Building an equity millipede | Page 334 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Thegman's Journal (Equity Millipede Concept) 102 replies

Trading an Equity Millipede 23 replies

Equity millipede & Flying Buddha trading journal 9 replies

Build an Equity Millipede with the filtered Flying Buddha 171 replies

Application Development - Journal of Building an equity millipede 14 replies

Attachments: Building an equity millipede
Exit Attachments

Building an equity millipede

  • #6,661
  • Oct 14, 2014 10:24am Oct 14, 2014 10:24am
Quoting 60minuteman
{quote} I believe it may be true for you, right now, beyond that there's no evidence. Entry technique is a very small part of the puzzle Agree there's no need to be offended because someone disagrees with your opinion
LOL coming from a person who does seems to become offended when someone does disagree with them by putting them on ignore afterwards.
  • #6,662
  • Oct 14, 2014 10:41am Oct 14, 2014 10:41am
Quoting 60minuteman
{quote} I believe it may be true for you, right now, beyond that there's no evidence. Entry technique is a very small part of the puzzle Agree there's no need to be offended because someone disagrees with your opinion
Again 60 with respect I was sharing my experience, don't really see the relevance of "I believe it may be true for you, right now, beyond that there's no evidence"
I do not need to provide evidence to anyone only myself as this was 100% true to me. I shared my experience to contribute. It may or may not help someone. Yes there is more to this than entries but again in my personal experience of this it was baby steps, one thing at a time. Not offended in any way just being clear that my experience was not partly true it was fully true. Just as you believe there is no need to remove risk quickly is fully true to you. Do you now see what I mean?
Once You See, You Can't Unsee But You Will Get The Odd Poke In The Eye
  • #6,663
  • Oct 14, 2014 11:39am Oct 14, 2014 11:39am
Quoting yonseo
{quote} Yes you do enter 2 positions at every 00 level which means you run the risk of -200 pip loss until you TP 1 position at the next 00 level. Basically your stacking positions if a trend happens while giving the holding position extra 100 pips room to breathe. The concept is similar to Peter Crowns free trade at 1:1 so that you get that extra cushion space for price to breathe when the free trade occurs. The biggest weakness of this approach is when price ranges less than 200 pips. You will get whipsawed -200 pips both directions and potential...
Yonseo, thank you very much for your reply. I understand the concept of free trade and understand the mechanics of puting on the first trade (already mentioned these in my original post). What is not clear to me are the subsequent trades. May be I am not explaining myself well so I will use an exmaple.
GJ is coming down from 173.00, so I put in a sell stop at 172.00 with two positions A&B. Both have a SL of 100pips, but only A has a TP of 100, B has no TP. Price hits 172 and trade is initiated. Price continues to 171. Position A closes with +100pips. Position B now left to run as free trade. Now I need to place another sell stop at 170.00 as per the rule. Where I am confused is do I place two new positions with the same parameters (both with 100pips SL and one with 100pip TP) at 170 or just one new position? If just one new position, what SL and/or TP I should use if any? I hope I have made myself clearer? Thanks
  • #6,664
  • Oct 14, 2014 11:56am Oct 14, 2014 11:56am
Quoting danjuma
{quote} Yonseo, thank you very much for your reply. I understand the concept of free trade and understand the mechanics of puting on the first trade (already mentioned these in my original post). What is not clear to me are the subsequent trades. May be I am not explaining myself well so I will use an exmaple. GJ is coming down from 173.00, so I put in a sell stop at 172.00 with two positions A&B. Both have a SL of 100pips, but only A has a TP of 100, B has no TP. Price hits 172 and trade is initiated. Price continues to 171. Position A closes with...
I think you did make it clearer. Good example because I trade GJ almost exclusively these days.

So going back to your example as a sequence:

1. Price comes from 173.00 towards 172.00:

a) You place 2 pending SELL stop orders at 172.00 and with SL at 173.00, if the order triggers then you also need to place 2 pending BUY stop orders at 173 incase of a reversal.
b) You also need to place 2 pending SELL orders at 171.00 with SL at 172.00
c) 1 SELL position at 172.00 is TP'ed out at 171.00 for 100 pips profits.

2. Price comes from to 172.00 towards 171.00:

a) Your 2 pending SELL orders will trigger at 171.00 and with SL at 172.00, if the order triggers then you also need to place 2 pending BUY stop orders at 172.00
b) You also need to place 2 pending SELL orders at 170.00 with SL at 171.00
c) 1 SELL position at 171.00 is TP'ed out at 170.00 for 100 pips profits.

You can actually place both BUY/SELL stop pending orders in advance. Even like 500~1000 pips away beforehand. All you need to do then is place reverse pending orders when a current BUY/SELL stop order triggers. This approach literally takes less than 5minutes of your time a day if you place orders beforehand. Just set alerts to your phone when the order triggers since thats the only time you need to get on your screen to place the reverse order.
  • #6,665
  • Oct 14, 2014 12:23pm Oct 14, 2014 12:23pm
Quoting yonseo
{quote} I think you did make it clearer. Good example because I trade GJ almost exclusively these days. So going back to your example as a sequence: 1. Price comes from 173.00 towards 172.00: a) You place 2 pending SELL stop orders at 172.00 and with SL at 173.00, if the order triggers then you also need to place 2 pending BUY stop orders at 173 incase of a reversal. b) You also need to place 2 pending SELL orders at 171.00 with SL at 172.00 c) 1 SELL position at 172.00 is TP'ed out at 171.00 for 100 pips profits. 2. Price comes from to 172.00 towards...
Sir, thank you for the explanation. Much obliged.
  • #6,666
  • Oct 14, 2014 6:58pm Oct 14, 2014 6:58pm
For those who have been asking me for the DIBS video, I tried to upload to save the frustration on both parties.

See if this link works:

http://depositfiles.com/files/as7wmqcl7
  • #6,667
  • Oct 14, 2014 7:17pm Oct 14, 2014 7:17pm
Quoting TheRealDeal
1. Participation 2. Low Risk Entry 3. Growth {image} @VEEFX: i used Forex Tester
You buy when up, and sell when down,capturing whatever the market gives you, which is why you equity curve is a mirror image of price. I think I get it.

thx for posting
  • #6,668
  • Oct 14, 2014 11:42pm Oct 14, 2014 11:42pm
Quoting yonseo
For those who have been asking me for the DIBS video, I tried to upload to save the frustration on both parties. See if this link works: http://depositfiles.com/files/as7wmqcl7
Thanks Yonseo, works for me.
  • #6,669
  • Oct 15, 2014 4:49am Oct 15, 2014 4:49am
thank you for that video yonseo.
much appreciated.
  • #6,670
  • Oct 15, 2014 3:23pm Oct 15, 2014 3:23pm
Quoting TheRealDeal
Hello Traders! I am sorry to interrupt your hot discussion about who i am, but i decided to backup what i said in my last posts with some backtesting. In no way i am trying to prove myself, however i will try to prove my point. Unfortunatelly i cannot provide you backtest data of thousands of trades, because i am relatively busy. 420 Trades overall: 90 Wins, 156 BE, 174 loses. Test Time: 2 years (2005-2006) Method: On H4 TF wait until engulf or outside bar forms (bullish or bearish - we enter both sell and buy regardless of the trend) Entry: On...
Wow, quite impressive and inspirational.
Do you really in live trading also rely only on inside bars as entry method and achieve similiar results? No matter what the trend is?
I am asking this becaus I once have myself an EA programmed that trades IBs and tried to test a strategy with it. It was not successful to take any IB at least not with the EA I tested it.

Thanks,
Myrmica
  • #6,671
  • Oct 15, 2014 4:10pm Oct 15, 2014 4:10pm
Quoting Myrmica
{quote} Wow, quite impressive and inspirational. Do you really in live trading also rely only on inside bars as entry method and achieve similiar results? No matter what the trend is? I am asking this becaus I once have myself an EA programmed that trades IBs and tried to test a strategy with it. It was not successful to take any IB at least not with the EA I tested it. Thanks, Myrmica
You can't trade IBs sucessfully with an EA because not all picture perfect IBs are the same. On top of this, people have individual discretion as to how and when to exit their positions.

Peter Crowns gives out a hint in post:

http://www.forexfactory.com/showthre...de#post1947945

The positions closest to the daily open have the biggest potential to survive because the position might end up being near the weekly or monthly open. These are the VIP positions that return immense profits.

Other positions which have a much less potential to survive are better off closing out for relatively smaller profits. In another words make good use of the lesser non VIP positions while they are useful because they becomes useless once they die on BE. These positions alone should be more than enough to cover all your losses and add profits to your balance.

If you observe TRD's charts, you will notice that the positions are either:

1) near the weekly open
2) tip of weekly wick

Anyone who TRUELY knows how to trade this approach should be able to discern that the positions NOT near the daily/weekly/monthly open and/or wicks did exist but do not appear on TRD's charts because these are the positions that he diversified at ranges of the higher timeframes to cover his losses and add profits to his balance.
  • #6,672
  • Oct 15, 2014 6:07pm Oct 15, 2014 6:07pm
Thank you yonseo for your answer and ideas.
So if I take an inside bar, no matter what the direction is close to the start of the week then this would be a good start for a method?
I am trying to trade on the 4h timeframe because I have no time intraday.
  • #6,673
  • Oct 15, 2014 6:17pm Oct 15, 2014 6:17pm
Quoting yonseo
{quote} LOL coming from a person who does seems to become offended when someone does disagree with them by putting them on ignore afterwards.
I put you on ignore because you were being a dick.
tradewith60
  • #6,674
  • Oct 15, 2014 6:23pm Oct 15, 2014 6:23pm
Quoting Myrmica
Thank you yonseo for your answer and ideas. So if I take an inside bar, no matter what the direction is close to the start of the week then this would be a good start for a method? I am trying to trade on the 4h timeframe because I have no time intraday.
There are no hard and fast rules as to which direction we should take the trade when an inside bar forms, except for the rules and filters set by the individual trader. The filters and/or rules you set for inside bars has give and take tradeoffs.

One approach for trading inside bars according to Peter Crowns for 4H Charts is to consider the current weekly open(CWO) and previous weekly close(PWC). You take take buy breakouts above CWO/PWC and sell breakouts below CWO/PWC. Sometimes you get insidebars crossing the CWO/PWD which allows breakout trades in both directions. These are the positions that have the highest chance to survive if a strong movement in either direction forms.

Of course I am not saying these are the only inside bars worth taking, you amplify profits from stacking positions in a trend by taking the other lesser inside bars in the same direction.
  • #6,675
  • Oct 15, 2014 6:28pm Oct 15, 2014 6:28pm
Quoting 60minuteman
{quote} I put you on ignore because you were being a dick.
LOL You got to be kidding me.

1. Quoting someone out of context (You)

2. Asking someone to not quote them out of context (Me)

Who's being the dick?
  • #6,676
  • Oct 16, 2014 12:57am Oct 16, 2014 12:57am
Quoting yonseo
{quote} LOL You got to be kidding me. 1. Quoting someone out of context (You) 2. Asking someone to not quote them out of context (Me) Who's being the dick?
And 60minuteman - Please PM each other if you want to have an issue, no need for it to be put in this or any other thread.
  • #6,677
  • Oct 16, 2014 1:04am Oct 16, 2014 1:04am
Quoting Myrmica
Thank you yonseo for your answer and ideas. So if I take an inside bar, no matter what the direction is close to the start of the week then this would be a good start for a method? I am trying to trade on the 4h timeframe because I have no time intraday.
The best method is to just trade them, record each trade and take a screen shot. At the end of each month have a look at the overall balance of your account, check each screen and trade and record what you see.

I have done this in the past, and really now that I am writing it I should be doing it more today. Take a screen shot of the setup BEFORE you execute your trade and store it. In a month's time when you should be doing a revision of the previous months trades, look back on those screen shots and ask yourself what direction you would trade eacg in. If your answer lines up with your actual trade then take notes, if it doesn't ask yourself the question.

Eventually this is how you will start to find little things that work in setups better than others but without actually trading them and learning from your past then you will not find long term success. Business is exactly the same, each month I do a thorough revision of the previous month because without it how will I learn what worked well, what can be improved and what was a waste.

RT
  • #6,678
  • Oct 16, 2014 1:54am Oct 16, 2014 1:54am
Quoting Myrmica
Thank you yonseo for your answer and ideas. So if I take an inside bar, no matter what the direction is close to the start of the week then this would be a good start for a method? I am trying to trade on the 4h timeframe because I have no time intraday.
@yonseo, Razor_trader: Firstly, thank you for your contribution. I guess we can keep Graeme's goal alive a little longer.

@Myrmica: Before you start doing something, you have to understand the reason it happened, the purpose of it and its structure. What are IBs? How traders create them? Why? What they represent in the market? What is the reason IBs exist?

After you find the answers for all these questions, you can ask yourself more questions about the way they form and the location in the inside bar formation. Inside bar forms near the extremes of the mother bar or in the middle? What were the traders thinking when they created inside bars on both locations? Can this give us a clue about survivability of the trades and about its risk reward?
Where is the close of the mother candle? Where is the close of the inside bar? Is it near top, bottom or middle of mother candle? Is the IB a bold or some indecision candle?
Location: Where is the setup located on HTF?
News: Is there any major news event coming soon?

IB is a tricky entry pattern, because they represent a range or pennant, which is about to break either up or down. But when we enter (on break) we assume that momentum will develop, before it develops. Institutional traders know very well these locations and prepare to hunt your stop.

On the other hand IBs represent the best risk reward i am aware of and the best place for your legs to survive long term.

i hope i helped


TRD
  • #6,679
  • Oct 16, 2014 2:25am Oct 16, 2014 2:25am
Quoting TheRealDeal
{quote} @yonseo, Razor_trader: Firstly, thank you for your contribution. I guess we can keep Graeme's goal alive a little longer. @Myrmica: Before you start doing something, you have to understand the reason it happened, the purpose of it and its structure. What are IBs? How traders create them? Why? What they represent in the market? What is the reason IBs exist? After you find the answers for all these questions, you can ask yourself more questions about the way they form and the location in the inside bar formation. Inside bar forms near the...
I have seen a lot of references to the big guys hunting the retailers stops lately - Is that really true - I find it hard to believe that Deutsche Bank gives a second thought to my single contract?
  • #6,680
  • Edited 5:08am Oct 16, 2014 4:30am | Edited 5:08am
Quoting stewrigh
{quote} I have seen a lot of references to the big guys hunting the retailers stops lately - Is that really true - I find it hard to believe that Deutsche Bank gives a second thought to my single contract?
I tried on purpose not to mention about how big boys trade and move the market, because this is advanced stuff and will confuse the new traders here. Unfortunatelly it is a fact and it has a lot to do with the market structure.

So imagine you run a hedge fund with 600 mil $. Your clients wish that their orders are executed at the best possible price. They want to buy at bottoms and sell at tops. Let take a buy as example. In order to execute these big buy orders at bottoms you need to have a lot of traders in sell postions at same time to buy from them. Otherwise you won't be able to get filled or will get huge slippage at fill. But retail traders are not so stupid, they want to buy, unless the previous low is broken. So what ITs (institutional traders) do, they start selling heavily instead of buying and force price to break some imporant S/R. The reason is to attract the breakout traders. Break out traders see that line is broken and jump it. They push the price harder down. The buyers, which are long at the swing low, start closing postions or they have their SL hit. This gives the price bigger inertia to the downside. So finally there is liquidity for the ITs to buy. They start deploying their buys positions on chuncks as price falls. They try to hide this in lower TFs, but it is easy to see because as price goes down it leaves big wicks pointing to the upside.

Some traders call it compression. So on the way down they are deploying buy positions and activating more sell orders (limit sell orders) to get 2 things: more liquidity and free the way for the up move later, so they can push the price up relatively easy. Now all sellers are trapped and start closing. This pushes the price up and momentum is created. This is the reason for the engulfing pattern. It represents the other side of a trapped retailer. So price flies too fast that there many left buy orders. What ITs do after, is just take some profit and reverse the price back down trapping again some buyers. They reverse because they want to use places of interest with higher liquidity. So while price goes down again , they are buying again, because they have more money to deploy. So now they need cooperation of other traders to help them reverse price back up in their desired direction. And this happens exactly at the place where last time retailers were trapped and so many buys orders where left unfilled. Supply and Demand traders get their orders filled and price starts to climb up ones again. At this time ITs have loaded all their 600 mil into buy positions and can go home happy. If they are not satisfied they will repeat the process until they are.
All of this you can see on the chart as Fakeouts, Engulfing pattern, Quasimodo. I especially love QMs.

It is important, when you trade, try not to look for pattern on the chart, but to understand what actually happened. Who participated in the market and how?

i hope that helped

TRD
4 traders viewing now