NFP and interest rates have the biggest impact, so it’s more a question of picking and choosing. If you avoid trading around all of them it really reduces your opportunities. I’ve been trading this system for about four months and I check on the calendar before placing each trade for the major events, but have not avoided taking a position unless it’s rates or NFP.
I have an unrelated question: what are people doing when they have open positions on a Friday? I set up a couple of trades yesterday, they triggered in the night and now they’re sitting around entry with about five hours until market close. Leaving them open over the weekend opens them up to the Sunday jump, where price seems to move a lot. Do you close out your positions on Fridays no matter what, or is this discretionary?
Right now I’m thinking it makes no sense to just close them because it’s Friday, unless they’ve made some profit already. If they were near TP that would be different.
Hi Shojin- I recognize the name from a different forum, and understand you have some great insight into trading this market - - Nice to see you here. As far as your Friday trades, I can give you my thoughts, but alas - I’m not a great trader yet.
From my understanding - Friday are generally used for the institutional side to “square up” positions, and therefore introduces another element of risk. If I trade on Friday, I am in it for a “scalp” only, or an intraday bet only. If I have a trade open -no matter it’s status, I close it.
However, if a person trades on a longer term type scenario - I suspect then Sunday gaps, or Friday squaring up - is not all that important? (just guessing here)
Must be another Shojin on the other forum; I don’t recall posting forex stuff anywhere else. (EDIT: oh wait, maybe reddit). My insight might not be as thorough as the other one…
Anyway, I agree. I don’t like having open positions over the weekend. I placed the pending orders yesterday hoping they’d hit TP, or even SL I guess, by now. My EURGBP trade has price literally drifting along my entry like a magnet and the other trade is up a bit, but not enough to move SL up. Still two hours to go…
Andy mentions NFP as it is the Super Bowl of news and events…personally I would avoid any red event as listed in the FF calendar…that’s more,than just the nfp
Excellent point …I trade using strengthmeters and closely follow,the performance of individual,currency indexes
Fridays for,me involves seeing what currencies have trended well in the week …traders will be generally looking to close out trades,on these currencies for the weekend
So always beware and perhaps trade the fade on Fridays
question to anybody: if using Ducks system for 4h trend trades, Ducks doesn’t require the higher timeframe (in this case daily) to be lined up. as a newby, i’m thinking it’s desirable to have a higher timeframe present as well. is it really needed for entry into 4h trends?
harpoon - it is a matter of perspective. Certainly looking at the daily t.f. is not a bad thing, however, it is entirely dependent upon your trading philosophy. If for example you are an intraday trader, and the current pressures are up - even following a daily candle that is down - what do you do ? or on the other hand- if pressures are up - and directly into a daily resistance, what do you do?
I believe those are questions you need to answer for yourself.
I think 3 Ducks works best, with the 4h, 1h, and 5m charts, for 24 hour trades. I guess for a longer timeframe you could shift to longer time charts, 1d, 4h, and 1h perhaps.
I would leave it be in all honesty. This system is MAJORLY based on catching the big move trades. Like you will have many loses but that big 200 pip trade will take it all home and knock those losers out. Addin the daily chart to it will only complicate things in a unnecessary way. The way it is set up is to grab those big moves in 24 hours, daily charts are for very large moves like more than 200 pips. So in short the daily chart could be used as a confirmation for the4h chart yes, but i would leave it be for now in my honest opinion.
as specified in the Duck’s document, the stop loss one picks determines whether they are short term or positional trader. if you use 4h swing points for the stop loss, then you’re a positional trader. if you use 1h stop loss points, then you’re a shorter term trader. sounds like you people are using 5 min charts . i wonder if that leads to making zany amounts of money… i’ve been playing with the 1h charts (using 1h stop loss). i can’t stay up late so might have to get into a trade, go sleep, wake up and move the stop loss (i might use swing points for stops, as you set them after they occur e.g. after when i wake up :).
regards my main question, the system aligns all target trades with a higher time frame (e.g. 1h trades are aligned with higher 4h timeframe), but not the 4h frame. perhaps, this timeframe is a longer timeframe so it’s not as essential to have it aligned to the higher (daily) timeframe. an example would be the recent aud/usd down move. if one took a 4h trade here, and waited for the daily timeframe to become aligned, they would have missed out on much of the move. it depends of course what you mean by aligning the daily timeframe. for me, it’s when i can see at least 3 target timeframe moves. so if i aligned the daily timeframe, i’d need a down 4h move, counter 4h move, another down 4h move. then i’d have both daily and 4h timeframes in same direction. (sorry to complicate things, this stuff can get complicated…).
It says “… the 240 min chart will also let me see if there is a change in sentiment QUICKER THAN A DAILY CHART”
ok then. i probably won’t bother needing a daily timeframe to be already established in the same direction when taking 4h trends. although if there is a daily timeframe going the other way, i might skip it.
if i look for a higher aligned daily timeframe , seems like i would miss out on lots of nice 4h trends, coming in much later on and getting little profit… might have to manually backtest this idea. hopefully i don’t get into too many trend less environments. i was just thinking the babypips way - align with a higher timeframe.
thanks again (and the duck doc is really funny…)
Hello thefisherman - I’m not 100% sure of what your getting at with your 3 different comments? This “system” has always and originally not meant to be a “system” but rather, a framework, for you to create your own view of the market, and your own “system”. Likely this style won’t fit everyones eye, but I certainly get a great deal of positive info from it.
a question : what about dealing with correlation, as correlated trades can increase risk? nothing on this is mentioned in the duck doc. should we wait till a trade gets to break even before opening up another one (takes away correlation risk) ? but that would mean missing out on opportunities while we wait, especially if it’s a 4h (longer timeframe) trade.
I’ve been thinking about this a bit recently. I have only had a maximum of three trades open simultaneously, but of course there’s a correlation question whenever you have more than one open. My solution for now is to just make sure I check a correlation table before opening a second trade, to see how it relates to my first one. If it’s doubling my risk, then I will probably reassess the whole idea. So it’s just another step in considering the trade; the same as checking the calendar and using the position calculator.