Q A M Trading Strategy

You might like to look at a more favorable starting price level for example, the start of the session and reference pullbacks to that zone.

However, this will depend on the trading window you end up choosing and other information.

EG pair

The information supplied showed the average trading ranges for the given pair.

Shorting from just under the pivot is fine and would be desirable however in this case it was more important to realize that price would have a very difficult time actually hitting the target. Since its unlikely that this favorable target will bet hit then why wait around hoping?
Move onto another pair(s) and look for better opportunities. Simple as that!

Some reasons are:

1. Distance from current price to pivot was >> 20 day ATW range
2. Volatility was low
3. Bank holiday pending implying that price movement is typically slow and potentially limited in range
4. Combo of all of the above and the fact its a turtle pair suggests price would not hit the pivot

Based on the points above if an entry was made it would have been halfway between the lows and the pivot suggesting additional risk if taken and as time gets closer say a few hours before FF the market activity slows down alot (at least until 30 minutes to an hour out from Frankfurt when PA usually starts to increase and ranges pick up) and PA could have simply remained almost stationary leaving the trade almost isolated. This situation is not ideal and entries should not be made. There are far better opportunities so a trader needs to be aware of these potentially bad entries and look for 'better' setups.

Ideally, entries should be attempted from zones showing multiple confluence (Fib overlay, pivots, S+R, DO line, etc etc)

Not all of these entries will be successful but on average and over a long period of time the results will speak for themselves.

Waiting for an important zone is usually better however, each situation needs to be assessed on its own merits meaning 1 chart setup might be 'better' looking than another chart.

If in doubt simply sit back and watch and wait for an opportunity that jumps out of the chart at you!
You'll know when this happens it will be almost obvious and the more charts you look at the faster you see these opportunities.

This is where the thinking part of the QAM Method comes into play!
The trader has to do this thinking by considering all the facts and all the likely scenarios and then forming an intelligent opinion.
Then decide to take action or to move onto another pair.... always the traders choice.

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

Thank you very much for your detailed explanation Masterrmind, appreciate it, some usefull information to keep in mind.

No problem at all!

Initially it feels like there are so many trading factors to be aware of that it feels almost impossible to take a 'good' trade.

Eventually once enough time has been spent studying the material and analyzing charts the light will turn on and you will see opportunity jumping out of the chart at you!

Have you noticed the following chart structure observations?

1. Take long cycles above the DO line and above the pivot and
2. Take short cycles below the DO line and below the pivot

[sometimes the Quantum signal boxes may not be aligned but entries can still be considered if they present as 'good' setups]

These setups can be considered in the same or similar direction as the current trend.

Countertrend trades are then those trades that seek to go against the current trend in the form of pullbacks usually to the DO line or a pivot point.

Hint:

Countertrend -
Attempt to reduce risk on the countertrend type cycles and increase risk on the trend type cycles (trader choice).

Trend -
This can be as simple as adding 1 extra trade to cycles that go long away from the pivot and the DO line or
This can be as simple as adding 1 extra trade to cycles that go short away from the pivot and the DO line.

In other situations trades might need to be taken in counter-intuitive directions.

Always account for risk in cycles that feel 'riskier' or simply don't trade them.

If you can make as little as 0.5% net daily gain on your trading account over a long period of time by keeping away from dangerous entries then you may only need to look for the highest probability setups and keep clear from the other 'riskier' type trades.

(refer to the compounding Excel to see how how an account can grow)

Good trading,

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

The Quantum London Trading EA v1.6.1 will be used for testing on the demo account today.

Stay tuned as trades get placed from any of the TFs (M1, M5 and M15)

AUDJPY [M15; 10 - EA]

1 long in progress now.

The EA will be allowed to trade it through cycles probably without much intervention on my part since I want to outline some of the many dangers that can unfold.

Only 0.01 lots per trade will be applied.

Multiple charts will be used with varying TFs and varying magic numbers.

Enjoy the show!

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

The following pairs are now running using the EA 1.6.1

AUDJPY [M15; 10 - EA - magic#301]



EURGBP [M5; 40 - EA - magic #302] and



EURUSD [M1; 200 - EA - magic #303]



No consideration has been given to setting up better cycles whatsoever.

This is purely to show some cycles of trades on different TFs and to make comments after cycles have completed.

Note: to use the EA effectively it must have separate magic numbers for each chart then the EA parameter settings must be very carefully checked.

I'll go through this process in more detail throughout the day.

Ask questions if you need help because if you set it up incorrectly it will not work correctly and can be very dangerous!

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

EA 1.6.1

Common Tab settings



Inputs Tab settings (may be different depending on magic numbers, number of pairs traded, trading window times and lot sizing etc)





Set the magic number (different for each chart)
Set Trade 24/5 = False
Set Trading window End and Start times (if only 1 slot is being used be sure to delete out the other time slot entries)
Set Stop After Each Cycle = True (if only 1 cycle is to be traded, EA will wait for further instructions)
Set the time frame (the EA trades from this input value)
Set the desired trading days (skip Monday or any day you like but setting that day = False)
Set the Quantum entry and close values (very important)
Set all the entries for the Lot sizes = 0.01 (very important)
All other settings can be left the same as per the screenshot for the time being.

Its very important to test out all of the EA settings on a demo account well before setting it on a live account.

Spent the time experimenting with the EA and everything will become second nature (easy)

Do not be concerned about the stochastic parameters in the EA as I DO NOT use them at all (they are not needed)
Do not be concerned about the Grid settings at this stage as I tend to apply a separate script for this purpose or set pending orders manually especially with such a small starting account (very different when trading a >>$10K account)

ps. at a later stage I may go through some of the other EAs provided in the zip folder but I encourage you to take the initiative.

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

Although the AJ pair is currently in action if the other pairs (EG + EU) which are really turtle pairs look like they may not trade for several hours then I may apply the EA to other pairs.

By looking at the trending label indicator lines for the HH + LL levels you'll be able to see when trades are likely to open at certain Quantum values on a given TF.

So all you need to do is watch for price to make higher highs or lower lows and set the EA going just before these levels are hit.

Make sure that the Quantum settings and the TF settings match between chart and EA!

There is a technique to doing this correctly which will be outlined later.

The whole idea is to start looking at how the EA opens and closes cycles of trades and what to watch out for on the charts.

Very important:

Remember that the EA is only a helpful tool it does not replace the thinking ability of the trader.
It should never be used to open multiple trades blindly (unless your account has an infinite balance)

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

EURAUD [M1; 200 - EA]



Price action is much faster on this pair compared to the turtle pairs so trades should be opened more rapidly.

Once a Q box is generated the EA will open the trade at the close of that candle based on the TF applied in the EA settings so make sure that the chart you are looking at matches exactly the EA settings.

So in the case of an M1 candle price may not move very far from Q box trigger to entry level.

However, on a higher TF such M15 the price can move much further .... something to be aware of!

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

I'll start applying the EA to my QAM- 1K live trading account from the first trading day in May which will be May 2.

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

Example entries on EA [M1 chart] pair.



The entry level of a trade after Q signal box appears are shown on the screenshot.

Spread and execution time also play a role in the entry level achieved.

Note the "Start next cycle" box visible on the chart. It allows trading to pause after a competed cycle and will not continue until the trader clicks on the button.

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

Why not close out trades at the DO line?



Price could quite literally keep heading up now after bouncing up off the DO line.

So why not think about closing out trades at the DO line and generate some profit.

What about the red news should we be concerned or keep trading on?

Thinking traders are we not?

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

EURAUD [M1; 200 - EA]



1 cycle via Expert Advisor completed.

Note that trades could easily have been closed out at the DO line by manual intervention (by the trader).

On this occasion price bounced up off the DO line only a short distance before heading back down but this may not always occur (in fact it does not) which could mean that additional risk has been applied to the cycle because of failing to close it out when the opportunity presented itself.

What would you have done if you kept the cycle running as price bounced up off the DO line and price did not return to the DO line anytime soon?

Perhaps a little bit of this huh........

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

Here is an excellent example of what can happen if you trade blindly....

Imagine if the last cycle on EURAUD was not closed out .........

Over 160 pips to the upside on the back of AUD news.....

Now imagine the DD trading 0.01 lots per entry on a 1K account...... a little bit of pain right about now.

What about if the entries had of been 0.02 or 0.03 or higher ............ get the idea?

Trade smart!



BOOM!

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

Perfect example.........

I could not have wished for more...........

Take serious note of failing to close out at ideal zones and trading during the red news.

News is fine if the direction favors your cycle but what about when it does not?

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

AUDJPY [M15; 10 - EA]



2 winners
1 loss

EURGBP [M5; 40 - EA]



1 winner

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

What about our little other turtle pair.... the EURUSD

Hows it traveling?

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

Here you go!



Now what did I say about closing out trades at the DO line.........

Could have been out of this cycle nicely in profit.

You don't have to wait for the EA to close out cycles..... monitor the trades, look at the PA, check for exit zones and ACT!

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

EURUSD [M1; 200 - EA]



Better to have closed out at the DO line.

Good example of how price can bounce off the DO line and head up much higher.

Additional risk added unnecessarily to the cycle.

The cycle could still be very profitable if price heads back down and clips a new Q box but ask yourself at what risk was this possible?

Note: The EA is great at performing its tasks it will keep on opening trades over and over provided they meet the set criteria. But this also means the EA needs to be controlled by the trader NOT the other way around.

1 really bad cycle left without correctly applied risk spells possible doom.

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

I will allow the EURUSD cycle to continue until the EA closes out this one cycle.

That means I will not interfere with the cycle at all.

Lets see what becomes of it!

Whether the cycle turns out profitable or not is not the main point here.

What is important is realizing how important the trader is compared to the EA.

Think of the EA as only an assistant while you are the master and as the master you need to make sound decisions at the right time!

If the EA is applied correctly and the trader remains in control with sound trading judgment the combination can be very very powerful!

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

EU pair



Notice the obstacles that price has to overcome to generate a Q close signal.

How likely is this?

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