My Line in the Sand

Nice trades there Steve, like your discipline. Are you using M5 with amplitude 4?

Hi Fxentropy,

Yes, I've found Amplitude #4 works well on M5 when using Market Structure.

Trying to Trade Forex without discipline and a structured approach would be expensive for me.

GBP/JPY M5 Observations

hi steve and all,
this is my trading plan:

i will reentry whe price breaks the red line and first tp will be 133.50
green pips!

the idea looks like good.

Yep, sure its expensive - for all!

Here is trading i did today on GJ, not one loss. I used your indi but also my own judgement. I know my trades are a bit offtopic for your thread, but i wanted to thank you !

GBP/JPY M5 Short and Long Trades

As long as I call more right than wrong I will be in profit.

Hi Tnavi,

I find higher TFs takes far too long to play out these days.

When I was Trading D1, it could take me a week, sometimes, to make +2R.

By Trading M5 I can Trade both with and against the Longer term Bias and improve my net return significantly.

Hi Fxentropy,

Happy it's going well for you.

I still haven't got the Skill, or is it Balls, to Trade Short into a rising Market that's why I'm using Market Structure to determine my Trade Direction.

I've been inspired, by the thread below, to look for a way to try and limit my losses but allow my winning Trades to run as far as possible on M1.

I'm using the HalfTrend on M1 set to Amplitude #3.

When the HalfTrend changes colour enter on a Break of the Setup Candle, if the Market doesn't Break the Setup Candle keep moving your Entry until a Trade is Triggered or there is a change in colour of the HalfTrend.

Exit a Trade at a change in colour of the HalfTrend.

Start the process over again.

I will be setting a maximum StopLoss of 15 Pips.

It looks promising and leaves no ambiguity as to Entry or Exit.

http://www.forexfactory.com/showthread.php?t=606433

Hi Fxe, what are blue lines, located at:
16.Sep 08:32
16.Sep 08:40
?
Hope, it is not blood from dead Sell trades ...

Hi Steve.. Firstly, congratulations on a successful system and thread.. I have subscribed to this from early days and find your system promising. With the new M1 strategy and its simple rules, will be nice if someone can code these into an EA... All the best.

Hi steve,
How many weeks do you test this setting?
Its looks like very very easy to be good.

you mean the little horisontal blue line , from palce to place? those are original TP levels...but if i close manually, before reaching the target, it will let marks like this on chart. Same the red little lines, those are original SL levels. Hope its clear.

Hi Tnavi,

I haven't tested it extensively I was intending to test it going forward.

I've done some quick manual back testing and it looks promising.

I could make it the most Technical and difficult to understand exercise you could wish for but there would not be any more guarantee of success.

What I like about it is my MAXIMUM StopLoss is 15 Pips my TakeProfit is LIMITLESS.

Below are two random Charts one is more choppy than the other both would be in profit.

Hi stevepatt,

Can you please explain what does the amplitude part does and when to increase or decrease amplitube? I have keen interest in following your trading methods as
for more than a year I have been trading a similar method of trading.

I just concentrate on one pair GBPJPY which has daily highest ADR and use 1m entry while watching M30 trends, pullbacks and retracements based on three moving average crossover of 10, 20 and 40 and three TFs of 1m, 15m, 30 m, backed by Currency Strength or weakness to avoid impulsive trading.

At one point of time I was making 20% per month but the mistake I made was trading without stop-loss. 5 to 6 trades each day, minimum 20 pips and maximum 40 pips. But there were a few times (twice a week in the Asian Session), the 20 pip TP plan resulted in 80 pip in 3 minutes of trading without me planning for it. Call it luck. May be I happened to be on one of the days of sudden burst of momentum took place. Just in 2016 almost 300 instances of 1 m GBPJPY moves have produced at least 50 pips in 1 minute trading. PDF of statistics shows it.


Because I had the comfort of a huge buffer margin and my main trading background is of options I did not trade with any stop losses.
Timing with Currency Strength and weakness was giving an edge and impulsive trades were being avoided. For a few days, it was going quite smooth.

However, after a few adverse positions started piling up and the trend was going strong against me, I started averaging out and ultimately recovered equity in 40 days after a 25% drawdown to 27% growth (net +2% growth) but with qui te a few lessons. This process repeated thrice. I stopped trading for the three occasions for 35, 25 days and 45 days without any particular logical reason. It was largely because of an unknown fear of getting margin calls in spite of me having provided sufficient buffer margin to withstand 1800 pips of drawdown. It is at this point of time I realised psychology plays a huge role in your trading decision.

I will be watching your journal to learn about your success in handling stop loss as an efficient money management technique for the same kind of trading.

By going through the psychological roller-coaster ride I learned quite a few lessons:

1. Averaging out does help in reducing breakeven and recovery but need a large margin buffer and a stable mind.

2. I averaged constant lots (add 1 lot for every 200 pips adverse movement) and it took a lot of time. When I was undergoing this drawdown, randomly I demo traded Proportionate Lots and realised the recovery could have been quite quicker had I devised some system of PLS and equity stoploss.

3. I should have been clear as to the percentage and frequency of pullbacks that take place during a very strong consecutive trending period. The ratio that happened on a daily basis was 80 up 20 down. I need to work on finding more on this part. I am not a coder nor do I have Excel links. Fibos or some levels linked to percentage of pullbacks should have been plotted and played along for planning the recovery trades instead of averaging at a uniform pip movement level.

4. Confluence level don't help during strong trending moves. We should wait for their exhaustion points for confluence levels to work.

5. Currency Strength and Weakness Index helps considerably on controlling impulsive trading.

Final lesson: Small TF Pullbacks plus efficient money management will be a constant winner for GBPJPY and if one uses 10 trades a day I won't be surprised if the return can be 30% a month based on 4 days a week trading. Ofcourse, I am sticking to what I am doing and you have provided another alternative method of trading which just suits me. For adverse trades I would now be looking for improving money management techniques. If your trades with stoploss proves profitable I will switch to your way of trading.

I feel if you can link half-trend indicator with currency strength or weakness driven by correlation index of GBP and JPY the impulsive part of trading will be gone and
the strike rate will be bettered. May be the half-trend indicator starts blinking when the index of GBP group currencies index gains 80% and JPY group of currencies loses 80% for proving good time to enter. I find Honestknave's CSDASH a reliable CS meter.
http://www.forexfactory.com/showthre...32#post9014532

Ofcourse, you have own your trading method and I will follow that because I have been a beneficiary of very similar method myself. I compliment you for setting up a trading journal. I can say anybody looking for a regular income will surely benefit by your method if stop-loss management proves effective in keeping losses to the lower side.

Hi Simnz,

The lower the Amplitude the more sensitive the HalfTrend is to movement up and down.

Too Low and it becomes too sensitive to Market movement.

Too High and you will be getting into moves too late.

I used to only Trade EUR/USD but it's ADR, when compared, with the GBP/JPY is really low so have switched. The Swings on GBP/JPY are usually more than I need to reach my 2R.

It's also important to have "White Space" to Trade into and be able to hit your TP before reaching the nearest Swing Low/High.

I am simply using Basic Market Structure on M5 HH HL Long Bias LH LL Short Bias wait for a PullBack to Structure look for PA (Pin Bar/Engulfing) and use the HalfTrend for confirmation.

It's important to be Trading at a level you are comfortable with but will still cause some pain when you lose but not create a fear of losing.

I think of a Level of DrawDown I think would be comfortable with then half it and Trade accordingly. It is inevitable, when Trading, that we will hit a period of losing Trades in a row, which will cause DrawDown, it's a Mathematical fact.

http://www.daytradinglife.com/tradin...ty-calculator/

I use a Maximum StopLoss of 15 Pips GBP/JPY, it's important to have an ECN Broker with a Low Spread.

I never Trade without a StopLoss

I never risk more than 2% per Trade

I aim to make 2R return +4% Per Trade

The pass three weeks I have had returns of +17.99% (-2.11%) +20% Net return for three weeks = +35.88%

Fifteen Trading Days = 35.88% /15 = Daily Net Return 2.39%

I have loaded the Currency Strength Weakness Indicator but can't get it to work at the moment. I will have to see what I can do.

Hi Stevepatt,

Thank you very much for posting link for losing streak probability calculator as well as sharing your valuable experience of 3 weeks trading (36%) which is more than 17% per month I have experienced before the drawdown fiasco pulled me down psychologically. I think I am going to trade your way using stop losses. I won't be surprised if you will touch 50% which is very realistic to expect as far as I am concerned.

I started trading directionless EurUSd future options since May 2015 and surprisingly the returns have been 100% p.a of Margin Money as narrow trading range has remained and I had to do a few adjustments only 4 or 5 times when the pair clocked consecutively a rise/fall of more than 300 pips in a day. My directionless strategy doesn't need any intervention if the currency does not move for 400 pips on the high or low side of the spot price. Directionless trading gains from premium decay and I find no other pair except EU suitable for this kind of low-stress trading.

I am trading with Interactive Brokers. Their spread on GBPJPY varies between 0.5 pip to 1.5 pips + 0.02 pips commission. Major income they make is from Interest. Slippage is rare. They follow FIFO rule which means I can't hedge in the same currency. I have to hedge in other currency or use options to do so. Maximum leverage is 20 times as regulated by SFC in Hong Kong.

Can you please suggest any Singapore or Australia regulated ECN broker who offers similar spread and doesn't play with slippages? If the broker allows hedging in same currency, then excellent.

Oanda and many major retail brokers widen their slippages without any provocation from the market.

Hi Simnz,

Try the ones listed below, I'm with VantageFX

https://www.vantagefx.com

https://pepperstone.com/en/

GBP/JPY M5 Long Trade

This will be my only Trade this week, I'm going to be away until the weekend.