and currencies and saw that the mean of 38-50 ( ~ 44 % ) gives...
This is true, most of the time the first candle will break above or below S&R, then more likely that next bar candle will test the support turned into resience and vise versa, so drawing your fibs on the previous candle and wait a retracement to Fibs 38.2 most of the time is really a good way to minimise risk and better entry price and lower drawdown

I trade the H1, what I and have noticed is that this particular formation goes very well when the market print a bullish or bearish engulfing candle, If I don't get on the breakout of the first candle, I go to a lower time frame, ie 5M chart and draw fibs on the previous candle which will be some candles on M5 and wait PA to retrace back to previous structure level which convergence with 38.5 - 50 fibs and if PA signal a get go candle formation from that level , I enter the market

Its not limit order, it wont work this way, I wait candle confirmation on lower time frame signal the entry, because entry on limit order is an entry against order flow at the moment when PA retrace back where PA could never goes back into the direction of the trade

Test it your self, I cant comment on other topic as MM

I hope this is what you thought of
I Have Learned to Take Some Losses to Make Profits
  • #33,502
  • Mar 23, 2014 6:07am Mar 23, 2014 6:07am
Quoting ababias
{quote} I am not a senior member. Just want to know your perspective and not finding faults in your chart. Pl. see my chart. With PAC, do you think we will not able to follow the BIG E rule of entry the trade on the First or second candle. {image}
ababias,

First we all learn and practice the 5-Method. When we attain trading mastery and have mastered the 5-Method, we can then start to break a few rules.
Big E as one point stopped using the 5EMA shift+3, and he became more aggressive in his TDI setup for entry.
Read his post#701.

here is a pic of that post.

Attached Image (click to enlarge)
Click to Enlarge Name: Big E post 701 candle close ab 5EMA.png Size: 58 KB


When we use the 5SMMA as Price Action Channel PAC, that can help use in trading and also adding position when the price action breaks out above or below the PAC.
You can place both the 5EMA shoft +3 Typical Price and the 5SMMA on yiou charts and do visual back-testing and see how often those TDI setup aggressive entries fails to break into a new trend.
Remember, when you want to do aggressive entries you must also do quick exits (conservative exits) in order to preserve your trading capital Rule no.1 above all other rules. Also learn when to re-enter the market after you made your quick exits so that you do not miss the breakaway trend run. In using the PAC, you will be better off trading the 5-Method when you use a proven money management strategy.


regards,

EMMANUEL
Honesty is a very expensive gift. You wont find it in cheap people.WBuffett
  • #33,503
  • Mar 23, 2014 6:12am Mar 23, 2014 6:12am
Post #261 tells us to use our brains.
So I listened and practised a lot and I now know when and which rule to break.

Market is dynamic, therefore we must learn to adapt to changing market conditions and use a proven money management strategy.

Attached Image (click to enlarge)
Click to Enlarge Name: Big E Post_261.png Size: 147 KB
Honesty is a very expensive gift. You wont find it in cheap people.WBuffett
  • #33,504
  • Mar 23, 2014 6:19am Mar 23, 2014 6:19am
A blast from the past.
Attached Image (click to enlarge)
Click to Enlarge Name: Big E CHS post4109.png Size: 207 KB
Honesty is a very expensive gift. You wont find it in cheap people.WBuffett
  • #33,505
  • Mar 23, 2014 6:20am Mar 23, 2014 6:20am
Quoting BataviaTrade
{quote} I find using PAC (2 MA's) more complex than using 1 MA. The PAC start to bring in confusion and hesitation to me. How do you utilize the PAC for your entries?
I tried to make my decision based on price Action in relation to information I am getting from the TDI...I use the PAC mainly as trade management indicator as moving average tend to follow price and normal don't give you the type of signal that PA and TDI can give you. So when trying to take a trade...I factor out first the pair mode/bias...consolidation, continuation, and vice versa from higher time frame and then decide on what to do. Though I only open two trades last week...I was able to have two winners.
  • #33,506
  • Mar 23, 2014 6:22am Mar 23, 2014 6:22am
Question:
I see from charts posted that Stochs indicator are not being used. Does that mean the Stochs indi is not really required?
  • #33,507
  • Mar 23, 2014 6:38am Mar 23, 2014 6:38am
Quoting OuterWest
" Learn R-Multiple and Position Sizing and apply them to trading the 5-Method and incorporate them and develop your own personalised winning system." Hi Emmanuel, I see on Forex Factory a variety of ways people manage their trades. Position sizing and Reward to Risk ratio is one not much discussed. One Question traders need to address in their trading plan is what size % risk to their account to use on each trade. Here is an example of one method that could be used to determine trade sizing Trade Management, Reward to Risk, Stop Loss and Exit. Reward...
Hi OuterWest,

Your a right. Here in FF, a lot of discussions are in indicators based systems, indicatro trade signals, etc. and very little on other components of a winning trading system.
Last week Van Tharp was in Sydney and he conducted another system development workshop. Not sure if anyone here attended his workshop.

Anyway, here is a few pages taken out of my system development document of TMS-II. It is on using multi-lot positions to improve trading TMS.

I am available if anyone is interested to explore this proven money management strategy.

regards,

EMMANUEL
Attached File(s)
File Type: pdf Using Multiple Lot Positions To Improve in TMS-II .pdf   244 KB | 4,177 downloads
Honesty is a very expensive gift. You wont find it in cheap people.WBuffett
  • #33,508
  • Mar 23, 2014 6:42am Mar 23, 2014 6:42am
Quoting OuterWest
Question: I see from charts posted that Stochs indicator are not being used. Does that mean the Stochs indi is not really required?

Stoch (8,3,3) is use in the 5-Method as secondary indicator as confirmation of the TDI setup and PA.

Many of the experienced traders rely more on PA and dropped the Stoch in their trade setup decision.

It is an option now.
Honesty is a very expensive gift. You wont find it in cheap people.WBuffett
  • #33,509
  • Mar 23, 2014 7:10am Mar 23, 2014 7:10am
Quoting camron
Position sizing and risk management were the topics that made me think these days. I had this inner fight between trading a smaller position size and thinking about getting a more precise entry? I noticed when there appears a breakout candle (#1 TMS) then in most cases the 2nd candle touches the 38-50% Fibs of the #1-candle. I just want to know from you guys if I can just place limit orders to get a better fill, reduce risk and make more pips. I backtested it on different timeframes and currencies and saw that the mean of 38-50 ( ~ 44 % ) gives...

Fib 38/50 entry is one of my entry technique.
Use lower timeframe to look for such retracement entry and avoid using limit order.
In strong trending market, the retracement can be shallow 23% and 38%, so we can miss a momentum entry.
What can we do so as not to miss a good trade entry?
Use position building method.

Attached Image (click to enlarge)
Click to Enlarge Name: GJ example Build up positionsM.png Size: 191 KB
Attached File(s)
File Type: pdf How to Build a Position.pdf   3.1 MB | 1,917 downloads
Honesty is a very expensive gift. You wont find it in cheap people.WBuffett
  • #33,510
  • Mar 23, 2014 7:26am Mar 23, 2014 7:26am
Quoting emmanuel7788
{quote} Fib 38/50 entry is one of my entry technique. Use lower timeframe to look for such retracement entry and avoid using limit order. In strong trending market, the retracement can be shallow 23% and 38%, so we can miss a momentum entry. What can we do so as not to miss a good trade entry? Use position building method. {image} {image}
Thanks Emmanel for this MM and power information regarding building position, we can learn from you this powerful strategy
I Have Learned to Take Some Losses to Make Profits
  • #33,511
  • Mar 23, 2014 7:36am Mar 23, 2014 7:36am
Quoting TheScorpS
{quote} Thanks Emmanel for this MM and power information regarding building position, we can learn from you this powerful strategy
why disrupt regular sleep and wait patiently every 4hours and look for that TDI setup and then jump into the market and then jump out after 2-3 candles when we believe that the reversal will run 3 to 8 candles? There are better ways to make pips when we know how to crank up those pips using positions sizing and multiple-entries and multiple exits strategy.
one of the keys is higher timeframe, multi-timeframe analysis and knowing the market type before we jump in.
Honesty is a very expensive gift. You wont find it in cheap people.WBuffett
  • #33,512
  • Mar 23, 2014 8:45am Mar 23, 2014 8:45am
Quoting LFN
{quote} Hi! Can I ask where you got the TradersDynamicIndexVisual indicator? Is it the same as the @TMSTDI_WatchDog.ex4 in this thread? www.forexfactory.com/showthread.php?t=294327
Here you go

Attached File(s)
File Type: ex4 Traders Dynamic Index VISUAL ALERTS.ex4   22 KB | 696 downloads
  • #33,513
  • Mar 23, 2014 9:09am Mar 23, 2014 9:09am
Quoting MrAussieFX
{quote} Here you go {file}
Thanks
Is it your own development?
  • #33,514
  • Mar 23, 2014 10:56am Mar 23, 2014 10:56am
Anyone has tried trading Silver/Gold/Oil with this strategy? I find some members are trading successfully AUD/JPY, AUD/USD as they tend to trend longer in one direction, so maybe others will have similar result if we try it on commodities and futures.
  • #33,515
  • Mar 23, 2014 11:25am Mar 23, 2014 11:25am
Quoting LFN
{quote} Thanks Is it your own development?
No mate, I found it somewhere but I don't remember.

Cheers
  • #33,516
  • Mar 23, 2014 12:05pm Mar 23, 2014 12:05pm
Quoting emmanuel7788
{quote} ababias, First we all learn and practice the 5-Method. When we attain trading mastery and have mastered the 5-Method, we can then start to break a few rules. Big E as one point stopped using the 5EMA shift+3, and he became more aggressive in his TDI setup for entry. Read his post#701. here is a pic of that post. {image} When we use the 5SMMA as Price Action Channel PAC, that can help use in trading and also adding position when the price action breaks out above or below the PAC. You can place both the 5EMA shoft +3 Typical Price and the...
You are right preserve the capital. Thanks.
  • #33,517
  • Mar 23, 2014 12:12pm Mar 23, 2014 12:12pm
Quoting chakal
Anyone has tried trading Silver/Gold/Oil with this strategy? I find some members are trading successfully AUD/JPY, AUD/USD as they tend to trend longer in one direction, so maybe others will have similar result if we try it on commodities and futures.
I do ..many of us as well...

see post..

  1. Post 33,346

Sad i'm not trying to understand PA
  • #33,518
  • Mar 23, 2014 12:35pm Mar 23, 2014 12:35pm
Quoting emmanuel7788
{quote} Hi OuterWest, Your a right. Here in FF, a lot of discussions are in indicators based systems, indicatro trade signals, etc. and very little on other components of a winning trading system. Last week Van Tharp was in Sydney and he conducted another system development workshop. Not sure if anyone here attended his workshop. Anyway, here is a few pages taken out of my system development document of TMS-II. It is on using multi-lot positions to improve trading TMS. I am available if anyone is interested to explore this proven money management...
Excellent read Emmanuel, I plan to use this strategy. What indicator do we use for the "Average Weekly Range?"
Thank you.
  • #33,519
  • Mar 23, 2014 12:35pm Mar 23, 2014 12:35pm
E/A H4. Any comment and suggestions?

I am looking to enter long when green cross red. Also seen price will go down even though TDI below 32. How to check this situation?
Attached Image
  • #33,520
  • Mar 23, 2014 12:44pm Mar 23, 2014 12:44pm
Quoting ababias
E/A H4. Any comment and suggestions? I am looking to enter long when green cross red. Also seen price will go down even though TDI below 32. How to check this situation? {image}
I think EA has a chance to bounce at the current level. It's sitting on S/R I marked blue.
The blue level isn't as powerful as the red tho.

EA levels from daily TF
Attached Image (click to enlarge)
Click to Enlarge Name: 2014-03-24_0041_EA.png Size: 14 KB
Everything you can imagine, is real - Pablo Picasso
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