Q A M Trading Strategy

Searching for a likely pair to trade prior to Tokyo Open.............

Masterrmind..........

GJ



Short cycle in action.

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

GJ



5 additional manual shorts added to the current cycle.

ps. stops and TPs initially are set wide but can be modified as trading continues if desired.

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

Large cycles are currently being built up on the EURAUD and GBPJPY pairs.

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

Expert removed.

Manual approach takes over.

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

GJ



Short cycle now all closed out.

+861.4 pips!

ps. EA long cycle will continue to run on.

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

Outstanding performance!

Any trader following along could have had similar results.

You can see on the GJ chart 2 posts above that I still closed out clusters of trades at certain levels to grab some profit.

The reason being is that no matter how confident you might be of your levels for TP there is never a guarantee that they will be met.

So I take profit and I attempt to minimize exposure although on this account it can handle quite a lot!

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

Excellent. Patience does pay off.
How do you time your entries and what is the basis?
Do you target the range-trading or consolidation period?

The ratio between minimal lot size and account balance on this account (not so on the original account) affords me the luxury of having plenty of flexibility to allow trades to run over a much greater trading range without undue DD issues.

This has proved to be a very important criteria for growing a small account.
At least this has been the case up to this point (the future is yet uncharted of course).

Since this account offers such flexibility it means that I can literally open up at least 2 volatile pairs and have trades run between 250 to 500 pips against me with up to 300 trades at 0.1 lots a piece and DD remain under 30% (exact DD needs to be calculated on a case by case basis).

This is incredibly powerful considering that the account could be more aggressively traded which would likely produce a faster growth rate but at the expense of a slightly higher DD!

Getting to your questions:

Due to this new found account flexibility the DD is so far contained although it does come at the cost of both terrible spread (account type related) and lower profit.

But its the DD which is the bigger evil in this method so I sacrifice a few trading conditions to gain 'control' over the DD ... simple as that!

1. I choose a volatile pair(s) to trade for the day although it could be any pair(s) on the go to list.
2. Set it loose near Tokyo Open
3. If its a short cycle I will wait for price to collect entries on the way up to a midR or R level, pivot points, chart structural level or key handle
4. I will always look at the PA at key levels and observe hesitation/consolidation in that zone
5. If bearish intent (ie a potential trend reversal) is shown I may unload multiple shorts with the expectation of price continuing down to TP levels.
6. I'm very aware that price can run away after such an entry and continue up higher creating additional DD.
7. I'm very aware of all upper zones and chart structure including likely impacts of currency news and I understand that I never really know how much of an impact news will have on a pair so I can choose to not trade a red news pair on a given day or trade away provided risk is accounted for.
8. If price continues to run up and away from me then I allow the Expert to continue generating trades at Q entry levels
9. I will then watch PA and at the next hesitation/consolidation area I may unload multiple entries again with the expectation that price rolls over and heads down to TP levels (in the case of a short cycle) but if the pip distance is 'not far' from the previous level I may simply monitor
10. I particularly like zones such as double tops as displayed in the GJ pair today during the Asian session and this is where I usually unload with multiple entries.
11. I don't get greedy, I watch my DD and I'm always aware of the risk on the trading account.
12. I never assume that price will always hit my TP levels so I try to close out clusters of trades well above the TP levels.
13. I may also look to hedge and apply any number of trading techniques at my disposal should I think they are necessary to firstly protect the account and secondly to grow the account.
14. The account ratio so far has provided an almost relaxing type trading approach in which a 100 pip move away from me is not an issue at all. Whereas on a small standard type account it could be a major reason for concern as DD increases rapidly.

I hope this offers an answer to your questions but you are always welcome to ask more if you wish.

Good trading,

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

Thank you for your detailed explanation. Please explain in detail the hedging techniques that you would employ and in situations demanding it.

If someone to open an account with a broker whose spread is not more than 1.5 pips per trade for cross pairs, how should a retiree plan to use equity of $50,000 with DD tolerance for 30% for trading your way?

Retirees have reached a stage where they can no longer afford to be risk-averse because banks are not paying any deposit interest. Many are willing to take risks and learn risk management .

Affinity to MT-4 kept me from trying out my brokers other trading platform.

It turns out that simply by using my brokers other trading platform I can trade positions that are 1000 smaller than the smallest one I can open from MT-4 for my same small account.

My account's ability to run QAM is now up to par and I will be able to follow you with full confidence.

Of course, no automation. 100% manual. But the ratio between account balance and the smallest unit that I can trade just got way more comfortable.

I am excited for tonight's Asian session!

The hedging has in part been explained earlier in this thread so I would suggest taking a look at that in the first instance.

What type of account is it?

A 30% DD is not a requirement and a far lower DD limit could be applied and controlled (hard stops on all trades) which I would recommend on a case by case basis depending on the account holders risk tolerance, account type and many other factors.

Banks have not been paying any 'real' interest for many years now.

FX offers an alternative approach however as we all well know the risk is higher and it has to be much higher due in part to potential payout.

Taking risk is a necessity in FX with those people who refuse it left on the outside.

A 50K account in my opinion could be applied on a standard ECN type account which has lower spread, faster execution time and little to no restrictions and a lower leverage applied if desired.

Much depends on the type of gains expected from the traded account for example an expectation of monthly gains.

The good part is that I have already provided somewhat of a forward live test so you can examine the trading on my account (all accessible) and gain an appreciation of what is likely to be achieved (no guarantee moving forward though) on a 50K account.

In a perfect world the following type account would be ideal:

ECN type spread and trading conditions on a cent type account to lot size ratio ..... simple as that!

Taking risk is a necessity but it has to be 'contained' and 'controlled' risk NOT uncontrolled or the account might easily vanish!

The most important part is the risk management as it will make or break you in this strategy.

There is more that I could add to this post so I will re-visit it again later on.

Thank you for the questions.

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

Ideal Brokerage account:

If anyone can find a broker that allows a very large ratio between account balance and minimal lot size but has very low spread and excellent trading conditions and preferably MT4 please post it here.

Similar to the cent account I now trade but with much lower spread conditions and no major restrictions.

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

Well, I now know that my broker, Oanda here in the USA, does allow extremely small lot sizes in their fxTrade platform. I also know their spread is not bad. And I am already testing it so we'll see how it does there.

That sounds good.

Larger the ratio the better because the DD will be far more easily contained and although the growth will be lower the account may stand the test of time.

After several cycles of trades you might choose to slowly increase your lot sizing to accelerate growth but as you know the risk also increases.

So what you would try to achieve is a balance between account growth and applied risk.

The larger the ratio and the smaller the lot sizing the more 'relaxing' the trading in general.

Great to see you ready to go but be aware that should a pair trend off heavily against you there may come a time when closing out several trades for losses becomes a reality so monitor your positions at all times and always have a plan on what to do should a bad situation develop.

It is very much account size to lot sizing ratio and the summation of the number and lot size of all trades applied.

Keep monitoring the current floating DD as per the indicator you see in the top right of my charts.

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

Yes I'm also aware of that broker but I don't think MT4 Experts can be applied which is a necessity for me since I'm applying constant 0.1 lot sizing at present and to open up all these trades manually although possible is far more efficient using the MT4 Expert.

If an Expert can be applied then this may be a good option.

ps. I may look at this broker in a little more depth.

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

FF Economic Calendar (GMT +10)



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

Tokyo Open

Just started so lets find a pair or pairs to trade.

Feel free to offer suggestions because there may be pairs that suit your account type far better than the account I'm using as I am limited by spread.

Masterrmind..........

The Q range of every ***/JPY pair got pretty wide from that last bit of "low impact" news not long ago, and more AUD news is on the way. I am always partial to the GJ. EG is not looking too bad.