Parabolic SAR - that's all!

[Benjimang]

I have a thought. This system could probably also be used with success on smaller timeframes than the daily with one exception. Trading would need to begin at around 6ish GMT morning and end at around 5ish EDT. That way you can ensure volatility will be maximised (a ranging market will kill this system).

I realise an ea would be simple to make with one indicator, but if someone could code one with some simple money management and EA execution timing, I'd be happy to run some forward tests on it on various timeframes.

-Benjimang

[ccox]

wow, the USD/CHF came within a nosehair of piercing the daily parabolic dot at 1.2005 on yesterday's daily chart. The low came RIGHT UP TO that point.

I'm thinking there is a very good chance sometime in the next couple of trading sessions, the price will pierce the new daily parabollic dot at 1.2007. When that happens, I'm thinking to add another short position to my existing short position.

The 30 min, 1hr, 2hr, 4hr, daily, weekly & monthly would all be going the same direction. To me, that seems like a pretty powerfull confluence of timeframe indicators.

back to the charts...

[dpaterso]

OK - well - I'm glad everyone else is so happy this morning - I'm not!!!

Right now 10 of my 27 positions / pairs are showing a loss (albeit small) - what happened last night???

At my other broker:

AUD/USD is starting to eat my profits from last week!!!

EUR/GBP pair is NOT doing as well as I hoped!!!

On the other hand - about five minutes after I started updating my stop and reverse positions they started to move in the right direction again. Maybe I should not sleep and we'll all do well!!!

Anyway - in keeping with my own advice - I WILL NOT EXIT ANY OF THESE POSITIONS UNTIL I GET STOPPED OUT I.E. STOP AND REVERSE OR WIPED OUT (that statement is more for me than anything else but you get the picture)!!!

Regards,

Dale.

[dpaterso]

Well - I just hope everybody appreciates this:

My 27 positions / 27 pairs that I have open at one broker - which were showing a nett profit of $3947.70 yesterday - are now showing a nett profit of $1169.33 as I type - and - I even watched the profit dwindle to somewhere around $500 today!!!

BUT!!! BUT!!! BUT!!!

As a show of good faith - and in keeping with my own advice - and to save face - I HAVE NOT CLOSED A SINGLE POSITION MANUALLY - AND WILL ALLOW EACH POSITION TO RUN TO ITS LOGICAL CONCLUSION BASED ON THE INDICATOR!!!

No - seriously - my first inclination is obviously to bale out - especially on the positions that are showing a decent profit - and there are quite a few (about five are around the $200 mark and there are quite a few more around the $100 mark) - but - I am tired of looking at historical data and saying to myself 'how come I got out here and did not let the trade run' and 'why did I not wait - just look at what I could have made' or 'now look - I closed the position and took a loss - and now look where the price is'. I have made THOSE statements many many more times in the last six or seven months than I have made statements like 'wow - I'm glad I got out when I did'! Get the picture?

So far - I think that because of what happened to the JPY and AUD since last Thursday - I got a false sense of security i.e. the initial immediate profits I made using this indicator this time round were inflated. Having said that - I do believe that although the profits to be made are not as great as they could have been i.e. not maximised - there will nevertheless be profits on most of the positions at the end of the day.

Of course - when things start going against you - you start flipping between different charts and different time frames and different indicators mainly I suppose to reassure yourself. One thing I did seem to see though - was that it certainly does appear that you could make more on smaller time frames - like 4, 2, and 1 hours - there just seems to be more movement and this, of course, goes against everything I have said here. On the other hand - having said that - all of my open positions have manged to 'ride out' every single bit of news data that has come out so far - and - just to give you an example - I'm pretty sure that when the BOE announces its interest rate position tomorrow (or the next day - can't think right now) - my positions will be able to take the spike - that's the difference - in my opinion anyway.

Put it this way - if this indicator does nothing else for you - it sure will teach you self control and patience!!!

Edit: the main 'problem children' seem to be AUD, CAD, NZD and ZAR. Why? My 'educated' guess is because - at the moment - Crude Oil is above $78 a barrel and Gold has been trying to get some direction the whole day. I reckon Oil is nearly at its top - and when that comes down - so will Gold - and I'll be a happy camper!!!

Regards,

Dale.

[ccox]

Regarding timeframes. I personally feel the 4 hour time frame is the best for me. Its big enough, and allows me to put S/L out far enough, to not get constantly triggered by every little thing that happens.

The 4 hour time frame also lets me actually trade every day. Where as the daily or weekly charts.... I might not be trading but a few times a month.

Also, the 4 hour lets me set entry points, and then only adjust those entry or S/L points, every 4 hours. So... I don't need to be glued to my computer.

I'll even go so far to set a limit out around 50-60 pips from my entry point, based on the parabolic dot, and I'm not to concerned, I've "missed the boat" as far as profits go.

I'd rather take 50-60 pip profits, then keep adjusting my S/L based on how the parabolic dot moves, with the hope of some BIG explosive trend.

In baseball terms, I'm looking for singles and doubles. If the long ball happens, it happens.

[willsucceed]

Originally Posted by dpaterso

Well - I just hope everybody appreciates this:

My 27 positions / 27 pairs that I have open at one broker - which were showing a nett profit of $3947.70 yesterday - are now showing a nett profit of $1169.33 as I type - and - I even watched the profit dwindle to somewhere around $500 today!!!

BUT!!! BUT!!! BUT!!!

As a show of good faith - and in keeping with my own advice - and to save face - I HAVE NOT CLOSED A SINGLE POSITION MANUALLY - AND WILL ALLOW EACH POSITION TO RUN TO ITS LOGICAL CONCLUSION BASED ON THE INDICATOR!!!

No - seriously - my first inclination is obviously to bale out - especially on the positions that are showing a decent profit - and there are quite a few (about five are around the $200 mark and there are quite a few more around the $100 mark) - but - I am tired of looking at historical data and saying to myself 'how come I got out here and did not let the trade run' and 'why did I not wait - just look at what I could have made' or 'now look - I closed the position and took a loss - and now look where the price is'. I have made THOSE statements many many more times in the last six or seven months than I have made statements like 'wow - I'm glad I got out when I did'! Get the picture?

So far - I think that because of what happened to the JPY and AUD since last Thursday - I got a false sense of security i.e. the initial immediate profits I made using this indicator this time round were inflated. Having said that - I do believe that although the profits to be made are not as great as they could have been i.e. not maximised - there will nevertheless be profits on most of the positions at the end of the day.

Of course - when things start going against you - you start flipping between different charts and different time frames and different indicators mainly I suppose to reassure yourself. One thing I did seem to see though - was that it certainly does appear that you could make more on smaller time frames - like 4, 2, and 1 hours - there just seems to be more movement and this, of course, goes against everything I have said here. On the other hand - having said that - all of my open positions have manged to 'ride out' every single bit of news data that has come out so far - and - just to give you an example - I'm pretty sure that when the BOE announces its interest rate position tomorrow (or the next day - can't think right now) - my positions will be able to take the spike - that's the difference - in my opinion anyway.

Put it this way - if this indicator does nothing else for you - it sure will teach you self control and patience!!!

Edit: the main 'problem children' seem to be AUD, CAD, NZD and ZAR. Why? My 'educated' guess is because - at the moment - Crude Oil is above $78 a barrel and Gold has been trying to get some direction the whole day. I reckon Oil is nearly at its top - and when that comes down - so will Gold - and I'll be a happy camper!!!

Regards,

Dale.

I am happy to hear of some success with a kiss formula. I am checking this system out for myself, just can't settle on a timre fram. One thing i cannot figure out is why you are struggling with closing down a position in profit. Rather you seem intent on following through on a strategy of exiting that is based on your PSAR dots. This is very odd to me. You have already won, you are in the black and are in nice pipage. You have beaten the system. Why not just close them down when you see a nasty sell candle or with some sort of a trailing stop? To me this is kinda like a poor man who wins a bunch of money than spends just as much time fretting on how to spend his new fortune than he did when he was worrying about his bills.

[dpaterso]

Hello - thanks for the concern.

The reason I'm sticking to it is because - like I said before - I ALWAYS have a habit of 'bailing out' too soon - and Parabolic SAR has a nasty habit of testing your resolve to the limit - and - when you finally give in - it's uncanny how the pair breaks out into a nice trend.

Put it this way: on 27 pairs - I'm no gambler - but the chances of every single one of those getting stopped out based on PSAR are pretty slim and at least a few of them have to eventually trend for a couple of days - I want to be in for that.

Aside from that - this really is just an experiment on what was practically two 'wiped out' forex accounts. I only trade the Indices and Stocks now and don't use PSAR for these. I just thought - let me test my OWN resolve - and let things take their course. Hey - if it works out - I can just keep trading forex like this until the cows come home - very little maintenance - and - hopefully - if I'm right - long term profits - scalping has not worked for me - ever.

Put it this way: it's the last day of the month at 14h56 New York time - and I am now going to post the fact that as I type the profit on this account is sitting at $1937.97. I will not 'top up' this account for the next month - and - if it gets wiped out - I'll update this thread - and - if it does not - I'll post the profit figure on the last day of August. That would be a fair test would you not say? Oh - and I will ONLY use PSAR - nothing else.

Regards,

Dale.

[ccox]

That is a valid point. That is why, using this strat, once I enter a position. I use a 4 hr time frame, place my S/L where the new Parabolic dot appears, and then place a limit order out, 50-60 pips from where I entered.

From looking at the charts, if you go with the higher volume pairs, this seems to be a reasonable expectation for profits. Its simple, and I don't have to stay glued to the computer

obtw, just to clarify something regarding the S/L. Say.. I'm long USD/JPY 2 mini lots. I have my S/L set based on the current position of the Parabolic dot. But I set it for 4 lots, not 2. So if I get stopped out, I immediately get placed back in the trade, this time short, 2 mini lots.

I assume others do that, and don't actually place 2 different orders. 1 to get out, 1 to get back in.

[dpaterso]

Hello.

Just to clarify for someone who tries this:

It depends on your broker. At one of these brokers I can place an order for - like you say - double my current amount of lots and that will effectively close out the first position and open another one in the opposite direction i.e. stop and reverse. At the other broker - if I did this - I would have to place a stop loss AND a stop order at the same price to accomplish the same thing. Be careful though - I have seen it happen (you're not going to believe me I know) on more than one occasion - where the one order has been executed and the other has not been executed or the price has been slipped on either or both orders. This results in a 'hedged' position which, like I said before, always turns to 'sh1t'.

Regards,

Dale.

[dpaterso]

OK - well - I just came to check (can't help myself you know)!!!

Anyway - I'm now on $3017.98 - at 17h25 New York time (which is 23h26 here in SA so I am going to get some shuteye).

I'm not going to update this thread with my figures on a daily basis - but - I suppose I just wanted to demonstrate the value of patience and trusting the indicator thus far - hope it pays off in the long run.

Another good example - by the way - is AUD/USD - which I was very worried about - but - even after a 'nail biting' session for me today - seems to be going in the right direction again.

Regards,

Dale.