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Trading Made Simple for Day Charts

  • #2,141
  • Jan 30, 2015 12:43pm Jan 30, 2015 12:43pm
Quoting Miche09
Dear britpip, Sorry for a newbie question, is it a TDI an indicator?, I know it has to cross the candle(s), but how to show in the chart?. Thanks
you are looking for the TDI cross with confirmation from Price Action

Ideal entries / lower risk will be when RSI and TSL are heading in the same direction and a cross from the 32 or 68 regions is stronger, but again must be supported by PA.

If you trading reversals, then wait a candle and confirm that PA is reversing.

I wait for the day candle to close before looking at entries, so a new colour on APB/HA will be an alert for me to go check out the action. trades are set up/placed in the first hour of the new day candle.

Attached is my day chart screen for new candle colour as well as the current pairs I trade - recently dropped AUD/NZD and brought in GBP/CAD. Currently I am not planning on trading any CHF pairs!
Attached Image(s) (click to enlarge)
Click to Enlarge Name: bp7 day charts.gif Size: 122 KB
Click to Enlarge Name: bp7 tdi day 8up.gif Size: 178 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #2,142
  • Jan 30, 2015 4:15pm Jan 30, 2015 4:15pm
Hi BP! Could you kindly go over the time at which you enter again and what you mean by price action confirmation?

By PA confirmation are you simply looking for a certain coloured candle, or do you go to a lower TF and check for pullbacks for entry etc? Also how long do you wait for the new candle to be formed before taking it's colour to be a signal? 1 hour? 12 hours? etc

Finally from reading past posts I gather you prefer to take the 2nd candle of a colour over the 1st?

Cheers! And thanks again to Steadyrandy
"Never Take a Trade You Don't Understand!" - Pres78
  • #2,143
  • Jan 30, 2015 4:50pm Jan 30, 2015 4:50pm
Thank you so much steadyrandy and Britpip7.
  • #2,144
  • Jan 30, 2015 5:01pm Jan 30, 2015 5:01pm
I've just been doing some rudimentary stats on runs of 7 or more consecutive same coloured bars on 4h timeframe, selected somewhat at random.

These stats wouldn't hold up to too much scrutiny but I would say show some of the signs to look out for:

Long:
65% of long trades had a small sized candle of the opposite colour preceding it
47% of the time the first candle of the run was also relatively small (so size of candle seems somewhat irrelevant)
71% of the time the preceding candle had a longer lower shadow than it's body
61% the RSI and TSL crossed each other at a sharp angle
79% the TSL was either parallel or facing upwards
61% the RSI/TSL cross was below the MBL
80% of the time the RSI was less than 55%

Short:
46% of short trades of 7 bars or more were immediately preceded by a fractal (compared with 25% long - this is probably not statistically significant)
68% of times the preceding candle was of a small size
50% of the time the first candle of the run was small size (again implying that candle size in either the 1st preceding candle or the 1st candle of the run is of no great importance)
93% of the time the candle preceding the 7 run short had a upper shadow than it's body
89% of the time the RSI exceeded 45%
68% of the time the RSI / TSL crossed at a sharp angle
86% of the time the cross occurred above the MBL
39% of the time the RSI and TSL were heading in the same direction (21% less than long)

So there ya have it! Not terribly scientific and wouldn't hold up in a court of law but fairly interesting (to me at least) nonetheless.

Most interestingly was that 71% and 93% respectively, the preceding candle of the run had a very telling shadow.
86% of big shorts occurred from above the MBL where as 61% of the longs were from below. The longs were also the ones with the 71% revealing shadow on the preceding candle compared to 93% so this implies that the shorts are easier to spot by looking for a crossover above the MBL and a long wick on the preceding candle.
And it seems that either a sharp crossover or the TSL direction to back up the RSI are important for a good trade.
Candle size seemed fairly insignificant
Finally that a low RSI was required for a good long and a high RSI for a good short!
"Never Take a Trade You Don't Understand!" - Pres78
  • #2,145
  • Feb 6, 2015 2:03am Feb 6, 2015 2:03am
Quoting ZeeDeveel
I've just been doing some rudimentary stats on runs of 7 or more consecutive same coloured bars on 4h timeframe, selected somewhat at random. These stats wouldn't hold up to too much scrutiny but I would say show some of the signs to look out for: Long: 65% of long trades had a small sized candle of the opposite colour preceding it 47% of the time the first candle of the run was also relatively small (so size of candle seems somewhat irrelevant) 71% of the time the preceding candle had a longer lower shadow than it's body 61% the RSI and TSL crossed...
Nicely down on the data analysis, collection and summary.

Next step would be to calculate your win to loss ratio for pips based on the above.

On average Big E found that a colour change on the HA / APB resulted in 3 to 8 candles in the same direction, so entering on candle # 3 was not advised.
"To live with Passion, it takes Courage and Grace to survive"
  • #2,146
  • Edited 4:13pm Feb 8, 2015 3:13pm | Edited 4:13pm
Hello Britpip7, I know you swore off from CHF for awhile, but what do you think abut the USDCHF daily setup? TDI is not there yet, but rolling away from 200d and light volume for the test.
  • #2,147
  • Feb 25, 2015 8:25am Feb 25, 2015 8:25am
Britpip7 and all,

I've been an off and on trader for the past few years, most recently trading index options, but I've managed to get interested in forex again and want to concentrate my efforts here.

I found the original Trading Made Simple thread and have read as much as I can, and that led me here. Trading the daily charts suits my lifestyle much better than middle of the night London trading (I'm in central US). I have read through enough of this thread to understand the basics of how it works, I just need some time and experience to get the nuances necessary to make this work for me.

Britpip7 you seem to have this nailed down pretty well and I hope to learn from your experience. I do hope this thread continues, it's a little quiet now, but most pairs seem to be consolidating so that could be why there's little activity here now.

In any case, thanks for all you've done, and I'll be lurking around for awhile, maybe posting a chart or two. Any help or suggestions are welcome.
  • #2,148
  • Mar 13, 2015 11:28pm Mar 13, 2015 11:28pm
Quoting steadyrandy
Hello Britpip7, I know you swore off from CHF for awhile, but what do you think abut the USDCHF daily setup? TDI is not there yet, but rolling away from 200d and light volume for the test.
Hi Randy - hope you got in the CHF recovery action - most currencies pulled back to where they were before.

Sorry for not being around for the past month or so - hectic schedule again, but I am still trading - rading is going well
"To live with Passion, it takes Courage and Grace to survive"
  • #2,149
  • Mar 13, 2015 11:30pm Mar 13, 2015 11:30pm
Quoting Richard7
Britpip7 and all, I've been an off and on trader for the past few years, most recently trading index options, but I've managed to get interested in forex again and want to concentrate my efforts here. I found the original Trading Made Simple thread and have read as much as I can, and that led me here. Trading the daily charts suits my lifestyle much better than middle of the night London trading (I'm in central US). I have read through enough of this thread to understand the basics of how it works, I just need some time and experience to get the...
Richard - glad you found the thread - I just dropped in to see what is happening - not much apparently - please post some charts - I promise to check in more often
"To live with Passion, it takes Courage and Grace to survive"
  • #2,150
  • Mar 13, 2015 11:44pm Mar 13, 2015 11:44pm
Trading update for year to date 2015

last 11 trades have been successful

total trading success above 90%

profit factor 5.0 which is 5 to 1 win/loss ratio

Main message from this - cut down on the number of pairs you are watching - keep on the day charts - wait for the perfect entry - believe in the methodology
"To live with Passion, it takes Courage and Grace to survive"
  • #2,151
  • Mar 14, 2015 7:45am Mar 14, 2015 7:45am
Quoting Britpip7
Trading update for year to date 2015 last 11 trades have been successful total trading success above 90% profit factor 5.0 which is 5 to 1 win/loss ratio Main message from this - cut down on the number of pairs you are watching - keep on the day charts - wait for the perfect entry - believe in the methodology

very well done Britpip! not many can beat 5:1 , and that is an excellent show of patience on your part! would you be willing to show us one or more of your entries with a chart and explain why it was , to you, the "perfect storm" of entries. I am still struggling with deciding what constitutes a nice entry and what should be left to pass.

Thanks!
  • #2,152
  • Mar 14, 2015 10:12am Mar 14, 2015 10:12am
Britpip 7, good to see you're still with us. I will post some charts as they come up. I've made a few demo trades so far with mixed results but learned a little from it, perhaps I'll get together a couple of examples and post them. Still getting caught back up with the nuts and bolts of posting, screenshots, etc. I'm also struggling a bit with MT4 but I can figure that out on my own.

What I would like to know from you Britpip is, have you settled on an MT4 template? I've seen quite a few throughout this thread. Also I like the idea of cutting down the number of pairs to follow, which and how many are you following? Is it the same as your screenshot from post #2141?

Last, great work on the 11 in a row! Could you post screenshots of one of the more recent trades with a little commentary, like why you got in, why out, where did you take profits, etc.? I know I'm asking a lot, but as was once said, 'you have not because you ask not'

Any help is greatly appreciated, the work you've done here is fantastic.
  • #2,153
  • Mar 14, 2015 10:39am Mar 14, 2015 10:39am
Here are my last two trades on GPB/JPY

Some overviews on the charts:

The horizontal lines are the weekly S/R levels that coincidentaly line up very closely to 500 pip intervals, so these all become BRNs at 190 / 185 / 175 / 170. Whether this is a self fulfilling prophecy or not? It is interesting on this pair to zoom out and see where PA rolls over and the alignment is there for the past 9 months or so.

The 100/200ema lines also show how these dynamic S/R levels are followed by PA on this pair - 100ema is dominant from 2012, with the 200ema being dominant since Sep 2014.

The zones are manually drawn in and I nuked the Il_supdem indicator only because when PA broke a zone, the indicator removed the zone!

With regards to my day settings for TDI - RSI is set to 3, TSL is set to 8.

I tend not to bother with the RSI 10 values so have removed it.

My golden rule for watching pairs on the day charts - If the HA / APB changes colour (depending on which you use, I am using HA but I am not convinced there is much difference in how this affects my trading!), then it is worth looking at as the "trigger candle" for a possible entry.

If the RSI has crossed the TSL at day close AND the TSL is moving in the same direction as the PA (proposed trade), then this is a higher probability entry. If you want to verify of the TSL is increasing or decreasing in value, then enable the TDI Visualization to "show in the data window"

Commentary on the 2 entries.

Entry 1 - traditional TDI cross:
PA had hit the 185.00 and stalled and was now moving lower. Change in colour on HA, so this becomes my trigger candle. TDI cross with TSL heading down. 3 entries taken - first entry closed at +128 and SL moved (too aggressive) and was hit by the pull back for +5 pips. Hindsight - could have left this alone for another day before closing and moving SL.

Entry 2 - continuation of trend - no TDI cross - PA break of 100ema and weekly S/R level:
PA approaching 180.00 and has broken 100ema with 300pips clearance to 200ema, so this becomes my trigger candle. TSL and RSI still heading lower - entries set from 180.10 to 179.90 (probably should have set all entries below 180.00!). First position closed before Friday close and SL moved just above Friday open - if PA pulls back then worst case is BE on all 3 entries. Will monitor Sunday opening and move SL if PA continues south.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: GBPJPYDaily zoom out day.png Size: 75 KB
Click to Enlarge Name: GBPJPYDaily 3-14-2015.png Size: 42 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #2,154
  • Mar 14, 2015 10:45am Mar 14, 2015 10:45am
Quoting Richard7
Britpip 7, good to see you're still with us. I will post some charts as they come up. I've made a few demo trades so far with mixed results but learned a little from it, perhaps I'll get together a couple of examples and post them. Still getting caught back up with the nuts and bolts of posting, screenshots, etc. I'm also struggling a bit with MT4 but I can figure that out on my own. What I would like to know from you Britpip is, have you settled on an MT4 template? I've seen quite a few throughout this thread. Also I like the idea of cutting down...
Richard,

Thank you for the comments. I am on a nice run at the moment.

here's my current pairs - the final 2 - CAD/JPY and AUD/NZD are the only 2 that I will swap out if I see another pair with good ATR numbers / trading ranges.

Golden rule - do not open multiple trades on multiple pairs - too much risk on the account. Once a trade moves into profit and you have locked in the pips with the SL, then look for another entry.
Attached Image (click to enlarge)
Click to Enlarge Name: Britpip7 pairs.gif Size: 160 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #2,155
  • Mar 14, 2015 10:57am Mar 14, 2015 10:57am
Quoting mess7777
{quote} very well done Britpip! not many can beat 5:1 , and that is an excellent show of patience on your part! would you be willing to show us one or more of your entries with a chart and explain why it was , to you, the "perfect storm" of entries. I am still struggling with deciding what constitutes a nice entry and what should be left to pass. Thanks!
Thanks - just to clarify - the 5:1 profit factor is calculated on Gross profit / Gross loss
"To live with Passion, it takes Courage and Grace to survive"
  • #2,156
  • Mar 14, 2015 4:52pm Mar 14, 2015 4:52pm
Thanks for the quick response. Before I ask a bunch of dumb questions I'll study what you've posted here and go back and re read some of this thread. Right now I know enough to be dangerous (mostly to my account balance) so I'll keep demo and back testing until I have some intelligent questions.

Thanks again.
  • #2,157
  • Mar 15, 2015 7:37am Mar 15, 2015 7:37am
Quoting Richard7
Thanks for the quick response. Before I ask a bunch of dumb questions I'll study what you've posted here and go back and re read some of this thread. Right now I know enough to be dangerous (mostly to my account balance) so I'll keep demo and back testing until I have some intelligent questions. Thanks again.
Richard - sounds like a good plan - my biggest issue was over trading until I settled on the day charts - it's a very common issue. Next up on the list was entering too early and not waiting for the signals to confirm PA and TDI direction (or even worse, dropping down in time frames and taking the H4 signals!) - I used to try and get every pip on a move, but once you realize there are hundreds of pips on the the day charts major moves, then missing 150pips is not a concern.

Having a core number of pairs to watch works well for me as you get accustomed to how they move and how they interact with weekly S/R levels and the 100/200ema.

I only ever take a set up after day close and try to place any new trade entries in the first few hours of the new day candle, or, worst case, no later than 8pm Pacific. If I miss the move - too bad - I will not place a trade until after the next day close, or until the next S/R break / bounce, or TDI cross / bounce.
"To live with Passion, it takes Courage and Grace to survive"
  • #2,158
  • Apr 7, 2015 5:24pm Apr 7, 2015 5:24pm
OK, I'll try posting a chart, GBPAUD. I haven't done a whole lot of trading but here's one that worked out. Unfortunately I'm still struggling with MT4 a little and inadvertently closed out the entire trade at around +185 pips. I wanted to close half and move the stop to break even but it closed the whole thing. I'll figure it out.

But....it was a decent trade. I liked the way it was bouncing off the 100ma like it had twice before, TDI crossed up below the 50 line. I was a little sloppy on the entry but that's one thing I like about trading the daily, there's more margin for error. The plan was to take profit at about 1 1/2 times ATR, then move the stop to break even and let it go till there was a clear exit signal. I think I missed about 100 more pips because of the untimely early exit, but it gets me thinking about the potential exit, which I think just occurred with a TDI cross back down. That would've resulted in a +300 and then +150 closing the second half.

Question for you Britpip, would that be a proper exit? I know you're exiting in 3 stages ideally, but I'm looking to get some in trade management tips.
Also, How many trades do you take on a weekly basis? Maybe monthly would be a better question?
Attached Image (click to enlarge)
Click to Enlarge Name: GBPAUDDaily.png Size: 57 KB
  • #2,159
  • Apr 8, 2015 11:02pm Apr 8, 2015 11:02pm
Good to see this thread still alive. After a long hiatus im gonna get back on the wagon
  • #2,160
  • Apr 11, 2015 2:50pm Apr 11, 2015 2:50pm
Quoting Richard7
OK, I'll try posting a chart, GBPAUD. I haven't done a whole lot of trading but here's one that worked out. Unfortunately I'm still struggling with MT4 a little and inadvertently closed out the entire trade at around +185 pips. I wanted to close half and move the stop to break even but it closed the whole thing. I'll figure it out. But....it was a decent trade. I liked the way it was bouncing off the 100ma like it had twice before, TDI crossed up below the 50 line. I was a little sloppy on the entry but that's one thing I like about trading the...
Currently I enter with 3 entries as individual trades about 5 pips apart. This means I can close them manually one at a time and with the stupid USA broker rules for FIFO this does work. I am looking to run TP1 and then move to BE after that triggers, for TP2 and TP3, run the SL to the previous candle low - this would result in both being stopped out on April 3rd pull back. Any trade resulting in profit is a good thing - closing too early sometimes leaves you regretting it because that can "lose" several hundred pips. I have done this many times as the temptation is to bank the $ with the live accounts . It's all a case of fine tuning once the entry signals are clear.

The trend reversals only occur every couple of weeks or so, so this means that depending on how many pairs you trade, you may see a trade entry opportunity most weeks. Mostly I am seeing 3 or 4 trade entries per month, with the possibility of several hundred pips per trade if I actually stick to my trade plan , but then I am focusing on a lower number of pairs.
"To live with Passion, it takes Courage and Grace to survive"
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