My Baby

Same here just an example...

I thought the real ones. Ok. GL

I probably should have just drawn the resistance line 5 pips lower for the example, but thats where I would have had it.

3 - Momentum Reversal

So after we have the turn we want to see that momentum hold, and as the up trend tries to continue we want to see it do so weaker than the Turn.. Again, this should be obvious.. And usually best seen on lower time frames.. We draw a fib from the top of our trade and wait for a touch of the retracement levels to then make an assessment on the momentum.

In the Chart below you see the Turn is 3 bars down and the attempt to resume the trend moves up slowly over 5 bars, the pin bar at the bottom may have made us hesitant but subsequent bars push momentum into the bearish favor .. Once we are satisfied that the Turn has held it's momentum i.e Momentum Reversal, we bring our stops down to the closest resistance that is behind the 61.8 fib level (114.05) and SELL more at the 38.2% fib level (113.80) . We keep our $25 risk and sell the 3rd position accordingly just as explained in the Money Management post.


The Fibonacci is just to keep things mechanical and non discretionary. We will always add to the trade at the 31.8% level and trail our stops behind the 61.8% (find a resistance level that is closest to it. The fib will be anchored on the top through the entire trade in this case at 114.36

In this case the stops come down to 114.05 and from this point our we are in our trade and progress to the Mechanical Pyramid..

Money Management

Market Price on our 3rd position (Momentum Reversal) is 113.80 with Stops at 114.05 so 25 pips risk. We need to work out how much to sell

so...

Position 1 FUEL - .40 per pip at 114.42 Stops are at 114.05 our risk is +63 pips (.40 x 63 = +$25.2)
Position 2 TURN - .30 per pip at 113.59 Stops are at 114.05 our risk is -46 pips (.3 x 40 = $-12)

Remember we keep a constant risk of $25 so for position 3 we have $25 + position 1 ($25.2) - Position 2 ($12) = $38.2

Position 3 MR - Our stop is 25 pips and we have $38.2 to spend so ($38 / 25 pips = $1.50 per pip)

So we now have 3 positions open for a total size of $2.20 per pip our total risk is $25

Praise the Lord for the glimpse of your strategy.

Sounds familiar

haha yeah theres nothing magical about the fib to me it was just the best way to remove discretion so for the trade its merely a consistent measuring tape. I can say I am entering here with my Sl here and no need to think or second guess myself...

did you know that the steepest angle they can build a sidewalk is 61.8 degrees?

any steeper and people are too scared to walk down it... its a psychological tipping point and so that's why I liked to keep the stop behind it

Which brings us to the fun part, the Mechanical Pyramid... will get into this when i get back from breakfast

I use anchor system as well. Zigcharm trading system.

Interesting fact tho regarding sidewalk. Keep em coming sist.

Enjoy your breakfast. I look forward to the next post

4 - Mechanical Pyramid

So now all the hard work is done we simply manage our trade, we have eased our self into a pretty good position with $2.20 per pip at the start of a new trend with just $25 risk... we still have no expectations, we remain unpahased to what the market does. It will do this in 1 million different ways and so that is why we use our Fib tool to avoid discretionary actions. Remember if we make random decisions we must expect random results.

So from this point on we simply trail our stops every time the market makes a NEW LOW, we adjust all stops at the same time trailing them behind the 61.8 fib level and always adding a new position at the 38.2. I traded this whilst working so used limit orders and price alerts. Often I would take 5 minutes at work to adjust the stops on my smart phone. But you could code something to do this.

I also used a trade copier software program which was awesome to adjust everything with ease. But doing it manually is easy enough. I would check the market in the morning before work for maybe half an hour and then again when I got home. when you're in a trade you may be a little more hands on but it's quite easy to manage...

In the chart below we messed around for a little while before making a new low in our trade I market it with a red X ... We leave the 100% fib level where it is and drag the 0% fib level to the new low. We can now move our stops down 10 pips. We can do some quick math in our head knowing that our pip value is currently$2.20 and we have moved all stops down from 114.05 to behind the new 61.8 fib level of 113.92 (red dashed line). That's 11 pips so at $2.20 we have gained ground or (11 x $2.20) so we have $26.2 to spend on our 4th position which we are not opening yet...

We see the market retrace again to our new fib zone so with our stops already in place our limit order can open our 4th position at 113.61. With our stop at 113.92. That is a 31 pip stop loss with $26.2 to spend so our size will be (26.2/ 31 =.85) So we enter at .80 a pip....

Life is sweet we have risked only $25 but now have a total position size of $3 a pip at the beginning of a potential new trend. We still have zero expectations..

We simply repeat this process dragging the fib down any time the market makes a new low in our trade, adjusting stops and setting new limits at the 38.2% fib level...

XXXX

So as it unfolded in this case there would have been no more revisits to the 38.2% level, so if still holding we would still have 4 positions on with a pip value of $3

If we were still holding this you can see in the chart below where the stops would currently be, and where the limit order would be for Position #5

Now I deaigned this to trade into insane Risk Reward levels but I am a human so despite my best intentions I often just took a profit once it was up about 10:1...

There were trades I was in where I saw 6 months later I could have literally made $100k from a $50 risk. IF I just held and managed my trade.. But of course that is pretty unrealistic.. Once you have turned $25 into $600 in just a few days to a week it's quite hard to hold anymore as you fear losing tat $600. But that was just me.. Doing this I was still able to make very satisfying returns..

So when you decide to take profits will be up to you, but I would suggest shooting for at least 5-10:1... If you are not as desperate for money as I was when I was trading this then maybe you could eventually hit that 1000:1 trade lol.. It's not impossible.

So this was and still is my baby. I really loved trading it as it took little maintenance. I spent the longest time removing as much discretion as possible so I didn't even have to think about it. The other thing is the mindset you really need to expect the worst case scenario that you may have a very long losing streak. but we are not thinking trade by trade, we are trading with the next 20 trades in mind.. This is very important.

Maybe will add some more but this has been a lot of work for me than I first imagined, so for now will leave you with it.

Thanks for your interest and best of luck.

lol that's right this was in my Wolf Wicked days lol =P what a benny

But this is what your EQ should look like



Make no mistake this is a a gambling system, but a good one at that, and also a good one to test on a trade simulator. Like I mentioned earlier I used a trade copier and had 5 different broker accounts that I spread my money over so I didn't raise any flags with my brokers...

Moral of the story is:

Well you read what you wanted to read.. I would expect no less.. I believe what I said was I checked previous trades and could have had I only held on and pyramided.. But I never did because I'm human and often stopped at 10:1.. I remember it actually it was a long on GBP/AUD.. enough said lol. You can hold and trade this indefinitely but lets be realistic here.

Maybe take some English lessons? Whack one out? I dunno, can't help you

lol ok... I sense someone didn't get any Saturday night I can relate to this...

Maybe I should have not mentioned what could have been... Silly me''

Well ok you bring this up this is important.. The more you add to the trade the more intense the pip moves both with and against you are going to be.. Psychologically this is tough but it's important to stay impartial.

For good mindset just forget it.. think of the risk not the paper profit/loss.. You have spent a peanut... But unfortunately it is difficult to avoid the fact we have emotional attachments to money when we are in paper profits. It's ok it's a fantastic problem to have. If you are very happy with a certain profit amount and your EQ has a massive erection then just take it..

The cool thing about this method was sometimes I'd go to bed with my profit in -$5 or something whilst it was chopping around and wake up, up 3- $500s.. Of course my instincts were to just grab that profit.. And I often did too...

Anyway, not selling anything here just sharing..

We are simply here to operate, not get emotional

A the end of the day I didn't need to do anything in hindsight and still made good progressive gains without what could have been so..

Not understanding your point here..

Ok summary of the system is here:

1 - Fuel
2 - Turn
3 - Momentum Reversal
4 - Mechanical Pyramid


Enjoy

Nice work Cindy, I really like the scaling workings ....just ignore any doubters... as the bank said few years back ,,Always Remember .....".ITS YOUR MONEY RALPH"

Thanks mate just happy to be able to lay this all down and share it with you guys.. theres no strings just test it in your own time... it was perfect for personal situation and personality maybe not everyones cup of tea who knows

sometimes i wish id just stuck with this before doing the hardcore intraday stuff but anyway