Simple & almost naked. The dream date or the dream system?

Can SMA’s help to increase the acuracy of profitable trades ?

Sandybeach,

I wonder the same thing. I do feel that the set up I posted had a much higher chance of success because everything lined up perfectly, a retracement and then a continuation downward. Only going with the trend could be too restrictive.

Greg


I added a 200 sma. This sample trade is a trend trade using the method for entry. What do you think Sandybeach and Blizard and others???

Greg

Interesting to entry only when it bounce back to the ma, used then as dynamic S/R.

Btw I’d rather use a 50 EMA, not SMA

Cheers :wink:

PA close to a fib level doesn’t mean it will be a bad trade. Point is that this system is intended to scalp, so trading close to critical levels (fibo, but also keep an eye on big/mid figures and daily pivots) can means many things on a very short term that would affect our scalping

Hope it helps :slight_smile:

Greg Jones, interesting, the SMA’s are interesting, but we would need to test it more to ensure it works, but perhaps only taking trades in the direction of the daily trend is not a bad thing. It would mean fewer trades, but you could go for a few more pips per trade and perhaps watch a few additional pairs to compensate for loss of trades.

In the last day i have been testing this system on 4 pairs (EURUSD, GBPUSD, USDJPY and USDCHF). I have had 19 trades, 5 profitable and 4 non-profitable. If i had taken the trades only in the direction of the daily trend, then 3 of those losses would of been trades never executed and the last trade would not of been executed as the pair was sideways at the time of trading.

So i think alot of merit can be just to take trades on the 5 min chart in the direction of the daily trend. Doing something as simple as this may get rid of more false and losing trades and any other indicator or SMA lines.

This is the indicator i use to give me the daily trend.

ZCOMFX_daily_trend_2.zip (3.95 KB)

I find it quite helpful, it gives a simple arrow in the corner of the screen with a green up arrow upward, red down arrow and a sideways blue arrow if the pair is not trending and ranging.

It is quite accurate and has helped me alot !

SandyBeach,
Thanks for the indicator but I don’t seem to have it for fxcm. What I’m doing is a trial of 10 trades going only with the trend when the zz swing gives me an signal on the five minute. This would be entering after a retracement within the trend.

Greg

Great work guys. Nothing wrong with adding a SMA or anything thats helps you filter bad trades. My only worry is that were getting away from the simplicity however, we need to increase the accuracy so that may be the way to go.

thanks

A completely agree Blizard, simple is best, i now only have my chart with the Swing ZZ indicator, daily indicator (as posted above) and fib and pivot indicators.

Also trading the main hours of 0700 - 1700 GMT seems to be a good filter also as the market can go flat overnight, but i guess thats the obvious one :slight_smile:

Blizard one question, i am having a little issue with exiting trades, i either cut them short of profit or miss it and end up with a loss.

What do you recommend, i like the idea of just going for 5 pips, but what happens if we dont get our TP, do we accept it as a loss?

Thanks

This strategy will work on any pair, but the more movement a pair has like EUR/USD the more profit we can get and the less chance of a fakeout.

Guys please correct me if i am wrong :slight_smile:

Stockneon how are you getting on with the strategy, are you managing ?

Blizard, maybe in a few weeks we could review your strategy, add in anything that works, chuck out what does not work so we can all keep this simple, without us adding lots of indicators which may not provide any real benefit?

I just think there have been a number of suggestions here which are good additions, but i do agree its best to keep it simple.

  • Notice critical levels on your chart, its crucial for your analysis
  • Use trail stop to let your profit run (lets say move to BE when price reach +5 pips, and trail it with 5 pips) and use it according to market sentiment, otherwise close at 5pip ofc :slight_smile:
  • SL must represent the MAXIMUM that you feel to “bet” to see if you are right or wrong, it doesn’t mean you cant close a position before the SL is triggered, when you see market going agaisnt you

-> use a contigency plan :slight_smile:

I wont get deeper in this stuff as its a bit out of topic, but if any further view on this is needed, just tell me

Cheers

Perfect entry on AUDUSD M5 minibar 3 btw. If you let this run you are done for the day

Entry is the horizontal line, TP is the maroon line (mid figure) that has been just reached. +20pips trailing it.

NOTE: trailing it, i should be still in, but i closed it as a crucial level, a mid figure, has been reached, and 20pips with 2% risk over 10 pips SL - is a good amount of profit, that would theoretically allow me to sit on my hands till end of the week according to my weekly objectives

Cheers


also took +15 shorting AU after that and +5 shorting EURJPY (i was +14 but i got trailed stopped out)

I’d like to share the following:

today i backtested this system on M1 with 2 different parameters on 1 single pair over 1 full day:

  • minibar 3: 13 win vs 7 lose (65%)
  • minibar 4: 10 win vs 5 lose (66%)

Percentage of win is basically the same, but let’s do some considerations:

  • this system has a big disadvantage to my eyes: you have a very bad RR ratio, so doing lot of trades can lead to have a negative balance.
  • I said no. of trades, not of pips. Keeping TP 5pips would kill the account for RR reasons, also cos most of the trades noted could have run for more pips. so trail stop or splitting the profit at some point would be useful (+ use a contigency plan in case it trades against you, SL must really be a reminder imho, especially with this system)

let’s also consider is a poor backtesting, but it’s intended only to give an idea, and the system was applied “blind” - without any other filter for the signals.

I’m currently working on it, apart from fibo levels shown by the creator, I added mid/big figure and daily pivots to the chart and i’m finding a way to apply my beloved slow stoch to the system, mixed with yarara indicator, (seems to be a good mix) and plotting TMA to give me an idea where we are in terms of price.

Also multi TF analysis seems to be crucial, using M1 and M5 as we are talking of a scalp system =)

I’ll share properly when i’ve a decent plan in mind!

Cheers :slight_smile:

Hi,

Gotta say this thread is awesome. Blizard seems a cool calm guy with out the ego issues normally found on these threads and the results are worth reading.

In response to CryAgony’s comment about RiskReward. I have seen systems that can work profitably over time with just a 50% win rate. The key to this apparent misnomer is the RR ratio e.g. a TP 30 and a SL 20 with a 50% win rate you will make money - work it out. (ok answer example: 4 trades - 2 wins & 2 losses = Profit 60 Losses 40 = total profit of 20)

However this systems SL is above/below the last dot. This can often exceed the TP. I have no magic answer to this issue but 66% winners is really very good and hope that if a perfected TP SL system can be worked out then it will benefit us all.

Happy trading :53:

Its really great seeing other members participating like CryAgony and madmkiv. Keep the suggestions coming guys! If you combine the breakouts of the trend-line of the original system, with the fib pullbacks to the “sweet spot”, the overall system is extremely powerful. Ill post today’s trades to illustrate.

I definitely agree with the Risk to Reward Ratio, is seems the SL is usually much larger than TP, however the system win ratio seems more than 65% from my experience.

When combined with the FIB pull backs that have a much superior Risk to Reward Ratio, the system seems well balanced.

thanks