High Probability Trading

[tonymand]

I am surprised at the negative response to Raging Bull and his post. As far as I can see this is the basis of a set of principles that would work. I am gobsmacked it came from 4x made easy as I have not heard anything good about them round the traps. Of course individuals might need to redefine certain elements to suit themselves but the key elements of trading price action, identifying a trend and only trade with it and having a set of usable tools are all there and all you then have to do is add careful money management. Perhaps this is one of the reasons that most would be traders fail as they think a collection of whizz bang indicators is going to make them a million bucks but I am sorry guys I dont think that is so and if you think about it even for a few seconds you will realise why it cant be. Thanks Raging Bull I certainly appreciate the post and if as you go along you can post up some screenshots of trades you have taken that would be great

Addit: Raging Bull is making money from this. In my view anyone that is having success and is prepared to share how is worth listening to

[raging bull]

thanks tony, I would love to show screenshots but am a little bit comp illiterate....I can post next time my next trade which will be sunday 4pm of the asia open...Until then I will keep answering all questions about this thread.

basically I guess you are right tony, this is rather a principle or strategy than it is a system. Maybe I should go through steps in more detail, I thought if I generalized it would help more ppl due to different trading techniques applied.

[aegis]

Originally Posted by tonymand

I am surprised at the negative response to Raging Bull and his post. As far as I can see this is the basis of a set of principles that would work. I am gobsmacked it came from 4x made easy as I have not heard anything good about them round the traps. Of course individuals might need to redefine certain elements to suit themselves but the key elements of trading price action, identifying a trend and only trade with it and having a set of usable tools are all there and all you then have to do is add careful money management. Perhaps this is one of the reasons that most would be traders fail as they think a collection of whizz bang indicators is going to make them a million bucks but I am sorry guys I dont think that is so and if you think about it even for a few seconds you will realise why it cant be. Thanks Raging Bull I certainly appreciate the post and if as you go along you can post up some screenshots of trades you have taken that would be great

Addit: Raging Bull is making money from this. In my view anyone that is having success and is prepared to share how is worth listening to

The problem is that the key elements in trading price action are not very clear in forex. Stocks and even futures have much smoother price action. There is often no rhyme or reason why a certain currency pair rises and falls. This market changes its pace very quickly and it's difficult to turn a profit on a consistent basis. So when a person starts saying "hey, just follow the price action" you have to ask how and why. Plus, even if you follow that type of trading style, you still need to have a set of hard and fast rules that you follow. Otherwise you will eventually get eaten alive.

It's much easier said than done.

[raging bull]

I agree with you aegis you do need a hard set of rules, as well with anything in life practice makes perfect. However if you follow the theory, you first identify the direction by looking at the 4hr. candle then you go down the time frame and find a suitable position to go long or short depending on your 4hr candle....thats the hard part is finding a good position on the smaller frames, but more often than not as long as you follow the 4hr candle you will be ok and rewarded because more often than not the next candle on the 4hr is a continuation of that trend. fyi remember
i use vt trader and my candlesticks are heikin-ashi not the regular candles.

Back test the 4hr heikin-ashi candles, ive traded by just using the candlesticks with no indicators, every 4hrs i either change position or remain in my position letting the profit ride....

Regardless of which way it goes all you have do is follow the 4hr candle, it moves very slowly and it swings alot, its easier done than said actually, you do have losing trades usually when the market is sideways though

[tonymand]

[quote=raging bull;29659]
this is rather a principle or strategy than it is a system. QUOTE]

That is exactly why it needs to be taken seriously because systems as such are generally no better than chance. As Aegis rightly says it is easier said than done at least partly because fx is erratic. If anyone doubts that pull up a weekly chart of the ASX from 2003 (see below) if you want to see dependable one way price action and then ask yourself why according to a number of Australian brokers traders have lost money in the greatest and most dependable bull market in history. And perhaps ask yourself why you are trading fx rather than the asx. Tymen is one person who has made it clear that he is trading Australian shares in preference and who can blame him. Having said all that though with some simple principles (as offered by raging bull) backed up by your own action patterns then this market can be tamed (at least by the talented few).

[jlmac27]

Well put tony,I think these people are missing the whole idea behind this post.With learning anything you must start with principles.And I believe the rest will fall into place with time and experience.Good thread raging bull.

[BlackPips]

this idea / system is good, i can attest to it, but, it has flaws that will require adequate familiarity with the general market scenario and the template one is using.
for example,last week i was up 220 pips by thursday, with a system like this - just this, and this pairs - and by friday i lost 250 pips!

now tell me, was it money management or something?

i applied the same management principles i had used to make the 220pips.
i have analysed my trading and i tell you, this method can be good but watch out for its backside.

[muddbuddha]

Originally Posted by aegis

There is often no rhyme or reason why a certain currency pair rises and falls. This market changes its pace very quickly and it's difficult to turn a profit on a consistent basis.

There is always reason. That is 100% a fact. The "rhyme" is completely up to you.

The one thing thing to keep in mind is that the Fx market is like a coiling snake. It takes some time to coil itself, writhering back and forth in doing so, but eventually, and often catching the unweary off guard, it will spring out and attack.

Much of the day to day movement is market noise generated by trader sentiment. When you consider the depth of the Fx market, the movements are fairly tame considering the amount they could really move.

Many stocks can lose or gain 2-4% a week...in comparison, currency pairs move fractionaly within weeks. The last two weeks have been just a small correction for many of the pairs, which is inevitable; but still fractional when compared to corrections in other markets.

Ragingbulls method may be profittable for him as he's adapted himself to seeing the market in that way....that doesn't mean it would be profittable for anyone else unless you're sharing the same brain.

If I trade with only two MA's and how price acts around them, how vague is that?! Pretty damn so. But it's the way I've developed my mind to see the market and for me, it is profittable.

Sharing methods is sometimes dangerous as those with no method often try to leach the method in it's entirety and when they fail, they hold resentiment against the author as some type of fraud. When in reality, it's their own lack of market understanding that is the root of the failure.

Like I've said 1000 times, it's the trader not the system that generates the profits. If you rely on a strict system without discretion based firmly in market understanding, you will eventually fail.

I would encourage you to break away from subscribing to paradigms like the one you stated in the previous post and convince yourself the complete opposite. Perception is reality.

[raging bull]

black pips, you may have missed the signal for reversal. Did it test your trendline??? did it break and close lower thus creating a new trend. One thing about this system its not a automated system and you must pay attention and reap the rewards. It is very possible to lose all profits but you need to tweak your money management and should have set a stop loss or locked in profits to break even or have a small gain.

But thats why we are all here, to learn right???

[raging bull]

I beleive you have a great point muddbuddha, trading psychology is a skill not many people take the time to learn. Everyone is just interested in makeing a quick buck but not to understand how and when. This is why I rely on principles to help my trading strategy, most new traders dont take the time to put a action plan together and follow through with it, many times I dont trade at all I just put mental alerts of where I would have made my position and log in what I learned from it....

Its all a learning process