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Trading Without a StopLoss

  • #2,381
  • Edited 8:13am Aug 30, 2014 6:34am | Edited 8:13am
Thanks Nanningbob for the info.having these on a single sheet of paper can strongly influence choice of trades when the margin gets tight. Maybe even before.
Rap.
p.s. of the 176 trades in profit I made this month 120 of them were in the high half of the pairs regarding volatility. Draw your own conclusions...
  • #2,382
  • Aug 30, 2014 11:08am Aug 30, 2014 11:08am
http://s6.postimg.org/kb5cm66n5/2014_08_30_180541.jpg
  • #2,383
  • Aug 30, 2014 1:22pm Aug 30, 2014 1:22pm
Quoting Rap Skallion
Thanks Nanningbob for the info.having these on a single sheet of paper can strongly influence choice of trades when the margin gets tight. Maybe even before. Rap. p.s. of the 176 trades in profit I made this month 120 of them were in the high half of the pairs regarding volatility. Draw your own conclusions...
nanningbob's posting is good - but another consideration is how much of a move for each of those pairs is an extended move on a weekly basis. I've found this to be extremely helpful info as well.

Ex. - I think I've explained a little about this previously, so, my apologies if this is repetitive for some:

I track the AUD/USD and GBP/AUD pairs throughout the week recording their 30m opens. I also keep up with how far each 30m open is from:

- previous 30m (presents scalping opportunities galore when you can see historically with high instance where the current 30m bar opens __ pips above the previous and you can usually with high reliability scalp __ pips because of this..)

- 0000 GMT open of that day (presents knowledge of how far of a move for the pair is an extended move with high probability of reversal)

- 0000 GMT MONDAY open of the week (presents knowledge of how far of a move for the pair is an extended move with high probability of reversal - I use this info for targeting and potential entry)

There's another calculation I run on all of this data that presents levels which are high probability for reversal of the pair which I log the success rate of being reach and the duration from when the target originates 'til the target is hit.

The combination of all of these things creates a much more predictive view on the market than any indicator I've ever seen. I do combine all of this with a basic stochastic....

All of this information also creates solid buy zones for a pair and solid sell zones - with extremes to each side which are rarely reached until levels beyond those develop.

No stops on any of it...Over the period of time I've worked strictly with numbers on the pairs I've trade my trade success has been much higher than ever before...
"Holy Grail" exists - accepting where is the first step.
  • #2,384
  • Edited 3:22pm Aug 30, 2014 3:06pm | Edited 3:22pm
Quoting nanningbob
I found some free time here so uploaded my volatility spread sheet. I use this chart to determine what pairs I will trade on a regular basis. It is the average pips per day a currency moves over the last year. This way I dont waste my time trying to trade pairs that simply dont move. For example the eur/chf move 29.3 pips a day. To me that is not worth waiting 24 hours, a move of 30 pips. I havent tried trading the eur/chf in years. Same thing with the eur/gbp at 42 a day. I concentrate on currencies that will move and make my trading time worth...
Thanks for the reply, Bob!

Catching 30-50% of the day's move makes sense to me.

From reading some of your PDF's about the 10.X method, I understand you check your trades during each session and bank whatever profits the markets have made available to you.
Personally, I'm able to check my charts twice a day - about an hour before London open and then right before US close.
In this case, would you consider a better strategy to target a fixed % of the daily move when placing the trades or just bank profitable positions manually whenever I check the charts?

Thanks once again!
TF1
  • #2,385
  • Aug 30, 2014 10:20pm Aug 30, 2014 10:20pm
Quoting trader-f1
{quote} Thanks for the reply, Bob! Catching 30-50% of the day's move makes sense to me. From reading some of your PDF's about the 10.X method, I understand you check your trades during each session and bank whatever profits the markets have made available to you. Personally, I'm able to check my charts twice a day - about an hour before London open and then right before US close. In this case, would you consider a better strategy to target a fixed % of the daily move when placing the trades or just bank profitable positions manually whenever I check...
I take profits or let them run based on what I think the market fundamentals are for that day or week. Last years Japanese run was a good example, you didnt need charts the fundamentals were so strong you just jumped in anywhere and go with the run. Go look at a weekly or daily chart and count how many candles are full bodied (the wicks are much smaller than the candle body) compared to ones that are not. Then go to a 15M or 1H chart and watch price action as it went from open to close for that day candle or weekly candle. Do you see the spurts and then retracements? Get a feel for the market and how it moves. Does it look like the move is done for the day but it is only the euro session? What drove it to that point? Was it a big news story or just the normal market move? If it is a big news story does it have the power to continue the move through the next session or day? If you dont know, grab your profit and go to dinner. If you know, wow the FED just changed interest rates, well now price can run for 2-3 days or for several weeks. Then you may want to ride the wave. That is how you look at taking profit. Since I dont know 90% of the moves on the screen and what drove the price I just take my profit and move on. But if I know then I will look for multiple entrances.

I posted a 1 hour strategy at my 10.7 thread its is on pg. 87. I got hit with NFA compliance at IBFX which puts a big hurt on using my multi level strategy. Although I appreciate the NFA in cleaning up the industry their stupid FIFO rulings is one of the dumbest things I have ever seen. Imagine this type of thinking used in real estate. You buy a house in 2000 another in 2007 got some bargains in 2010 and 2013. You want to sell the house you bought in 2010 for a nice profit but the govt. wont allow you until you sell the house in 2000 and 2007 which you are hanging onto until the market recovers more. I mean how dumb is that. Those guys have brain freeze on that one.

Anyway.... This adjustment hopefully will work with being compliant with NFA and FIFO. Bold trader posted his 1H strategy and he is a professional trader who runs his own group of traders. It also is interesting to study. I will probably start a thread using this 1H strategy later but I am still testing one more indi. The 10.7 series will work on any TF and any other strategy you like to use. It warns you of potential trades you can use and then check with your system.
  • #2,386
  • Aug 30, 2014 10:27pm Aug 30, 2014 10:27pm
Quoting merquise
{image}
Yes good article good thoughts.
  • #2,387
  • Aug 30, 2014 10:29pm Aug 30, 2014 10:29pm
Quoting VaBikePacker
{quote} nanningbob's posting is good - but another consideration is how much of a move for each of those pairs is an extended move on a weekly basis. I've found this to be extremely helpful info as well. Ex. - I think I've explained a little about this previously, so, my apologies if this is repetitive for some: I track the AUD/USD and GBP/AUD pairs throughout the week recording their 30m opens. I also keep up with how far each 30m open is from: - previous 30m (presents scalping opportunities galore when you can see historically with high instance...

Sounds like a nice simple workable system.
  • #2,388
  • Aug 30, 2014 10:34pm Aug 30, 2014 10:34pm
Quoting trader-f1
{quote} Thanks for the reply, Bob! Catching 30-50% of the day's move makes sense to me. From reading some of your PDF's about the 10.X method, I understand you check your trades during each session and bank whatever profits the markets have made available to you. Personally, I'm able to check my charts twice a day - about an hour before London open and then right before US close. In this case, would you consider a better strategy to target a fixed % of the daily move when placing the trades or just bank profitable positions manually whenever I check...
let me know what you think bob, Personally I use tiered pending trades taking profit at 20 pips and separated by the spread so that one closes before the other opens for when I am away, and I scalp the trades that are in profit when I see them while I am at screen, and I am at screen 8,10 times a day.. Trader-f1 could tier 60-75% atr of a pair this way, with success. (60% is safer)

EURCHF just never seems to reach any kind of a tp. EURGBP doesn't move enough to trigger my trade. This was true before I downloaded your paper and now I know why.
  • #2,389
  • Aug 31, 2014 4:03am Aug 31, 2014 4:03am
Quoting Rap Skallion
{quote} let me know what you think bob, Personally I use tiered pending trades taking profit at 20 pips and separated by the spread so that one closes before the other opens for when I am away, and I scalp the trades that are in profit when I see them while I am at screen, and I am at screen 8,10 times a day.. Trader-f1 could tier 60-75% atr of a pair this way, with success. (60% is safer) EURCHF just never seems to reach any kind of a tp. EURGBP doesn't move enough to trigger my trade. This was true before I downloaded your paper and now I know...

I have done tier trading and its a good way to multiply a move. When the markets are trading I look at my trades for the week and see if pocketed more moves than pips available. If I have I had a really good week. For example if eur/jpy moved 350 pips from high to low and I pocketed 4-500 pip I maximized the move. I just keep buying the dps/rallies and add some extra levels here and there. If you catch a nice trend for the week it makes for a great week. My schedule does not allow me to do as much of that as I like during the summer but now I hope to some more again in the fall. The two key periods, just before euro and usa opens are now free and I can set up my trades for those sessions again.

If you want to have fun learning to trade, for guys not familiar with multiple level trading, take a buy trade and a sell trade on two correlated currencies and see if you can make more pips than the losing trade loses during a week. I used to do this with the aud/usd on two charts. One I would sell and the other I would buy. I would close and reopen the one in profit and see if I could earn more pips than one left open as a loser. Once you learn how to do that the market will no longer seem a mystery to you. Unless you run into a massive move, in which case you just stay hedged, you learn to trade yourself out of a hole. It was fun to do and you learn a lot.

I did this once in one of my threads several years ago and the aud/usd went down 130 some pips one day but I got 165 pips buying the rallies so profited 35 pips even though I was trading against the trend. Its fun to do and quite a challenge. If you can do that believe me the market simply does not scare you anymore.
  • #2,390
  • Aug 31, 2014 12:03pm Aug 31, 2014 12:03pm
Quoting nanningbob
{quote} If you want to have fun learning to trade, for guys not familiar with multiple level trading, take a buy trade and a sell trade on two correlated currencies and see if you can make more pips than the losing trade loses during a week. I used to do this with the aud/usd on two charts. One I would sell and the other I would buy. I would close and reopen the one in profit and see if I could earn more pips than one left open as a loser. Once you learn how to do that the market will no longer seem a mystery to you. Unless you run into a massive...
This is exactly what I have been doing with the EUR/JPY and GBP/JPY for 18 months now!
  • #2,391
  • Aug 31, 2014 1:25pm Aug 31, 2014 1:25pm
as a experienced trader trading live for several years, I would say it is Ok as long as you have a mental stoploss, even if you don't want a SL, you got to know where to get out if it doesn't go your way, and you should not be trading during news time because you will not be able to react in time, price can spike hundreds of pips in a single second. if you still want to trade during news time,you should use a stoploss especially during news or not trade at all.
Bulls are stupid Animals!especially when Im short!
  • #2,392
  • Aug 31, 2014 2:10pm Aug 31, 2014 2:10pm
Quoting merquise
{image}
I have read heaps of books saying put a stop loss , all put out by brokers and people worked or working for brokers guess what I don't use a stop and it works for me thanks for your article
people leave, but this thread will go on for ever
  • #2,393
  • Aug 31, 2014 2:11pm Aug 31, 2014 2:11pm
Quoting roughtrader
as a experienced trader trading live for several years, I would say it is Ok as long as you have a mental stoploss, even if you don't want a SL, you got to know where to get out if it doesn't go your way, and you should not be trading during news time because you will not be able to react in time, price can spike hundreds of pips in a single second. if you still want to trade during news time,you should use a stoploss especially during news or not trade at all.

well said
people leave, but this thread will go on for ever
  • #2,394
  • Aug 31, 2014 2:23pm Aug 31, 2014 2:23pm
Quoting roughtrader
as a experienced trader trading live for several years, I would say it is Ok as long as you have a mental stoploss, even if you don't want a SL, you got to know where to get out if it doesn't go your way, and you should not be trading during news time because you will not be able to react in time, price can spike hundreds of pips in a single second. if you still want to trade during news time,you should use a stoploss especially during news or not trade at all.
It's funny because I make a lot of money off the news without a fixed stop loss. If one pair goes against you another goes for ( complementary correlation). the market usually overreacts and comes back so you take your money and run on the pair that went your way and wait for the rebound on the other one.

Traders should learn how to trade the news. stoploss frequently does not work because the market makers will frequently swing the price this way and that to rake in pending trades and stoplosses before letting the market go the way it should. trade the move and not the news, I have seen the move ignore the news and go the other way without reason
  • #2,395
  • Aug 31, 2014 3:51pm Aug 31, 2014 3:51pm
Quoting Rap Skallion
{quote} It's funny because I make a lot of money off the news without a fixed stop loss. If one pair goes against you another goes for ( complementary correlation). the market usually overreacts and comes back so you take your money and run on the pair that went your way and wait for the rebound on the other one. Traders should learn how to trade the news. stoploss frequently does not work because the market makers will frequently swing the price this way and that to rake in pending trades and stoplosses before letting the market go the way it should....
ofcourse if you only trade the news and know what you are doing it is another matter becauses that is all incorporated in your strategy, but most traders not trading the news tend to get hurt by them and to sit on the sidewalk during that time might not be a bad idea
Bulls are stupid Animals!especially when Im short!
  • #2,396
  • Aug 31, 2014 4:05pm Aug 31, 2014 4:05pm
Quoting nanningbob
{quote} I take profits or let them run based on what I think the market fundamentals are for that day or week. Last years Japanese run was a good example, you didnt need charts the fundamentals were so strong you just jumped in anywhere and go with the run. Go look at a weekly or daily chart and count how many candles are full bodied (the wicks are much smaller than the candle body) compared to ones that are not. Then go to a 15M or 1H chart and watch price action as it went from open to close for that day candle or weekly candle. Do you see the...
Thanks for the reply once again, Bob.

I still need to develop this "feel" for the market which you already have.
I think at this moment I will incorporate some sort of fixed % based on the daily/weekly ATR while I learn this multi-level trading approach.
Going to have a read through your 1H strategy at the 10.7 thread.
  • #2,397
  • Edited Sep 1, 2014 2:17am Aug 31, 2014 5:09pm | Edited Sep 1, 2014 2:17am
Quoting roughtrader
{quote} ofcourse if you only trade the news and know what you are doing it is another matter becauses that is all incorporated in your strategy, but most traders not trading the news tend to get hurt by them and to sit on the sidewalk during that time might not be a bad idea
I agree that trading during the busy, news-driven days is a different animal. teus, wed., and thursdays are the busy days. the US session at opening and around ten o'clock are especially raucous. You have to acquire a touch. But then that touch is good during any breakout. Somewhere almost every day some pair breaks out.

There are those who are very good at trading channels, knowing just when they will turn back for the other side, and taking advantage of that.
I admire them, but I know I am no good at that.
A new trader needs to determine which style He is best at. There are very very few who are good at both channel and breakout. this is a source of many conflicting lines of thought
  • #2,398
  • Aug 31, 2014 6:35pm Aug 31, 2014 6:35pm
Quoting roughtrader
as a experienced trader trading live for several years, I would say it is Ok as long as you have a mental stoploss, even if you don't want a SL, you got to know where to get out if it doesn't go your way, and you should not be trading during news time because you will not be able to react in time, price can spike hundreds of pips in a single second. if you still want to trade during news time,you should use a stoploss especially during news or not trade at all.
Here's my take on news time trading ... .

Read your econ calendar and look at the pairs that are most likely to be affected by the announcement.

Develop some kind of strategy that will take advantage of pair movement, potentially in both directions (since you don't know what the news will be). This can involve breakout plays using Donchian channels, pivot point levels, Ichimoku and the like. If you want to hedge, but you're not able to hedge within the pair (most U.S. brokers don't allow this), consider hedging with substantially correlated pairs.

Set up good for day entry orders to take advantage of news-related movement. Do not attempt to chase news-related movement with market orders.

Be prepared in some fashion for lack of follow through on the breakout. This is perhaps the only situation in which I actually do use a stop loss to ensure a breakeven proposition in the event that the breakout peters out or to at least capture a small bit of pippage if the breakout goes nowhere. I generally prefer to trade breakouts only if I can have "eyes on the chart" as the news is released so I can move up the SL manually, although there are also off the shelf scripts and such for MT4 that can move the stop to BE for you once price clears a particular objective.

Post-news, be prepared to take advantage of not only the breakout, but potential retraces that occur thereafter, as well as potential "news traps," which can sometimes be as constructive as the movement that immediately follows news releases. See https://twitter.com/Break_Retrace3

As a purely personal choice, I tend to trade right through news events. It's my feeling that most major news announcements, such as rate announcements, are basically telegraphed to the market far in advance of the actual news release. Moreover, given my way of trading, if price happens to move in a manner adverse to my position, well, that's another entry opportunity for me ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #2,399
  • Aug 31, 2014 7:27pm Aug 31, 2014 7:27pm
Quoting ZebraSquirl
{quote} Here's my take on news time trading ... . Read your econ calendar and look at the pairs that are most likely to be affected by the announcement. Develop some kind of strategy that will take advantage of pair movement, potentially in both directions (since you don't know what the news will be). This can involve breakout plays using Donchian channels, pivot point levels, Ichimoku and the like. If you want to hedge, but you're not able to hedge within the pair (most U.S. brokers don't allow this), consider hedging with substantially correlated...
  • #2,400
  • Aug 31, 2014 8:00pm Aug 31, 2014 8:00pm
LOL I hate news trading.
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