I have been trading this method live for a month with great results. I cannot tell you that I have followed the method entirely mechanically but I think if one did they would they would be profitable with it. I’d like to share it. I think it is simple, straight forward, and profitable. You can decide if it is for you.
I have been trading for quite a while, and all I’m saying by that is that after a while you hopefully discover what fits you with regard to a method. This method feels right to me as I am able to immediately recognize principles of it that make it appear sound. My live trading of it is doing well and hopefully proving that my suspicions of “soundness” are real. My live trading of it is very short lived I must point out.
The characteristics that I like about this method are that it revolves around support and resistance, breakouts, and it can be applied mechanically. Overall performance if used mechanically has not been forward tested by me, but again, if it is mechanically sound then backtests should give you an idea of its worth.
Warning; I am using money money management that I cannot recommend to anyone else. I’m risking 10% per trade. I know many may click the back button right now but based on my backtests I feel I can handle that based on win/loss ratio, average stop loss, drawdown, using non correlated pairs, etc. That can get discussed later if anyone is interested.
This method came from another forum and I have permission from “Buff”, the thread starter to share it here. Buff’s real name is Jim. He posted several videos on the other forum which I will link here. His videos are extremely informative and I could not present the method as well as he has I do not think.
Enjoy and if there are any questions we can discuss. You may not have any questions though, the videos are that good in my opinion.
hi, Mike:
thank you for the videos.
I am still a little confused about this method though. Since you said ‘this method feels right to me’, can you post your understanding of this method here for me? What I am still trying to understand is how you actually get in and out of a trade and the rationale behind it. THX for your help.
The easiest way to get into a trade is to just straddle a recent high and low of the pair you want to trade. Once the trade is triggered you use the “working lines” and move your stop according to the rules explained in the videos.
This is an always in method therefore you use the Stop and Reverse orders that are always set while the trades are in progress.
I just want to say again that this seems to be a great mechanical method which seems to backtest positively. I personally have broken the rules based on my own discretionary reasons. Because it is a trend following system, and it will catch every trend, I believe that it can be mechanically profitable.
The videos are pretty clear on the method and he even explains how to get in the first time. I would watch them again if I were you.
And by the way, mikeylikesit, please do elaborate on these points:
“Warning; I am using money money management that I cannot recommend to anyone else. I’m risking 10% per trade. I know many may click the back button right now but based on my backtests I feel I can handle that based on win/loss ratio, average stop loss, drawdown, using non correlated pairs, etc. That can get discussed later if anyone is interested.”
Yes, please do discuss in as much depth as you can. Thanks!
Yes, I have reconsidered the 10% per trade idea. That was over leveraging. So currently I am just trading this on GBPUSD as it backtested better than all other pairs by far. I am using 5% per trade. I am away from the computer where I have files stored related to my backtests. I will try to remember to post those which precisly show r:r etc. If I recall the tests showed a win/loss ratio of right around 50% but wins were almost 3 times the size of losses. The average loss was about 150 pips on the 4 hour chart. Since I am only trading GBPUSD I don’t have to think about correlation anymore.
You would help yourself greatly if you manually backtested the system on
how did he draw the lines? never understand them after watching the video.
could anyone please write a document with charts to explain it in detail?
Thanks in advance!