Q A M Trading Strategy

We should consider at least the following points:

1. Are we already in a trading cycle?

2. If so what is our total risk? If the current risk is already at full allocated risk then we do not trade the new cycle.

3. If no current cycle in progress consider the following:

a) How far away from a possible 1st entry are both pairs at present?
b) If 1 pair is closer to a Quantum signal being triggered then analyze that chart

4. How far into the trading cycle is it?

5. Is the risk worth the likely reward? (ask yourself the question) ... If not do not trade if yes then look further.

6. How far away from major S or R zones is price currently?



a) In the case of a short setup if price is only 5 pips away from this level and PA has been trending up then you might be better to wait to see how price reacts at this level if in fact it reacts at all. Price can power straight through a resistance level or it can slow down and hesitate ... and what we want to see is price start to drop and continue to the downside with alot of bearish intent!

Many other questions to find answers to but this is a good start.

Every time you think about taking a trade you should mentally go through all these questions.

The aim is that you make better trading decisions.

In the QAM strategy we do not enter a trade blindly just because a red box or a blue box appears.

We are thinking traders that manage risk correctly!

Masterrmind........... :nerd:

Very nice thread mm

What about Euro news and we are close to ff open?

Awareness is vital .... then you need to make an assessment on those factors.

How likely is the news going to impact on your planned trades ?
You may not know the answer to this question, maybe no-one does so what you have to do in that case is form the best opinion that you can.

Close to FF Open spells out increased risk usually due to increased volatility plus a good chance that price will trend off in one direction which might be opposite to where you want price to go resulting in either larger DD or eventual stop out.

There is a lot more to be said about the typical PA behavior of the FF open leading into the London Open but this is best left for later in the thread when I outline trading techniques that take advantage of this trading window.

Masterrmind...........

[quote=Masterrmind;8793275]EURGBP [M1] @ 3%RISK PER CYCLE NEXT WEEK THE EURGBP [M1] CURRENCY PAIR WILL BE TRADED USING 3% RISK PER CYCLE ...........
1. What are the maximum and average trading ranges in our trading window and on a daily basis over the previous 20 trading days? Max for cycle = 39.9 : sl = 29.2
2. How many trades per cycle on average can we expect to see? cant see all on 1min but looks like ave of 3cycles
3. What SL in pips should we use? 29.2 say 30
4. What lot size per trade should we be trading? 0.034


all very similar to E/C but on daily range there are some differences

Thanks for having a go jgoedhals its appreciated.

Using data from IC markets demo account I got the following for the EURGBP pair:

Using a H1 Chart of EURGBP and applying the default QAM template the 20 previous trading days data can be noted and entered into columns in Excel as per the screen shot below (likewise for the Daily Ranges making sure to alter the open Hour and the end Hour times in the Xi-AsianBO indicator).



SL is then calculated as being 36 pips + 2-4 pips as a buffer.

I used a SL = 38 pips! (On the chart check for S+R zones and adjust the location of the SL if required).

Note that the table on the far left side shows the 'eye-balling' approach and the values obtained by that I mean create a scatter plot in excel (also shown in the screen shot) and delete out the 'outlier' values (the large values that don't fit with the rest of the data.

Below the scatter plot I have included the Mean and standard deviation (SD) values for comparison purposes.

Then you need to open an M1 chart and over the first 4 hour period of the Asian Trading Window (with Q = 200 applied to an M1 TF) simply make a note over the previous 20 days trading of a) the number of cycles and b) the number of trades per cycle.

Then determine an average # trades per cycle over the 20 trading day period.

Masterrmind...........

For those interested let me know if you understand this concept.

I know it appears to be a fair bit of work just to determine a 'reasonable' SL but it makes sense to me with respect to the QAM strategy.

If you go through this process often it also trains your eyes and your brain to form an expectation of the likely trading ranges in a trading window that interests you and therefore the procedure of determining a SL is transferable.

It will also quickly alert you to a potential issue if you suddenly start seeing a trading range in the 1st 2 hours of Tokyo on the EURCHF pair closing in on 40 pips or so.

Masterrmind...........

Found my mistake.. tokyo cyles was wrong

1. What are the maximum and average trading ranges in our trading window and on a daily basis over the previous 20 trading days?
trading window no outlier maks 35.7 and ave 25.0
daily no outlier maks 120.0 and ave 82.4
2. How many trades per cycle on average can we expect to see? cant see all on 1min only 3 days but looks like ave of 3cycles
3. What SL in pips should we use? 35.7 say 38
4. What lot size per trade should we be trading? 0.026 for 3% of $1000 account

MM do you mind sharing your excel template

what is that aqua ana magenta boxes ?

1. IC data for Daily Ranges are as follows:



Looks like you are working things out fairly well ... happy to see it but be aware of the following:

1. Balance will not remain at US$1000 but rather the current balance before the start of the trading day so if you had of used my balance shown in the TE you'd have used US$1018.97 but I certainly didn't ask for this to be done.

2. Once you have determined the SL and the number of entries its straight forward in finding the lot size based on a known total risk per cycle.

However, the following points should be noted:

Given a USD denominated account the value of a pip trading the EURGBP pair is calculated as follows:

1 PIP is 0.0001 (except trading the yen pairs such as UJ which denotes a pip equal to 0.01)

So, 1 pip per US$10000 = (pip decimal placement/currency exchange rate)*(Notional amount) [in Base currency]

To convert to a different currency use pip value in the other base currency and multiply by the other currencies exchange rate.

Now back to the EURGBP pair:

1 pip of the EURGBP pair in USD per 0.1 lots = (0.0001/base currency exchange rate) * US$10000 * (EURUSD exchange rate)

So if the EURGBP pair was trading at 0.77313 and the EURUSD was trading at 1.10065 then

1 pip traded at a volume of 0.1 lots would be (0.0001/0.77313) * US$10000 * (1.10065)

1 pip value for EURGBP at a volume of 0.1 lots = US$ 1.4236
1 pip value for EURGBP at a volume of 1 lot = US$ 14.2363

Therefore, I applied a value of 1 pip per 1 lot in the GLS equation of US14.2363.

Note that currency exchange rates change all the time so the transaction is only accurate momentarily unless the market has just closed of course in which case the rate will be current until the market starts trading again.

Hope that was useful although most of time we are lazy and just apply a value of USS$10 per pip per US$100 000 trading volume.

Masterrmind............

That is the M-Candles indicator which traces out a H1 candle over the smaller M1 candles.

I like to see hourly TF's on the chart when I'm trading the QAM strategy because I can easily tell at a glance how far into the Asian session the market has progressed and importantly I can quickly see how much time is left before the trading window ends.

Of course there are many other ways to keep track of market progress but I just like the M-Candles as they also show the hourly candle progression across the chart (bullish, bearish etc).

Masterrmind...........

I'd prefer not because traders would gain much more by constructing the Excel sheet themselves.

I'm more than happy to help out traders with required formulas at the bottom of columns as required.

It would probably take no more than 30 minutes maximum to construct and once you've made the tables for 1 pair you can simply copy and paste it to be used for another pair and just change the name of the currency pair and clear cell contents.

If traders are interested in constructing the Excel chart similar to mine then by all means let me know and I'll go through it step by step.

Note: The Excel is not really needed though all you need is the chart with the 20 trading ranges and then find the Mean+SD+2-4 pip buffer and you have the SL.
This can also be worked out using a good calculator or an online statistical tool.

Masterrmind............

Its ok i have made my templates and it is working just fine.

It will be a later start today and I'll go over some more of the QAM strategy later today.

Masterrmind............

Great work!

Masterrmind..........

EURGBP [M1; 200 - manual]



Monitor PA prior to deciding on any entry(s) and if you don't like what you see on the chart then don't take any trades.

Patience often pays.

Masterrmind............

Look for trading opportunities on a different pair such as EURCHF [M1; 200 - manual] .........



Masterrmind...........

EURGBP [M1; 200 - manual]



Following PA and take note that just because a box appears I am in no hurry to make an entry........

Masterrmind............

EURGBP [M1; 200 - manual]



Still watching PA looking for an opportunity to short the pair down ..... but be patient.

Where do you think price is likely to go bassed on the current PA across the chart?

Masterrmind............

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With R1 @ 40 & H1 level @ 50, would expect some pull in that zone.