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The Daily Fozzy Method

  • #21
  • Sep 13, 2006 9:34pm Sep 13, 2006 9:34pm
hai....
this my first post....
im doin the demo but i lost 5 grand in a week...
it because the late signal...
i tried afew method that had being post in FX but the signal still too late...
anyway thx to fozzy...ur signal came so early and reliable...
i think i gonna recover my lost in few weeks with ur method...
n i got my first 50 pip today...
any fix version of ur method are more than welcome...


-Shot Seventh point-
"Analysis Is Hard But Trade Is Easy"
  • #22
  • Sep 13, 2006 10:04pm Sep 13, 2006 10:04pm
dear fozzy,

i'm very interested to test your system.. could u please upload the template file here.. thanx in advance..

Quoting fozzy
This is my first post on FF after months of reading and trying some of the numerous systems provided by members of this forum. Months ago I came across the following indicators that were posted on one of the Vegas threads. I cannot remember who posted it but I am extremely grateful for their insight and hope they do not mind if I show my way of using this indicator.

After months of testing and swapping from system to system I've come back to this indicator and in hindsight I should have stuck with it from the start as it seems to work for my style of trading.

Anyway, on with the detail. I only trade daily charts and only EUR/USD, GBP/USD, USD/JPY and USD/CHF. Why these? Primarily because these are the only ones I have backtested and have been trading for the last 3 months. I also tend not to trade Monday mornings (Australian time) as prices sometimes gap over the weekend. However, this is discretionary.

On each chart I have an 8 period RSI. I also have an 8 period MA of the RSI and Bollinger Bands with a 20 period setting, also on the RSI.

Long Entries: RSI must be below the middle Bollinger Band. Enter long on the open of the next bar after the MA has crossed above the RSI.
Short entries: RSI must be above the middle Bollinger Band. Enter when MA crosses below RSI.

Stop loss is the low/high of the previous bar. I move S/L to break even if the price moves greater than 40 pips in my direction. After the initial 40 pip move I use a trailing stop for exits (25 pips).

I only look at the charts once per day, just before 0.00 GMT. This way I know which pairs are approaching my set-up. I then place trades if my criteria has been met. That's it. A simple system that seems to work for me. Looking at charts all day does not suit me as I have a real job and I'm not in a convenient timezone. 10 minutes a day is all I need. This method provides a limited number of trades but the trades can last anywhere from 1 day to numerous days. There can also be days on end with no trades. I have found that the secret is have patience. I also have come to believe those who say longer timeframes are easier, especially for newbies.

I'm not going to say this system will always work but for me it has generated over 400 pips in September already. Please try this out on demos before putting your hard-earned into it. Just because it is working for me (at the moment) does not mean it will suit everyone.

Please feel free to comment.
  • #23
  • Sep 13, 2006 10:41pm Sep 13, 2006 10:41pm
Quoting bijak_sinner
dear fozzy,

i'm very interested to test your system.. could u please upload the template file here.. thanx in advance..
Sorry,
FF doesn't accept template files as uploads. You can create the template yourself (in MT4) by following the directions provided by Sam1.

Cheers

Fozzy
  • #24
  • Sep 13, 2006 10:44pm Sep 13, 2006 10:44pm
Quoting HAGeek
looks very interesting..

have you tried trading with 2 lots. 1st lot TP at 50pips. 2nd lot trailing 50pips?

looks pretty good on those 4 pairs in last month or so.
Sorry, missed this post earlier.

I haven't tried trading with more than 1 lot. Certainly sounds promising. Thanks for the tip - I'll test it out.

Cheers

Fozzy
  • #25
  • Sep 13, 2006 10:59pm Sep 13, 2006 10:59pm
Quoting bijak_sinner
dear fozzy,

i'm very interested to test your system.. could u please upload the template file here.. thanx in advance..
Here is a quick template. You need to unzip it with winzip or winrar. Install fozzy.tpl to templates folder in MT4
Attached File(s)
File Type: zip fozzy.zip   < 1 KB | 6,278 downloads
  • #26
  • Sep 13, 2006 11:10pm Sep 13, 2006 11:10pm
Quoting fozzy

Long Entries: RSI must be below the middle Bollinger Band. Enter long on the open of the next bar after the MA has crossed above the RSI.
Short entries: RSI must be above the middle Bollinger Band. Enter when MA crosses below RSI.

Please feel free to comment.
Hello,

What do you do if the RSI crosses the MA, following the long signals, but they are both aimed downards (chart attached)? Do you still go long?

Thanks,

Jason
Attached Image
  • #27
  • Sep 14, 2006 12:13am Sep 14, 2006 12:13am
Quoting minute
Here is a quick template. You need to unzip it with winzip or winrar. Install fozzy.tpl to templates folder in MT4
thanx mate! cheers
  • #28
  • Sep 14, 2006 12:32am Sep 14, 2006 12:32am
Quoting Se[V]eN
hai....
this my first post....
im doin the demo but i lost 5 grand in a week...
it because the late signal...
i tried afew method that had being post in FX but the signal still too late...
anyway thx to fozzy...ur signal came so early and reliable...
i think i gonna recover my lost in few weeks with ur method...
n i got my first 50 pip today...
any fix version of ur method are more than welcome...


-Shot Seventh point-
Hi Seven, and welcome to the Factory.

If you lost $5000 in a week, and assuming your account is only a few thousand dollars, then your problem in not the system you are following. The problem is your money management. May I suggest you go read the money management thread in the beginner's forum?

Once you have knowledge of money management, and have learned to not use high leverage, then start applying that to your system, or Fozzy's system if you choose.

Please understand one very important thing. Your objective as a new trader is not making money. Your objective is to learn how to trade first. Therefore, trade only in a demo account until you learn how to trade. Do not trade any more real money.

I hope this helps.

[Edit: Oops, I just realized you did say you were trading demo. Sorry about that.]

Dial
sxaxlxvxaxtxixoxnxbxyxgxrxaxcxexdxoxtxoxrxgx
  • #29
  • Sep 14, 2006 7:46am Sep 14, 2006 7:46am
Hey Fozz. Thanks for giving some knowledge to the rest of us. It's always good to get anothers perspective on trading and the confluence of indicators. That said, I have a question about them.

Unfortunatly following the forexfactor forums is more difficult for me, as I'm not using MT; I'm on TradeStation.

So, we have the RSI, Bollinger bands, and 8 MA of the RSI?

I understand the first two, and I understand how you're getting the 8MA of the RSI (on MT) but what exactally is it? I understand it to be whatever the RSI(8) is and taking a MA(8) of the RSI(8). Basically smoothing it? How am I doing?

Thanks for you help and generosity.
mrLogik
  • #30
  • Sep 14, 2006 10:06am Sep 14, 2006 10:06am
I'm wondering if someone could program a simple alarm or email when the 8rsi crosses the 8ma in the bottom window. Neat system!
Trade what you see - Not what you think
  • #31
  • Edited 3:50pm Sep 14, 2006 1:47pm | Edited 3:50pm
Hi all,

Looking back at the charts I see that some crosses happened below middle BB line, heading south and produced good pips in downtrend. The same for crosses happened above middle BB, heading north, which gave actually great pips. Why those crosses is "not valid" by Fozzy's rules?

Forgive me if I sound silly, but why do we need BB? Just for it's middle line, or something else important that I don't see?

Thank you and good trades to all
  • #32
  • Sep 14, 2006 3:20pm Sep 14, 2006 3:20pm
I have a question please, cross ema rsi is between 13 and 14 sept. eur usd , today is late take trade or not? I think it was necess. take on start 14th sept. yes?
thx bj
Attached Image
BJ
  • #33
  • Sep 14, 2006 4:02pm Sep 14, 2006 4:02pm
I took this trade, made about 20 pips then got scared and closed the trade. Not used to daily charts yet.
It might be too late to take it now.
Now it's time to check on USD/JPY
  • #34
  • Edited 4:24pm Sep 14, 2006 4:14pm | Edited 4:24pm
Quoting diallist
Hi Seven, and welcome to the Factory.

If you lost $5000 in a week, and assuming your account is only a few thousand dollars, then your problem in not the system you are following. The problem is your money management. May I suggest you go read the money management thread in the beginner's forum?

Once you have knowledge of money management, and have learned to not use high leverage, then start applying that to your system, or Fozzy's system if you choose.

Please understand one very important thing. Your objective as a new trader is not making money. Your objective is to learn how to trade first. Therefore, trade only in a demo account until you learn how to trade. Do not trade any more real money.

I hope this helps.

[Edit: Oops, I just realized you did say you were trading demo. Sorry about that.]

Dial



hai dialist...
thx 4 ur advise....
its true i hav no dicipline...
i will go to basic....


if u hav some lecture 4 me sent to: Link removed by Moderator
Please PM me


-Shot Seventh Point-
"Analysis Is Hard But Trade Is Easy"
  • #35
  • Sep 14, 2006 6:26pm Sep 14, 2006 6:26pm
Quoting jlowder
Hello,

What do you do if the RSI crosses the MA, following the long signals, but they are both aimed downards (chart attached)? Do you still go long?

Thanks,

Jason
Hi Jason,
Sorry for not replying earlier. This method uses daily charts because I like my sleep. I will endeavour to respond to all questions but those of you who are not in my timezone (Australia) might not get a response for a few hours. Most people I know say I need all the beauty sleep I can get.

I take long trades whenever the RSI crosses the MA. The trade is at the open of the next daily bar with a stop/Loss at the low of the previous bar.
With a daily system you sometimes have to be patient as they do not always take off immediately. The stop/loss will limit your downside anyway so I would let this trade ride. No system will produce 100% winners but this one wins more than it loses (for me, so far).

Good luck with this and feel free to ask any questions you like. However, I will re-state that you shouldn't trade this sytem with real money until you have done enough testing to feel comfortable with it. That way, if you don't get to the comfortable stage, you get to keep all your money and I don't feel guilty.

Cheers

Fozzy
  • #36
  • Sep 14, 2006 6:52pm Sep 14, 2006 6:52pm
Quoting JBB
Hi all,

Looking back at the charts I see that some crosses happened below middle BB line, heading south and produced good pips in downtrend. The same for crosses happened above middle BB, heading north, which gave actually great pips. Why those crosses is "not valid" by Fozzy's rules?

Forgive me if I sound silly, but why do we need BB? Just for it's middle line, or something else important that I don't see?

Thank you and good trades to all
Hi JBB,

You are right, long crosses do appear above the middle BB and short crosses below the middle BB. Whilst these often prove profitable I have found that the crosses below the middle BB (for long trades) have a higher probability of success. If you trade all crosses you would have higher trade frequency. However, I am happy to stay out of the market for days at a time until I see a set-up that I am comfortable with. I only trade what suits me and I find I sleep better if I'm more confident with the trades I'm in.
Instead of using BB you could just have a 20 period SMA as your middle line. However, I use the narrowing of the BB to alert me to a potential volatile breakout.

Cheers

Fozzy
  • #37
  • Sep 14, 2006 7:10pm Sep 14, 2006 7:10pm
Thanks Fozzy.

This is good point to have BB to see volatility. Now it really makes sence to me. Thank you for starting this thread.

I add Vegas Currency Daily on my charts too. It helped me to close EUR/USD on time, when it stoped right below the tunnel.
  • #38
  • Sep 14, 2006 7:47pm Sep 14, 2006 7:47pm
Quoting brainjt
I have a question please, cross ema rsi is between 13 and 14 sept. eur usd , today is late take trade or not? I think it was necess. take on start 14th sept. yes?
thx bj
Hi brainjt,
The cross did not occur until the 14 sep. I only trade on the open of the next bar after the cross. So, I would go long on the open of 15 Sep. You might not get every available pip this way but you will find the chance of a successful trade is much higher. On a daily system it is very difficult to pick exact tops and bottoms. As diallist said on another thread, the top 20 pips and bottom 20 pips in every 100 pip move is "fat". Like him, I'd rather trade on "lean" pips.
The attached chart should show what I mean.

Cheers

Fozzy
Attached Image
  • #39
  • Sep 14, 2006 8:02pm Sep 14, 2006 8:02pm
can this apply to H4 chart? i am intraday trader...looks like it works
{Link Removed}]
  • #40
  • Sep 14, 2006 8:30pm Sep 14, 2006 8:30pm
Quoting kenari05
can this apply to H4 chart? i am intraday trader...looks like it works
Hi kenari05,

I have only tested this on daily charts. The daily charts suit me and my circumstances so I've not looked at other timeframes. But please feel free to try it on any time period you like.

Cheers

Fozzy
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