Looking for Real Trading Method | Page 33 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

bo7a method... method for GBP/JPY 205 replies

Looking for info on TASC "hysteresis" MA crossing of Bands method. 2 replies

Sure Method = Real Money 44 replies

Looking for Mouteki method EA 1 reply

Attachments: Looking for Real Trading Method
Exit Attachments

Looking for Real Trading Method

  • #641
  • Jul 12, 2014 5:00am Jul 12, 2014 5:00am
Quoting Chicky
{quote} Here is a list of some of the methods I tried. Will try to keep them in chronological order of experiment: 1. Martingale aiming at 0.10% return per trade, risk unknown, USD/JPY stochastic (without knowing this term/technical existed)- Failed 2. Martingale aiming at 0.03% return per day, risk unknown, USD/JPY stochastic (without knowing this term/technical existed) - Failed 3. Playing retraces of USD/JPY by putting pending orders on both sides - After initial success, complete loss. 4. Martingale aiming at 100% return per month, trading USD/JPY...
Agreed.
These wont get the job done. If they do, it'll be mediocre at best. Lets just say you won't be spending your time at the top.
Rgds
  • #642
  • Edited 11:48pm Jul 13, 2014 10:54pm | Edited 11:48pm
Quoting Chicky
{quote} Here is a list of some of the methods I tried. Will try to keep them in chronological order of experiment: 1. Martingale aiming at 0.10% return per trade, risk unknown, USD/JPY stochastic (without knowing this term/technical existed)- Failed 2. Martingale aiming at 0.03% return per day, risk unknown, USD/JPY stochastic (without knowing this term/technical existed) - Failed 3. Playing retraces of USD/JPY by putting pending orders on both sides - After initial success, complete loss. 4. Martingale aiming at 100% return per month, trading USD/JPY...
If you carefully read all these methods that were tested over the years in almost all market conditions, will find that the ones that worked are 12, 13, 21, and 22. There is one thing common in them. They all focus on bounces at key price levels. No matter how those key levels were arrived at (i.e. chart reading, calculations, fibs, trend-line touches, etc.) the PA almost always showed several bounces at these levels. This is very logical, because there are huge pending orders and many buyers/sellers at these levels to make them volatile. A small trader like me and you can extract few pips from these bounces. However, sometimes an order or event is so high impact that PA may not hesitate cutting through that level without giving us an opportunity to trade a bounce. Other times, our brokers may not let us trade that bounce. But still, one can find repeated opportunities to play these bounces. The one million dollar question is how to play these bounces? Several ways and with many risk:reward combinations, depends what you are comfortable with. The basic formula is that the product of Success Ratio and Risk:Reward ratio should be positive and position sizes should be small enough that they can absorb a series of losses. For example:

Data
Risk $100
Reward aimed at $300
Success Ratio: 30% or 30 winners in every 100 trades

Calculation:
Gain = $300 x 30 = $9,000
Loss = -$100 x 70 = -$7,000
Net ($9,000 - $7,000) = $2,000

This looks good, but what if first 70 trades are the losers and the next 30 are winners? (It can happen and happens more often than many believe)

The draw down in this scenario will be $100 x 70 = $7,000.

That means the account balance should be big enough not only to absorb this possible (and likely) loss of $7,000 but also after losing $7,000 our account equity should be good enough to execute trades with same number of lots. Let's say this $7,000 is 40% of our total "Investment" (or more realistically speaking our "bet money"). After losing 40% of the account balance we should still be able to execute as many number of currency units that can give us $100 loss or $300 profit. Therefore the account balance one needs to start under the above scenario is $7,000 / 0.4 = $17,500.


I see logic in this and therefore playing bounces with calculated risk also qualifies as a system that can be real.
The Thief of Wall Street
  • #643
  • Jul 14, 2014 10:52pm Jul 14, 2014 10:52pm
Quoting Chicky
{quote} I think author of this method was right in saying that one can reduce trading risk to zero. (He indeed meant the Normal Trading Risk due to price fluctuations and not remote risk of currency failure or broker going bankrupt, etc). This is like moving sls to BE. The most important feature of this method is that YOU remain incharge of your Trade Portfolio and are not at mercy of the market. Return is also not bad. Currently up about $30 from yesterday, from $2,197 to now $2,230. That required "Doing Something" with the trades (Trade Management)....
From $2,230 to $2,250, very little draw down during this process. However, required little bit of "doing something" with the trades.
Attached Image (click to enlarge)
Click to Enlarge Name: Untitled1.jpg Size: 132 KB
The Thief of Wall Street
  • #644
  • Edited 7:01am Jul 15, 2014 3:56am | Edited 7:01am
Quoting Chicky
{quote} If you carefully read all these methods that were tested over the years in almost all market conditions, will find that the ones that worked are 12, 13, 21, and 22. There is one thing common in them. They all focus on bounces at key price levels. No matter how those key levels were arrived at (i.e. chart reading, calculations, fibs, trend-line touches, etc.) the PA almost always showed several bounces at these levels. This is very logical, because there are huge pending orders and many buyers/sellers at these levels to make them volatile....
As I have read about % wins, the problem with your 30% doesn't guaranty 30 wins over 70 losses in 100 cases. It guaranties that every single trade will have 30% expectancy.. Correct me if I'm wrong but I believe that it's tied to the definition of gamblers fallacy..

EDIT: I need to ask a question here as the title seems appropriate I am from Europe and my brokers platform is on GMT-2 server time (broker is from New Zealand)... So the candle for the new day starts at NY close and with Asia opening.. I am wondering how much time would you wait to see the developing of the daily trend? To see if the price will rise or fall for that day? Just a thought...
  • #645
  • Edited 11:42pm Jul 15, 2014 10:18pm | Edited 11:42pm
Quoting merquise
{quote} As I have read about % wins, the problem with your 30% doesn't guaranty 30 wins over 70 losses in 100 cases. It guaranties that every single trade will have 30% expectancy.. Correct me if I'm wrong but I believe that it's tied to the definition of gamblers fallacy.. EDIT: I need to ask a question here as the title seems appropriate I am from Europe and my brokers platform is on GMT-2 server time (broker is from New Zealand)... So the candle for the new day starts at NY close and with Asia opening.. I am wondering how much time would you...
Looking at probable event with expectancy ratio always confuses me. If I buy a lotto with 1% chance of winning $100 million on one ticket, I will either win $100 million or will get nothing but definitely not "Expected Value" of 1% of $100,000,000 = $1,000,000. Similarly if a trader is good enough to produce 30 winners out of 100 trades with risk:reward ratio of 1:3 will win 30 full trades and will lose 70 full trades in a population of total 100 trades but will never win 30% of every trade or lose 70% of every trade, because "Expected Value" is for calculation/estimation only and it has nothing to do with actual outcome. Traditionally we use the term "Expected" which is little bit misleading. Any Americans reading this please take a note and invent a proper word, you people are good at that (I am not so sure about rest of the things you do though).
The Thief of Wall Street
  • #646
  • Edited 11:40pm Jul 15, 2014 10:43pm | Edited 11:40pm
Quoting Chicky
{quote} From $2,230 to $2,250, very little draw down during this process. However, required little bit of "doing something" with the trades. {image}
All trades matured at just above $2,250. No position open. Will now start a new crop of trades. Today's draw down (maximum unrealized profit at any given point of time) was $25. The Net Asset Value went down to $2,225 but then bounced back. Closed trades following the rules. The rules say I can open new trades any time I want, but I am waiting to see how London reacts before starting afresh. It really does not matter from where and at what level I start entering trades, but I want some basis to start with.

Below this is another account, testing the same method, but this second one with a Net Asset Value of $136 is very important account. I have left several trades open on this account. According to the author of this method, sooner or later all these trades should show profit while risk remains within bounds. Logically, it is not possible within a short period of time of one hundred to one thousand years, a million years would be a different story though. But let's see if all these trades turn to show profit as claimed by the author.
Attached Image (click to enlarge)
Click to Enlarge Name: Untitled1.jpg Size: 278 KB
The Thief of Wall Street
  • #647
  • Edited Jul 16, 2014 1:24am Jul 15, 2014 11:07pm | Edited Jul 16, 2014 1:24am
Quoting Chicky
{quote} All trades matured at just above $2,250. No position open. Will now start a new crop of trades. Today's draw down (maximum unrealized profit at any given point of time) was $25. The Net Asset Value went down to $2,225 but then bounced back. Closed trades following the rules. The rules say I can open new trades any time I want, but I am waiting to see how London reacts before starting afresh. It really does not matter from where and at what level I start entering trades, but I need some basis to start with. Below this is another account,...
Just to let new readers know that the author claims to have made one billion dollars (yes, it starts with B and not M) in 10 years using this method.
The Thief of Wall Street
  • #648
  • Jul 16, 2014 4:23am Jul 16, 2014 4:23am
If you are still looking for a trading strategy, take your time, no point rushing it. I do however find DDMarkets a useful resource for providing market insights, mainly for experienced traders. It's free and fairly accurate, worth a shot.
"The Market is Not Evil, it Simply Separates Dumb People From Their Money."
  • #649
  • Jul 16, 2014 6:35am Jul 16, 2014 6:35am
Just wanted to pop in and say I love the thread Chicky, well done.
  • #650
  • Jul 16, 2014 7:29am Jul 16, 2014 7:29am
Chicky (or perhaps anyone else) maybe you can help me.

I have spent the best part of 10 years developing a robot with the help of my programmer, initially loosely based on the ProactTraders Wild Card System for one particular currency pair on the 15 minute time frame. It has now evolved so that, when Strategy Tested over the last five and a half years, it produces an average of 42 pips per week, with a maximum drawdown of 511 pips (which was by far the largest ever drawdown). There has never been a losing year or more than two consecutive losing months.

As I live in Thailand with no traders nearby this has been all my own work. I just wonder how this compares to other systems and whether these stats are good, mediocre or bad. I also need input from other traders on possible inputs to increase profit.

No gimmicks, falsification of figures or hidden motives. I would just like to start talking about something which may be good.
Mike
  • #651
  • Jul 16, 2014 6:17pm Jul 16, 2014 6:17pm
Quoting Chicky
{quote} This method is amazingly simple to understand but equally difficult when it comes to application. Trade management part is very complex. A trade size is about 100 to 300 pips and you carry several positions in different pairs at the same time. This is how you apply this method. What you do is look at the market situation, fundamentals, charts etc. just to get a general idea where it is heading, up or down, no particular level, no detailed technical analysis, etc. just an idea where it is heading.
Hi Chicky, I read a similar thread on babypips about portfolios of currencies, and it interests me because I am increasingly interested in portfolio type management. However, I think that having a portfolio of currencies isn't ideal because they are so highly correlated. Whereas you can take a portfolio of stocks that you believe will perform over different sectors, currencies are strongly linked. The problem comes with the actual management - there is an example of someone demonstrating the difficulties of this with a myfxbook on the other forum.
  • #652
  • Jul 16, 2014 7:13pm Jul 16, 2014 7:13pm
Quoting Chicky
{quote} Here is a list of some of the methods I tried. Will try to keep them in chronological order of experiment: 1. Martingale aiming at 0.10% return per trade, risk unknown, USD/JPY stochastic (without knowing this term/technical existed)- Failed 2. Martingale aiming at 0.03% return per day, risk unknown, USD/JPY stochastic (without knowing this term/technical existed) - Failed 3. Playing retraces of USD/JPY by putting pending orders on both sides - After initial success, complete loss. 4. Martingale aiming at 100% return per month, trading USD/JPY...
What is the time frame for these?
  • #653
  • Jul 16, 2014 8:54pm Jul 16, 2014 8:54pm
Quoting Michaeljames
Chicky (or perhaps anyone else) maybe you can help me. I have spent the best part of 10 years developing a robot with the help of my programmer, initially loosely based on the ProactTraders Wild Card System for one particular currency pair on the 15 minute time frame. It has now evolved so that, when Strategy Tested over the last five and a half years, it produces an average of 42 pips per week, with a maximum drawdown of 511 pips (which was by far the largest ever drawdown). There has never been a losing year or more than two consecutive losing...
I have experience of EAs. However, can look into the logic of technical that you are using .......... only if you like to share, no obligation.
I am sure somebody will help you on this.
The Thief of Wall Street
  • #654
  • Jul 16, 2014 9:09pm Jul 16, 2014 9:09pm
Quoting goldenmember
{quote} Hi Chicky, I read a similar thread on babypips about portfolios of currencies, and it interests me because I am increasingly interested in portfolio type management. However, I think that having a portfolio of currencies isn't ideal because they are so highly correlated. Whereas you can take a portfolio of stocks that you believe will perform over different sectors, currencies are strongly linked. The problem comes with the actual management - there is an example of someone demonstrating the difficulties of this with a myfxbook on the other...
An investment portfolio is totally different from a currency trading portfolio. The first thing an investor has to decide is the investment objective, all other decisions (how much money, for how long, how risky, etc.) follow this decision.

A currency portfolio has a shorter life because the objective is to profit by buying and selling (trading). It is a blessing that there exists correlation among pairs and this correlation is not perfect. A perfect correlation does not provide arbitrage opportunity.

It all depends how you balance your portfolio. It is like a bookmaker making a book in a gamble, collecting bets from punters. The first bet accepted on a horse has the highest risk, this risk is partially/overly compensated by taking the next bet on another horse, then again a third bet to cover risk from the first two bets, this goes on and on, helping bookmaker set the rates for each horse and offsetting risk plus creating a situation where no matter which horse wins his/her collection exceeds the payout. If you try to use this technique in currency trading, will realize that imperfect correlation is a blessing. The only issue is learning how to do this.
The Thief of Wall Street
  • #655
  • Jul 16, 2014 9:13pm Jul 16, 2014 9:13pm
Quoting MCRotter
{quote} What is the time frame for these?
I did not get the question. The trading timeframe was from 5M to Daily.
The Thief of Wall Street
  • #656
  • Jul 16, 2014 9:15pm Jul 16, 2014 9:15pm
Quoting Chicky
{quote} I have experience of EAs. However, can look into the logic of technical that you are using .......... only if you like to share, no obligation. I am sure somebody will help you on this.

Chicks...

When comes to EAs, and trade systems alike, the rules are pretty simple. Don't really matter where you go or how you approach the market...an EA should be an extension of your beliefs.

Past trying to pick more fights and past others saying what cannot work...I stick to my guns and say the same.

A proper strategy, will always be the winner.

Issue is, there is a lot of understanding to what that strategy is. When to trade...when to sit...when to hold...when to fold...

Can it be done???

I have talked before about a little charity forum that I belong to and since going live with a minimum charitable donation to the Registered Charity of choice, a $20 investment can pay off in grand dividends.

This is what we do...because we can.

Sergien.
Attached Image (click to enlarge)
Click to Enlarge Name: sergien.png Size: 33 KB
Money Can't Buy Happiness. Poverty Can't Buy SHIT! You Choose!
  • #657
  • Jul 16, 2014 9:18pm Jul 16, 2014 9:18pm
Quoting Chicky
{quote} I have experience of EAs. However, can look into the logic of technical that you are using .......... only if you like to share, no obligation. I am sure somebody will help you on this.
Typo................ I have NO experience of EAs.
The Thief of Wall Street
  • #658
  • Jul 16, 2014 9:20pm Jul 16, 2014 9:20pm
Quoting Magix
{quote} Chicks... When comes to EAs, and trade systems alike, the rules are pretty simple. Don't really matter where you go or how you approach the market...an EA should be an extension of your beliefs. Past trying to pick more fights and past others saying what cannot work...I stick to my guns and say the same. A proper strategy, will always be the winner. Issue is, there is a lot of understanding to what that strategy is. When to trade...when to sit...when to hold...when to fold... Can it be done??? I have talked before about a little charity...
It was a typo. I have no experience of EAs. This is beyond my expertise ............also outside my area interests.
The Thief of Wall Street
  • #659
  • Jul 16, 2014 9:40pm Jul 16, 2014 9:40pm
Quoting Chicky
{quote} It was a typo. I have no experience of EAs. This is beyond my expertise ............also outside my area interests.
Is it?

Is it really, Chicks?

Cummon...be serious for a second. Can you watch and trade 28 pairs at a time?

Can you prosper from the same chart in a 24 hour clock consistently?

Isn't this same thing the exact nature of your thread?

A Real Trade Method?

You can round the clock your PC and terminal, but will you push the button when you need to?

Let's say you do have the holy grail of trading...are you going to trade it?

The holy grail consists of wins and losses. Most people are so afraid of the losses that they can never see the wins. All you have learned in market, up to now if you haven't found your holy grail...is a FALLACY.

Keep reading...keep trying...but the only consistent failure of your account will always be the same thing.

YOU!

and

You Alone.

You aren't prepared, like most, to round the clock trade. You can try and define a system. You can try to define a trend...you can try and trade on all of that...

But the only real question is...

Will you?

I have set up an account, a nominal amount that means nothing to me personally...it won't break me if it fails, won't make me if it succeeds, but is in the true spirit of market. It will trade how I tell it to. Take profit and cut losses where it is told to...and will either pass or fail.

This is one of many live accounts I trade. And is set up for a single reason.

To dispel all myths about market.

I will show cost averaging. A technical playthrough and profitability based on indicators.

Will do all of this on a nominal amount.

I can load a couple hundred k into an account, but what would that actually prove?

Here is everything that you've learned about market...why I can succeed where so many will fail.

Nothing more, nothing less.

An eye opener, hopefully....

My TE is nicked "Kuat is my Bitch", pay no mind to the name of the account that will consistently kick ass in market and appreciate how it is doing it.

Everything wrong...but will continue to grow.

Guarantee it.
Money Can't Buy Happiness. Poverty Can't Buy SHIT! You Choose!
  • #660
  • Jul 16, 2014 9:48pm Jul 16, 2014 9:48pm
Quoting Chicky
{quote} All trades matured at just above $2,250. No position open. Will now start a new crop of trades. Today's draw down (maximum unrealized profit at any given point of time) was $25. The Net Asset Value went down to $2,225 but then bounced back. Closed trades following the rules. The rules say I can open new trades any time I want, but I am waiting to see how London reacts before starting afresh. It really does not matter from where and at what level I start entering trades, but I want some basis to start with. Below this is another account,...
Today's draw down is $15. At one point it was about $18, then a full recovery and then again $15. The account equity is now $2,240. Have started building a new portfolio after cashing the previous one.
Attached Image (click to enlarge)
Click to Enlarge Name: Untitled1.jpg Size: 157 KB
The Thief of Wall Street
1 trader viewing now