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Jay's High Probability Setups

  • #281
  • Jun 24, 2016 3:26am Jun 24, 2016 3:26am
thanks jay well did gamble on the gbp/jpy but did make 1500 p live but my broker AXIS did stuff me up was able only on 0.05 grrrrrrrr do we expect the GBP lower or will recover
thanks
  • #282
  • Jun 24, 2016 4:05am Jun 24, 2016 4:05am
Quoting ellenbrook
thanks jay well did gamble on the gbp/jpy but did make 1500 p live but my broker AXIS did stuff me up was able only on 0.05 grrrrrrrr do we expect the GBP lower or will recover thanks
Now that 1.38 is cleared, I don't have any expectations on GBP.
Wouldn't recommend trading it before all the dust is cleared.
  • #283
  • Jun 24, 2016 6:38am Jun 24, 2016 6:38am
Quoting FX-Jay
I was abstaining from giving any trade recommendations before the Brexit vote was over in order to to encourage anyone to enter the market during an extremely volatile & uncertain period. Now that the Brexit speculation is over, I'll give out some medium term high probability trades that I have: * AUDCAD below 0.9350 * AUDCHF below 0.7000 * USDCHF below 0.9500 & of course the long awaited 1.1635 on EURUSD
do you have invalidation criteria or time projection for your lelels. What is mid-term by your standarts? Surely eurusd will hit 1.1635 someday, we can so much confidently say it will go to 1.20-30-40. do you attach time period to those targets or you wait for development further? Thanks.
  • #284
  • Edited 10:27am Jun 24, 2016 10:15am | Edited 10:27am
Quoting feline207
{quote} do you have invalidation criteria or time projection for your lelels. What is mid-term by your standarts? Surely eurusd will hit 1.1635 someday, we can so much confidently say it will go to 1.20-30-40. do you attach time period to those targets or you wait for development further? Thanks.
Yep as I've mentioned before, invalidation criteria include trend reversal & opposing signals (which won't happen unless the trend changes, since trend direction is a component in getting the signal).

Concerning time projections for these particular calls & the setups I shared as of the beginning of 2016 (medium term trend trades vs. short term anti-trend trades):
I don't have any set limit, but given that I am using a combination of Daily & Weekly TFs in doing my analysis, I project the holding time to be anywhere between 1 day & 2 quarter cycles.

If you're interested in some numbers, since I shifted to this particular (non-day trading) method in the beginning of 2016, I've had (as of date) 159 distinct tradable setups out of which 156 were profitable & 3 non-profitable. The average holding time per setup is 8 days & the longest being so far 118 days (almost 4 months).

Most of the setups I share here on FF are from the batch that I believe is extremely high probability & will have targets reached much faster than the other 'regular' high probability trades (reason being people here are not really interested in long term trades & more often than not don't know how to manage DD & risk).
For me the best trades are the ones that move away from target (while remaining valid) & allowing me multiple entries before snapping right into the target after they get you bored/un-interested/scratching your head on why is market is behaving that way. An example would be the stubborn AUDJPY trade that I shared here couple of months ago. When I posted it, I expected it to be from the 'easy' batch of setups (like all the ones that preceded & followed it) rather than the 'stubborn' setups.
That trade reached its target 76 days after the high probability setup showed up.

For the EURUSD setup, the targets were: 1.1437, second target was 1.151, and third target was & still is 1.1635.
If you recall, Target #1 was reached in 4 days, target #2 was reached in 24 days.
48 days have passed since the 3rd target setup & it is yet to be reached.

I hope I answered your questions, and my apologies for the long post, I just used it as an opportunity to answer some questions that may be going around other people's minds on my setups' duration given that I'm not posting much lately.

Best,
Jay
  • #285
  • Jun 24, 2016 11:06am Jun 24, 2016 11:06am
Quoting FX-Jay
{quote} If you're interested in some numbers, since I shifted to this particular (non-day trading) method in the beginning of 2016, I've had (as of date) 159 distinct tradable setups out of which 156 were profitable & 3 non-profitable. The average holding time per setup is 8 days & the longest being so far 118 days (almost 4 months).
Here's a visual representation based on a strategy tracking account that I'm using
Attached Image (click to enlarge)
Click to Enlarge Name: Capture.PNG Size: 28 KB
  • #286
  • Jun 24, 2016 11:41am Jun 24, 2016 11:41am
Quoting FX-Jay
I was abstaining from giving any trade recommendations before the Brexit vote was over in order to to encourage anyone to enter the market during an extremely volatile & uncertain period. Now that the Brexit speculation is over, I'll give out some medium term high probability trades that I have: * AUDCAD below 0.9350 * AUDCHF below 0.7000 * USDCHF below 0.9500 & of course the long awaited 1.1635 on EURUSD
Two of the above setups require CHF strength, and apparently the Swiss Central Bank confirmed that it has been intervening to weaken the CHF in the wake of the Brexit vote: http://www.cnbc.com/2016/06/24/swiss...er-brexit.html

Usually it is not recommended to stand in the way of Central Banks, but to be honest the way it should really be is: Central Banks should not stand in the way of the Market. So I'll be favoring the market's opinion over the Swiss Central Bank on this one.

Expect some choppiness, but sooner rather than later the above targets will be reached
  • #287
  • Jun 24, 2016 1:56pm Jun 24, 2016 1:56pm
Impressive...Thanks Jay
  • #288
  • Jun 24, 2016 4:08pm Jun 24, 2016 4:08pm
Quoting FX-Jay
{quote} Yep as I've mentioned before, invalidation criteria include trend reversal & opposing signals (which won't happen unless the trend changes, since trend direction is a component in getting the signal). Concerning time projections for these particular calls & the setups I shared as of the beginning of 2016 (medium term trend trades vs. short term anti-trend trades): I don't have any set limit, but given that I am using a combination of Daily & Weekly TFs in doing my analysis, I project the holding time to be anywhere between 1 day & 2 quarter...
Thanks for reply. I havent followed the whole story, so forgive me if I repeat question that have been asked before. Do you use leverage, cause I see you are holding pretty long-term and could suffer some dd, also, what happens if dd gets extremely large, but target isnt invalidated, would you take additional measures to get out of such trade, or liquidate part of position etc. And a very important question that I am curiosu about - as I see your trade close time could be anywhere from hours to many days ( much more green concentrated in the earlier hours/days) , so - are those the same strategy trades or there is a difference for the different holding periods. Meaning - do you arrive with the exact same proccess to those targets , doesnt matter if they are satistfied in 1 hour or 50 days? So you just get a good target, then wait, no matter how long it will take? So it is basically the same analysis strategy, but the time to strike is widely variable and cannot be estimated well? Thanks.
  • #289
  • Jun 24, 2016 5:29pm Jun 24, 2016 5:29pm
Quoting FX-Jay
{quote} Now that 1.38 is cleared, I don't have any expectations on GBP. Wouldn't recommend trading it before all the dust is cleared.
thanks JAY have a nice day
  • #290
  • Jun 25, 2016 4:06am Jun 25, 2016 4:06am
Let's dissect the post into different segments:

Quoting feline207
{quote}Do you use leverage, cause I see you are holding pretty long-term and could suffer some dd
I like to categorize myself as semi-professional part-time trader. Unlike most retailers, I don't use excessive leverage. For me, managing Risk is far more important than making big bucks from high leverage.
You need to master 3 things in order to avoid falling into the over leveraging trap:
1- Trust your system & be confident of the outcome it will give you
2- Be in control of your emotions while trading
3- Have a Financial + Risk background & acquire as much knowledge in those 2 categories as possible.

Quoting feline207
{quote}what happens if dd gets extremely large, but target isnt invalidated, would you take additional measures to get out of such trade, or liquidate part of position etc.
The above cases are the ones that I wait for to get the big money. DD is part of the game. As long as the target is still valid, you are still in play. Before deciding to trade any setup, I put down all the possible scenarios that could happen & Manage my trade based on the worst case scenario that could arise.
This may come as a surprise to some, but on my main account each setup is allowed a minimum of 7,500 pips space to play without me even getting close to a margin call. But anyways you can bet the farm on the fact that the very few 'bad' signals get invalidated waaaay before even quarter of the above number is reached.
Again, when you have a proven profitable system, its the MM & TM that keep you in business. A profitable system in the hands of an amateur will lead to worse results than a non-profitable system in the hands of a professional.
  • #291
  • Edited 4:49am Jun 25, 2016 4:29am | Edited 4:49am
Quoting feline207
{quote} And a very important question that I am curiosu about - as I see your trade close time could be anywhere from hours to many days ( much more green concentrated in the earlier hours/days) , so - are those the same strategy trades or there is a difference for the different holding periods.

The above visual representation is for the same strategy that I've been using since the beginning of 2016.
​I've set a separate account that just tracks this strategy since on my main account I sometimes take different trades that will cause disturbances to the statistics, and won't allow me to be able to accurately study the progress of this strategy.

Quoting feline207
{quote. Meaning - do you arrive with the exact same proccess to those targets , doesnt matter if they are satistfied in 1 hour or 50 days? So you just get a good target, then wait, no matter how long it will take? So it is basically the same analysis strategy, but the time to strike is widely variable and cannot be estimated well?

100% correct. So basically all trades you see on that graph are for the same strategy & have been evaluated (pre-entry) in the same exact way whether they were closed in 1 day or 118 days.
Concerning the time, as I said earlier the average holding time is 8 days. Unlike my previous methods (that I still use whenever I have some free screen trading time), the timing of the entry or the exit are not essential to this strategy & are not a main factor in the level of probability of the trade setups
  • #292
  • Jun 25, 2016 12:57pm Jun 25, 2016 12:57pm
Quoting FX-Jay
{quote} The above visual representation is for the same strategy that I've been using since the beginning of 2016. ​I've set a separate account that just tracks this strategy since on my main account I sometimes take different trades that will cause disturbances to the statistics, and won't allow me to be able to accurately study the progress of this strategy. {quote} 100% correct. So basically all trades you see on that graph are for the same strategy & have been evaluated (pre-entry) in the same exact way whether they were closed in 1 day...
Thanks. It sounds very interesting. I think I am trading with some similar philosophy to yours, however your performance rate is absolutely outstanding. What I dont get from your last sentence - how can the probability be independent on BOTH entry and exit. How is that even possible, when an edge is actually making more positive pips from open to close of trade. So yes, open and close prices could not be that important by themself, but open vs. close of trade at least must be very important. And given the fact that your close is set at a target price and not dynamical, then the only floating point is the entry(open), but the entry vs exit. still have impact on the edge/performance/probabiltiy/whatever. And like mentioning the timing of trades. Doesnt timing also include pricing? Because price-time are simultaneously evolving. Getting a price means getting the time that price is available and vice versa. I will try to put it in other words - Suppose that whenever you realize there is a target born, you immediately place order in the same direction to reach the target, and you also do only one entry per target (no reaveraging entry price) . Would your edge still remain intact then? of course it doesnt make much sense, because who wouldn't want to maximize profits vs minimize risk as much as possible. But if you need to optimize the entry point and cannot depend on random entry, it still depends on entry price. I am asking all this because I have very good targets, however I find it difficult to know the deviation before the strike (even a rough approximation is nothing but a guess). However, I need to be able to take as much as possible from a move. Entering for 20 pips is not the same as going for 100 or 500, but it also changes the probabilities, that are dynamical. I really dont calculate that, but that is my logic. The further price travels away from target, the lesser potential risk and reward of such a trade, but there is also much lesser probability to get far away price. That would filter the trades and you could go for only small % of the total trades. Do you apply any filtering with the following things in mind? Do you believe that deviation from target price does not change in any way the probability for the target price. If probability is independent of time nad price, than what does it depend on, is it probability at all? OH I wrote so much, cannot even read it. Have a nice weekend.
  • #293
  • Jun 25, 2016 3:24pm Jun 25, 2016 3:24pm
[quote=FX-Jay;8999479]{quote}

thanks for the words of wisdom J ... I read all your stuff and I find it most helpful

good pips Man
Learn THEN Unlearn
  • #294
  • Jun 27, 2016 11:17am Jun 27, 2016 11:17am
Quoting feline207
What I dont get from your last sentence - how can the probability be independent on BOTH entry and exit. How is that even possible, when an edge is actually making more positive pips from open to close of trade.
What I was trying to say is that the timing of the exit isn't essential in determining a highly probable setup using this method. Exit is all about the target that I set & if the setup gets invalidated then the criteria that invalidate the trade are what matter & not exactly the exist time.

Quoting feline207
So yes, open and close prices could not be that important by themself, but open vs. close of trade at least must be very important. And given the fact that your close is set at a target price and not dynamical, then the only floating point is the entry(open), but the entry vs exit. still have impact on the edge/performance/probabiltiy/whatever.
For me the edge/probability of my target being met are separate from account performance/return. I work on MM separately, and it is essential to maximize the profit & it is also essential to minimize DD, and thats something I continuously evaluate & work on.


Quoting feline207
And like mentioning the timing of trades. Doesnt timing also include pricing? Because price-time are simultaneously evolving. Getting a price means getting the time that price is available and vice versa.
Theoretically thats true, and Im not arguing against that. If you wanna look at it that way then yea timing is very important. But practically, using my method timing is a means for optimizing rather than giving an edge. The edge itself doesnt come from the timing of neither the entry nor the exit.
  • #295
  • Jun 27, 2016 11:25am Jun 27, 2016 11:25am
Quoting feline207
I will try to put it in other words - Suppose that whenever you realize there is a target born, you immediately place order in the same direction to reach the target, and you also do only one entry per target (no reaveraging entry price) . Would your edge still remain intact then?
Yep, and thats why I feeling extremely comfortable calling it high probability & sharing trades with utmost confidence even when the market looks to be going in a completely different direction.

Quoting feline207
of course it doesnt make much sense, because who wouldn't want to maximize profits vs minimize risk as much as possible. But if you need to optimize the entry point and cannot depend on random entry, it still depends on entry price.
I am asking all this because I have very good targets, however I find it difficult to know the deviation before the strike (even a rough approximation is nothing but a guess). However, I need to be able to take as much as possible from a move. Entering for 20 pips is not the same as...
Again, in my books, Optimization and making the most of a setup is a completely different story than obtaining the high probability setup in the first place. Im currently putting my full focus on optimizing the DD% for this strategy. Soon enough I will be starting to shift my focus to optimizing profits & mostly optimizing my entries. As per the MyFxBook stats, my average entry accuracy is 48% while the average exit accuracy is 85%, so definitely there a lot of room for improvement specially in entries.

Quoting feline207
The only filtering I do at the moment is based on how high the probability of the setup is. Im filtering anything below 90%. But after getting done with the optimization, Im sure I will start filtering trades to reduce additional unwanted DD.
The only filtering I do at the moment is based on how high the probability of the setup is. Im filtering anything below 90%. But after getting done with the optimization, Im sure I will start filtering trades to reduce additional unwanted DD.

Quoting feline207
Do you believe that deviation from target price does not change in any way the probability for the target price. If probability is independent of time nad price, than what does it depend on, is it probability at all?
I had the pleasure of working with NorthTrader in the recent past, and we managed to prove that when it come to the TZ concept, deviation from target price does affect the probability negatively. So depending on the system being used, the answer will vary.
& no there is no probability that is independent of both time & price in the models that I use
  • #296
  • Jun 27, 2016 12:29pm Jun 27, 2016 12:29pm
I understand that because it is your own strategy and you cannot reveal the interesting parts of it, you have to reply in a certain way. And maybe that is the reason why I still do not understand much, or maybe the problem is me. But still, I do not get too many things. I understood that - you assign probability to every trade, the probability does not depend on how far price will travel, but it also does not change from the time it passes. If you remember some of eurusdds postings, he said that probability is nothing without time attached to it. X% what, when? So I do not understand - if you have 90% probability for a target in your strategy, what do those 90% represent? Because every price is recurrent at some point in the future. If the probability is for the price being recurrent, then it is 100% for infinite time. Also, at least imo entry optimization and dd optimization go hand in hand. Your dd is dependent on mae, which depends on the ability to time entries / market turning points. But that is my view and you probably have your ways. It certainly can have different angle of view depending on the system that is being traded and I dont know yours.
Another thing that gets me very curious - 1.1635 is price that hasnt been used for a long time and you said that whenever an opposite signal occurs, it will invalidate the previous. Does that mean that since 1.1635 was last printed, you havent had another signal for a short eurusd so you are just trying to long till that target is hit. Or was it when the market last printed 1.1635 that you got your target or you got it later. Very interesting for me, if you reveal a little bit more, when is the first moment during which you can observe the target through your system and you assign the probability. Is it when the price was last used, or it is later. And also - is your system fractal/timeframe dependent or not. I mean - do you operate it ona certain timeframe, so you can switch on a shorter one and trade other signals (as it was with TZ for example). Or it isn't...
I can literally ask questions forever cause it is so interesting for me but I think I will soon start to get too annoying here on your journal. So you decide how much you can talk about certain aspects of your trading. Wish you good trades.
  • #297
  • Jul 1, 2016 10:46am Jul 1, 2016 10:46am
Quoting feline207
If you remember some of eurusdds postings, he said that probability is nothing without time attached to it. X% what, when? So I do not understand - if you have 90% probability for a target in your strategy, what do those 90% represent? Because every price is recurrent at some point in the future. If the probability is for the price being recurrent, then it is 100% for infinite time.
For this trend trading system, if I say the probability is 90%, I mean that there is a 90% chance that the target will be hit before the setup being invalidated.
For the TZ system, if I say the probability is 90%, I mean that there is a 90% chance that the target will be hit before H (H being the number of bars / time)

Quoting feline207
Another thing that gets me very curious - 1.1635 is price that hasnt been used for a long time and you said that whenever an opposite signal occurs, it will invalidate the previous. Does that mean that since 1.1635 was last printed, you havent had another signal for a short eurusd so you are just trying to long till that target is hit. Or was it when the market last printed 1.1635 that you got your target or you got it later.
The 1.1635 is till as valid as the day I first posted it. If you check back my posts you'll see that even though I maintained a firm opinion about my target, I was warning about some retracements at some times. I do that when I see an opposing signal to my main signal, but that opposing signal doesn't invalidate the main one, and has a lower probability. What I do in these cases is trade only towards the main signal & use the retracement if it happens to add to my main position. So I mostly don't trade against my main signal.

Example: Target 1.1635 , market @ 1.1590 ... didn't rule out a retrace to 1.1220

What happened next is that the market went down to 1.11 & then shot up to 1.14.
@1.14 I expected a drop back to 1.1140. Market went all the way down to 1.09 on Brexit vote, and now is back at 1.1140.

Again, I did not trade the down move, I just kept them in mind to know how to manage my position for the 1.1635 target.

Hope that helps.

Best,
Jay
  • #298
  • Jul 1, 2016 10:55am Jul 1, 2016 10:55am
Expecting a big down move in both USDJPY & USDCHF during next week.
You'll see USDJPY below 101 again very soon
  • #299
  • Jul 1, 2016 4:08pm Jul 1, 2016 4:08pm
Quoting FX-Jay
Expecting a big down move in both USDJPY & USDCHF during next week. You'll see USDJPY below 101 again very soon
  • #300
  • Jul 4, 2016 11:04am Jul 4, 2016 11:04am
I'm going to be trying a high risk version of the strategy that I am currently using in trading currencies.

I'm going to try to make the testing as systematic as possible, for that I decided to use an EA that opens trades just once every 24 hours in a time window that I determine.

I will link a Trade Explorer for this account here on FF to keep me motivated with the test.

IMPORTANT: This is a DEMO test, and risk management on this account is minimal!

I do not recommend in any way trading a real account with hard earned money using the style you are going to see on this account.

Risk management is the most important factor for continuity in this business. If you're planning to become a full time trader or make consistent money, the most important thing to focus on is managing your risk first, and everything comes after that.

This is nothing more than a test for me & you to be able to see how far/high a $10K account can get using high probability setups & no real risk management; before going bust. Yes! I do expect the account to go bust at some point, but will that be before or after the Million? We'll see together.
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