With the calculation of the Conqueror stop I do it every day, at the furthest close the market has moved in my trade’s direction.
I do calculate on the daily ATR, and will increase the distance from the close as it increases. What I don’t do, however, is to ever move it backwards.
If I remove a 1/3, and the indicators turn positive again, or the ATR increases faster than the market moves in my trade’s direction then I leave the stop where it is until a new calculation moves it forward.
Thanks Toposwope. There is a lot of confusion around the ADX indicator. For what I have rt now, it does tend to filter out the big moves and allows entry pretty late in the game- to an extent where I am thinking to not use it at all except for exits.
toposwope, Thanks for that info, AKS is not the 1st person to raise this question, and as I don’t use MT4 I was not aware of the problem
Thanks for the reply again Cyco.
Yesterday I watched as one of my positions got closed out 9 minutes after the NFP announcement - that’s one volatile piece of news!
So far all my closed positions are losses but my open positions are in profit putting me ahead around 10% equity-wise since I started demo trading. Now the problem is waiting for them to hit a stop loss or bishop exit. None are really that close to the 40 ADX mark yet.
Since you guys are on the topic of ADX I’m going to ask a couple questions about the entry and exit filters relating to this.
One thing I couldn’t figure out is when wanting to use the ADX filter do we have to wait for that day’s candle to close before deciding to get into the trade? If we do that we may have missed a large break of the channel or a big move. On the other hand if it closes and ends up as a downward ADX slope this wouldn’t be an entry signal. Looking at AKS’s statement it looks like he waits for the close to confirm the filter. I’ve just been setting a P&C order just outside the 55 channel if the previous day’s ADX was angled up, so not waiting 'til close.
Also when taking into consideration the bishop exit, again do we have to wait for the candle to close? or once that ADX is angled downwards a little we take our money and run?
I had 3 of mine close yesterday, but I still have 14 open, so not a huge loss to the system.
Smith said in a recent interview he only looks at the market at GMT midnight, so the candle has closed and with only NZ open there is very little price movement to distract him at the time.
With the delay due to ADX’s time scale (150 days) I will tend to place a stop order on the 55 channel that the market is close to or moving towards and take the trade unless ADX is falling after a retreat from a move in that direction.
If the market has had a massive run up then drops like a stone through the lower channel the ADX will be pointing down, but I’ll still take the trade as it is saying the up trend has finished, but it has not had enough time to say that the down trend is strong yet.
I also had been having issues working out the problem with my ADX indicator. Am using Marketscope (fxcm) and found the default adx much more sensitive than other software (such as PRT), rising above 40 quicker. Also was giving many more conqueror signals and these were incorrectly timed…
Have since discovered Marketscope (and mt4) default adx indicator uses EMA smoothing rather than Wilder smoothing method, which results in the discrepancies.
Found some custom indicators which rectify the problem. Anyone else use Marketscope?
Marketscope, the one from Trade Station on FXCM? Love that charting software!
souljie, If you are interested Cmac and I meet up occasionally here in Perth.
Cyco, just wanted to say thanks - you gave me a lot of information so far to process and research, since I am very much in the same boat (work full time, want position trades before/after work) and hopefully this will help my family.
I’m curious, other than the books you’ve already mentioned in your thread. Are there other helpful resource that have contributed to your success?
Potim; As best as I can answer ‘life up till now’.
In a short history of myself, studied Physics at Uni, professional athlete, worked retail, worked as a mechanic, worked in farming, worked mid-level management both retail and farming, started a private equity syndicate, real estate development, tried network marketing, lived in Europe trying to get an import/export business going there. Very early on I realised I wasn’t going to be ‘average’ and have been looking at many things over time.
The best ‘other’ books I would recommend would would be the Rich Dad/Poor Dad series. I didn’t read these till much later than I had the opportunity to, and it cost me some time working out what I was actually trying to achieve: Freedom through passive income.
One of my network marketing mentors taught me that you are not truly free until you have 10 income streams of at least $100,000 a year each.
10 income streams of 100k each?! Man, I’d love even 1 of 50k - wouldn’t have to go into work anymore, could work from home and spend time with my family.
I’ll look into those Rich Dad/Poor Dad series - thanks for the tip.
Hey Cyco,
Maybe can meet up some time in the future but I want to get a good run on these first few strategies first. So far I’m in my 2nd week of live trading. 1st week I was down about 2.5% equity-wise but at the moment I’m up ~3%. Drawdown in cash is still around 4%. As of now I’ve got 21 open positions and another 6 stop/limit orders on the line which should hopefully trigger tomorrow. Takes me around 1.5-3 hours total (morning and evening session) to maintain the positions and search for new ones.
In one of your earlier posts you were saying your account was drawn down to 68% at one stage but am I right to assume that was the cash component only? Equity-wise the drawdown wouldn’t have been so large? I’m just getting a bit worried as my number of positions just seems to keep increasing rapidly - I don’t even have gold/silver on my list!
I’m certain a few pairs have a strong correlation coefficient between them in my positions. Do you limit your entries because of this?
The Rich Dad series seems like a good base for financial literacy. I just started Think and Grow Rich by Napoleon Hill which is along the same lines too.
First week of live trading here! Up 1100 pips to date (open), mainly with conqueror, a couple of 55/20 this morning and one or two trend.
I too am concerned about the the strong correlation between some of the pairs, i’m sure the book says to ‘take the best trade’
Also, Cyco, how do you calculate the SL for Conqueror when trading JPY. The ATR seems extraordinarily high compared to other pairs, thus creating a huge SL. EG. Went LONG on CAD/JPY using this system. The ATR today is .7041 creating a stop of about 14082 pips! Logic dictates it’s incorrect.
Perhaps as the JPY is only to two decimals places, the SL should be 70.4 x 2 = 140.8 pips ? Thoughts?
Cheers
Dale
Hey Dale
You’re correct the JPY pairs are only two decimal places. So if ATR is 0.7041 the stop should be 70.41x2 = 140.82 pips.
Excellent, that’s what I set it as, seemed logical 
The 68% draw down was in equity. This was my beginner stupidity - before finding Smith’s book.
With regards to correlated pairs. I just take all of them…
In regards to number of trades open and stop positions:
I have 24 open positions and 88 stop orders waiting for the market to meet them.
Think and Grow Rich is another excellent book. Another is How to get Rich by Felix Dennis, also The Richest Man in Babylon is another in the oldy but goody type. If your brain works in the way mine does the Why We Buy by Paco Underhill offers some great insights into what we think we perceive.
Hey Guys,
Out of interest. What do you do if you’ve entered on a Conqueror indication, and then a week later it also breaks the 55 day low (yay), but the following day (today) the rejection rule comes into play? Pair is NZD/CHF.
To me, it seems the only cross indicators for a sell according to smith is the bishop and thus, because i entered with Conqueror, I should wait for a Conqueror exit. Thoughts?
Thanks for the reply again Cyco. I was thinking the same too and just taking everything that signals an entry!
The chart analysis and journal logging is taking longer and longer these days. I was hoping it would become more streamlined so I could add more strategies. Maybe a few more weeks will do it.
I just noticed the rollover financing with 20+ positions is making a big hole in equity too - around 0.3% of capital per day for me.
Dale,
I just had a look at that pair and I’ve personally got 3 open shorts there: trend analysis, 55/20 channel and conqueror. In this situation you’d have to apply some discretion.
Cyco said before that he uses the tightest stop of the strategies of open positions on the pair. So I would assume if there was a 55/20 break and a Conqueror, and the rejection rule popped up he’d use the rejection rule. This is a protecting profits kind of stance that I have adopted in most parts. If I only had the 2 strategies up like your current situation I think I would have closed the trades out with the rejection rule too.
Because I have the extra TA trade open though, I’ve decided to let all positions ride first using the conqueror stop. My argument is that 2 of 3 strategies still favour an open position and I could technically “shift” the risk over to the other 2 strategies. Trend analysis seems like a stronger strategy than the 55/20 breakout and conqueror so I’m hoping to ride out the trend. I’m not sure if this is the right choice but with more experience I’ll find out.
I believe that whatever the choice, just have a good reason to do it and if it does fall over you’ll learn from it.
Oh, you place a trade for every independant buy signal. I was just placing the first one that came, and if others came, holding for the ride. (didnt read this thread properly!!!) The broker i’m currently using (Interactive Brokers) just amalgamates orders together so if i went long with 2 contracts on aud/usd on a 55/20 and then a channel i’d have four contracts, not two seperate lots of two. (if that make sense). I guess it makes sense as if you get the trend early, eventually the conquorer will indicate and then the 55/20, just ramping up as the signals get stronger.
I’m in the process of setting up a trading account with GFT as IB Charting tools are terrible.
Hi Cyco,
I’m curious - are you still applying the ADX filter from Courtney’s book? I ended up buying the book - excellent read!! Bit confused about his stops with the Conqueror system stops, since he’s saying 2x ATR - but a max of $2000 on a standard lot, for a catastrophe. Most 2x ATR are over 200 pips though.
Also, are you applying the Slingshot trades as well? I may have missed it
Totally inspired by your results, so totally looking forward to applying the principles in his book (after I’ve read it again and demo) - hopefully I can make half, and work from home - awesome contribution Cyco!!