Q A M Trading Strategy | Page 51 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

WRB/MC strategy:Coder needed to semi-automate my strategy 11 replies

strategy builder/tester for new scalping strategy 1 reply

Trading System versus Trading Strategy: Gaining a Profitable Edge 33 replies

Is opposite of losing strategy a winning strategy? 21 replies

Karmo's trading strategy trading GBP/JPY 2,030 replies

Attachments: Q A M Trading Strategy
Exit Attachments

Q A M Trading Strategy

  • #1,001
  • May 27, 2016 1:41am May 27, 2016 1:41am
Quoting 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. {image} 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...
Thank you for posting 1000 posts on this thread and sharing your discretionary trading knowledge. I have immensly benefitted from them though I have not posted anything on your thread .

I have gone through each and every post of yours and thanks to you I realised what mistakes I was making.

In spite of making good profits I never took profits on cycle basis and was therefore stuck on days when I could not trade anymore because of FIFO rule and trying to control margin calls.

Cycle trading/Equity trend trading opened my eyes and in spite of three times the account showing 10% increase in a month in different weeks I was only looking at the profitability of each trade and felt helpless in not being able to trade any more for fear of margin calls or avoiding overtrading.

I am a 67 year old discretionary trader now teaching free of cost as a communitu service housewives and retirees with substantial savings to trade fx spot and fx options. Unfortunately, I don't have any skills in Excel or coding though I have learned to understand by practice and study how Excel sheets, Indicators, EAs, Apps margin/position/pip calculators can work as my trading assistants.

I only believe in signals transmitted by my brain and I use EAs only as data crunching aids. I want to have simple indicators and clutter-free chart for my brain to function smoothly and fearlessly.

I don't use any kind of TA indicators except Moving Averages Distance to determine trend, pullbacks, retracements and reversals. I am fond of using boxes for drawing ADR lines, using small TFs in large Time frames like GGbox (similar to M candle and other so many such indicators).

I keep looking for seasonal patterns (particularly for oil consumption for CAD trading) and fortnightly, monthly, quarterly changes (thinking that after all they need to have profits at least every quarter since there is no dividend paid by fx market makers).

Most of what I do is casually and intuitively. I have not put together my trading ways into a system so far.

But after seeing substantial profits and seeing big drawdowns (not affecting my equity in any way) in my account I realise I have to have a system if I have to teach discretionary trading effectively. And luckily I landed onto your thread.

What I do instinctively:

1. Take a direction view based on fundamentals only. I draw a mental map of daily news events and draw a sort of trigger points. If GBP or JPY has three events I will assume one event may take it up, another may bring it back to opening line and third one may even take it down. It always pays off at the end of the day if you are able to judge and do grid/position slicing trading.

2. I don't use stop-loss and instead pile up positions up to 5 slices. I determine the high-low of a month and then determine maintenance margin I will incur if the past pattern repeats. I also keep some more extra margin as buffer to enable me to do scalping.

3. I treat trading as a consumer goods business where I am dealing in only one limited edition item which can appreciate in time and lose value or gain value on a daily basis too.

My limited edition product is GBPJPY. It is always moving and has large ADR. It is sort of a derivative of 14 pairs, all involved in playing a chess game, and pulling each other in opposite directions. It is a challenge managing this fast moving pair but worth its while in terms of trading opportunities and profits. Its difficult to determine what direction it will take on a long-term basis. So I only use it for short-term trading (weekly/monthly position hoping for appreciation) or day trading and particularly scalping because of its momentum speed (making daily profits).

Trend bias is paramount for me and I don't trade during months like December, January when multi-year adjustments are carried out by market makers in Japan and USA to balance their books like any business person will do. I don't see any ulterior motives in this kind of exercise. Spot fx is affected greatly by options and structured products whose data is not available to retail fx traders. Large traders do seem to have access to such data and whether they act in tandem or not is anybody's guess.

I estimate Medium-term trend on the basis of fundamentals, seasonal pattern for CADUSD.

4. For running a business cash flow management is important. I am prepared to sell my goods at breakeven price but not on a loss or mix goods and sell on an average price.

I don't use stoploss and instead average my positions to reduce my breakeven point. Mentally, I am not affected by seeing some stock losing value on a daily basis and am willing to put up with a large drawdown up to 30% of position value. My day trading is not affected until I cross danger point of my account equity. It is at this point I get stuck and if the drawdown continues I feel frustrated at not doing scalping trades. My business practically comes to a halt. Luckily so far no reversal has taken place as to wipe out my equity (except in 2008) or put me in huge loss. Thank God, profits so far have taken care of my living expenses after I started trading in GBPJPY for more than a year.

5. I have been making decent money but now I realise I can't teach this kind of risk trading to anyone. And must make a system and collect proper tools.

Indicator/EAs/scrips I am now looking for are:

1. How to determine drawdown by selecting (a) date which means if I select 15th of a date vertical lines are drawn on each 15th of the month so that I can compare when the reversals A good script has been coded by cyber1 but that is inadequate . http://www.forexfactory.com/showthre...83#post8939083
I am looking for a tool which can draw drawdown trendline by selecting two dates (from time,date,year to time,date,year) and selecting multiple dates up to 10 preferably using just one indicator to identify seasonal trends.

2. Drawing multi-time frame boxes based on volatility (ADR), pips input manually, Moving Average Distance, Fibs. I will use these boxes as point for entry and exit, support and resistance. You have provided a host of good tools. Your 20 pair ADR indicator and Session BO box are good. If the dashboard can print Moving Average Distance as well, it will be another good feature. Pivots+Fibs is also good. Moving Average Distance box drawn based on MA input will be very useful in visualising resistance/support, pullbacks, retracements, reversals, probable profit etc. For actual volatility I use Gumrai Multi Pips dashboard to do top down analysis to estimate medium term trend bias and CJA's Ranges Dashboard extra to keep an eye on ADR exhaustion points.

3. I have learned that Bollinger Bands or Donchian Channels could provide one-point indicator for all my needs. I have yet to come across this kind of strategy being practised from an experienced person like you.

4. For Position trading the way I slice portions to reduce breakeven points do you think Reverse Martingale can help me? The attraction for Reverse Martingale is risk/reward system and the possibility of not having a huge drawdown as a stoploss points. Instead I can slice drawdown into 7 stoploss positions and trade 1+2+4 total 7 trades for better risk reward positions. In theory it looks good. Your advise and any EA can you recommend which can print positions on chart in a table form like profit tracker.

4. I advise my students to choose only Interactive Brokers for lowest commission, spreads and funds security. But I use MT4 to deploy assistants like Indicators, Scripts and EAs and for demo trading. I would like to have some indicators/EA which can provide statistics like FF TA on the chart itself. Similar to iprofit trackers but not based on history. To print on chart drawdown, probably profit based on dummy trades input manually or through EAS.

What I learned from you?

You have exposed me to the equity trend trading.

I will try to practise live on it.

And use Drawdown as stoploss point instead of looking at each trade's movements.

Can you suggest good entry points? I am at present using only MA distance. Fibos: Can they act as overbought or oversold points?

Thank you again for sharing liberally your experience and knowledge.
Practice makes a person perfect
  • #1,002
  • May 27, 2016 6:35am May 27, 2016 6:35am
Quoting simnz
{quote} Thank you for posting 1000 posts on this thread and sharing your discretionary trading knowledge. I have immensly benefitted from them though I have not posted anything on your thread . I have gone through each and every post of yours and thanks to you I realised what mistakes I was making. In spite of making good profits I never took profits on cycle basis and was therefore stuck on days when I could not trade anymore because of FIFO rule and trying to control margin calls. Cycle trading/Equity trend trading opened my eyes and in spite...
Welcome simnz,

Quite a detailed post with several very interesting points of view and worthy of discussion.

You are the first person to publicly mention the "equity trend trading" concept so very well done .....

Several 'traders' have argued that all I talk about is the risk applied to the account or they are only in it for the "entertainment value" ........

By understanding, modifying when necessary and controlling the risk on every trade or every cycle of trades a high degree of professionalism enters a traders mindset and with many hours of chart time (experience) the trader learns to trade almost instinctively in that they simply know what to do in any (most) situation.

The level of focus and the ability to react in a timely manner to what the market throws at you inevitably leads to a successful or unsuccessful trader.

There is no half way ground you either get the risk issue mastered or you remain mediocre at best .... these are the facts!

By outlining risk and short to longer term goals using Excel the process has been laid out very clearly for those interested.

Historical data allows an appreciation of what could occur in the future and an understanding that an outlier in the data is also possible meaning that once again risk enters the equation and must over-ride all other factors to protect the trading account.

The discretionary part of trading comes from plenty of the right type of experience.

Be very careful of using the words overbought and oversold ..... these are traps for the newbies of the trading world!

Any indicator that shows an overbought or oversold zone (typically 30/70 values are used) is only suggesting that price might be tired and therefore start looking to take some profit off the table.

Never use such an indicator to suggest that price is going to reverse since many times price can remain oversold or over bought far longer than you can remain solvent!
Risk again is the ticket out of this situation!

The price action does not care about a stochastic or MACD they mean almost nothing to the market!

Learn about risk management and learn price action trading techniques .... then when you've mastered these concepts start getting the fundamentals sorted out and knowing when they apply to a specific trading strategy or preferred trading window.

Simply looking for red news is only at the most basic form of understanding fundamental considerations in trading.

If small periods of time are traded in the market and not during high impact news events then fundamentals may play little to no role at all with the majority of trading handled through technical expertise.

However, and this is important, when (if) my little 1K account reaches 10K the cycles taken will start to overlap heavily into the Frankfurt and London sessions and when you have 20+ trades in a cycle running you better know how the fundamentals are 'likely' to impact on your results.

IF you assess the news impact to be high then you need to think about tightening stops, reducing the number of positions and a whole host of other considerations not yet elaborated on in my threads.

They will be addressed in the future when the time is more appropriate (only the very basics have been outlined so far).

One of the points I also mentioned was to know your preferred trading pairs very very well.

The trader still needs to decide which pairs to trade on which day and in which trading window slot.

There are times when other pairs might need to be added into the mix to offset some of the developing DD but which pair(s) do you choose and why would you choose a certain pair(s)?

1k account is a challenge ..... no secrets here!

>>10K ........ far better!

Could you elaborate more on exactly what you are referring too in terms of "Can you suggest good entry points?" .... perhaps post a chart with descriptions.

There are many methods that can be used for entries but it does depend alot on your intentions.

For example,

On a turtle pair (EURCHF or EURGBP) I might wish to have multiple entries generated to form a huge fan of trades because I know the likelihood of a large trading range is not very high so my intention might be to jam pack as many trades as possible within say a 20-30 pip range and all I'm looking for is price to drive up high enough to generate the trades in the first place and then drop 20-30 pips to close out the cycle. This is based on a long cycle of course but a short cycle could easily be set up also.

Remember that what we want from this huge cycle of trades is an enormous amount of pips however, since the lot size is fixed (at least at this stage it is for a small account balance) we know the ranges are small so we need plenty of trades to generate pips.

When the account is larger (much larger) I will show many different techniques (still with a maximum floating DD) that can easily generate hundreds of pips just on the 1 turtle pair.

So why don't I do that now? ........... 1K account can't handle the DD! The 1K account needs to grow up first!

Fibonacci ratios are very ideal for looking at over bought/sold conditions, exhaustion levels etc but far more powerful is to consider areas with very high confluence. This is where a given area might be at a 127.2 Fib extension which is also close to a key level of support or resistance (as the case may be) which is also close to the ADR (for example or trading window range). Basically, a zone where multiple points of interest come together to provide a high probability case for entry (still might lose the trade but on average over a long period they have shown to be very good areas to take trades).

Feel free to post charts if you wish and I'll address any further questions you might have in due course.

Masterrmind...........
Master your Mind then Master your Trades
  • #1,003
  • Edited 4:04am May 29, 2016 3:42am | Edited 4:04am
Quoting Masterrmind
{quote}


1. There is no half way ground you either get the risk issue By outlining risk and short to longer term goals using Excel the process has been laid out very clearly for those interested.

2. Be very careful of using the words overbought and oversold ..... these are traps for the newbies of the trading world! Any indicator that shows an overbought or oversold zone (typically 30/70 values are used) is only suggesting that price might be tired and therefore start looking to take some profit off the table. Never use such an indicator to suggest that price is going to reverse since many times price can remain oversold or over bought far longer than you can remain solvent!

3. Learn about risk management and learn price action trading techniques ....

4. then when you've mastered these concepts start getting the fundamentals sorted out and knowing when they apply to a specific trading strategy or preferred trading window. Simply looking for red news is only at the most basic form of understanding fundamental considerations in trading.

5.If small periods of time are traded in the market and not during high impact news events then fundamentals may play little to no role at all with the majority of trading handled through technical expertise.

6.Know your preferred trading pairs very very well. The trader still needs to decide which pairs to trade on which day and in which trading window slot. There are times when other pairs might need to be added into the mix to offset some of the developing DD but which pair(s) do you choose and why would you choose a certain pair(s)?

7. There are many methods that can be used for entries but it does depend alot on your intentions. For example, On a turtle pair (EURCHF or EURGBP) I might wish to have multiple entries generated to form a huge fan of trades because I know the likelihood of a large trading range is not very high so my intention might be to jam pack as many trades as possible within say a 20-30 pip range and all I'm looking for is price to drive up high enough to generate the trades in the first place and then drop 20-30 pips to close out the cycle. This is based on a long cycle of course but a short cycle could easily be set up also. Remember that what we want from this huge cycle of trades is an enormous amount of pips however, since the lot size is fixed (at least at this stage it is for a small account balance) we know the ranges are small so we need plenty of trades to generate pips.

8. Fibonacci ratios are very ideal for looking at over bought/sold conditions, exhaustion levels etc but far more powerful is to consider areas with very high confluence. This is where a given area might be at a 127.2 Fib extension which is also close to a key level of support or resistance (as the case may be) which is also close to the ADR (for example or trading window range). Basically, a zone where multiple points of interest come together to provide a high probability case for entry (still might lose the trade but on average over a long period they have shown to be very good areas to take trades).
Thank you so much for responding with a response which I consider as extremely helpful in my trade journey.

1. I went through your Excel sheet and unable to understand what is meant by global variables and ADJ SL.
2.I will never think nor teach in terms of overbought or oversold nowonwards. I would rather now take profits at this stage and act depending on where my equity trend line stands. I need to learn more about how to trade equity trend line.
3. Risk Management : Your journal will help me in refining the methods. Price action trading techniques: Can I consider ADR or arbitrary use of roughly estimated pips as part of these activities?
4.Red News: Yes I consider it only a trigger point for that day. I try to go through news and analyse if they are planted with a motive.
And how the market makers are going to use it to make money, cover loss or do short covering. Example: I never believed BOJ has taken any decision on providing incentive to borrowers to borrow money (negative lending) and made 400 pips of GBPJPY in an hour of trading.
5. I do scalping on M30 entering at M5 based on moemntum , Currency Strength and Weakness during Asian sessions only.
6. Trading pairs: I mostly trade GBP/JPY and need advice from you on which pairs should I trade during Asian session to amass pips, particularly 20-30 pips strikers. Are there any pairs fit for straddles , both for short and long cycles ?
7. I can feel that there is some pattern to currency pair trading during Asian session as if a circus is being played where artistes are chosen randomly to perform and the hint of which pairs will get momentum is given very early in the first two hours of Japan session. If there is any indicator which can markdown timeout for each pair, may be those pairs can be identified very early before their size grows later in the day. I sometimes use an indicator which marks Zlines using seconds/minutes/hours/days/week ago in different timeframes.
GVC is now developing a basket indicator which will mark out time for currency strength and weakness and I hope it will be very helpful in identifying the momentum in early stages. He is supposed to post the EA this week. Once I have accessed it, I will post charts showing my entries.

8. I will now use Fib 127.2 as an anchor for entry. For positional trading, I want to systemise entry, adding more to winning entries. Which Fib level will be idea for it? Also for positions going in adverse direction, I want to average in order to reduce breakeven point.
At what point should I enter? Or should I use Moving Average Distance on day or weekly timeframe as an entry point? What factors should I take into figuring out Major and Minor confluence areas?

Kindly provide any useful material or analytical tools you feel will be good for my students to learn systematic but discretionary trading
using simple chart aids.

Thank you again for being generous in sharing your experience and knowledge.
Practice makes a person perfect
  • #1,004
  • May 29, 2016 7:59am May 29, 2016 7:59am
Quoting simnz
{quote} Thank you so much for responding with a response which I consider as extremely helpful in my trade journey. 1. I went through your Excel sheet and unable to understand what is meant by global variables and ADJ SL. 2.I will never think nor teach in terms of overbought or oversold nowonwards. I would rather now take profits at this stage and act depending on where my equity trend line stands. I need to learn more about how to trade equity trend line. 3. Risk Management : Your journal will help me in refining the methods. Price action trading...
1. The Adj SL is determined from finding the mean (average) ATW trading ranges over the previous 20 trading days (simply using a H1 TF and summing all the 20 values together and dividing by 20), then using Excel to find the value 1* SD away from the mean, then temporarily removing all values greater than the mean + 1 standard deviation value (Note: I could of used 2 * SD but 1*SD is sufficient at this stage). Then this new recalculated value gets 4 pips added to it and that becomes the initial global SL for a given pair.

Then this process needs to be repeated over all currency pairs which in my case is 13 pairs in total.

2. Looks like you understand this point I made... good.

3. Risk is very important! Without risk we make no profit and with too much risk we may end up losing everything .... so it needs to be understood.

4, 5 .... ok

6. GJ can be a wild pair. Are you trading a small 1K account as in my trading journal or a larger account? Be careful with GJ it can ferocious!

Think about what happens if a given currency shows great strength such as GBP and you plan to trade say EG + GU. If the euro and the USD are both neutral or very weak what would you expect to see in the PA on the chart?

EG - heavily down and generating a long cycle right?
GU - heavily up and generating a short cycle right?

How might trading these 2 pairs in tandem affect your DD?

How might the DD plotted against time look when trading both pairs at the same time?
a) if the trends remain strong more and more trades get opened and the DD increases ... yes?
b) think abut how you might add other pairs, reduce trades or hedge.

What about the risk involved?
What if the trend continues ....... and races out closer to your global SL .... what then?

You need to have a plan and you need to know with a fair degree of certainty how you will manage your trades.

Get very familiar with the charts especially the pairs you will be trading, look for patterns, know the typical trading ranges in a given trading window slot.

Know the session patterns and what PA does at the start of the day, Tokyo Open and leading into Frankfurt Open etc.

Check out the volatility charts available from myfxbook they are very useful.

Study price action, trading levels, pivot points and support and resistance because its very useful not only in the cycles but also for taking internal higher lot entries manually!

Confluence is particularly relevant to all areas of trading but again more so in the manual trade approach.

When I mentioned the 127.2 Fib as an exhaustion level please understand clearly that this does not mean that price will reverse on a dime!

If price hesitates and then continues say UP further then look at the 161.8 FIB as well as longer term levels of resistance in the case where price is pushing up higher and also identify the major handles (or the next handle up).

You must always look at the order flow and the transfer of strength from the bulls to the bears including but not limited to pin bars, bearish engulfing candle and a breakdown in momentum. But still you need to be patient, consider lower TFs and manage your risk with a realistic SL.

Attempt to search FF Forum for suitable material on a topic but feel free to ask questions here if you really get stuck.

Good trading,

Masterrmind............
Master your Mind then Master your Trades
  • #1,005
  • Edited 2:33am Jun 1, 2016 2:02am | Edited 2:33am
Thank you for taking out time to educate me.

1. Scalping has helped me in creating buffer margins on a daily basis and take care of losses.

However I have yet to find any indicator which can help me determine the acceleration of immediate momentum. Can you advise any indicator that can really help in identifying momentum acceleration though it looks like a stroke of luck is needed.

2. For longer cycles I have put faith in medium-term downward trend of GBPJPY because of Brexit and based on my news trading experience of more than 14 years. It has paid off for me so far. Next week I will switch to futures options trading on Euro pairs of CME until volatility becomes normal after Brexit. I will sell EURGBP calls and from the premium earned buy EURGBP puts. Now waiting for EURGBP to come up a little and then I will sell calls .The idea is to use market money to buy options. The risk is there but have to take it and suspend spot fx for a while to avoid rollercoaster rides.

What you taught me is invaluable about not treating any position as overbought or oversold.

3. I am attaching statistics produced by dweb's indicator. How can I intrepret them and use them for
(a) trading
(b) piling up or reducing positions
Attached Image (click to enlarge)
Click to Enlarge Name: Quantum statistics.png Size: 50 KB


4. Myfxbook charts for volatility: How can I plan my TP, stoploss and building up grid/averaging/pyramiding based on those statistics?
An example with chart will be helpful for my students. Or any link of your post dwelling on this.

5. I want my students to use as less indicators as possible because of the limitations of the app platform on which they are trading. Particularly university students are able to get jobs on the basis of this platform , set up by a non-profit foundation, which is verifying their records and supplying to would-be employers. ForexMaster holds competitions for students on an on-going basis.

Will you be kind enough to advise me how to make best use of ForexMaster application which has limited technical indicators? Just by using two technical indicators - Moving Averages and Bollinger Bands- on the platform and analysis done by your Excel Sheets how can
that platform be used effectively? It is a little bit of challenger to use only two indicators and still be a good trader. Housewives, retirees and university students stand to benefit by using a simple platform like ForexMaster or Oanda (which is far better than Forexmaster as it provides many technical indicators) and similar other Apps I am not aware of. If you come across any other App which you feel is superior than Oanda, please do let me know.

Technologically challenged persons will welcome your lessons tailored for Mobile phone app.

6. I am following your journal. Unfortunately I use Interactive Brokers and not MT4. I will try to find a bridge to connect IB with MT4 two ways so that I can post my journal too. But I just found a good free platform fundseeder which supplies free journal and also access to
professional investors. Your journal should also find a place there. MT4 is acceptable to them.
Practice makes a person perfect
  • #1,006
  • Jun 1, 2016 2:41am Jun 1, 2016 2:41am
Quoting simnz
Thank you for taking out time to educate me. Scalping has helped me in creating buffer margins on a daily basis. However I have yet to find any indicator which can help me determine the acceleration of immediate momentum. Can you advise any indicator that can really help in identifying momentum acceleration though it looks like a stroke of luck is needed. For longer cycles I have put faith in medium-term downward trend of GBPJPY because of Brexit and my news trading experience of more than 14 years. It has paid off for me so far. Next week I will...
Short TP scalping type trades at higher relative lot sizes are ideal for creating the buffer profit ........... correct!
Do not apply too high a lot size though be being greedy ... it is a double edged sword!

Expect huge volatility leading up to and during the Brexit referendum ........ potential fireworks in the making.
Some brokers are running scared and forcing traders to reduce leverage during this time and strangely enough its the same brokers who lost millions last time due to the CHF dropping their currency peg...........

As for dwebs indicator I too use it and find it very useful but I apply it to higher TFs such as M15 .... H1 and higher.
Best you address questions about his indicator directly to him as this is his little project not mine.

The problem with any momentum type indicators is that they fail miserably when price on the chart decides to change direction almost randomly.
However, they may be useful in the case where very small scalp type trades are the order of the day and are applied in combination with other trading factors the most important of which is positioning of price relative to chart structure.

I'll send you a PM with the names of a few but I do not recommend any of them meaning that you use them as educational indicators and nothing else if you get my point.

I trade futures and options as well so all the best with those trades.

You should do some research on the volatility tables that myfxbook provides so you know exactly how the data is determined.

Averaging and pyramiding ..... ahh yes very profitable techniques if applied correctly.
I may (read that as I will) be using such techniques later in the QAM method but not at this early stage because the small account needs to be nurtured and cared for over several more months until its grown up and can handle some serious techniques that I will throw at it.

Crawl ...... walk ........ run type of mentality.

MA - take them or leave them is my approach and I never trigger a trade based off any MA
Bollinger bands - same story.

Masterrmind........
Master your Mind then Master your Trades
  • #1,007
  • Jun 1, 2016 4:12am Jun 1, 2016 4:12am
I will not get into any discussions about how great or how bad brokers are or might be!

These types of discussions should be directed at the Broker threads not in a trading strategy thread!

Thanks in advance everyone.

Masterrmind ...........
Master your Mind then Master your Trades
  • #1,008
  • Jun 1, 2016 4:18am Jun 1, 2016 4:18am
Trading Analytics

There are plenty of trader analytic type websites popping up all over the place.

I encourage discussion and debate over trader analytic type systems and websites.

In case you missed it I have my live trading account linked to a trade explorer (TE - Forex factory) and myfxbook.

There is also FXBlue which can be used and at least a thousand others!

Masterrmind.............
Master your Mind then Master your Trades
  • #1,009
  • Jun 4, 2016 9:26am Jun 4, 2016 9:26am
Hmmm.any body can creat excel file. And with which step and lot trade give me a which price I can close all position until I have not lose.the zero level??
  • #1,010
  • Jun 4, 2016 8:32pm Jun 4, 2016 8:32pm
Quoting sanyax
Hmmm.any body can creat excel file. And with which step and lot trade give me a which price I can close all position until I have not lose.the zero level??
Hi sanyax,

Most people can work with Excel but certainly not all!

Excel is a simple and convenient tool that provides a trader with a means of analyzing data and turning it into usable information.

The market offers no future guarantee of profitability no matter how great the historical results.

A trader needs to be smart enough to understand the risks involved and control this risk.

Profit is never known in advance but the risk should be!

Obviously the smaller the risk even on a non-winning sequence of cycles or trades the longer the account survives until eventually 'termination' will occur.

Termination of the trading account rarely if ever occurs at a balance of zero and mathematically it occurs at a level >0 but less than required margin to open the smallest lot size offered by a given broker.

This is due to margin requirements set by a given broker which means that at a very small balance the brokerage account will not have enough funds to meet margin and therefore unable to open any position.

+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

I'm assuming you are referring to the consecutive 10% losses Excel sheet!

Other risk% can be tabulated in Excel such as 7%, 5%, 2%, 1% or 0.5% or any other value.

1K account I intentionally applied a 10% maximum floating DD level because of the nature of the Quantum Strategy which is DD hungry.

Very Important: For a different strategy a different risk% would need to be determined.

Experience and analysis tells me that this applied risk% of 10 is suitable for a small 1K account trading the QAM Method as I do.

It serves 2 purposes:

1. It allows for some DD to be generated and a reasonable net% gain to be made daily (recall that net %gain is typically 0.3 to 0.5 * DD) and
2. If a full 10% loss occurs it is considered recoverable (certainly more so than say 25-35% loss which would be damaging psychologically)

* Note: for much larger accounts say >>10K the risk% should be greatly reduced (2% to 5%) and for >>100K perhaps use 0.5 to 1% risk.*

Profiles can be developed using Excel or other sophisticated software that show how reaching a given $$ amount changes over time.

These are based on the applied risk% for an initial balance and then altering the risk% at various levels of account balance.

So imagine from:

1K to 5K a 10% risk is applied
>5K to 10K a 8% risk is applied
>10K to 20K a 6% risk is applied
>20K to 50K a 5% risk is applied
>50K to 100K a 2% risk is applied and
>100k a 0.5% to 1% risk is applied

Ofcourse this is theoretical but it gives the trader an expectation of a future time horizon and allows them to modify and alter their strategy dynamically over time.

Obviously, the smaller the applied risk and assuming a 'good' strategy is used the longer it takes to reach the ultimate goal!

Therefore, the trader decides what risk% to apply and how this risk% will be changed over time relative to the growing account balance.

The trader might also like to reduce the risk% based on 1 or 2 losing events.

For example, say the current balance is $1234 (initially 1K) and applied risk is 10%.

A trader suffers a full 10% loss and now the account is $1111.

The trader may choose to lower the risk to 5-7% and trade at this level until they build up the account again and then either stay at say 5-7% or increase risk back to 10%...... trader choice every time!

The purpose of this table is to provide the trader with a clear understanding of how risk% levels influence the account balance in cases of loss.

The Excel is also to provide a confidence booster to the trader from a psychological point of view.

It is hoped that a trader carefully builds up the buffer profit and continues onto each additional buffer profit level.

However, in reality it is likely over a given time horizon that a trader will eventually hit perhaps not all of the assigned risk but at least a large chunk of it.

Take a look at my live trading account QAM-1K Live and you'll notice one such drop in the equity curve when a daily loss occurred but it was not the full 10% rather less than this amount at 6.34%.

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

In answering your question! ........ hmmm

Not really sure what you are asking.

There are no guarantees in trading success, not now, not next week or anytime in the future!

If you continue to lose 1 day after the other and have no winning days then of course your account will eventually have insufficient margin to open the lowest lot size and that's when its over for you. At least until you replenish the account!

If it was me and I had >2 full losing days in a row at 10% each then I would stop trading probably for the rest of the week and certainly have a very long hard look over the weekend through my personal trading journal (which every trader should keep and not just the comments that I write in the posted Excel every day as this is not my personal trading journal) and look at every single trade I took both good and bad and try to determine why the losses occurred.

Start asking questions:

1. Is it the market and news impacts?
2. Is my applied risk set too high?
3. Am I following my trading plan?
4. Am I trading too many pairs at the same time and getting into DD thats too much for me to handle?
5. etc

A trader should be all over their trading strategy, their risk level, the sessions they trade, typical session patterns, understand Exel data and what the information means and in short understand every component and treat it as a business that you personally audit.

Hope you find some of this information useful and if not that's ok because I'm sure other traders will.

Good trading,

Masterrmind............
Master your Mind then Master your Trades
  • #1,011
  • Jun 4, 2016 10:51pm Jun 4, 2016 10:51pm
Quoting Masterrmind
{quote} Hi sanyax, Most people can work with Excel but certainly not all! Excel is a simple and convenient tool that provides a trader with a means of analyzing data and turning it into usable information. The market offers no future guarantee of profitability no matter how great the historical results. A trader needs to be smart enough to understand the risks involved and control this risk. Profit is never known in advance but the risk should be! Obviously the smaller the risk even on a non-winning sequence of cycles or trades the longer the account...
thankes for replay and sorry my bad english
i need som excel file for back test and know how much max dd
  • #1,012
  • Jun 4, 2016 11:50pm Jun 4, 2016 11:50pm
Quoting sanyax
{quote} thankes for replay and sorry my bad english i need som excel file for back test and know how much max dd
For my account you can always check the TE here on FF Forum or on myfxbook (search Masterrmind) and look for the DD.

If you wish to test your own scenarios then your results may be far different from mine because of the trader discretion applied in this QAM Strategy.

1. You will need to know what initial account size you wish to trade eg 1000, 2000, 5000, ...., 100 000 etc)
2. Then you the trader needs to decide what risk you will apply.
3. I have provided some hints and ideas about risk% applied to certain account sizes in the posts above as well as elsewhere in my 2 threads.

What are you trying to backtest?

If your initial account size is <=$1000 (or other currency equivalent) then I would limit maximum floating DD to 5-10%.

Depending on how comfortable you are with trading multiple pairs and multiple trades best option is to start with 1 pair and only 2-3 trades.
In this case you might only require 2-5% based on 0.01 lots per 1000 balance.

ps. If you are prepared to state your initial account size and level of experience then I'm prepared to comment on a realistic max DD level however, typically this is a very personal matter based on traders risk tolerance.

Masterrmind...........
Master your Mind then Master your Trades
  • #1,013
  • Jun 5, 2016 12:10am Jun 5, 2016 12:10am
Quoting simnz
... But I just found a good free platform fundseeder which supplies free journal and also access to professional investors. Your journal should also find a place there. MT4 is acceptable to them.
Trading account now connected to fundseeder!

ps. note that the account will not be placed on the leader board until it hits 50K ..... plenty of work to be done in the meantime!

Masterrmind...........
Master your Mind then Master your Trades
  • #1,014
  • Edited 5:19am Jun 5, 2016 5:07am | Edited 5:19am
Quoting Masterrmind
{quote} Trading account now connected to fundseeder! ps. note that the account will not be placed on the leader board until it hits 50K ..... plenty of work to be done in the meantime! Masterrmind...........
Fundseeder has a lot of credibility than myfxbook. Glad you are there. Leader board needs 6 months and 50K equity.
I feel you will hit 50k mark even though the job looks stupendous to anyone who has not gone through such a journey.
I am familiar with this journey.

The more simple the methodology of analysis and trading is there, the possibility of strike rate in Asian session is 90%. This is based on my own experience of keeping 10-20 pips target and entering when the momentum is about to gain. Only discretionary trader can guess the timing of momentum acceleration. EA and indicators are not of any particular help here so far.

During last 5 months I have tried: (a) multipairs and the return in a month was 17% (b) single pair because I am unable to spend much time on watching chart and the return is 9%. However, I have to have a grip of risk management so that drawdown remains in control all the time.
Equity trend trading, which I learned from your post, gave me an idea of how to cope with long persisting drawdowns.

My trading approach

I am a momentum trader, trade only during Asian hours in one pair GBPJPY, and depend on three factors for my trading with a target of 60-80 pips a day .

I estimate probability of pip movement by using Session Average or ADR and real-time volatility figures posted on free site: finviz under forex performance category.

My trade routine:

(a) Identify momentum drivers : GVC's Basket5 EA captures momentum drivers (pair count plus 5 starred pairs) in real-time and I rely on it completely.
Attached Image (click to enlarge)
Click to Enlarge Name: Momentum Trading plan.png Size: 80 KB
I use two charts: one having only GVC EA and another having three indicators, line regression channel , AIMS Box (fractals shadows) and Blubbb_zlines (indicator for momentum direction marking)

(b) Estimate time it will take for the basket (GBPJPY co-relation is 90-95% most of the time with the 14 pair group) to achieve pips movement. GVC EA is recording the basket pips movement by way of weekly, day, 4 hour and one hour and identifying the strength by way of pair count and the position of 5 heavyweights.

(c) I do trading on M30 frames and enter market normally during last 5 minutes of each M30 candle during Asian Hours hoping HTFs will push the momentum during that time so that I can get out with 20 pips on GBPJPY in 10-15 minutes time of trading. These days it is working. Last Thursday I traded for 20 pips but instead got 80 pips in a matter of 7 minutes. Whether it is a regular pattern or not is yet to be determined.

I estimate how long the momentum time (15m or 30m) may take to reach my pip distance target and then I jump into the trade in M1 tf and hope to exit whenever my target is met. TP limit order is placed along with the trade itself.

When the market makers/HTFs unleash their volumes is not known to anyone but time marked (seconds/minutes ago) for each pair as well as the direction by way of an arrow the 14 pairs will give an idea of whether to jump in the trade or not. This feature may be added by GVC

Risk/Money Management

Quick Top down analysis is given by GVC EA and I develop some bias for short-term trades based on my fundamental views and the economic calendar events.

Since I average positions into 5 equal lots instead of using SLs to reduce my breakeven point, I apply my bias and keep ready a stand-by (emergency) short-term trade positions plan in case my momentum trade goes in adverse direction. More like a back-up system for me.

Last month, largely because of me putting too much faith in my bias as well as greed, I missed three opportunities to take profit each week. After reading about equity trend from your posts I finally took the profit having recovered from 25% drawdown last week. Last month I went through 25% drawdown (all from profits ), recovered in a week, again went down in water by 18%, 20% and finally recovered equity by 24%.

I will continue to do scalping as my short cycle stream of income as it has worked for me.
Now for long cycle stream I want to continue to do averaging/pyramiding with equal lots and am looking for a
system to reduce my breakeven point.

Please guide me on designing a Risk/Money Management plan and how to cope with consecutive volatility.
I have just come across a free excel sheet as part of forexop's site under tools/stop-loss-take-profit-optimizer which is close to what I am doing presently.

Thank you.
Practice makes a person perfect
  • #1,015
  • Jun 5, 2016 7:35am Jun 5, 2016 7:35am
Quoting simnz
{quote} Fundseeder has a lot of credibility than myfxbook. Glad you are there. Leader board needs 6 months and 50K equity. I feel you will hit 50k mark even though the job looks stupendous to anyone who has not gone through such a journey. I am familiar with this journey. The more simple the methodology of analysis and trading is there, the possibility of strike rate in Asian session is 90%. This is based on my own experience of keeping 10-20 pips target and entering when the momentum is about to gain. Only discretionary trader can guess the timing...
The account needs to build up quite a lot to meet the requirements of being placed on the leader board!

But given enough time I believe its certainly achievable .......... time will provide the answer.

I've had a good look at some of the other accounts there which show the analytical history some of which have very interesting results!

A common factor among many traders is their inability to consistently produce similar gains as the account grows on a month by month period!

Especially as the account size increases considerably ..... the monthly gains tend to drop off (not in all cases though but certainly most).

I too have traded much larger accounts and grown them but not a 1K account using the QAM Method its for the benefit of smaller startup Quantum
traders and also the fact that I enjoy a challenge.......... !!

If someone says it can't be done I'm the first to ask .... Why not?

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

There are plenty of dashboards here on FF!

GVC, Seller9 and many others have created great dashes and basket trading EAs but the problem is traders typically push a button hoping for success which rarely if ever comes and if it does it is very short lived.

For longer term trades definitely get onto the fundamentals and form an expectation of which direction the pair is likely to trade and have a plan in place for when it goes against you.

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

Your Drawdown:

Seriously your DD @ 25% is bordering on out of control in my opinion and you need to address this issue now.

Look at limiting your DD and what processes do you have in place if DD continues against you say it increases to 28% ...then 30% ... then 40% ....

What processes do you have in place ..... hedging strategy .... depositing additional funds .... closing some or all trades .... something else?

What is your backup plan precisely?

Greed -------- eliminate this trait from your trading now as it will turn you into a gambler not a risk averse trader!

I think you need to have a good look at implementing my equity trend trading approach.

I also use short term scalping techniques to gather quick profit using higher lot sizes especially in developing DD situations that might need to be offset by some buffer profit.

Averaging and pyramiding can certainly work well in the right situations but I won't really apply these techniques until the account is much larger.
With A + P applied the growth can really accelerate.

Please explain the following quote in more detail please:

"Please guide me on designing a Risk/Money Management plan and how to cope with consecutive volatility."

I think I know what you are asking but I need to know which system you are trading, an idea of account size, trading ranges expected etc etc.
In short I need to know your trading plan ..... pairs, session times etc etc.

Once you provide enough information then I'll draft up a money management plan for you.

Good trading,

Masterrmind...........
Master your Mind then Master your Trades
  • #1,016
  • Jun 5, 2016 11:23am Jun 5, 2016 11:23am
I have already explained you the entire trading setup I follow. Asia session only. Entry based on momentum acceleration generated by ongoing moves of 14 pairs. Sell GBPJPY if JPY is strong and buy GBPJPY if GBP is strong.

I also trade EurUSD occasionally like an option trade. I will identify EurUSD high-low for 100 days and plan my trading margin. If the high-low range for 100 days duration is (example : 600 pips) I will add 50 pips as buffer . For 650 pips I will calculate initial + maintenance margin required based on 5% initial margin and then stuff another 30% (200 pips) as buffer margin. So basically I will be putting in 850 pips worth money in margin account.

I will slice 850 pips margin in 5 parts and 170 pips or $1700 will be my first lot. 50 pips is my target. I don't calculate
risk/reward part. Averaging is done by trading equal lot of $1700 at every 120 pips move. So far, I have not calculated drawdown for this pair and maximum 4 lots have been used by which time reversal happens and profit is generated.

Problem comes in when the pair goes up for 4 consecutive days with 600-700 pips at a go. It happens once every quarter. At that point I sell CME futures options at 300 pips above the spot price (ATM) at peak of 700 pips and buy call option from the proceeds to hedge. I am OK with this kind of hybrid risk management because I am not putting in additional money to buy insurance.

GBPJPY has no CME future options and I am deprived of the opportunity to hedge my spot fx. I am yet to set up a proper risk management plan for handling it. The returns are lucrative and generate quick returns in a matter of 10 days and the returns can be up to 35% a month on total margin equity.

I calculate 1200 pips hi-lo monthly range plus 400 pips as buffer. Total 1600 pips. I use 300 pips worth money as initial+maintenance margin (about $2800 as first lot) and subsequent lots will betraded at a distance of 200 pips if the position goes adverse, to reduce break even point. 20 pips x 4 or 5 trades = 80-100 pips is daily target. Again no Risk/Reward calculation.

I travel for long periods so sometimes don't trade at all for 60 to 75 days in one go. So there is no consistency in my
returns.

GBPJPY generated 32% of profits in scalping in April alone and provided a mental cushion to accept the drawdown of 25% which if I had liquidated would still have left me with 7% profit. But the drawdown recovered last week by 22% on Thursday and I liquidated the position treating it as equity trade. On Friday I did not trade because of other work.
Practice makes a person perfect
  • #1,017
  • Jun 5, 2016 1:26pm Jun 5, 2016 1:26pm
Means yo trade with system and trade step step until your balance decrease 5%? And then close all position?
  • #1,018
  • Jun 6, 2016 7:03am Jun 6, 2016 7:03am
Quoting simnz
I have already explained you the entire trading setup I follow. Asia session only. Entry based on momentum acceleration generated by ongoing moves of 14 pairs. Sell GBPJPY if JPY is strong and buy GBPJPY if GBP is strong. I also trade EurUSD occasionally like an option trade. I will identify EurUSD high-low for 100 days and plan my trading margin. If the high-low range for 100 days duration is (example : 600 pips) I will add 50 pips as buffer . For 650 pips I will calculate initial + maintenance margin required based on 5% initial margin and then...
Your method differs alot from the QAM Strategy no question about that!

Would you be prepared to start your own thread here on FF Forum.

To discuss your risk management dilemma because although this topic is relevant your style is far removed from the QAM Strategy.

Otherwise we can address it via PM if you wish.

ps. I don't really want this thread going off on a tangent to what I've started here if you know what I mean.

Masterrmind............
Master your Mind then Master your Trades
  • #1,019
  • Jun 6, 2016 7:14am Jun 6, 2016 7:14am
Quoting sanyax
Means yo trade with system and trade step step until your balance decrease 5%? And then close all position?
Not quite right.

If 5% was the assigned maximum floating DD then I would start looking to apply other techniques when floating DD starts to exceed say 2.5 to 3%.

If you wait until 4.5% out of a possible 5% then you are not giving yourself much room to move.

By room to move I'm referring to opening up additional recovery trades because these trades will almost certainly draw some DD between open and close.

It would not be my intention to close all positions at once although this can happen depending on the situation.

I would be more inclined to stagger the SLs of the remaining trades by 5 to 10 pips if possible even if it means drastically reducing the SL locations of the first few trades. This gives your trades a chance to miss being stopped out all at the one price when waiting for a reversal in price.

Ultimately the most important rule is to NOT exceed the maximum floating DD .... period!

So a trader needs to carry out their business and trading techniques within the guidelines.

Understand the risk, make sure the sum of all your SLs of all open trades add to less than the assigned maximum floating DD!

Eventually you'll be able to think far more clearly and rationally and concentrate on your open positions because you know that your risk is taken care of.... subject to PA and other factors on the chart when an opportunity arises allowing the SLs to be tightened you take it with both hands because you know it means a reduction in risk!

Masterrmind..........
Master your Mind then Master your Trades
  • #1,020
  • Jun 6, 2016 7:18am Jun 6, 2016 7:18am
Quoting Masterrmind
{quote} Your method differs alot from the QAM Strategy no question about that! Would you be prepared to start your own thread here on FF Forum. To discuss your risk management dilemma because although this topic is relevant your style is far removed from the QAM Strategy. Otherwise we can address it via PM if you wish. ps. I don't really want this thread going off on a tangent to what I've started here if you know what I mean. Masterrmind............
I think that's OK. I would not start my thread and i would be thankful if you find time to send me PM.
However you can generalise risk/money management techniques for the benefit of all readers.
Practice makes a person perfect
0 traders viewing now