say i was in one setup, and another setup offered itself (but first hadn’t got to BE though). i thought i check the correlation coefficient of the new one. if it’s not highly correlated , i can take it. is that correct approach? and do i pick the coefficient for the timeframe i’m dealing with (e.g. use 4h if it’s 4h trend trade)?
If having a hard time with currency’s and correlation etc… You can try stocks, I switched to stocks 7 months and haven’t looked back. Thousands of stocks to choose from. I still look at Forex too don’t get me wrong, but found the stock market easier personally. But Forex is great as well, I like to trade both really.
jay: but US market going down for last year. you’d think forex would be a better bet in times like this…you couldn’t trend trade on the daily timeframe with stocks most of the year (going long), so that would be a problem . what strategy did you succeed at? from learning i gather that intra day share trading is too hard. most short term share traders use trend trading on a daily timeframe, from what i gather
and if you could answer my last q that would be great. and thanks again for your help (and everyone else too).
shojin/others: thanks for the correlation table. i’m using it. hey, which coefficient do you use? is it perhaps daily for short term trading, or it doesn’t work like that (and which is for h4 time-frame?). my books don’t explain this aspect. and some people calculate it, and they seem to do it differently from each other, so that is even more confusing to me…
I do believe you guys are just complicating things a bit much with the correlation tables!
My advice, is to “keep it simple” and just [B]LOOK[/B] at the charts. You can quickly see if any such possible correlations exist by looking at H4 charts side by side. Your “eyes” and your “mind” can see much more than correlation tables.
Remember, that your first scan for “3Duck” candidates is at the H4 level and that filters out most of the charts leaving you with maybe 4 or 5 candidates at most for the week ahead.
Don’t complicate things! Just “K.I.S.S.” 3 Ducks!
I think you might be right: keep it simple. I’m trying to better assess whether I’m getting the most out of my current trade, or whether I should be adding to my position, before thinking about other pairs.
Yes I agree with those comments too Carnino. I’ve watched a lot of Andy’s videos & nowhere on there or in his posts have I seen him refer to anything other that the usual repetition he goes through when setting up the 3 stage process.
If it’s worked consistently for him & long standing regular thread posters for nearly 10 years without the addition of other analysis then why does it need improving now?
well, Andy does mention correlation in one of the videos i saw, about not doubling up on risk …
who wants to wait till one trade gets to BE before launching another , so i do need to know about correlation…maybe no one really knows the answer (about which coefficient to use)… in the mean time i’ll use my eyes visually comparing the pairs , as i do see correlation that way (great tip)…
Yes, he does and I have already referenced that material in a [B]recent post[/B].
However, he does not use correlation tables, he just [B]LOOKS at the charts[/B] (eg. EUR/USD and GBP/USD and looking at the EUR/GBP to find which is stronger/weaker).
been testing using past charts, trying to get into 1h trends. i let the winners run, trailing using 1h swing points…i’m finding it hard to get profits. seems like i have to come in early in the trend too, like the second wave, to make it work. and after doing that i’m getting about 0.45R/trade, but could be wrong and less… anyone else find this timeframe hard to profit from? maybe trailing using swing points is bad for this kind of timeframe… perhaps i should trail on the higher 4h timeframe, but still use 1h setups…
(regards correlation: yeah, i see correlation more now… things are definitely synced out there )
Have you downloaded the pdf showing how this system works?
i’m a little doubtful about using the suggested 60sma on the 1h timeframe as a trailing exit (for trading trends on 1h timeframe). from my manual tests it seems to give up too much profit often (doesn’t follow price closely enough). here is a little pic of the aud as an example, 1h timeframe (this was a recent downtrend on the 4h frame from may onwards…). as you can see, something like a 30ema (orange) seems to collect profits better in these 1h down trends. assume entries were taken early into the trend. i’ve marked 4 blue 1h downtrends that i could have gotten into.
and u really got to get into the 1h trends early, seems to me. i might try trailing at something like 30 ema (orange).
(i also found that trailing using swing points gave up too much profit on 1h trends. i feel i might do much better if i follow price more closely for this timeframe)
eddie: i downloaded the pdf a good while ago and have spent lots of time understanding it.
i find for trading this system on the 1h timeframe, my initial stops on average (this is being tested still ,using swing lows/highs for initial stop loss) work out to be about 3 atr, or about 45 pips. let me know if anyone thinks this is nutty for 1h timeframe ducks.
also, with initial stop losses about 45 pips, good runs go for about 3R if you get in early. that’s not much. 5R using 45 pips more often would be better. so I’m thinking it’s better to take profits earlier (maybe at 3R or 2.5 R) since trends rarely run for long on this timeframe.
just wondering what are others getting (roughly) for isl in pips on the 1h timeframe, and do they take profits or let them run . just sharing :45:
i think my posts are too long and boring , sorry everyone. just wondering, what kind of stop loss sizes in pips are people using on the 1h timeframe? and what kind of risk:reward ratios are u scoring? i’m finding take profit at 2R possibly works best, not what i had hoped for (hoped for trend following kind of results like a variance of 2R,3R, 5+R from time to time). might try the 4h timeframe… or perhaps if I tried more narrow stop losses like 2.5atr for the 1h timeframe …
I don’t use fixed stop-loss size, nor use R:R, nor stick to any particular time-frame.
[ul]
[li]I look at all 3 time frames and judge visually which one seems to be the better choice (short-term, medium-term, or long-term).
[/li][li]I then decide on a stop-loss based on fractal-points or high-low swing points, or if those seem chaotic, I use a ratio of ATR (x3 to x4), always calculating a risk of 1% in accordance with size of the stop.
[/li][li]Then I wait for it to break (in profit) beyond a certain fractal, swing-point or ratio of ATR.
[/li][li]After that, I ride it out with trailing stop based on fractals, or swing points or a ratio of ATR (x2 to 3x) or a combination of all three.
[/li][/ul]
Andy is a great trader and a great guy…hes always happy to help traders with his system and how to work it to the max …
suggest members contact him direct you need more advice …get the answers from the horses mouth ?? 
Andys PDF’s are great …but the real thing is always going to be more relevant and useful to you
N
Carnino: great tips. I think I need to use a similar approach – be open to multiple timeframes. And your other advice is helpful too. thanks for that
nvp: you’re right. I think I may do that in the future (contact andy). but first more learning and I should check out the other pdfs you mention.
what about this 4h signal (yellow is 60sma, usdchf)? the 60sma for this timeframe (4h) gives us a green light for this timeframe, but it doesn’t look like an uptrend (needs another higher high IMO). i would not proceed to next step (examining 1h chart) and skip it. it doesn’t look like it’s in an uptrend.
I would skip this one or would only look for quick scalping or short-term opportunities on the M5 chart for USDCHF at the moment.
thanks for your opinion on that, but are u worried about a market crash? chf jan 15 last year had an 800 pip gap…for a small stop loss e.g. 10 pips, that’s 80X. at 1% risk that’s 80% of an account gone.