Trading is as simple as ABCD

Just been reviewing my days trading and I discovered a funny thing...

I wandered how come I'd lost 2 % today because I hadn't done too badly on entries etc so was a bit confused to see the days loss at 2.5% but when I looked at my losers today it became very apparent what had happened...

I started the day using Teds new EA for trailing in my entry and automatically managing my trades until I realised it was getting me in a bit too early giving me some unnecessary losers. However it also has an automatic trade size selector on it which was trading at around 2.5 lots but when i took over control again and started manually entering apart from the fact that I started to win or BE nearly every trade, but unfortunately for some strange reason I was trading at 0.25 lots a tenth of the size of the losing trades from my earlier trials of Teds EA.

So the cardinal sin, bigger losers than my winners and despite a very healthy win/loss ratio I lost more money over the day... Just goes to show the importance of getting bigger winners than losers and certainly bad news to be around the other way...

Oh well lesson learned but nice to know if I'd used the same size as the losers then I'd of been up about 10% on the day so not so bad after all...

I liked the EA but I think it needs a bit of adjustment before I use it again most importantly the entries were placed above the actual price not the top of the candle hence the entries being too early....

Oh well back to manual entries tomoz will have to do all the hard work myself...

How are you determining which candle to enter on top of? Is based on the CCI pulling back under the 100 for a short? Is it once it closes the first candle with the CCI in the red for a short?

I know you have said you drag the order 2 pips below the previous candle during the pullback for a short. Is that it? Once you see the CCI at 100 or more, and within 20 pips of the red 100 lwma, you place your limit order and wait for it to hit 2 pips south of the previous candle? Just curious. I am entering more on feelonce I see the other criteria meet. I have been tempted to place a limit order at the 100LWMA, looking at the touch trade, as you called it.

Just finished reviewing my days trading and theres a couple of things I've learned from today, I still had a couple of crazy top of the wave buys, when I see positive candle action and terrified I'm going to miss out I jump on board only to see my trade reverse immediately leaving me stranded at the top of a wave so either sweat through a heavy drawdown or get stopped out for my 20 pips..

But what did stop me today from rushing in like that is my new 20 pip rule from the 100lwma because most of those entries are miles away from the lwma. Also I am making a rule to only enter trades when the CCI is overbought for a sell or oversold for a buy. It so improves your chances of getting a longer run. In fact the more overbought or sold the better as long as price doesn't take out our A point, soon as that happens invalidates ABCD setup.

One other thing from today was my tendency to let trades go positive say 10 pips then sit there and let them come back to BE... Crazy, got to start banking if it doesn't break B. Crazy not to as the price will inevitably come back to my entry level and give me another signal so if I bank the first run then I can re-enter and bank the 2nd until either one goes through or on the 3rd failed drive I'd have to consider trend is under threat.. also when price breaks B it normally flys straight through with hardly a pause so anything else just bank...

I've noticed something else today too, nothing new, but even when the trade breaks B and turns at its eventual D point I need to bank, even strong trends will come back from that last drive retracing practically all the push up so there's no point in leaving it to turn back and hold just in case it goes back up. far better to bank and if it goes again jump back on. That way I'll be getting the vast majority of the runs twice so banking twice as much from each momentum run. This way works well on both types of days trending or the more popular rangier days like today...

Last point from today, I can't help but notice some of these reversals are very easy to spot with a break and retest of the 100lwma being an absolutely awesome entry. Unfortunately these reversals won't appear on the TTindy early enough to catch these 100lwma break and retest entries, but I have got an alert on the lwma whenever it changes slope. I liked to then hold it until the lwma changes colour again. And any entries in between just scalp the CD move or grab an orphan. Here's a great example on EURNZD today.



Theres gonna be plenty of false starts I guess but the aim is to get those bigger winners and the earlier we get in the new trend the better...

Hi Capstone

Have you read my detailed entry post where I described it step by step?? http://www.forexfactory.com/showthre...39#post7856639

Just to clarify lets say I'm buying from the chart below, the point to remember is that price is approaching a level where you think price is going to reverse and go back up with the trend. In this example its the 100lwma but it could of course be any of our key levels or in fact several of them. Now look at the CCI reversing first it has to go oversold so below the -100 level. Then I'm waiting for the first CCI candle to be shorter than the last telling us downward momentum is dropping away so we can fully expect price to follow soon. This is the 09.10hrs CCI candle is shorter than the previous one so telling us price is slowing ready to turn. Thats when I first start to drag pending buy stop, not a limit order as per your post. If you want to play safe wait for the first green candle back with the trend then drag your order down 2 pips above the ask price, not the top of the candle as this is the bid price. I use the tick box to identify the ask price level as the candle closes.

I hear what you're saying about a limit order but I'm not so keen as quite often price doesn't reverse and just keeps going counter trend. The reason I like stop orders is because price has to move back with the trend for your trade to get hit, its confirmation you're right..

If the CCI candles keep shortening as per this example just keep dragging it down until it gets hit or if momentum goes back up again, the CCI candles get longer , then leave it where it is or move it away the price might keep going and reverse completely.

What you will notice if you start to do this is that the tick chart will be trending down nicely towards your key level with LLLH's , when all of a sudden it will reverse and start producing HHHL's thats when a green candle will start to appear. When you get really good at it you will drop the pending order above the first HH on the tick chart and enter on a breakout on the tick chart, these entries goto break even pretty quickly. If you catch it right the tock chart will continue to trend up back with the trend and leave your entry as clean as a whistle, never to return... Thats how I get my entries to BE so early and very often go to BE in the same one minute candle...

When you first start I might suggest waiting for the first green candle back with the trend to close and drag Buy stop 2 pips above it...Whilst doing it just observe the tick box reversals and you're see what I mean..

Hope that helps, but quite hard to explain with words so I might try and make a video of it next time I trade and post it here....

EDIT: Just thought I'd add a very important point about this entry technique, only use it on strong trending pairs that you fully expect to fly back with the trend, just can't over emphasise that enough all this stuff works on strong trending pairs...no guarantees of course even with that

Another day starts....

News wise its gonna be quiet this morning with French on bank holiday but this afternoons US session is going to be even quieter I guess with US and CAD on holiday..



TTindy very quiet too not any strong trends yet with all pairs in single figures. bit of overnight JPY weakness..



As I type it looks to be warming up a little as GBP strength building with GBPJPY top..

First trade of the day and grabbed myself a little orphan as price faltered at R2 but of course like I said yesterday should of let this one run a bit more, lol

Only kidding good reason to grab the little monkey, I'm happy...

Grabbed another 21 pips there in about in about 2 mins....

Back in again BE in same 1 min candle...

Good start to the day another 16 pips there and in and at BE in same candle again...42,6 pips so far..

These are the days I love

Just waiting for that GBPJPY to pullback a bit time for a correction I think back to 183.25 and the 100lwma...

Meanwhile let me just talk quickly about trading 1 minute charts. Many traders have the belief that 1 minute charts are just noise and too difficult to trade, well just for those guys heres a noisy 1 minute chart..



But I'm not trading that chart am I??? Why would I when I can trade this chart , absolutely text book trading just like those trainers show us on their £2,000 training courses and thats the last time you see a chart like it!!!!

No i like trading charts that look like this..



Nice and easy to trade, trend trading at its simplest form... Strong AB moves followed by perfect BC moves,50% pullbacks, followed by lovely CD moves...Couldn't be simpler could it???

Now how did I know not to trade GBPCAD but to trade GBPJPY??

Easy one is in my top 8 trenders in fact top and the other is nowhere to be seen.....

Only trade strong trending pairs no matter what timeframe you trade it makes it so much easier even on these notoriously noisy 1 minute charts....

Many a true word spoken in jest!!

Nice.

Even my hated breakout trade works on strong trenders, went to BE in same candle so all risk off the table immediately...

Hello clivepackham,

Today i am also trade with GBPJPY. And about 1 min charts. still i don`t do


1 minute charts

Morning Clive - UJ has been kind to me this morning (so far).

And the trend continues with a nice little breakout entry lets hope it gets away this time...

Well done Mike fancy posting a chart when you stop for a cuppa??

Another 19 pips there but like I said yesterday when I didn't take my orphans but should of done , today I've been grabbing orphans left right and centre for 61.2 pips but if I'd of left my trades to run today I would have 100+80+60+25=265pips and still going!!!!

Just don't know before hand whats going to happen do you??? But either way its fine as orphan grabbing will work on all day types...

Ted??? Hows that hindsight indicator coming along????

Hi Muhitalam

What timeframe do you trade???

You should give them a try on demo of course, I'm up about 16% today and if I'd of held more like 60% but only risking 5% per trade whats your % profit from this GBPJPY run today???

Not one loser today either and more importantly my risk is normally off the table within a few minutes at most. Don't do drawdown if I can help it...well not for more than 2 minutes anyway....

Gave 10 back with a silly momentum trade but back under control with this nice pullback entry back with the trend hopefully upwards on onwards..