This is just ridiculous.
The pair moved a full 1,500 pips in 4 days wiping out 3.5 months of down move!!!
If only GU would do that. I have a buy sitting out there
SanMiguel,
Now we can watch it go back down to the 20 day average line and below. The Euro is on life support and not expected to live at these levels. All indications are that there will be some more dumb moves by the German Government.
Johnny
How many different indicators do you use Johnny? Always seems like something new lol. I once had a chart with like 90 BBands on it, not for actual use, just for fun :p.
hellogoodbye4201,
I have an indicator for all occasions. I even have indicators for indicators. I have four charts for every pair. Each chart’s individual timeframe has the same indicators but are adjusted for each timeframe.
The real story is I need very few indicators to trade and each chart although very different could be traded very profitable all by itself.
I have indicators to predict the future bar, the Support and Resistance levels, the higher timeframes, #buyers vs sellers, volume, trendlines, Linear Regression Channels, Highs and Lows, yesterdays H-L-C-O, Buy and sell points, Market opens, time to bar end, moving averages, PA intraday movement prediction to and from the reversal points and a few of my own just to be sure that all the rest arn’t just head fakes. LOL.
My charts look more like a painting done by Picasso on drugs.
Johnny
Must have been a good party huh?
R Carter,
The kids must have thought your trade system was some kind of new video game.:eek: Check your account balance they may have taken it to the next level.
I took a look at your latest method last night to see what it was all about. I would love to say your method is the greatest thing since sliced bread but then I’d be lieing and I tend to be blunt and honest and especially so when it comes to method and system analysis.
If you are at all sensitive about critical comments then please put the dog somewhere where he won’t start barking with all the loud comments. Tell the wife and kids to go shopping or anything to get them out of hearing range. Close all windows and shades to avoid the neighbors calling the Police.
I have seen similar things before and would put this into a trend Analysis/Pivot reversal type method. The use of the Linear Regression Line really hasn’t any advantage over a simple moving average when the data point value is 2. The mathematical formula for a linear regression line has to have at least three data points be an advantage over a simple moving average. A lot of indicators will not even plot a line with an entry of two.
You stated in your last post to me that your system catches all the price movements but the fact is it totally misses all the ups and downs of the market. This is not a precise method of trading as you suggested and is really quite the opposite.
The first test showed a minimum opportunity loss of over $12,500 per contract when using your system to determine a buy vs a S & R system to determine a buy. This first test went in favor of the trend as the bar continued up on the initial buy Long entry but this would not always be the case and the uninformed trader could find himself down thousands of dollars in a hurry. This system maybe simple to use but so is a match to burn Your money. Anybody trying to use this method with a less then $2000 stoploss setting is going to get burned and even still could get burned on a long wrong way candle.
Although the Daily movement is quite substantial it can’t compare to the Hourly. Looking at the Monthly chart to determine anything is really quite useless. I find it a tail wagging the dog method of determining trend.
I trade the Hourly or 30 minute chart with a look to the Daily for overall trend but trade the present hourly trend. The Monthly is way too far out to determine the trend especially with the market volitility at present.
Just because a moving average setting of 2 starts to move one way or the other on the monthly chart is no reason to believe it’s a pivot reversal point. At what point in a month do I determine that the movement is going to hold in that direction? I could be two weeks into the month and the Price suddenly changes to the opposite direction in a big way totally reversing the trend. If you say it’s just the initial starting point of making that first trade then I’d have to say this is a crazy way of getting into the market and there are a hundred better ways of doing it.
I know your defense of this method is going to be the fact that you’re making money but the amount of money you make with any method or system is not the determining factor of whether it’s good or bad. Somebody could have made the same money flipping a coin. This method has no better results than a moving average cross but this would actually be a more defined method.
Please don’t take this personally as this is just an analysis of the method you described in your post. I only put my money on sure things with precise methods of entries and exits using systems that have performed on a consistant basis for a long period of time. This would not be one of those systems as this is a very loose approximate method of determining a pivot point. By the time you get into a trade with this method way too much time has past beyond the actual Pivot point. There are pivot point indicators readily available that are just as good or better then this method.
I had my son look at this as a test of his skills and understanding of charting and analyzing statistical data. His findings and comments were more critical than mine.
If you are are happy with this method and are happy with the results so be it. Only you have to live with your decisions. But I cannot recommend it to anyone else. Newbies could loose their shirt and then be considered naked trading which is soon to be illigal.:eek:
Thanks for your ideas and post,
Trade well and use a high stoploss with this method,
Johnny
When are you gonna put your method up on BP? I’d like to see it lol, by the sound of it your makin good gains and seems pretty precise. As for RC’s method, he does have more detail to go into but I do see a couple problems with it, at least for me, but hopefully he’ll cover those shortly 
I think Mr. RCarter’s children, of probable drinking age? perhaps took a visit to RC’s personal winery and came home, much to the chagrin of his computer.
JohnnyB, I put up some Shi LRC channels using the indicator you had posted, i think…It’s been a while since I had downloaded it. I started out looking at short term time Frames, just in order to get my demo feet wet, it looked nice for S+R.
Looking to get some 5m pips from the 15m TF, (i"ve only had 2 days to look at RCarters 2LWMA close/high/low monthly/daily indicators for all day testing the confluence of the lines for an entry into the daily), I entered at what I thought was correct, and got 4 pips. Heh.
To start, then It went down, and I was like what the hell…More investigation to my error-ish ways, and eventually it went back up and I got 10 pips…Which was nice. Then I spent more time on my inital failure turned profit and watched as the 15m no longer controlled the 5m timeframe, but was moved by an initial 1 hr retrace beginning.
Then it started a train of thoughts about how the 1m was signal-ing the 1hr retrace, so the 1m controls the 5m which controls the 15m and up?? This put me in an initial stupor, until i figured that the 1hr was working a retrace that was pushing everything it its direction. Which led me to guessing the bottom of the retrace…Since the LRC channels (5m) were down at that time, and 15m were up as well as 30m and 1hr. I was uncertain of the bottom, but went with the LRC channel and placed buy limits at/near the base of those chanels at that time…Since my free hour was fun and over, and time for sleep and then work…Bed time, demo only,i went no stops on the buys. Staggered buy limts based on different time frames, 30m bottom bollinger (approx), 1hr Bottom bollinger (approx), and for the what the hell, maybe that 15m retrace is just 1 bar (but just in case, a buy limit at its bottom).
Woke up and did a quickie check, and boom, the buy limits were hit and had come up with the daily’s upwards movement. Profit for everybody!
Yes the LRC channel adjusts, like BB (in my mind), I think that they can serve as a useful indicator of S+R, and got a 88% bounce from bottom 5m Channel to the near top.
Inside the channels, i had a 5:1 with a regular 20:2 BB to watch the movements of those self same BBs and tapped on some quickie Fib lines to see if they had any validity.
They do! heh.
So thank you for some useful tools, and whoever made that post about the MP’s non secret secrets which convinced me to try to LRC at least. Glad that was done, thanks for everyone’s input.
Still learning tons in this thread. Its good! heh.
Still wiggling around in my head, is the thought that 1m is king, cause it controls all timeframes. Like how do I know that the 15m will continue to retrace? Watch the 1m, my mind says. But thats not enough. When is a retrace gonna tap Middle BB, when is it just a fluctuation, and when is it a full turnabout? Does the 1m or even just the ticks control it? Arrrgggghhh. No No! Its the higher time frames, really it is! heh.
This Fx Process is an in-depth, fascinating, and hopefully profitable excursion.
When do I listen to the voices in my head?
Red
What’s your view on the weekly/daily regression rather than monthly/daily?
I haven’t backtested your strat (and you know I like to test things before trading them 
) but it seems to me, waiting for the 2 regression line to pivot and turn that we miss a number of pips. That’s fine with me, I prefer to wait for a definite change in direction before entering swing trades despite acknowledging that they can also be entered beforehand on the smaller TF’s without really knowing where they COULD be going. However, that missed # of pips must also be taken into account for the SL…AND an intraday turn of the regression line could be completely wiped out 2 hours later. Lets say the monthly trend was down, the regression line turns down at 0900 UK time when the FX flow is increasing, we enter short at 0900. Later…at 1900 UK time (a while after US open), price flow decides to move enough to change the regression line to moving up - we are now in an “interesting” situation. Do we use the daily 20:2 bollinger as the SL. Do we wait for the close of day to confirm the regression line’s direction, etc. etc.
An interesting discussion point…
[I]On the contrary, I do believe that the 1hr and lower can be traded; I regularly trade 1hr and less but the style is massively different (10-20 pips bounces from S&R). I agree with you that on the the whole institutions trade the larger TFs and position trades but there are plenty of hedge funds that trade intraday too. Quite why I don’t know, perhaps it’s a commission thing, perhaps it’s the fact that if the institutions put on a day trade with their normal position sizes they might severely affect the market (not a problem in FX but is definitely an issue in the equities).[/I]
So RC, you’d say trading the higher TFs such as daily and up is the best way to go?
Golly, I think he has said that about 2 outta every 4 of his messages! :p:p
That and ‘need to increase size about 500%’…hahah. :D:D
Good thing he is here, not sure who i would be learning from in such a constant fashion.
Red
Hello Robert,
Welcome back Robert to the funny farm of forex trading. Well I see your of the same opinion still and still confused about my trading which now seems we have a common ground. First and foremost I do not trade the one minute nor do I trade anything below the 30 minute. My entries and exits are done with an eye on the one minute. I will trade the daily if I’m not watching the charts. Understand the analysis was not an analysis of you or how you trade but only focused on the method you posted.
Your comment “I am perplexed by some of your posts… sometimes profound and sometimes way off the mark?” is only your opinion. Please keep your comments directed towards the method or system that is under discussion. I gave you a bit of your own medicine a little while back about the “horse and buggy” post on Mike’s thread and you didn’t like it much either. I expect disagreement and look forward to reading another trader’s view but let’s keep our opinions out of the discussion. Now let’s see if we can get you unperplexed shall we?
My opinion which comes from my experience and trainning of some professional traders is the professional trader is not the most informed trader. Whether he’s been trading 1 month or 20 years it’s just the same old job done it the same old way. The retail trader that has put his heart and soul into learning how to trade is by far the most knowledgeable. Now that comment probably got you a bit hot under the collar but that’s what happens when we inject our opinions into our posts. So your comments of “I’m a professional trader” holds little weight with me and Joe the Plumber would get no less respect. I find most professionals trade very sloppily and confuse overall success and big bank accounts with good trading.
Your comment “trading the daily using 2 close, high and low regression” is totally wrong. There’s no such thing as a TWO REGRESSION LINE. I jokingly said you should try a two linear regression curve which should have clicked you need three data points ( A, B & C ) to make a curve as only two data points( A & B ) will get you a straight line. The charts you posted shows the effect of entering a value of 2 for the LRL indicator. The indicator is defaulting to a value of one which means the line drawn on your charts are from high to high, low to low and close to close. Using a high or low input here is not used in determining anything so why even use it.
So now that we have rendered the fat in this method what have we got left? We now have a simple moving average of one on a monthly chart. This is just drawing a line from close to close with the line from the last close and the current price showing movement, which on the monthly is very little until a week has past as it goes up and down like a yo-yo and to me is somewhat worthless and akin to watching a turtle cross the road to see if it gets to the other side.
You say you get all the monthly pips which is purely a miracle since you don’t see the trend change on the monthly chart until a week or two and even this might be a fakeout and change the monthly to the same as the previous month. Two weeks of down candles and two weeks of up candles averaging higher ends with an up monthly candle. The real fact and explanation is that you’re already trading on the daily and the direction the monthly is going is immaterial. By the time you can see the trend change on the monthly you’re already out of the trade on the daily unless you like huge drawdowns. The monthly is only confirming what the daily has already told you was fact. If you’re driving down the road in a bad storm and the radio says it’s a nice sunny day who are you going to believe. If your wife says turn right and there’s only a left do you turn right?
The attached chart shows the month of March. Your statement you trade with the monthly trend is perplexing and would be no less so if you said you trade with the Yearly trend. You may think you’re trading with the monthly trend but the fact remains a trend is not derived from a value of one. The fact is that you could trade for a whole month thinking the trend was up but it was actually down wouldn’t necessarily kill your bank account. If you were trading all the countertrends and catching some pips your thinking what a beautiful system this is I invented. Because a month is a long time with lots of ups and downs even a blind squirrel finds a nut sometimes.
Now it just may be that your definition of of all the monthly pips available and my definition are not the same. The open to close in the month of March was a bit puny at 28.5 pips. I’d rather have the high to low of the daily and even better the hourly “noise” as you put it because one move on the hourly is bigger than 28.5 pips. You seem to have this thought that the bigger the time frame the more pips you can make which is just not true and just the complete opposite. (Go do some research or check the trades of your brokers best retail traders if your not convinced).
The fact is Robert I never want to trade like a professional trader as I have found only a few who truely know how to trade. They all trade the same way with few exceptions and that is only on the higher timeframes with the prevailing trend. These are safe trades which is what you all have been taught to do. Losing a few pips on the entries or exits is not a concern when trading large dollar amounts over long periods of time, especially with tighter spreads. Knowing how to code indicators and the basics of statistical data analysis is not in their repetoire. Most are right brained which puts them into the" I don’t care how the damn thing works just as long as it works" catagory. This isn’t all a bad thing and I wish sometimes I didn’t NEED TO KNOW all the details.
When a professional trader retires and starts to trade his own money he finds things are not the same down here at the retail level. He struggles with the higher spreads and misses all the help he took for granted back at the office.
Most still make a little money but most good retail traders make more in a month then they can in a year.( This was a quote by a professional Wall Street trader that requested my help)
On the attached chart GBPUSD-March the top panel shows a linear regression line of two on a monthly chart and the second panel a moving average of one also a monthly chart. Please notice there’s absolutely no difference and the values go from H-L-C to H-L-C. On the Weekly chart, panel 3, the trend for the month is showing down depicted by the yellow line. On the Daily chart, panel 4, we see six trends depicted by green for up and red for down, each have three trendlines. Based on your posts you would have only traded the three down trends and only making money on one possibly two and getting head faked on the 22nd. The fact is Robert you probably could have made the 28.5 pips and covered the months total pip movement. What a system I’m impressed. Poor if I use this method but impressed none the less.
On the attached chart GBPUSD-240 you will see the M240, M60 and the M15 and the fact a blind man could see the price moving through the Price channel indicator lines top and bottom. I didn’t put the M1 on this chart because it is too way too small with the M240 but the M15 shows the same effect. The fact you have what’s known as little-itty-bitty-TFitis it’s best to not aggravate this until we can sort out what’s actually causing it. I also added the up green arrows and the down red arrows to make it easier to see the highs and lows on the M15 chart. Now just pretend Robert this is a Daily chart and find the highs and lows.
Practice this for awhile then try it on the H1 and slowly over time the real thing the M1 itself. I no it sounds impossible now but believe me over time you’ll understand and you’ll get it perfected. The noise you say you’re hearing on the smaller TFs are probably attributed to the big ears all you pros have or a side effect of the condition.LOL. Please believe me when I say this M1 thingie is not some ill considered choice. I once had a professional trader say he was a perfect idiot for not seeing this in the first place. I told him not to dispare as nobody is perfect.
I looked at your past posts in March to see how you traded but you were trading some “outer limits to the center 4-2 cross with a long wick candle” thingie back then.
You change trading systems like I change indicators. I have always traded support and resistance and most of the indicators are all superfluous and just makes the chart less boring. I probably should change those to a couple of playboy bunnies but I get distracted too easily. I guess it might be good experience for a government regulator job.LOL.
Well Robert I need to actually get something done so will end this game for now but in the mean time take a look at the attached charts. It may help you find those nuts next week.:rolleyes: Just kidding old boy don’t get your dander up. About the big ears all you pros have it’s just something you’ll have to live with you might try wearing a big hat with the flaps down. LOL.
Have a great weekend,
Johnny
It depends if you watch the charts when your trading or are just making a trade and walking away. It also depends how well you handle drawdowns as they can get quite large. The average pips per bar can be a couple of hundred on the daily and one bar in the wrong direction will hit most SL settings. You better know how to trade or have a good method for determining entry. If you are watching the charts then I suggest the 4H or 1H or both as you will triple your profits.
Johnny
Hello Robert,
Your statement “Trading the daily verges on the darn right boring despite looking at 20 pairs its more like watching paint dry.” shows a need for an alert signal. We retail traders use these all the time which eliminates the need for screen watching and going blind. You can even have them send you the alert to your ipod or ipad. So when you’re laying on the beach or sitting on the throne you can be playing with your ipod and not missing any trades.
Johnny
I echo what someone else said: either post a strat or gtfo.
You still need to go into detail about your latest system
Lob in a few direct questions and we’ll have something to discuss
In the meantime just go about your normal trading.
The opening gap on EURAUD proved nicely profitable for a Sunday (was also support).
I only really have 2 questions and you could argue sides for both I imagine.
1 is the stop loss, I know RC doesn’t always use them with this strat but monitors the trades. Using the outer bollinger band is probably also suitable as that is the predicted range of price.
2nd is whether to trigger the trade at the end of day or immediately as the line points one way - again…probably up to the trader.
Lol, hopefully Johnny is done for now. I already like this strat, seems to work well but, I do have one major question. When a new day or month begins how do you determine which direction to trade? Lets say its the first of the new month and price rises 100 pips, where in the first 100 pips do you enter your long? What if on the second price drops 300 pips where would you enter your short? That’s the one thing I dont full understand about this strat but other then that I like it and already made some decent pips off it :p.
I got the gap on E/U and U/J