The Hot Dog Leg System (20 PIP EuroDollar Scalper)

Trading Systems Free Forex Trading Systems
1

At last I have come up with a strategy that is nearly as easy to learn as the cat and mouse but doesn’t require the same dedicated concentration.

Today I lost a trade and won a trade, I’m not afraid to show where it/I goes wrong, I think it probably makes a better example.

So what’s the system?

  1. Trade with the trend, i.e. if it looks like it’s going down, go short and vice versa, don’t waste your time thinking too much about it.

  2. Use 21 MA.

  3. Use StockRSI, set to 21. (For those of you using Meta Trader I have attached the indicator)

  4. Stops around 10, Takes around 20.

And trade when the candles aren’t spikey.

Entries are valid when your StochRSI is overbought/sold (I hate those terms), when you get a reversal candle, and when the last peak is around the same distance the other side of your 21MA, and (here’s the dog bit) a dog leg shape exists between the peaks.

I think that’s it, but I’ve probably missed something.

I will post some trades as I go on.

StochRSI.ex4.zip (1.98 KB)

2

Except for the missing dog leg this is a great setup, reversal is the same distance as the peak the other side of the 21 MA and as it happens it would have worked out, but if you get tempted - PASS

3

Hello

Your system works only on EUR/USD?

4

Simple answer to that - I don’t know, but it’s been working like a dream on the EURUSD for over 2 months.

5

can you share more details like how many pips did you made per month?

do you trade London, New York, Asia?

how many trades did you get per day, how many of these are fake-outs?

6

I trade when I feel like it :D, seriously. What I’ve been after for ages is a simple system where I can look at a chart and pick off a trade, rather than trade a fixed number of hours every day trading a method that shows a profit, and I’m confident I have cracked it.

Trading times are important and obviously the most volatile times are the best i.e. 8 am GMT to 5pm, but the key thing here is something I may have missed is that if you want to scalp for 20 PIPS there needs to be nearly 40 PIPS between the peak above the MA and the peak under it, it don’t matter if it’s middle New York open session, if it’s quiet it quiet, if the peak ar just 10 PIPS below and 10 above your MA, it’s not going to give you a nice 20 PIP scalp.

Also trade when the market is behaving itself, like it is on the left of the picture below, not the right - this is crucial, we are looking for nice clear signals.

As you can see from yesterday’s chart 2 trades, today at the moment - none and very unlikely to get any.

Also keep well clear of the news, I’m wary of placing a trade within 2 hours of the news, so if there’s lots of news, forget it, don’t waste your time, lots of traders will say that the news will generate volatility, it’s not volatility I’m after, it’s predictability.

I’m not exactly sure what you mean by fake-outs, but I’ll hazard a guess at an answer, I’m thinking what you mean is that when the market doesn’t make that 20 PIPS break for it, well we’ve accounted for that by making sure there is enough of a gap between the recent high and low, and also when the market behaves like it does on the left fake-outs (assuming the definition) don’t happen.

These trades really are high probability, so I can trade at a pretty high leverage, so when I get to 40 PIPS in a week, I don’t bother for the rest of it.

Are you using Oanda or MT4?

7

thanks for the answers.

I will give it a try, by “[I]you want to scalp for 20 PIPS there needs to be nearly 40 PIPS between the peak above the MA and the peak under it[/I]” you mean an 80 pips “dog leg” with the moving average passing through middle?

Also if I want to scalp 10 pips a 40 pips legs (20/MA/20) is OK?

By fake-outs I mean when you get a perfect entry which tuns into a losing trade.

30 minutes, 60 minutes before the news is to dangerous?

I use MT4 just for charting and Oanda for trading.

8

All I’m saying is, make sure the market is likely to give you the 20 PIPS you are looking for, just as in if it’s only ranged 30 PIPS in the last 3 hours, it’s going to be tough getting 20, if the market is obviuosly trending in one direction and has already moved 70+ PIPS, you are going to find it easy getting 20, and in which case take some more.

(20/MA/20) - That would hardly make any difference, but the answer to your question is no, don’t consider going down that route, what you would be attempting to do then is a mistake a lot of traders make is try and adapt the system to the market, wait until the market comes to you.

I see what you mean by fake-outs, to me it’s describing a losing trade, I don’t particularly care what kind of losing trade it is a loser is a loser and a winner is a winner, I don’t analyse any further, it’s all about my KISS mantra.

It’s not that 30 minutes or 60 minutes is dangerous, it’s just that I find that the further you are away from the new the more predictable it is, like in the vertical split I’ve done in the image above.

9

Isn’t this the good ol" 1-2-3 setup on a short TF? That’s what I trade on a 4H TF and just use a 50SMA for trend direction. I don’t need stochs or any other indie. d.

10

i do not see the attached images. everyone else can see the images in purplepatchforex’s posts?

11

I see them, posts 1, 2, & 6.

12

All I can say is that I can see them, sorry can’t help any more.

Trying to help in real time - there may be a setup developing, but it’s unlikely I will trade it, the last hour or so has been a bit crap, but you could look at going short if there is a bit of a rally up to about 1.3270 and signs of a reversal just after 3ish, it’s all there, but it’s not pretty so unless the reversal looks tidy, pass on it.

13

It was looking like quite a nice tidy reversal, so I went for it, unfortunately I was too cagey with my stop, just got back and wasn’t really in the trading frame of my mind, kettle was on, had phonecall to return so I didn’t give the trade the concentration it deserved

14

Sounds like a MEAN REVERSION trade with a twist (dog leg). Astute observation.

15

Or even Boll bounces…

boll bounces.jpg700×282 25.1 KB

16

reminds me of something jimmy young used to trade years ago.

17

Bollingers are X std dev away from a moving average - same as mean reversion. We are on the same page.

18

Very much so, but is there anyone reading? I mean it took me a long while to realise how basic and fundamentally important this is to trading, have I missed it before? there’s no way you can assume that everybody understands this, and yet it doesn’t seem to be of that much interest to the newbies.

Not sure if I’ve made myself clear, I know what I mean!

19

What are you referring to exactly?

20

Just to keep it simple and keep to a few very basic things, like make sure the candles aren’t spikey, and take into account the ‘Dog Leg’ which is part of the Elliot Wave Theory, and then it’s deviation from your moving average, and trade with the trade of course.