The MOES

Hi Everyone, I have only recently started posting on Forex Factory, but on a couple of threads, I have been posting that my system gets in the region of about 80% win ratio, so I thought, why not keep a trading journal of what I have been doing, and how they are going?

First and foremost, I did have an account paired with MYFXBOOK, however, an MT4 terminal update has rendered that useless, and I cannot get the EA working.

I took the opportunity to clear up some of my accounts, and I set up a new broker (basically because I get cash back from it... every little helps!) and I stuck in $1606 in there (yes a LIVE account, and the random figure is due to excess funds and currency transfer... whatever that is!) and paired it up with trade explorer on here, so warts and all are able to see...

If anyone wants to let me know how I can put it in my sig, it would be much appreciated!

The short term MOES have nothing to do with me accidently forgetting to add in the V for moves, it is supposed to be MOES… for a specific reason! I did think of calling it the Flaming MOES, but you know all about copy write, and so forth…. And besides I didn’t want the strategy to be shot down in flames…

So what are the MOES? It is my strategy, which I have developed which is mostly a counter trend, reversal strategy, looking funnily enough, at short term moves… I SWEAR I did not forget the V!!!!

Anyway, a lot of this strategy is counterintuitive… I developed it by trying to look for leading indicators that complimented, but ensured a good ratio of wins. I will NOT be divulging the secrets of the system – for a number of reasons, but I would love to help people with any questions.

This Journal is one to show how my mind works when picking trades… again, warts and all, as humans are fallible, and I think I am extremely human… and ipso facto…

So about the counter intuitiveness of this strategy:

We are all told that we should aim for a risk reward of 1:2 or higher… 1:1 is ok for aggressive strategies… well this strategy is usually in the region of 2:1… so for every $10 I hit TP on, I would lose $20.

So is this a losing strategy???

Absolutely not!

I would say one more thing, that the Short term MOES are complimented (although not tested as thoroughly) by the Long term MOES…. I DID NOT FORGET THE V!!!!!!!

These are split up over 2 accounts, so my net worth for the MOES is actually twice the value. I have them over to 2 accounts as I cannot hedge at my broker, so if I get a buy on the short MOES, I may not be able to take it if I am already in a Long MOE sell…

So although I look as though I am risking 2% of my account, it is actually 1% per trade, it just looks like 2%

What I plan to do, is to keep a record of the trades, how they panned out, and also to post some charts – although I usually trade by mobile, so they don’t translate that well, but Hey Ho! J I am hoping that I will be able to give a bit of an idea as to why I trade the way I do, and basically show that an 80% record is possible… for instance at the moment.. my win percentage is 83.3% as of time of writing, which is actually about right… for each 5 wins I usually have a loss.

It is always a constant battle to see why things went wrong, and see how you can improve them, and that is what I am going to be planning to do, and you never know, why not chip in with some ideas on my trading performance, positive criticism is always welcomed… don’t get me wrong, I may well argue with you, but I like to be challenged, and if you are up for a healthy debate, I am always happy to chat!

So, I have had 6 trades opened in the last couple of days, and the breakdown is like this:

CHFJPY, 23.2 pip winner, which went to full TP

This was over pretty quickly – it only took about 30 mins for the TP to get hit. My entry was just below the resistance line, and was actually just after a double top, so on the break of this resistance line, it was always going to be a high probability trade.

The Daily is also showing a strong double top, and if the support line gets broken at c. 131.378, we could be looking at a drop of about 300 pips or so over the next week I should imagine. The daily chart has already tested this level once… Anyway, for me off the 4hr chart, it was a nice easy win. My SL was above the last swing high..

CADCHF (2 of them, as I had two very valid good signals…) a 25.8 pip winner in total.

Not quite a high probability trade, and certainly I don’t recommend stacking, but I had good confirmation of the 4 hr chart to back up both entries on the 1 hour chart…

After I had entered, a double bottom on the 1 hour formed, so I was quietly (bricking it…!) confident that this would bounce higher. In quickish succession, both TP’s were hit.

SL again was placed beneath the recent swing low. There was a support area above this, but If I had used this, the trade would have been taken out.

Half the time it is a judgement call, on what is the better place to put your SL, but in the MOES, it is always better to place with enough room for comfort. In actual fact the second entry was at what would have been the S/R line for the first trade if I had been more aggressive. As I mention, I prefer winning trades, so adding the extra comfort room suits me – at the end of the day, I will only ever lose 1% net worth on the MOEs, or 2% on the short term account…

TP was not adjusted though for the second entry – they both could have been at the same level (the SL was!), but it is a case of locking in profit – and I was happy to let the first one run, and book in the pips on the second. I could have played this better, but hindsight is not a luxury you have when the right side of your chart is bare!

GBPJPY - 8.7 pip winner…

My rules are pretty clear for getting out of a trade. SL, TP or news event.

This was did none of these, as I closed it manually. This is one of those grey areas, and I believe that I made the rights decision on exit, and it is maybe only the second or third time that I have done it. It all comes down to human error… When placing SL/TP there is always room for error. In this case, and on reflection, my TP was slightly to high – we are talking about 2 pips worth… in actual fact it was 1.3 pips away from hitting my TP… it subsequently had a fall, and that worried me as It was working its way to that S/R line. In this instance, the sentitment looked as though it was changing, so better to lock in the pips, as the way my strategy works, is that if that sentiment were to bias long, I would get another signal so could renter… in that case, my TP would be slightly smaller… by about 5 pips or so. This is an example where I would say that anyone who says that S/R lines are irrelevant, does not know how to use them properly… S/R by the way are approximations of areas of S/R… sometimes the wicks will go higher, or lower.

EURJPY – Loser at 56 pips.

One of those trades where your SL is taken out due to a quick blip in the price, and then restores in the next hour or so. A massive twin peak set up here, and is probably primed for a re-entry, but I wont unless there Is a valid signal. Full loss on a set up that I was really confident in! haha! I was already ready to spend the cash on it… J

EURGBP winner at 15 pips

Kind of the opposite of the EURJPY, in that it tanked and took out my TP, and now has retraced.
If I was a bit more risk adverse, I would probably keep away from the EUR pairs.. but you win some and you lose some… both EURO trades in retrospect were a bit of a hedge against each other, one sell, one buy… I am not really surprised that it was a net B/e (pretty much on cash, not on pips).

Looking through the trades, I hope you can see why I wait until TP/SL levels, especially any new person to Forex – it is REALLY important to stick to your rules – the GBPJPY had some very rational thinking behind it that comes with experience and feel of the market place – the SL would have been taken out, and I would have been lucky to get back to B/E.

This however, is what happens when you get to know your system, you can start to feel how it reacts to the market, and how the market dictates your strategy.

Also, I hope you notice my NET pips here… 16.4, due to one trade that was 56 pips, when currently my average gain is only something like 15 pips… (this is quite low to the average, which is usually around 25 pips). This is where pip value means nothing, and also where apportioning your pips a number instead of looking at risk to lose is important…. A return on my account of 4% over the last two days, and only having a net gain of 16 pips, all the while risking 2% of my account…

That is the benefit of Money management, if you don’t do it, you need to start thinking about it…
I understand however, that this is especially important in MY strategy, and MAY not apply to yours, but the key learning is that if you are using a set lot size per pip, are you doing it

a) out of greed (it will bite you). You will be overleveraged 9/10
b) out of fear that using higher lots will kill your account? (you are missing opportunities to grow your account) – Ie in using fixed lot sizes of 0.01.

Food for thought

CHFJPY 17 pip winner

Another winner on the CHFJPY.

This was opened up on the 4 hour timeframe, and i was actually expecting this to close out pretty quickly - not to be unfortunately, as we had a news release halfway through. There was nothing unexpected about the news event, so I decided to leave the trade open.

Before the news event, the pair dipped by about 30 pips or so (my SL was around 90 by the way!). Now, a question I have is, how many people would have closed out the trade at this point? On the back of the news, the pair was still falling an hour after the release…. Only thing to do is close it right?

Wrong.

If you set a TP or a SL, you have to respect those. If you do not, you risk skewing your numbers significantly. If you close trades down early, you are leaving money on the table more often than not.

This morning, the pair had recovered most of its losses over night – the market will eventually fill the gap, you just have to trust in your decision making sometimes. Of course, it could have gone all the way to the stop loss, but if you close the trade early, you would never know…

I keep repeating myself on this, but if you close trades based on an emotional response as opposed to a logical one, you will be leaving profits on the table for the market to eat up once you are out. That is not what we want to see happen.

It can be emotionally draining to see green pips turn to red for a period of time, and you do have thoughts of getting out, but if you have a strategy that is consistent, then you HAVE to leave the trade open. The biggest threat to that consistentcy is you.

I have had trades go within pipettes of closing, as in less than one pip hitting a SL, only to see them reverse and go to full TP. Where would YOU close that trade?

On the way down – ‘it will obviously hit SL’
On the way back up – ‘This is just a consolidation, it will still go further down’
At BE – ‘I am not going to go through that again, and BE is better than losing money’
In Profit - ‘got out of that one, take SOME money and run’
OR would you leave it to TP… honestly, how many people would do this?

Take it easy, and have a good weekend!

A 3.4% return this week… and this account has only been open for 2 days!!! Lets see how we do next week for a whole week of trading! By the way, I don’t really trade on a Friday – certainly not after midday…

Both long term MOE's got stopped out today, first thing at market open pretty much.

I am not convinced the MOE's are really a good strategy for the longer time frames. they are really good at finding jumps in the market, but daily trading just seems to long for them.

I will persevere with them on a demo, but i may change the title to a better strategy and use that, although the long term MOES will be consigned to history!

Something in me says that the MOES don;t work longer time, as I said in my first post (i think) the long terms have not been properly tested, but I wanted to show that I am still risking 1% of my account for the MOES, and not the 2% that it looks like...

All part of the testing process however!

Onwards and upwards!

audusd- won for another 19 pips

a reasonably quick trade this one, and netted a nice 1.2% to the account, will hopefully break he $1700 mark shortly.

the trade did everything it was supposed to do and went to full profit without ever being out of profit- got to love those dress free trades!

Remember this is a love account, and getting tp on every trade (well except for the sl and the one That reversed) is why it is all about- trading to a plan and sticking to the plan!

at the moment the % ratio is up to 87% so I N actually expecting a loss soon to bring it down to the 80% although I am not trying to get a loss!!! Haha

this week will probably be a small win week, as the opportunities are limited- both by the eur issues at the moment- it could go either way, and big moves are not taken into account in this strategy, yes I will miss pips, but if it is against the trading plan why would I want to guess? Also nfp means that there will no trades on Thursday and probably Friday- I tend to keep away completely at these times... Just a personal choice!

oncethe euro sorts itself out it will be back to business as usual!

well, a 2.4% return for the week is not bad considering the issues on the euro- I try to stay away due to the uncertainty... And of course the nfp is always a fly in the ointment if you are not a news trader. On top of that my wife gave birth to our third child... So been s busy old week!!! 2.4% return is nothing short of superb! On top of that I made my short term goal of reaching 1700 dollars, which represents just short of a 100 dollar gain in just over a week.

I had one 'losing' trade this week, although it was not actually a loser- I opened up the wrong pair by accident, and closed at a spread loss... A bit of a pain as it wrecks the stats, but a loss is a loss.

Mo also opened and closed a trade straight away as I got a bit confused! That one was reopened as it was the right trade, and went on to TP although only a $5 profit.

I think this week shows that trading can be done profitably regardless of what you are doing and what is going on!!! 2.4% return- yep I wil take that thank you and just under 6% profit in total. Happy days!!!

2 nice winners today, but put the other trade through another account, so only showing the gbpusd trade. Good way to kick off the week! Win ratio keeping solid, and looking forward to showing the full monthly return of the system- hopefully about 20% give or take!

2 more winners this morning, and seriously annoyed with myself!


I woke up feeling a bit wobbly and closed both trades out. Literally about 15 minutes they both took a nose dive and I would have made c.60/70 dollars or so...

I have my rules and I broke them. This is the point I try to always make- your profitability is affected more by closing trades early than actually letting them go to full SL. In actual fact, this is mostly my fault as I am trying to maintain my 80%+ win mining ratio... What that means is that I have contracted a bit of fear in case I am proved wrong about it!! Looking through my trades I can see that I have not optimised a lot of my trades. So starting from today i am going back to trading for myself!!! I don't actually really care if my % drops below 80% because I should be earning more money regardless of the win ratio or the amount of pips gained.

Sonmessage to self and a learning for Everyone... Trade your way and don't get bodged down by trying to prove anything- pride can only be a bad thing!!!

well after a bit of a dip in form last week, I have now surpassed the 1800 mark, with a big return of 7.5% return this week. Bit annoyed as it is just short of the BRN of $200!!!

i had a bit of a dip last week, but this has been mainly down to lack of sleep- trying to trade right with 2 toddlers and a new born is NOT easy!!!

i am very happy with the performance so far, and looking at keeping it up.

just as an aside- eurgbp has just gone through .70000!!! Let's see where it goes from here!

so at the end of a very successful week, account up over 10% for the week, 2 losers out of 19 trades, and my account up 14% overall... Makes for some very happy reading, all with a risk of 2% per trade.

Reading some of the other comments on other threads, a lot of talk from one guy saying how market conditions have meant he has blown his account this week... Interestingly he is also massively over leveraged, and trying to hit home runs every trade. Which of course means that one strike and he is out which is now something like the 3rd or 4th account he has blown up. My bet pips is only about 175 or something, but my balance has grown a lot... This other guy has something like 700 pips in the green and nothing left to show for it. I honk at the start of the week I had minus pips but green profit....

There is only one marker of a good strategy, and that is having a positive bank account- everything else is just noise to make you feel better or worse.

You can blame everything you want, but ultimately the only thing that matters is YOU. You take the trades, not the market. You decide how you want to play those trades, not the market, and you manage the trades, not he market. The market only confirms whether you were correct or not.

I closed down two open trades in profit with more potential to the upside, as I want to enjoy my weekend starting today! They were both in profit- one more than the other, but I am happy to tie the green And run for this week!