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Multi-Lot Multi-Timeframe Position trading

  • #461
  • Nov 5, 2014 6:47am Nov 5, 2014 6:47am
Quoting marshalmax
Oops. Didn't go quite according to plan. Waiting for a pullback can sometimes mean you miss good solid moves because you wait for red candles when the move currently in play is a multiple blue candle move! So I placed an entry order at 40p above the 2nd trade just in case as a last resort. Well 30 mins into that hour it triggered and by the end of the hour was already at +25p! The beauty of multi lot multi timeframe trading as Grav put it is that you are getting higher accuracy in your entries but also you are milking that sucker when you get it...
Glad it's going well for you MarshalMax. Keep entry costs VERY low and pile on the good trades when they are going well. Be prepared to reduce risk real quickly when it turns, and it always does eventually. I can't say when things are going to turn, but you'll see it on your bottom line. Make sure you get out with most of your profit from a good run, at least half, but more is better. In the end, your success is determined much more by how quickly you reduce risk in a downturn than by how well you take advantage of a good run. In a good run, you've only "found a possible source" of pips. They aren't yours until you take them. That said, my bottom lot on UJ long is now +260 and I'm planning to let it ride some more as long as the market shows no sign of weakness.
  • #462
  • Nov 5, 2014 7:20am Nov 5, 2014 7:20am
Quoting mk5
really really awesome exercise G ! love the way you show us how we should be losing. feels like im totally gambling before.
Glad you got something out of it MK5. In the end, making pips is kinda easy. Not losing pips is really hard. The successful traders probably don't make any more pips than the unsuccessful ones. The successful traders just don't lose as much as the unsuccessful ones. Gone for lunch with my daughters. Best success to you.
  • #463
  • Nov 6, 2014 9:17pm Nov 6, 2014 9:17pm
Quoting Graviton
{quote} Glad you got something out of it MK5. In the end, making pips is kinda easy. Not losing pips is really hard. The successful traders probably don't make any more pips than the unsuccessful ones. The successful traders just don't lose as much as the unsuccessful ones. Gone for lunch with my daughters. Best success to you.
seems like UJ is somewhere around a resistance.
thank you G ! enjoy your beautiful day with your daughter ! Cheers
  • #464
  • Edited 11:03pm Nov 6, 2014 10:52pm | Edited 11:03pm
Quoting mk5
{quote} seems like UJ is somewhere around a resistance. thank you G ! enjoy your beautiful day with your daughter ! Cheers

I believe the Japanese will take the UJ to 121 as quickly as they can get it there. I'm 4 lots long on UJ and might be 10 lots long by the time we get there. They were able to boost their inflation rate up to 3.7% in May, but it's fallen steadily since then to 3.2% now and still falling. They will not let the rate fall below 2% regardless of how many Yen they need to print. That's the reason the Yen has moved up 1300 pips from 102 where I first discussed that trade in this thread 6 months ago. It's a long term position trade and 100 to 150 pip pullbacks should be expected along the way. It's not for the feint hearted.
  • #465
  • Nov 10, 2014 11:20pm Nov 10, 2014 11:20pm
Didn't have to wait long. Gone from -600 yesterday and kept my cool and exercised patience and currently +1000p up! Now that is a swing!
Winners add to winning trades!
  • #466
  • Nov 11, 2014 12:57am Nov 11, 2014 12:57am
UJ broke the resistance.
  • #467
  • Nov 13, 2014 3:25am Nov 13, 2014 3:25am
Graviton,

I noticed that there seems to be a slight conflict in statements about your trading style. Do you keep some trades on to run, as you've suggested earlier in this thread, or do you keep closing the the longest/oldest one if a pullback knocks off the top/newest one (or puts it slightly negative)?

Doesn't this continually remove trades and not let them run for any distance?


As for my trading, I'm currently in a good position with UJ now, with 13 different trades on from 12-600 pips in profit and the top two having drifted down to roughly -8 and -40. The overall average BE is quite low, so going to let this ride for a while and either get out with only 20-30% potential profit (would be a bit gutting, but still a very good profit), or come up with one of those massive big wins that people suggest is 'idiot taking far too much risk'.

I'm working on letting profits run for a while (as mentioned in another thread), as otherwise we end up capping some potential big gains.


(note, I've take a few trades off from earlier, just to build my base capital slightly, but am now trying to 'hold ground' with my current trades and see what happens.)
  • #468
  • Edited 12:56pm Nov 13, 2014 12:04pm | Edited 12:56pm
Quoting Nefser
Graviton, I noticed that there seems to be a slight conflict in statements about your trading style. Do you keep some trades on to run, as you've suggested earlier in this thread, or do you keep closing the the longest/oldest one if a pullback knocks off the top/newest one (or puts it slightly negative)? Doesn't this continually remove trades and not let them run for any distance? As for my trading...
The question of how long to let a trade run is a vexing one. If price is in a steady trend, we'd like to let it run for a very long time to get as many pips out of that one trade as possible, but almost all trends come to an end eventually, and we really don't want to give back all our profits to discover that the trend has ended. Ultimately, this leads back to the most difficult question in trading, when, where and how do I exit trades?

We have no control over how long price will follow a trend, so it's not really a question of us deciding how long we want to stay in the trade. Ultimately, no matter what system we trade, the market makes that decision for us. If a long trade continues to strongly trend up, we certainly should ride that trend, if it reverses sharply and threatens to take back all our hard earned profits, we should exit and at least get away with some winnings. The cases that are in-between these two extremes are really the only ones we need to worry over. The retracements are nearly Gaussian over time, which is to say that the longer we stay in the trade, the larger retracements we are likely to experience. We can use that fact to help narrow our decision space a bit. The longer we are prepared to ride the trend, the longer we would want to see an exit signal develop before we bail out.

So, for instance, as long as the trend is strong and the retracements are weak, we should stay in the trade. Eventually, those factors will reverse and the trend will weaken and the retracements will strengthen. We have no control over that, but if we observe it we can get out with some profits off the trade. So, we are looking for a reduction in the strength of the trend and an increase in the strength of retracements, relative to the duration we have been in the trade. We can only know how long we have been able to stay in the trade so far. We can't predict the future and say how long we will be able to stay in it in the future.

If our goal is to ride a very few trades to very great profits, then we don't need anything very complex for an exit signal. All we really need is a simple and reliable method to decide when should we exit, and to know where to look for that signal. If you want the trade to run a month, you should be watching closely about two timeframes lower for your signal, or looking for it on the daily. Sometimes your signal might be false, causing you to exit a good trade too early, and sometimes the signal might be late, causing you to lose back more pips than you would wish. I don't think there is any way to make it perfect, but if you can get close, you can achieve your goal.

Since you are in UJ long, and I am too, let's look at it for an example. Here is a very simple daily chart with a 3emaX10sma crossover. It's pretty clear that we had a nice uptrend in Sept, a turn down in the first two weeks of Oct, then another uptrend that has run through now. I've been following it adding trades on the top in small dips and taking them off the bottom when price spikes up, riding the trade up as long as it will keep going. Using this signal, I would exit all long trades if the 3ema drops below the 10 sma:
Attached Image (click to enlarge)
Click to Enlarge Name: UJ 1.PNG Size: 55 KB
  • #469
  • Nov 13, 2014 12:10pm Nov 13, 2014 12:10pm
An even cleaner signal, which I have discussed here before is the RSI cross over the 50% mark. I like to combine both of these and use them to double check my decision, so it looks like this:
Attached Image (click to enlarge)
Click to Enlarge Name: UJ 2.PNG Size: 53 KB


To me, it looks like the signals of when to enter and when to exit are very clear. If there is any question about it, I'll be happy to go over it more.
  • #470
  • Nov 13, 2014 12:14pm Nov 13, 2014 12:14pm
You can add all the junk you want to it, but I'm not sure the result will be any better. So for instance, here is adding The CCI cross over the 0 line. It sometimes gives a quicker indication, but also might be more likely to give a false signal:

Attached Image (click to enlarge)
Click to Enlarge Name: UJ 3.PNG Size: 53 KB
  • #471
  • Nov 13, 2014 12:17pm Nov 13, 2014 12:17pm
Here is another. Adding the Heiken Ashi smooths out the candles and makes the trend really stand out:
Attached Image (click to enlarge)
Click to Enlarge Name: UJ 4.PNG Size: 58 KB
  • #472
  • Nov 13, 2014 12:22pm Nov 13, 2014 12:22pm
Some people like using trendlines and channels, and that looks like this:

Attached Image (click to enlarge)
Click to Enlarge Name: UJ 5.PNG Size: 68 KB


Now it's getting so messy I can hardly even see what is happening, but if you look very close, you can see price breaking out of the channels before any of the other signals flash. You'll also note that price is again close to dropping out of the channel today, but since all the other signals are still showing an uptrend, I'm not quite ready to bail out of this one.
  • #473
  • Edited 2:08pm Nov 13, 2014 12:42pm | Edited 2:08pm
So, my point is, I examine all timeframes before I enter a trade, but to exit, I'll decide how strong the trend is and how long do I think I can stay in it given current market conditions, then look two timeframes down for my retracement exit signal generated by the market. If I want to stay in it for a day, I'll look to the H1 for my exit signal, If I want to stay in it a week, I'll look to the H4. To ride a trend for a month, I'll look to the daily, for a year trend, look to the weekly for the exit. I think that addresses one of your questions.

As far as taking trades off the bottom for profits as I go, that doesn't prevent me from riding the trend from the bottom to the top. I'm just not necessarily riding it with the same trade from the bottom to the top. That is to say, as long as I have one or more trades running from the bottom to the top of the trend, I have an opportunity to take advantage of that entire move. Of course, it's possible for me to buy on high points and sell on low points as price trends up overall and minimize my profits over that run, or not even make any profit at all, but the opposite is also true. If I buy at low points and sell at high points over the course of that uptrend, I can make more pips that I could have just riding the same single trade from bottom to top.
  • #474
  • Nov 13, 2014 1:28pm Nov 13, 2014 1:28pm
Quoting Graviton
So, my point is, I examine all timeframes before I enter a trade, but to exit, I'll decide how strong the trend is and how long do I think I can stay in it given current market conditions, then look two timeframes down for my retracement exit signal generated by the market. If I want to stay in it for a day, I'll look to the H1 for my exit signal, If I want to stay in it a week, I'll look to the H4. To ride a trend for a month, I'll look to the daily, for a year trend, look to the weekly for the exit. I think that addresses one of your questions....
Hi G,

Very Clear. In fact Gorgeous!

I still have 3 trades open on UJ - 108, 109 and 116. Obviously the last is a bit under water, but I think that Japan is Hell bent on destroying the Yen while the world just stands by cheering them on. My regret is that this Developing Trend was as clear as could be with Plenty of Fundis and Techs, yet I failed to add on seriously perhaps at .00s on the way up. Combo of nerves and the distractions of Life I'm afraid.

My question is with such a strong Trend how many positions would you anticipate holding open before re balancing even if there is no weakness in the moment?

Still working 3 on with harvesting one if you want to add a fourth or a few more?

Best, AG
Do not dwell in the past, do not dream of the future, concentrate the mind.
  • #475
  • Nov 13, 2014 4:11pm Nov 13, 2014 4:11pm
Quoting Graviton
As far as taking trades off the bottom for profits as I go, that doesn't prevent me from riding the trend from the bottom to the top. I'm just not necessarily riding it with the same trade from the bottom to the top.
Ok, that is what I believe you were doing/suggesting, but it seems to slightly contradict 'staying in' a trade, which is what longer term traders would do.

---
If you are in trades A,B,C,D and price shifts back down to where D goes back to BE or less, you could take D and A to average a nice gain, but still be ready to run with B,C. If the trend has failed (or it's a rather large retrace - hard to tell which), you can decide what % of what is 'left' from the profit of C you want to take and set a limit there. This also goes for B, but you might try for a higher % of the profits (which could take it off before C) or a slightly lower % and set a limit.

I guess by the fact you are continually removing the longest trade, you are maximising profits (by taking the largest profits currently available off the table) as well as raising your average price closer to the current price, which will eventually (and quite 'naturally') take you out of the trend.


---
What confuses me about swing traders is how (why?) they manage to hold trades so long when you might see it drift in and out of profit over the course of a few weeks/months. The gains don't seem nearly worth it (when considering the amount of capital/margin you have tied up in the trade), rather than just take a good portion of a move, bank some profits and then get back in again if it keeps moving.


Appreciate your detailed responses, Graviton. Thank you.
  • #476
  • Nov 14, 2014 12:28am Nov 14, 2014 12:28am
very detailed. love the way you explained. keep it coming G.
  • #477
  • Nov 14, 2014 12:38am Nov 14, 2014 12:38am
Quoting Graviton
So, my point is, I examine all timeframes before I enter a trade, but to exit, I'll decide how strong the trend is and how long do I think I can stay in it given current market conditions, then look two timeframes down for my retracement exit signal generated by the market. If I want to stay in it for a day, I'll look to the H1 for my exit signal, If I want to stay in it a week, I'll look to the H4. To ride a trend for a month, I'll look to the daily, for a year trend, look to the weekly for the exit. I think that addresses one of your questions....


basically out of 9 timeframes if theres one going againt the rest i'll just look for entry there yeah ?
  • #478
  • Nov 14, 2014 2:45am Nov 14, 2014 2:45am
in a trend, just buy and wait, the trend will take care of the rest, could anything be more easy?
Bulls are stupid Animals!especially when Im short!
  • #479
  • Nov 14, 2014 7:18am Nov 14, 2014 7:18am
Quoting AlbinaGrande
{quote} Hi G, Very Clear. In fact Gorgeous! I still have 3 trades open on UJ - 108, 109 and 116. Obviously the last is a bit under water, but I think that Japan is Hell bent on destroying the Yen while the world just stands by cheering them on. My regret is that this Developing Trend was as clear as could be with Plenty of Fundis and Techs, yet I failed to add on seriously perhaps at .00s on the way up. Combo of nerves and the distractions of Life I'm afraid. My question is with such a strong Trend how many positions would you anticipate holding...
Well, Japan has definitely decided to create and sustain a higher degree of inflation than the US or Europe would be comfortable with. Their latest move was in response to inflation just dropping from 3.7% in May to 3.2% now. 3.2% would raise serious concerns in the US and would cause a real panic in Europe, but Japan is now so sensitive to deflation they consider that quick drop of 0.5% a real threat and they intend to do whatever they must to halt the slide back into a deflationary economy. If inflation steadies though, I'd expect them to ease up and try to stabilize their policies. That might cause a pause and consolidation for an extended period of time, but I can't see a major reversal being consistent with their policy.

Never worry about missing part of a trend though. No one can say when a trend will begin or when it will end. The regret of missed opportunities will only cause bad trading decisions going forward. There are thousands of trends occurring in markets all over the world at this very moment that I am missing. None of them matter. All that matters is where I have my capital now and what it is doing.

The total positions I will trade is a risk and money management issue. Risk management is key to surviving this business over the long haul. Remember that the market can do anything at any time. Making pips is really rather easy. Keeping them is hard as hell. When things are going the best, consider the worst case scenario. Just a few words from a BOJ official could collapse this trade in minutes. I don't think the Japanese would allow the Yen to drop back to 80.0, but it could easily drop 150 pips in a quick pullback. When you are making big pips, forget about making more and focus like a laser beam on keeping them.

Glad to see things are going well for you. Best success in the future.

G
  • #480
  • Nov 14, 2014 7:39am Nov 14, 2014 7:39am
Quoting Graviton
{quote} .... Remember that the market can do anything at any time. Making pips is really rather easy. Keeping them is hard as hell. When things are going the best, consider the worst case scenario. Just a few words from a BOJ official could collapse this trade in minutes. I don't think the Japanese would allow the Yen to drop back to 80.0, but it could easily drop 150 pips in a quick pullback. When you are making big pips, forget about making more and focus like a laser beam on keeping them. Glad to see things are going well for you. Best success...
Thanks G,

I currently have a wide Stop back at 112.5 for insurance purposes which hopefully does not get hit. If so, I would still be up 500 pips in total. When the Pull Back comes, I would obviously like to cover at a higher level which for me would at least initially mean an opposing Entry Order until things sorted out in a few days. From Panama I can Hedge/Freeze my position unlike the story in the US.

I really appreciate the time that you spend with us.

AG
Do not dwell in the past, do not dream of the future, concentrate the mind.
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