A question about 3 ducks method

Beginner Questions
21

Welcome to the forum, stressed1, and thanks for your comments.

As you have already taught yourself, trading in position sizes large enough to blow up an account is a sure-fire way to become “stressed”. Here’s a plan for becoming stress-free, instead:

• I suggest you learn the nuts-and-bolts of the forex market in a demo account, trading modestly and conservatively, mimicking the way you will trade later with real money. In other words, if you intend to fund a live account at a later date with, say, $1,000, don’t start practicing on a demo account trading multiple standard lots with a funny-money balance of $50,000 or $100,000. Instead, trade your demo account as if it is a $1,000 live account, and use this approach to teach yourself to adopt position sizes, and manage risk, appropriate to the actual live account you intend to open later.

• Then, when you have mastered the nuts-and-bolts – the concepts, the terminology, the forex math (as Norman calls it), and the mechanics of your trading platform – then, move on to live trading with a tiny account in which you will trade tiny position sizes, strictly limiting your risk, until you have taught yourself to be consistently profitable.

Tiny position sizes, in this context, means no more than 1:1 or 2:1 actual leverage. And strictly limiting your risk means risking no more than 1% or 2% of your account on any one trade. This is not a way to get rich. It’s not even a reliable way to earn beer money. But, it is a way to practice, with real money on the line, until you achieve consistent profitability.

• Once you have achieved consistent profitability, you can begin to increase all the numbers – deposited funds, position sizes, dollars risked per trade, etc. Along with those larger numbers, will come larger profits and – inevitably – larger losses, and you will have to teach yourself to handle the psychological aspects of both.

It’s a long learning-curve, and it’s definitely not for everyone. But, if trading is your thing, this market can offer you some exciting opportunities. And alleviate that stress.

3 Likes
22

Clint,

Thanks for the advice. You must’ve read my mind, because your suggested plan is the one that I intend to follow. I’ve got a demo account right now, and won’t be risking real money for a little while longer. Yep, lesson learned - my money management has been my Achilles heel over the past few years, but to be honest, my recognition of high probability set-ups was suspect as well. Typical learning curve stuff. If you want to slay the dragon, it’s best not to get both arms and one leg chewed off in the first battle. But as the boys from Monty Python would say, “It’s only a flesh wound.” Take care…

1 Like
23

So let’s further expand on this thought.

I am trading Three Ducks as written in Captain Currency’s e-book. In his book he outlines a 4H-1H-5m screen. From Clint’s statement quoted above, that means that trades made using this system would likely remain open for only an hour before they either hit their profit target or get stopped out.

So in MY mind, that tells me that I should use the 1-hour chart as a guideline for setting my Take Profit & Stop Loss.

Does this make sense to anyone else?

1 Like
24

[quote=“phydaux, post:23, topic:82034, full:true”]

So let’s further expand on this thought.

I am trading Three Ducks as written in Captain Currency’s e-book. In his book he outlines a 4H-1H-5m screen. From Clint’s statement quoted above, that means that trades made using this system would likely remain open for only an hour before they either hit their profit target or get stopped out.[/quote]

No, this is not what I meant.

The middle screen – the 1-hour chart in The 3 Ducks System – is your “playing field”, if you are looking for intraday trades.

That does not mean that you are looking for trades that last an hour. It means that the “field-of-view” which the 1-hour chart gives you is appropriate for identifying trades that open, develop and close in an intraday time period.

Open any 1-hour chart in your trading platform’s default configuration, and count the number of 1-hour candles displayed on that chart. Unless you have manually adjusted the number of candles away from the platform default, you will see somewhere between 100 and 200 candles. That means 100 to 200 trading hours of market data. Recall that one week (5 trading days) is 120 trading hours. So, your 1-hour chart is showing you a week’s worth of market activity (plus or minus).

That is a large enough view in which to look for, and find, intraday trading opportunites.

Intraday means longer than scalping, but not longer than one trading day. However, a trade that begins as a promising intraday trade might extend into two or more days of profitable movement, and you should be alert to that opportunity, when it presents itself. In other words, a 3 Ducks trade typically runs its course intraday, but is not limited to intraday. If it wants to run, let it run.

You should go back to post #12 in this thread and read the USD/CAD example (regarding a consolidation within a trend). And read the paragraphs that follow, titled Overall Size and Resolution.

[quote=“phydaux, post:23, topic:82034, full:true”]

So in MY mind, that tells me that I should use the 1-hour chart as a guideline for setting my Take Profit & Stop Loss.

Does this make sense to anyone else?[/quote]

That’s what Andy suggests.

On page 12 of his ebook, Andy says:

“Day traders could use technical levels from a 1 hour or 5 minute chart for their stoplosses and profit targets. A swing or position trader may prefer to use technical levels from the 4 hour or even daily chart.”

I think that answers your question.

2 Likes
25

Thanks for your info CarlosRay! Even, I also didn’t know about this method with details.

26

Thanks again, Clint. You make my day!

27

I like the way you explain it, I would like to see some of your teachings since you sound like a person whose been trading for quiet a while. Thank you.

Am a newbie by the way.

28

what you doing is breaking copyrighted materials
and they seems serious about it
http://eu.wiley.com/WileyCDA/Section/id-302870.html

29

[quote=“m.k.a, post:28, topic:82034, full:true”]

what you doing is breaking copyrighted materials
and they seems serious about it [/quote]

And what you doing is running your mouth before you engaging your brain.

Here is what Elder’s publisher (Wiley) says about their copyright. (You might have seen this just inside the title page, if you had ever bothered to read Elder’s book.)

"Reproduction or translation of any part of this work beyond that permitted by Section 107 and 108 of the 1976 United States Copyright Act without the permission of the copyright owner is unlawful."

And what does Section 107 of the 1976 United States Copyright Act say?

"107. Limitations on exclusive rights: Fair use

"Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright."

I quoted a tiny portion of a 312-page book, and I gave Dr. Alexander Elder full credit for the material I was quoting.

As for my comment (which you did not quote in full) about gypsy downloads from the internet, here is what I said:

"Free gypsy downloads of both of the Elder books mentioned above are available on the internet. Wiley (Elder’s publisher) doesn’t seem very diligent about defending their copyrighted material. I’m not advocating gypsy downloads, but I am recommending both of Dr. Elder’s books for serious students."

30

17 U.S. Code § 107 - Limitations on exclusive rights: Fair use

Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include—
(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
(4) the effect of the use upon the potential market for or value of the copyrighted work.
The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors.

and this one from wiley :

Material That Requires Permission
You should always secure permission for the following:
single quotations or several shorter quotes from a full-length book (more than 300 words in toto)
single quotations from a newspaper, magazine, or journal (more than 50 words)
If you are in doubt about whether your use of copyrighted material is a fair use, request permission. Even if your use constitutes fair use, and you do not have to obtain permission,

you took 3 pages of value conetent and put on babypips what are you talk about , find a excuse again nice try