Q A M Trading Strategy

EA - update



Currently 19 longs in action (EA limit set to 25 today)

Price has moved down further to test the red zone (red rectangular area) outlined on the chart so lets see if the bulls come onboard!

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

EA - the final trades

Bears are in control.

Taking price lower.

Expert pulled from the chart.

SLs extended

TPs extended

11 longs taken out.
14 longs remain.

A great example showing how even on a bank holiday price can move and move alot!

The final 14 long trades will be allowed to run to completion and then the demo account will be retired as it has served its purpose.



ps. check on the demo TE for further details (entertainment only) however, these final trades do not form part of the QAM Trading Strategy. whatsoever and the demo account will be cancelled once the final trades have completed their journey!

pps. as mentioned previously my attention will be solely on trading the QAM-1K live trading account so check it out if you wish.

ppps. Commentary will follow after some of the trades and some of the cycles have been taken.

pppps. It is not too late to join in with a live account linked to a TE or myfxbook account and follow along in my other trading journal thread.

Good trading,

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

EURAUD - update



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

EURAUD - update



Closed out all 14 trades via script just prior to the end of the ATW session.



So that competes the demo account.

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

I just love your work & enthusiasm....infectious.
dweb

Thanks dweb!

Trading is a whole lot easier if you are more enthusiastic.

You have to keep the fire burning!

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

I fully agree...we create our own excitement...

Indeed!

My excitement will come from turning the US$1K into US$10K (QAM-1K live trading account).

Then by applying a highly modified QAM strategy (not yet outlined) that turns 10K into 100K (then 100K into ... well you can guess!).

The disappointment for me will come from traders who witness my results (market willing) and who then start asking questions!!

ps. I am still dumbfounded by the fact that NOT a single trader is interested in trading cycles alongside me ..... truly unbelievable!

pps. Perhaps the thinking and the constant monitoring of trades and managing the risk on every cycle is a little too much ...

ppps. Nevertheless, I have set out on this trading mission for the benefit of all and in time I am very confident in fulfilling it!

pppps. By fulfilling the mission myself I've gained a little in $ terms I guess but others will have gained nothing .....

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

Indeed...we both suffer, however, we are self driven and that's what counts....I am keeoing an eye on what you do...we will talk when I am ready to discuss some ideas with you.
Keep on, keeping on!
dweb

Always welcome dweb!

ps. 1 brick at a time is how you build a castle .......

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

luv yr thread

Cheer!

Very pleased to hear that iamgotzaa!

If you have questions or you need some of the material in the thread explained in greater detail or indeed simplified just ask me.

Always happy to help!

Good Trading,

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

Currently i'm trading with fix tp, e.g. 10pips

Quiet profitable but not most efficient. So drop by to see how you are doing it.

Many times it is the price action (info on news feed etc etc) on the chart that dictates the action that I take.

There are so many different situations to be confronted with that its almost impossible to cover them all.

The only way is to show plenty of examples that outline many situations and how to best handle it.

Most important is keeping a close watch on the current floating DD of the trading account.

Once the risk is controlled then personally I have no hesitation in closing out some trades for small profit, then add more entries later, wait for price to drop again and then take more small profit again (for a short cycle).

If I'm using an EA I'll let it open trades and then I'll be looking to close them out in mini clusters, for example, if PA shows signs of pushing higher generating more Quantum Sell boxes which the EA opens and then price drops 5-10 pips onto either a mini or key level of support and then if PA hesitates I watch PA for awhile and then decide to close some or all of the trades out.

There is no shame at all in taking small profit out of the market!
I take 1-2 pips sometimes and I'm happy to do that because at the end of the day/week/month it really does add up!

I use this small profit say on a given trading day to build up an intentional buffer in my trading account so that later in the trading session if a cycle starts going against me I have some profit that can be written-off against losses.

An intentional buffer is simply an amount of profit taken from small TP trades to be used later if necessary to offset a loss.

Another very important buffer is when starting with a new account and the following should be noted:

1. Trade with very low risk (maybe 1% to 3% up to 5% for the maximum floating DD% ..... then increase it or decrease it depending on trader performance)

2. Take small TPs, limit the number of entries on the chart at the 1 time and as you close out some trades look at places to open more..repeat

3. You should have an assigned maximum floating DD% (refer to point 2 above):
a) carefully and slowly start building the account balance until the account %gain is > assigned maximum floating DD%
b) once point a) occurs you start to relax a little because you know if a bad days comes along and wipes out the maximum floating DD% now in $$ value that your account should still be either BE or in profit.

For example,

Start Account Balance = $1000
Slowly gained profit = $100
Assigned maximum floating DD = 5%

If start of day account balance = $1100 and you have a 5% loss (5/100*1100 is $55) then
End of day account balance = $1100 - 55 = $1045

Now take my QAM-1K live account

I use 10% maximum floating DD

Current Account Balance = $1160.49

10% loss = 0.1*$1160.49 = $116.05

Which would leave the account at $1160.49 - $116.05 = $1044.44

It depends on how much you can build the account before such an event occurs (hopefully it does not but we need to be realistic so it is possible)

The account can handle a few of these major loss days and still fight on.

Try to get used to focusing on 2 goals:

Goal 1 - accumulating multiple small profit TPs that lead to a net positive daily% gain
Goal 2 - do not exceed the assigned maximum floating DD

Goal 1 and 2 actually contain numerous other factors most of which have been outlined or hinted towards in the thread.

If 10 pip TPs work for you all well and good.

It does not matter how slowly the trading account takes to get built but rather the process used to build it!

Continue to consistently compound your account on a daily or weekly time period and you are guaranteed to be a success!

If you have a full floating DD% losing day be sure to learn from it and then attempt NOT to repeat it again.

Masterrmind..........

Excel done and ready for trading next week ........

Collect the ATW ranges over the past 20 trading days from each of the currency pairs:

eg AUDJPY

Chart [H1; 20 day ATW ranges]



Excel



eg AUDNZD

Chart [H1; 20 day ATW ranges]



Excel



Similarly for the other 11 pairs through to USDJPY!

Then tabulate all results into 1 Excel table as follows:



Live account traded over here http://www.forexfactory.com/showthread.php?t=585458

Note: SL values can be used for the following week and then updated over the following weekend (unless ranges increase drastically)

Masterrmind..........

Creating a safety net or profit buffer

The purpose of any trading account should be to generate profit!

However, inevitably the account may suffer from a loss related to the risk assigned by a given trader as a result of unfavorable trading conditions .

In terms of all trades running at the same time as in the case of a cycle of trades this risk could be anything from 1% to 10% (lower or higher).

A relatively small 1K account requires some forward thinking if the intent is to have it survive.

This is where I introduce the concept of a safety net or buffer profit which in the QAM Strategy have the same meaning.

In short a buffer profit is trading profit gained which can be used to offset a future loss on the trading account equivalent to the assigned risk that leaves the initial deposit intact.

What does this mean?

An Excel table is provided below:



Note the following:

1. A balance of $1111 is required to offset 1 by 10% loss and retain the starting balance (1K).

2. A balance of $1881 is required to offset 6 by 10% losses in a row and retain the starting balance (1K).

3. A balance of $2868 is required to offset 10 by 10% losses in a row and retain the starting balance (1K).

The main point here is to realize that a buffer profit should be very carefully generated to a given amount to offset a future loss based on your assigned risk per cycle.

There is a certain probability of having 1 by 10% loss.....

There is a certain probability of having 2 by 10% losses in a row.....

...........
...........

There is a probability of having N by 10% losses in a row......

The idea here is NOT to determine the probabilities but to understand that it is far less likely to have 2 by 10% losses in a row than 1.

The psychological part is very important here because basically once the account return hits $1111 you know that even if the account has a full 10% loss the initial balance remains intact.

Then when the balance reaches $1234 you know in your mind that the account can handle 2 by 10% losses in a row.

Then $1372 can survive 3 by 10% losses in a row.

etc
etc

If you have a solid trading plan in place once the account starts to grow larger you know its very unlikely to blow the account!

When you understand what this information means your confidence grows!!

ps. It all leads back to being in control of the applied risk .....

pps. I have used 10% in the examples because this is what I currently apply in the live 1K account but other traders will have different %risk.

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

Cycles taken on the live account today

EG and GU cycles

EURGBP [M1; 200/700 - MN 407]



GBPUSD [M5; 40/150 - MN 411]



Notes:

1. EG applied M1 to generate more entries based on an assumed lower trading range
2. GU applied M5 to generate fewer trades based on a slightly higher trading range
3. Watch PA across the chart and if using the EA be sure to apply the trending label indicator to obtain 'better' Q values and update in EA
4. If you fail to watch PA and update Q values then your cycles will most likely result in far less profit and possible loss (depending on initial values)
5. SLs and TPs are adjusted throughout the trading day based on many factors.
6. Typically stops should be tightened before FF Open but not always
7. Note where the TPs are placed and how much more profit could have been gained from the cycles (both); GBP data could have gone either way!
8. It was decided that the additional risk of allowing the trades to run was NOT worth it in this case and so trades were closed out for a nice % gain.

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

EURGBP [M1; 200/500 - EA/Manual; MN 507] cycle closed out today



Spread issues associated with closing of trades can create a loss whereas a very low spread would have made an exit routine.

I didn't have to let the 3 shorts run though I could have closed them out for a small loss and still had a net profitable mini cycle.

I chose to let them run.

Overall a profitable cycle!

ps. It always pays to go over your cycles say end of day or no later than the weekend and consider if there was a better way to have handled the cycle of trades throughout the day.

pps. Always seek out ways to improve on trade management but realise that the far right side of the chart is never visible when trading live ... :nerd:

Masterrmind..........

Cycles taken on the live account today

GBPUSD [M1; 200/700 - EA/Manual; MN 211]



Note: I could have closed out the cycle the 1st time price came back to the DO line but chose to let it run longer. This decision should not be taken lightly because price could easily have bounced off the DO and not returned anytime soon leading to losing trades or at the very least large DD.
It is better practice to close out the cycle especially when all trades are in profit. My rationale behind leaving the GU cycle to run was in considering the current DD on the NJ cycle which means current floating profit on the GU cycles was offsetting some of the DD on the NJ cycle. The idea was to generate more profit (at least attempt too) from the GU cycle just in case the NJ cycle turned nasty. As it turned out both cycles were profitable and I think maximum floating DD remained under 3% for both cycles combined (check this with myfxbook later).

NZDJPY [M5; 40/250 - EA/Manual; MN 212]



Note the difference in the number of trades generated usually expect more on an M1 TF but in this case that is not the case at all.
Price action across the chart is what causes the frequency of trades together with the selected Quantum value for a given pair.

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

Be aware of the possible impact on small quantum trading ranges and the movement of price from Quantum signal box to closure of trade.

Price can and will move quite a distance over a 5 minute TF as shown below (taken from my live QAm account) which can cut potential profit.



When the ranges are very tight a profitable trade may reduce in profit or actually turn into a loss.

Note: it can also work the other way too making closure of trades more profitable in the case where price eventually closes many pips away from where the Quantum closure signal was first triggered.

ps. 1000th Post!

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