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Magic 5 - five pips only

  • #261
  • Dec 7, 2014 1:59am Dec 7, 2014 1:59am
Quoting Dave_C
{quote} That would mean that the average price range would have to be half a cent ie. 50 pips over the last 50 periods ie 12.5 hours on 15 min chart. For example:- The backtest optimization I ran on the 15m EURUSD for this year gave values of ATRLookback = 8 and MinATRPips = 13 (an average trading range of 13 pips over the previous 2 hours). Post 244 refers. I have run a further optimization where I extended the end values of ATRLookback and MinATRPips out to 100 and also optimized the start trading and end trading times and the results are below....

this is fantastic!

thanks so much Dave for your kindness to provide us this for free, i will perform some BT on coming weeks and post the result later,

cheers mate!
  • #262
  • Dec 7, 2014 3:31am Dec 7, 2014 3:31am
Anyone has indi on news coming up? Would like to put it to avoid trading during news
  • #263
  • Dec 7, 2014 4:27am Dec 7, 2014 4:27am
Quoting FxLapozi
Anyone has indi on news coming up? Would like to put it to avoid trading during news
Certainly the best you can find here : http://www.forexfactory.com/showthread.php?t=326551
MT4/MT5 EAs/Indicators/Alerts coder
  • #264
  • Dec 7, 2014 6:06am Dec 7, 2014 6:06am
TK (or anyone who cares to explain) .. "Consolidated areas"...

Your system says to avoid short candle and consolidated areas.. can you clarify what you mean by that? Would you consider the late afternoon hours of the New York Session as "consolidated areas" ?? (slow.. little movement etc etc) ..

sorry to bother you with such a stupid question from a rookie (one year live account) and your help is appreciated..
  • #265
  • Dec 7, 2014 8:39am Dec 7, 2014 8:39am
Quoting FerruFx
{quote} Certainly the best you can find here : http://www.forexfactory.com/showthread.php?t=326551
Nice!
Thanks mate!
  • #266
  • Dec 7, 2014 9:36am Dec 7, 2014 9:36am
Quoting FxLapozi
{quote} Nice! Thanks mate!
You're welcome!
MT4/MT5 EAs/Indicators/Alerts coder
  • #267
  • Edited 7:38pm Dec 7, 2014 3:51pm | Edited 7:38pm
Quoting Chaz-e
TK (or anyone who cares to explain) .. "Consolidated areas"... Your system says to avoid short candle and consolidated areas.. can you clarify what you mean by that? Would you consider the late afternoon hours of the New York Session as "consolidated areas" ?? (slow.. little movement etc etc) .. sorry to bother you with such a stupid question from a rookie (one year live account) and your help is appreciated..
Consolidation areas are periods of time where the price is generally going nowhere. There is no particular dominating buy or sell market force and traders are unsure. Generally there is a low trading range and volume. You are correct in that it usually occurs towards the end of the US session and before the Asian sessions begin but can continue right through the Asian day until about an hour before the Euro sessions. Major news releases during the quiet sessions can end consolidation and watch for Yelland (US Fed. Chairman). Her conferences are usually late in the US session or Draghi (EUR Bank Gov.) news conferences likewise. Both can end consolidation periods abruptly.
  • #268
  • Dec 7, 2014 5:58pm Dec 7, 2014 5:58pm
Thanks Dave.. I wanted to be sure.. let me have one more dumb question ... HA.. TK says 4 trades a day.. no more.. does he mean 4 winning trades or 4 trades regardless of their outcome? (Im very weird.. ahahhahah)

since I started working with this system I've improved my win/loss ratio (now around 55% which is good for someone with no more experience than I) ..

bottom line: last Thursday I had 3 wins.. did a misread of the 5EMA/RSI and blew out 10 pips.. went back a 5th time and won the 5..

was that wrong ? Is it 4 winning trades a day.. or 4 total trades ...

Thanks again for your advice..

Chas Z
Georgia USA
  • #269
  • Dec 7, 2014 7:35pm Dec 7, 2014 7:35pm
Quoting Chaz-e
Thanks Dave.. I wanted to be sure.. let me have one more dumb question ... HA.. TK says 4 trades a day.. no more.. does he mean 4 winning trades or 4 trades regardless of their outcome? (Im very weird.. ahahhahah) since I started working with this system I've improved my win/loss ratio (now around 55% which is good for someone with no more experience than I) .. bottom line: last Thursday I had 3 wins.. did a misread of the 5EMA/RSI and blew out 10 pips.. went back a 5th time and won the 5.. was that wrong ? Is it 4 winning trades a day.. or 4 total...
In Post #2, tk5 said max. 4 trades / day. I guess that means regardless of win or loss. Maybe he will enlighten.
  • #270
  • Dec 8, 2014 12:22am Dec 8, 2014 12:22am
two trade trigger on the ea which is opposite trend, 1 hit sl, another still ongoing, perhaps we should consider trend indicator?

Attached Image (click to enlarge)
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Attached Image (click to enlarge)
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Attached File(s)
File Type: mq4 Trend.mq4   3 KB | 354 downloads
  • #271
  • Dec 8, 2014 12:49am Dec 8, 2014 12:49am
..in your case, you need to work on your entry's and exits.
  • #272
  • Dec 8, 2014 1:17am Dec 8, 2014 1:17am
Quoting haircut
{quote} Hi Shoot. Also for me if you zoom out and look at the bigger picture the price has just broken out of consolidation area and also just broken a down ward trend line. Both of these things will then become support. So in my opinion and I am no expert you are trading back into these support levels. I know we are only looking for 5 pips but it makes the odds better in our favour if we are going long off of support and short away from resistance. Hope you dont mind me offering my novice opinion H {image}
Hi Haircut, I understand your point but to me the risk is that we are fast arriving at a place where this strategy is useless if we first need to check all forms of support and resistance. As you say we need just 5 pips. local momentum is what we are looking for and that is meant to be provided by the 5EMA and then supported by a couple of other tools. I have already found that with the 8 pairs I am following there are precious few trades a day, certainly nothing like the one an hour discussed. If you are right then this strategy no-longer fulfills my requirements. I will watch for a day or two more and decide. thanks for your support.
  • #273
  • Dec 8, 2014 1:42am Dec 8, 2014 1:42am
In the current situation on most of the major 15m charts the Short EMA is a long way away on the favourable side of the Long EMA so very little action in the near future unless the Long EMA is disregarded. Maybe food for thought.
  • #274
  • Dec 8, 2014 2:58am Dec 8, 2014 2:58am
Quoting Dave_C
In the current situation on most of the major 15m charts the Short EMA is a long way away on the favourable side of the Long EMA so very little action in the near future unless the Long EMA is disregarded. Maybe food for thought.
Hi Dave, I do question the relevance of the 200 EMA the way we use it. On M15 tf the 200 MA is equivalent to the 50 MA on the H1 tf. Now the H1 50MA is a well recognised source of support/resistance and so realising that i can see that we should not trade when PA approaches the M15 tf 200 EMA but I think it takes it too far to say we should not trade against the 200EMA trend direction on the 15 tf.

Thoughts?
  • #275
  • Dec 8, 2014 3:32am Dec 8, 2014 3:32am
Quoting shoot2scoot
{quote} Hi Dave, I do question the relevance of the 200 EMA the way we use it. On M15 tf the 200 MA is equivalent to the 50 MA on the H1 tf. Now the H1 50MA is a well recognised source of support/resistance and so realising that i can see that we should not trade when PA approaches the M15 tf 200 EMA but I think it takes it too far to say we should not trade against the 200EMA trend direction on the 15 tf. Thoughts?
I found that the 200 SMA acts as S/R, but only when it is flat. Look at M15 tf GBP/CAD for example.
You can use it for trend direction though - buy above, sell below.
Also the steepness of the the rise / fall of the 200 SMA signals trend direction.
I also like to have the 20 SMA on my chart to visually spot the trend cycles.

If there is momentum / sentiment, I tend to disregard the 200 SMA and trade the direction of the large candles.
  • #276
  • Dec 8, 2014 3:42am Dec 8, 2014 3:42am
I suggest to trade TK5's strategy manually. There is too much discretion involved in my opinion. Pivots, S/R, Sentiment/momentum...

Today's result (so far) in my live account: 7 trades, 6 wins, 1 BE.
I use a emergency SL of 15 pips, but will close manually if the trade goes against me or does not move at all.

I must say, I like this Kind of trading style. I also try to take only 1 trade per hour (sometimes more if there is a super clear setup). NY session yet to come...

Thanks Tk5!
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  • #277
  • Edited 4:24am Dec 8, 2014 3:58am | Edited 4:24am
Quoting Olarion1975
{quote} I found that the 200 SMA acts as S/R, but only when it is flat. Look at M15 tf GBP/CAD for example. You can use it for trend direction though - buy above, sell below. Also the steepness of the the rise / fall of the 200 SMA signals trend direction. I also like to have the 20 SMA on my chart to visually spot the trend cycles. If there is momentum / sentiment, I tend to disregard the 200 SMA and trade the direction of the large candles.
Yes that chart is a good example. Both the RSI and MACD were showing classic divergences. In fact 5 pips would not have done that setup justice in hindsight. The consideration is that a discretionary approach can take a few liberties for a 5 pip gain. I'm sure tk5 will have some input. If you have any ideas from a TA viewpoint , I can look at implementing them in the EA. I am finding the same as shoot2scoot in that the required setups at the moment are few and far between because we have a genuine trending market. I have always thought that RSI is a most helpful indicator and I'm thinking that it may be able to override the 200EMA particularly on such a clean break as we had below.
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  • #278
  • Dec 8, 2014 4:11am Dec 8, 2014 4:11am
Quoting Olarion1975
I suggest to trade TK5's strategy manually. There is too much discretion involved in my opinion. Pivots, S/R, Sentiment/momentum... Today's result (so far) in my live account: 7 trades, 6 wins, 1 BE. I use a emergency SL of 15 pips, but will close manually if the trade goes against me or does not move at all. I must say, I like this Kind of trading style. I also try to take only 1 trade per hour (sometimes more if there is a super clear setup). NY session yet to come... Thanks Tk5! {image}
Hey well done you Olarion. Out of curiosity which pairs, at what times? Cheers
  • #279
  • Dec 8, 2014 4:19am Dec 8, 2014 4:19am
Quoting shoot2scoot
{quote} Hey well done you Olarion. Out of curiosity which pairs, at what times? Cheers
Thanks. I normally start trading at Frankfurt Open 7 GMT until 10 GMT, then break until 13 GMT. Second trading session from 13 GMT until 16 GMT.
Today I had my first trade at Tokyo open, but that was an exception.

My pairs traded today are: NZD/JPY, AUD/JPY, EUR/CAD, EUR/AUD, GBP/USD, AUD/USD, GBP/CAD.
I general all pairs with low spread and no exotics.
  • #280
  • Dec 8, 2014 4:45am Dec 8, 2014 4:45am
Quoting Olarion1975
{quote} Thanks. I normally start trading at Frankfurt Open 7 GMT until 10 GMT, then break until 13 GMT. Second trading session from 13 GMT until 16 GMT. Today I had my first trade at Tokyo open, but that was an exception. My pairs traded today are: NZD/JPY, AUD/JPY, EUR/CAD, EUR/AUD, GBP/USD, AUD/USD, GBP/CAD. I general all pairs with low spread and no exotics.
By following TK's rules there haven't been any GU AU trade opportunity today since Frankfurth open. There hasn't been any short as I've been watching these pairs closely and if you took the buy when price broke the 5EMA to the upside then you broke rule number 1 as you went against 200EMA direction.
For those following the rules and monitoring AU and GU, I'm waiting for a red HA to close under 5EMA and RSI to start dropping from the oversold area
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