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Building an equity millipede

  • #6,821
  • Nov 23, 2014 4:38am Nov 23, 2014 4:38am
Hi to everyone,

I currently done my preparation for the next week of traging equity millipede. It shoud by just a short "roadmap" for the next week trading and pair I will focus on. Let me know if anyone interested in this kinds of preparations, we can maybe share it together.

These are just pure hindsight, I try to apply low risk entries on 5 min. charts, according to Graeme rules.

Kind regards

Solvermode
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  • #6,822
  • Nov 23, 2014 8:43am Nov 23, 2014 8:43am
Quoting eurozo
{quote} Hi danjuma, Not a problem. I use Yahoo as well. PM me with your email and I will send it to you. They have been of great help to me and I truly thank Graeme for everything he shared and taught!! I wish I could have posted it so everyone could benefit from it but maybe after you get it, you will be able too for everyone else. Zo


Danjuma and Zorrotrader, Let me know if you received the email with no problems






Zo
Staircase down to ride the elevator up.....wait..wait..wait for it
  • #6,823
  • Nov 23, 2014 9:36am Nov 23, 2014 9:36am
Quoting TheRealDeal
Graeme must be some kind of Saint to stay around for months. No wonder why he left and many others will...

  • #6,824
  • Nov 23, 2014 9:40am Nov 23, 2014 9:40am
Quoting eurozo
{quote} Danjuma and Zorrotrader, Let me know if you received the email with no problems Zo

Hi euozo, got it, may thanks. I have provided a link for other people to download it if interested.

https://www.dropbox.com/s/pyjdhlj46j...y%203.pdf?dl=0
  • #6,825
  • Nov 23, 2014 12:22pm Nov 23, 2014 12:22pm
Quoting danjuma
{quote} Hi euozo, got it, may thanks. I have provided a link for other people to download it if interested. https://www.dropbox.com/s/pyjdhlj46j...y%203.pdf?dl=0


Outstanding







Zo
Staircase down to ride the elevator up.....wait..wait..wait for it
  • #6,826
  • Nov 25, 2014 7:22am Nov 25, 2014 7:22am
I've been using this excellent method for around two months now, live trading on a demo account. I thought I would provide an update on my experiences with it so far.

I'm trading exclusively on the daily timeframe over 20 pairs (in general those with the lowest spread on my platform). I look at the charts and place trades just once per day for around 10 minutes in total.

For simplicity I look for only one candlestick pattern as my entry condition and place trades on a 'set and forget' basis with no TP (my current profit is floating profit from open trades). Once a trade is opened I do not look at it again - it either gets stopped out (most do) or stays open and becomes part of my floating equity.

I open about five trades a day on average and currently have around 30 positions open with a net equity gain of approximately 8,000 pips since I started.

Overall I'm impressed so far but intend to do longer-term analysis using software like Forex Tester or equivalent to see whether this level of performance is sustainable over the long term or if this is just a lucky streak.
  • #6,827
  • Nov 25, 2014 8:41am Nov 25, 2014 8:41am
Hi Soco.

What was the starting capital on the account, and what is the % of the account you're risking per trade?

What candlestick patterns are you looking for to place a trade? Engulfing bars, pins, inside bars?

Aside from looking for candlestick patterns, are you looking to trade with the daily trend, or are you just placing trades with the candlestick criteria only?

Are you only trading current strongly trending pairs, or anything that shows a good candlestick pattern?

Where are you placing your hard stop? Below/above your entry candle, or at the nearest support/resistance?

Are you entering trades on a lower timeframe, such as the 4, or 1 hour TM, or are you simply entering on the daily candle?

Going forward, are you looking to use any confluence with your entries, such as support/resistance, round numbers, trend lines, or Fib levels?

I'm not questioning the validity of your trades, just really interested in your progress and methodology. Good luck and please keep us all regularly posted.

This millipede strategy obviously has great long-term potential, if we can just get the entry criteria fastened down. And +8000 pips over 2 months is quite some performance, even if it is only on a demo.

Cheers, MP.
"Never interrupt your enemy when he is making a mistake" Napoleon Bonaparte
  • #6,828
  • Nov 25, 2014 9:19am Nov 25, 2014 9:19am
Hi MP

Thanks for your questions. I started with a £5,000 demo account and I'm risking 1% of it per trade but ideally I would like to get this down to 0.5% when using real money and if I had a slightly bigger account.

I'm only trading engulfing bars at the moment but am also looking at inside bar setups as I know many others use these to good effect.

I don't use anything but the engulfing setup as an entry trigger - I'm not considering support/resistance, trends or anything else. I'm trying to take a purely automatic approach with as few preconceptions as possible. Entry is only off the daily charts and I don't look at any other timeframe. Stop is placed above/below the extreme of the whole two-bar engulfing setup.

Hope this answers your questions but let me know if you want any more details about my approach. Are you trading this strategy too?

I'd also be interested to hear from anybody else who does anything similar to me to find out how it's going for them, as I know I haven't been doing it for long.
  • #6,829
  • Nov 25, 2014 9:52am Nov 25, 2014 9:52am
Quoting soco333
I've been using this excellent method for around two months now, live trading on a demo account....

"...live trading on a demo account..."
  • #6,830
  • Nov 25, 2014 10:08am Nov 25, 2014 10:08am
Quoting danjuma
{quote} "...live trading on a demo account..."
I realise that sounds a bit contradictory. I meant 'real time' trading on a demo account!
  • #6,831
  • Nov 25, 2014 10:13am Nov 25, 2014 10:13am
Quoting soco333
{quote} I realise that sounds a bit contradictory. I meant 'real time' trading on a demo account!
Thanks for clarifying. Anyway, just to say welldone - 8000 pips in 2 months it's not bad going. Let Graeme always said, you only need to know one thing well (not 200) to make money in the markets.
  • #6,832
  • Edited 5:14pm Nov 25, 2014 2:06pm | Edited 5:14pm
Socco are you taking both long and short positions on the same pair, I.e. Hedging?

that is a good performance, will be different handling emotions with real money.

if you have any charts with entries post them up would be interested to see them

so far so good though
  • #6,833
  • Nov 25, 2014 3:45pm Nov 25, 2014 3:45pm
Quoting soco333
... I'd also be interested to hear from anybody else who does anything similar to me to find out how it's going for them, as I know I haven't been doing it for long.
I have a nice millipede (5 + 7) of UJ buys loaded and holding.
Also a little milli of EU (5) sells about to be squashed.
My trades were taken basicly on auto, based on fundamentals.

You may find the Simple Uncomplicated (obvious) trading thread at http://www.forexfactory.com/showthread.php?t=508174 of interest with regard to seeing how your bar pattern compares. Just target mainly posts from gspajon, although only 18 pages overall.

What sort of percentage of your remaining trades are ...JPY pairs.

cheers scalpz
Target 2 : Stoploss in the green
  • #6,834
  • Nov 25, 2014 4:42pm Nov 25, 2014 4:42pm
Quoting soco333
Hi MP Thanks for your questions. I started with a £5,000 demo account and I'm risking 1% of it per trade but ideally I would like to get this down to 0.5% when using real money and if I had a slightly bigger account. I'm only trading engulfing bars at the moment but am also looking at inside bar setups as I know many others use these to good effect. I don't use anything but the engulfing setup as an entry trigger - I'm not considering support/resistance, trends or anything else. I'm trying to take a purely automatic approach with as few preconceptions...

nice work pls can u just post a chart and show us nhow u enter the trade .

thanks
  • #6,835
  • Nov 27, 2014 5:52am Nov 27, 2014 5:52am
Quoting soco333
Hi MP Thanks for your questions. I started with a £5,000 demo account and I'm risking 1% of it per trade but ideally I would like to get this down to 0.5% when using real money and if I had a slightly bigger account. I'm only trading engulfing bars at the moment but am also looking at inside bar setups as I know many others use these to good effect. I don't use anything but the engulfing setup as an entry trigger - I'm not considering support/resistance, trends or anything else. I'm trying to take a purely automatic approach with as few preconceptions...
If I may ask a few questions on my own:
I gather you don't move your stop to break-even, is that correct?
Do you treat all engulfs equally, i.e. would you trade an exceptionally long-bodied engulf candle normally despite the larger stop? Perhaps you adjust your trading size to compensate that?
  • #6,836
  • Nov 27, 2014 6:43am Nov 27, 2014 6:43am
Quoting soco333
Hi MP Thanks for your questions. I started with a £5,000 demo account and I'm risking 1% of it per trade but ideally I would like to get this down to 0.5% when using real money and if I had a slightly bigger account. I'm only trading engulfing bars at the moment but am also looking at inside bar setups as I know many others use these to good effect. I don't use anything but the engulfing setup as an entry trigger - I'm not considering support/resistance, trends or anything else. I'm trying to take a purely automatic approach with as few preconceptions...
Hi soco333,

I am basically doing the same thing as you. I am taking only engulf pattern, but from 15m chart (and then I try to stack positions). My hindsight is also daily engulf. Good luck!
  • #6,837
  • Nov 27, 2014 9:37am Nov 27, 2014 9:37am
As I said on the previous page, I have had break even positions taken out only to run onto big winners shortly thereafter.

I am sure that there is an optimum point at which you should move your stop to breakeven, but move it too soon and the position can be taken very easily.

One has to consider when moving the stop to breakeven whether it has a net benefit or net cost - I don't have a large enough sample size for my own trades, so I have not crunched any numbers yet.

For now however I am moving stops to breakeven, but when the data on my method of entry says otherwise, I will change up.
  • #6,838
  • Edited Nov 28, 2014 1:27am Nov 27, 2014 6:20pm | Edited Nov 28, 2014 1:27am
Quoting soco333
I'd also be interested to hear from anybody else who does anything similar to me to find out how it's going for them, as I know I haven't been doing it for long.
I have been in demo on 40 pairs and I admit my entries are very sloppy with approx 40 pip SL but after 2 weeks I have 44 position on 28 pairs and about 5000 pips. The problem is that I lost about 9000 pips to get those positions established. So right now I am down about 4000 pips. I have been doing for 10 trading days so I don't know if it will work or my sloppy entries will cost me 2 much. I move stops to BE after 24 hours

Quoting MCRotter
I don't have a large enough sample size for my own trades, so I have not crunched any numbers yet. For now however I am moving stops to breakeven, but when the data on my method of entry says otherwise, I will change up.
The second method I am forward testing is this one that the OP described here http://www.forexfactory.com/showthre...96#post3899196
that one I am up about 5000 pips but as the OP described there are bigger drawdowns. I am testing on 40 pairs. I think the only reason I am up is because I caught that Euro move last week and I was up 9000 pips but then lost 6000 pips with the AUD news earlier this as all the open AUD positions reversed and SL were hit on many of them but in the past 2 days and gained 1000 pips today. It is 2 early to say if it works but at least you don't move your stops to BE so positions have lots of breathing room.

If anyone has more time on that method let me know
  • #6,839
  • Nov 28, 2014 2:23am Nov 28, 2014 2:23am
Quoting MCRotter
As I said on the previous page, I have had break even positions taken out only to run onto big winners shortly thereafter. I am sure that there is an optimum point at which you should move your stop to breakeven, but move it too soon and the position can be taken very easily. One has to consider when moving the stop to breakeven whether it has a net benefit or net cost - I don't have a large enough sample size for my own trades, so I have not crunched any numbers yet. For now however I am moving stops to breakeven, but when the data on my method...
If I was to make assumptions, I would guess that NOT moving SL to b/e would increase your profits over time. However, it would also increase your drawdowns. The purpose of moving the SL is not maximizing the profit but rather reducing the risk. The idea is to decouple risk from exposure. You absolutely want to maximize exposure, but you don't want to scale the risk with it. Yes, it WILL make many positions die when they could win. It's just a different aspect of the management the OP implemented with his 'risk diversification'. It's all about protecting your capital and maximize the profit/risk ratio. With risk approaching zero, the ratio approaches infinity.

Quoting Sherpa
The second method I am forward testing is this one that the OP described here http://www.forexfactory.com/showthre...96#post3899196 that one I am up about 5000 pips but as the OP described there are bigger drawdowns. I am testing on 40 pairs. I think the only reason I am up is because I caught that Euro move last week and I was up 9000 pips but then lost 6000 pips with the AUD news earlier this as all the open AUD positions reversed and SL were hit on many of them but in the past 2 days and gained 1000 pips today. It is 2 early...
Greetings. I've played around with this for a long time. Personally, I find it losing way too much, especially in moderate ranges of about 300-400 pips. The problem is that your risk per entry is too high (200p) and if you enter "mechanically" there are going to be a lot of entries. If you get lucky and start doing this around the start of a nice trend, the results look impressive. If you don't however, it's a disaster.

In order to make it work, I think you need to be selective and only pick a few opportunities. For example, you might force spacing between the opportunities. Let's say you shorted gold last week at 1190, because it was coming down from 1200 and looked like a test of EMA 200. It didn't work because the price went back up to 1200 a couple of times. Instead of taking a buy there and then a new sell at 1190, you could just pass all those trades because they are 'too close' to an actual trade you took. Keep in mind that while this approach will keep you out of many many losing trades, it also WILL make you miss some golden trades at optimum places. Like stated many times in the thread, it's all give and take.
  • #6,840
  • Nov 28, 2014 2:41am Nov 28, 2014 2:41am
Quoting Sherpa
{quote}...The second method I am forward testing is this one that the OP described here http://www.forexfactory.com/showthre...96#post3899196 that one I am up about 5000 pips but as the OP described there are bigger drawdowns. I am testing on 40 pairs. I think the only reason I am up is because I caught that Euro move last week and I was up 9000 pips but then lost 6000 pips with the AUD news earlier this as all the open AUD positions reversed and SL were hit on many of them but in the past 2 days and gained 1000 pips today....
Also be selective, and trade just trending pairs (I don't believe we have 40 pairs trending right now!).
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