Camelback take profit levels

The technique outlined in the article by Joe Ross explains how to divide the take profit levels into 3. Level 1 is break even and cover expenses. The next is with R:2. The third is meant to ride the trend. Being a beginner, should I just stick to one take profit level and sticking it to R:1? If it is recommended to try the system to the fullest, can someone please explain how to set up the different levels in c trader?

One of the Laws of Forex says that Expected Value cannot be created nor destroyed.

You’ll have the same profit outcome taking profit in 3 separate steps or one step.

1 Like

Can you please elaborate. I don’t understand this. To me it seems that this technique kind of hedges it’s bets over 3 levels. 1 is too secure the spread. Then it’s the R:2, which I understand it’s lowering overall win rate. But if, and it’s s big if for me as a beginner, it gets to tp3 it will make quite a profit. Is this way of setting tp for more advanced traders?

This is why I’m asking the question. It’s difficult being new, because I see the need to tone down my expectations in many aspects. At the same time I’m wondering if I’ll understand the techniques good enough by not sticking to the rules given.

Sure, I go over similar here Which trade setup has the higher Expected Value all of those have the same expected value. You can do 3 Take Profits but it won’t change probability or value.

Give me a real life scenario on your pair of choice with a stop loss, tp1, tp2, tp3 levels and I’ll do the maths.

1 Like

As a beginner, you should start with simpler strategies and gradually expand your approach as you gain experience and confidence in your trading abilities. Aiming for a risk-to-reward ratio of 1:1, for example, can be a prudent approach initially.

What strategies would you suggest? I find the camelback kind of straight forward. Buy when above both ema’s and a strong trend and sell when below both ema’s and a strong trend. Stay out when the 15ma is flat. What I need to learn is to recognize when trend is strong and probabilities of going up or down…

I’ll take your word for it. I’m doing a lot of reading and watching. I watched av interview with Al Brooks yesterday, before I wrote the question, and he also says to trade with a R:2. This makes my mind uncertain and I start to wonder about things. From what I read here on the forums, it seems there is a consensus among the people I trust have knowledge, that you should never go above R:1. So for now, that’s more than god for me. Thank you for taking the time to help me out on my journey​:slightly_smiling_face::pray:

I’ve personally had more success trading with an R-multiple below 1. All R-multiples are proportionally even though. It will just take twice as long to get a 2R.
Just depends on how you want to skin the cat.

As for entry & exit strategies… none of them really matter. The reason you can’t make an underperforming strategy is the same reason you can’t make one that outperforms. Make one that fits your life style and will in the future… ie, for me: looking at the 1 min is great… but in 10 years do I plan to still follow the 1 min chart or maybe want to be more passive and do more in life.

1 Like

The camelback approach you mentioned, based on EMAs and trend strength, offers a clear and straightforward framework for trading decisions. To enhance your skills in identifying strong trends and assessing probabilities, consider studying price action patterns and incorporating indicators like the Average Directional Index (ADX) to gauge trend strength more precisely.

Just for the sake of learning. I’ve placed a bet on AUDNZD long. 15M timeframe. Local time is UTC+2. Entry price is 1.09892. Numbers are approximated, so we dont have to deal with decimals in this example. I’ve placed 3 TPs with a position size of 0.33. TP1 is at 20 pips, to cover spread and breakeven if SL hits. TP2 is at 40 pips, R2. Tp3 has no take profit level, but has a trailing stop loss to ride the trend. SL for all three TPs is at -15 pips. I’ve got my account in NOK. Pip value is a NOK 21.

1 Like

Expect it to lose 58% of the time. Loss streaks will be a little longer than win streaks on average.

AudNzd spread of 2 to 3 pips makes this lose 58-62% of the time with a 15 pip stop though.

1 Like

And I think it’s an even lower win rate with someonr like me behind the buy/sell button! I see in hindsight that I entered when the trend was losing steam. Making the trade a very poor one. There’s so many things to pay attention to and to get behind. But, I’m a beginner and I really enjoy the journey. One day, it will click :+1::pray:

I’ll keep an eye on that trade and see what the optimal setting would have been. :eyes:

1 Like

Thank you​:slightly_smiling_face::pray:

Dear MagSSS,

Using the “Camelback” technique with three take profit levels can be useful, but as a beginner, you may want to start with a simpler approach.

Here are a few recommendations:

  1. To begin with, you can use a single take profit level, setting it at R:1 (risk-to-reward ratio of 1:1). This will help you focus on risk management and developing the proper trader’s psychology.
  2. As you gain experience and improve your results, you can try the “Camelback” technique with three target levels:
  • Level 1: Take part of the position to cover expenses (break-even)
  • Level 2: Take an additional part of the position at R:2 or R:1.5
  • Level 3: Leave the last part of the position to “ride the trend”
  1. To set up these levels in cTrader, you will need to split your overall position into 3 parts (e.g. 33% for each level) and set the corresponding take profit orders.

However, I would recommend first mastering the basic principles of risk management and trader psychology with a single TP=1R level. When you feel more confident, you can gradually transition to more advanced techniques.

The key is not to rush and to progress gradually, analyzing your results at each stage. Good luck with your trading!