Multi-Lot Multi-Timeframe Position trading

Agree completely. I'm mostly flat right now awaiting developements.

Ouch! I was stopped out of a good position in GA Long with the NFP swings. Oh well, trading is risky. I knew that. It really can't be avoided. There is no stop that can't be hit and trading without a stop is just plain crazy. It's just part of doing business. Shake it off and move on.

I am still flat - I like to have the MAs cross as well as the RSIs on all timeframes.

Anyone got an EU short going on?

My EU shorts did not get hit with the swings, so still 2 short on that one.

I shorted EU again (and long UCad, short NU). I don't see many people wanting to hold USD short into the weekend with such an awesome NFP. Incredible job report and upward revisions:

http://www.zerohedge.com/news/2015-0...gains-november

I shorted a bunch of EU ... will keep adding over the coming days. I am going to keep the highest positions as my short 'anchor', and trade around the rest ... TP on big spikes down or support, then short again on decent bounces. We should likely see 1.1 on EU, and maybe 1.0 in a few months.

Who knows though .... just trade with the fundamentals and the trend.

EZ

Good plan, steady as she goes.

Hi guys,

I first looked into the data more deeply and entered then also EU short.

EZ, don't you think that opening 4 positions basically at the same spot is too much risk? Even if the numbers are great, still, you opened 4 of them. Or are your lot sizes lower than the usual ones?

We can talk about live scale in strategies from now on.

IBO

When the price was around 1.45 before NFP, the highest short SL was at b/e. The first short had a wide SL (over 1.16).

Then I saw good NFP #'s (strong for USD), so shorted 1 more with overall SL (of highest position and this position) at b/e. So now the risk is still just the first position, SL at over 1.16.

As it fell, I added 3 more, but SL at 1.145 (so I took on more risk here), but I think it being Friday nobody long EU will want to hold a losing position over the weekend, so it should sell off. Its a bit more risk, but I'm accepting it since I had a good week, and willing to sacrifice some profits in order for a possibly larger gain.

I'll move SL later ... possibly exit some of the lower shorts to reduce exposure. We'll see how it pans out.

EZ

Taking short AU and long UCad as well.

I long UCad (1,2442, 1.2487), and shorted AU (.7806) also. This news should make EU fall more next week:

http://www.zerohedge.com/news/2015-0...-day-ultimatum

Regards,
EZ

Wow bit of a terrible week. At one point was up over +2200pips but ended the week with +116pips in the bank and -500pips still open. WTF happened?

I really need to work on some good profit taking rules and maybe finetune my entries in order to reduce the number of them that go against me straight away. I was up nicely on USDCAD and so entered a 2nd trade only to find that point was actually the highest it got to all week. I may end up using TPs on my trades in order to get in, get the profit and get out. Instead of getting in and riding them as far as I can.

From some initial minor backtesting I have found that drilling down into the Hourly charts and wait for the same signal I get from my Daily chart (in the same direction obviously) tends to tighten up the drawdown on new entries. I may also be able to use my stops here thereby reducing the number of pips in the stop and increasing the position size which in turn decreases the time taken to get my 1% or 2% or whatever my target may be. When the same signal occurs again later, I can enter again thereby getting a few positions in place over a couple of days instead of working off the Daily chart and getting a few trades on over a couple of weeks.

I went short EU @ 1.1150 x 2 lots and got out for the weekend @ + 70 pips, that's a weeks work in some peoples books, I'm happy with that.

I mentioned before I have a very small micro account and I am just trying to build up enough capital to have a descent buffer, so I can have 5 or 6 lots, my R/R is far to high at the moment for that, I should only have one position at a time, but as I said its very small and its only for me to learn. So if I see an opportunity I will take 2 or 3 more positions, and trade as if I have a 10x larger account. I can afford to lose the whole lot but obviously I wouldn't be learning best practices if I did that. So if I get in and out on the 60 - 100 pip retracements and bad entries I can learn, improve, and my account grows. With the SNB in the mix and Greece in there as well I feel it could Range for a while and/or may retrace to 1.1461 before it takes off again and I will Re-enter at London open, Monday night my time (NZDT).

the EU H1 and M30 have formed a double top, and it could break out to the downside on Monday, but I've been stung 2 weekends in a row, by a SNB Long spike 30 mins to 1 hr after open, and being left holding my postions, because I'm at work and can't close them.

My main task for this week is to stick to my plan. Waiting for the Buffer. $$Top.

Its the weekend so I have time to post a bit, so I would just like to share a good story with you all, that may make you smile and also get you straining at the leash for another day of trading that trend.

I was looking at #EUR about 1am, just filling in time 2 hours before NFP and this guy @ARichartz had just posted " Just in case we see heavy volatility to the upside because of the NFP later today, I placed five entry orders to add to my current running eur/usd short trade at 1.1560, 1.1600, 1.1650, 1.1700 and 1.1750. "

and I clicked on it and it took me to his blog. I was interested because he was using multi-lot orders and when I read some of his blog I realised he was also trading the trend.

Check out his Trend Trading figures for the last Year. He has a very technical Risk Management formula which he explains in some detail.

Good Trend Trading this week.

So, you managed to get into good trades, held on until you were 2,500 pips ahead, but tried to ride out a retracement and wound up with a loss. I know that can be disappointing, but let's not give up. It sounds like you did two things right, getting into the good trades and letting your profits run up, but then made one mistake on where to exit with profit after a big move in your direction followed by a deep retracement. That seems to be where we are with this method now. Most that have tried it can manage to get some good trades running and make good pips, but are having problems judging where to take profits. Next, let's look at implementing a simple methodical system to take off some profits as these good trades run so that we will always profit from a good trade and never take a loss in a good trade once it is running well.

Yay!

When to hold 'em and when to fold 'em (Part 2.)

In Part 1 we discussed how to get the first two lots on a multi-lot trade taking minimum risk. Basically, if you are trying to put lots on with a 75 pip sl, then after the first lot is +75 pips, take it off for profit on a peak profit point, then put a new lot on after a minor retracement ends. If that trade fails, you exit break even at worst. If it succeeds, you put a second lot on after the end of a minor retracement and put both stop losses up to near the entry of your bottom lot so that the total risk is still about 75 pips. If the whole thing fails now, you still break even and if it continues to move in your direction, you prepare to enter the third running lot. I'll give a general guideline on how to put a third lot on with minimum risk now, and the trader can adjust their actions from this baseline according to market conditions and their own trading style.

When you are ready to place the third lot on, you'd have at least 225 pips in unrealized gains, 150 pips on the first lot and 75 pips on the second. You also have 75 pips realized gains off the beginning lot that was cashed in for profit. An exit now would produce 300 pips total profit for 75 pips initial risk, or a 4 to 1 reward to risk ratio. That isn't a bad decision and if there is any doubt with this trade, it's best to take the 300 pips profit here and start all over if price still continues moving in our direction.

If you are an aggressive trader and are looking for profits in the thousands of pips rather than in the hundreds, you can continue this process by working on putting the third running lot on. This isn't easy to do with minimum risk, but let's take this challenge on. You may want to draw this out on a sheet of paper if it's not perfectly clear, since it forms a baseline to trade from. If someone wants to help me out a bit they can draw it up and post it here.

The third lot is put on like the others, after a small retracement has ended and we have our minimum spacing of 75 pips. But first, the critical question is where will we exit if this trade reverses? Our guiding principle here is to never risk taking a loss overall to place another lot on. At this point, we have 75 pips realized gains, and are risking nothing on the first lot since both the stops are set to near break even on it. We are risking 75 pips on the second lot (with stop set to near the entry point on the first lot) and the third lot would risk another 150 pips to sl if the stops aren't moved from the entry point of the first lot, so a major reversal would put us -150 pips loss for the trade overall. This is unacceptable as it violates our first principle of never risking taking a loss overall to place an additional lot on. Clearly, there is more work to be done before we can put the third lot on.

Proceeding with our reasonable risk strategy, to work on putting a third lot on we first need to take the 150 pips profit off the bottom lot, giving us +225 pips total in realized gains. Then we again put new lot on top, again giving us 2 lots running. If the stops aren't moved we'd risk 150 pips on the top lot and 75 pips on the bottom lot, or a total risk of -225 pips. There are two additional principles that come into play here. First, we must take profit to win, and second, we want to slowly widen our stop loss amount as we run this trade longer. Our stops are now 150 pips below the top lot and 75 pips below the bottom lot. By moving the stops up 40 pips, or to 35 pips below the bottom lot, we can protect 80 pips of realized gain on this trade. Another trading principle is we want to protect our trading capital like a mother lion protects her cubs. With this setup, we now are trading with stop losses 110 pips below the top lot, a significant widening of the stoploss as we trade and we have protected 80 pips of realized gain on the trade. All of our trading principles are satisfied and two lots are running with no risk to our trading capital.

Now, when price has gone up our preferred spacing, another 75 pips, we are ready to put our third lot on top as we can do so satisfying all our trading principles. When the third lot is put on, sl is moved to near the entry point on the bottom lot, setting it's risk to zero. The middle lot has a risk of 75 pips and the top lot of 150 pips, so total risk is 225 pips. We have 75 pips taken off the original lot that was cashed in for profit and 150 pips that was taken for profit off the next lot that was taken off for profit, so if the whole trade reverses to stops, we take no risk on a loss overall on the trade. We also now have 150 pips between price and the stoploss, slowly increasing and widening our stop loss amount.

The 4th lot will be worked on in a similar fashion. The difference is now we want to start taking steady profits out of this trade and we will do so for the remainder of the trade. We MUST take profits to win. But at no time will we ever take a risk of losing on the trade overall. I'll cover that in Part 3.

Questions, comments, discussion?

G

Hi G, Very nice. My question is: Is the first position a 2 unit or single unit Entry?

Thanks, AG

There are really 3 single unit lots in this initial entry. It's a bit confusing since the first lot is taken off for 75 pips profit. The two that go on next are each single unit lots that go on one at a time. The second was placed on with a 75 pip sl so if it stopped out, there would be no loss overall, since the first made 75 pips profit. When that second lot was up +75 pips, the third lot went on and the stop losses were raised to the entry of the second lot, still keeping risk at 75 pips. So, the final configuration is, first lot taken off for 75 pips profit. Second lot sl at BE. Third lot sl risk 75 pips. Perhaps I can draw this up if it isn't clear?

Very clear.

Thanks. AG

One more question G,

Do you factor ATR into deciding what pip spacing to use for your trades?

AG