I am flying interstate tomorrow to spend a week with family.
I will be back in 7 days - Friday 21st Dec Oz time.
I had hoped to post a setup of a live trade, but life has dictated otherwise today.
In the interim - please feel free to post your own charts and ideas - if you stick to the basic philosophy we have discussed so far - we will not get off the track - this is all about learning, and thinking anew.
A new “Paradigm” … LOL … I actually find that word repugnant - it is, as I mentioned earlier, a synonym really for “new model”.
The idea is to get rid of the notion that actively tweaking and watching our trades will somehow bring us more money.
Ask: “Has this worked in the past?”
“Is my life enriched through my screen-watching activity?”
And if we honestly answer those kinds of probing and sometimes-nagging questions, we might have to say: “No. My short-term trading is not all that successful nor is it satisfying.”
There is no one more honest than a spouse!
Is your spouse totally at ease with the time you spend at the computer?
Is your relationship better or has it slipped a little since you became involved in trading activities?
These are searching questions and MUST be considered.
This is part of what I am aiming for in this thread - get the money AND the life!
I’ve started my own little blog to track my progress with this system, but It’s really just to keep me checking the charts every day and not forgetting about it.
Here’s what I’ve done so far with it:
long gbpusd (valid and timely entry, see next though)
I was anxious to try the system out so I got into these trades a little later than the signals, could be a BAD IDEA I know, it won’t happen again, but they were only a hundred pips or so off of what would have been the trade price, so I pulled the trigger:
long audusd (96p higher when I bought, costly)
short usdcad (80p higher when I sold, bargain?)
I’m using 250p stops.
Weekly trends are very strong, daily trends still hanging on, but we’re trading against the short term trend here. We’ll have to see if this strategy turns out.
I shall be following you with interest Cosgrove. It seems to me though that once you have a signal on the longer timeframe you should move to a lower frame to effect your entry. Certainly you could have got a much better price on GU. In addition there are broader issues to consider especially with CAD which in my view is still retracing and probably has a fair way to go yet. Nevertheless this is what its all about, different ideas and learning from each other
Hi cosgrove
Just looking on the AU it seems the monthly looks set to turn down
weekly in a strong downturn and the daily looks like its about to fishnet.I was wondering if the daily should be neater when crossing the 23.6 a bit like the down turn btw 6-12 nov on your chart when it passed below 76.4.But overall should we be looking at the monthly and weekly for trend via the stochs and eyeballs and then find an entry in that direction.
How can we look at a shorter time frame and get a better price? Sometimes the signals won’t be corelated, and if we wait for the lower timeframe to give us a signal, we might miss the whole move (if the lower TF never signals)!
Sure, I could have waited for stochs on the 4h to form a rope and dip, then turn back up (see 4h chart attached), but what if they had stayed overbought and price went straight up? I could have just waited until after the interest rate announcement, but there are just a TON of what-ifs that I really think you just have to discard and go with the system to figure out. Sometimes you’ll get a bad entry and make 600 pips instead of 800 pips, oh well!
Also, if I’m moving to a shorter timeframe, it would be the 4h. I’m approaching this system with the “look at the charts once a day” method, so I can’t (rather, choose not to) really follow the 4h. I know Ingot is using daily/weekly/monthly, but I don’t know if that suits my style…maybe it does and I don’t know it yet. We’ll have to see how this turns out.
Check the CAD chart I’ve attached. I did a fib retracement from the peak in Feb to the low in Nov. Looks like we’re right at the 38.2 level and the past few bars or so are having a hard time breaking it. Have to keep a close eye here as well.
I was under the impression that we were looking at the 100-200 MAs to establish trend, which at this time on the AU, the daily and weekly are all still up, while the monthly is all bunched up trying to roll over.
Yes indeed the entry on Nov 11 would have made us some pips, but also note that it gapped down the next day. I’m not sure exactly what you could have entered at with slippage and spreads, I wasn’t paying much attention back then.
From reading spudfyre’s threads, it seems that as long as the stochs are combed, we’re good to trade, and we want to exit on fishnets. And when there’s a tight rope formed, it’s going to be a NICE trade, but it doesn’t mean that we won’t have winners without a rope. But yes, check the TF above you for trend confirmation.
In Alan S. Farley’s book The Master Swing Trader, he talks about the “3D view”, which uses the larger TF to establish trend, the current TF for signals, and the lower TF for entries. It sounds great, but I just don’t know yet how we can specify our entries on shorter TFs. If we wait for all three signals to correlate, we don’t get many signals. Is that important though when they’re all huge winners? What if they aren’t?
Someone please correct me if I interpreted that wrong.
Hi cosgrove
Maybe look at something like on the AU the spinning top on the weekly 28/10 for possible retrace then to the daily wait for a drop below last higher low ( big red bar on the 1/11) then look to the 4h for the entry like the down bar (9/11 )that cleared the near lows.
I have my stoch all set up and MAs all set up like two rainbows.
I understand the stoch part.
I am not sure why we have the MA rainbow.
How do we use that part of this strategy.
I have read the whole thread and will follow along and give any help i can.
I am new to this and have done a lot of reading and back testing different strategys, and this looks very simple, just the thing I’m looking for.
I just don’t here much talk about the moving average rainbow.
Ingot and everyone else keep up the good work and we will all put our heads together and make this work.
Happy trading
Hi tonymand
US/CAD
In addition there are broader issues to consider especially with CAD which in my view is still retracing and probably has a fair way to go yet.
Would you be looking @ around the 10460.
First of all, I must say that I like the looks of this system. It seems like it should be easy to use and the rainbow effect makes it easy to eyeball trades.
Now, having said that, I must be suffering from information overload. Maybe I’m looking at too many systems and my brain is shutting down.
I’ve read the Spudfyre links (which I didn’t find easy to understand at all, BTW) and looked at my charts, using the Weekly as a basis, then checking the Monthly and Daily for confirmations.
When it seems that the Stochs are OK, I look at the MA’s and the short terms are aligned with the Stochs.
However, this is a Weekly chart, so should I be trading on those short term MA’s?
Wouldn’t they apply more to 4H or below?
I don’t see how I can trade the short term MA’s if I’m looking to go on a weekly basis as they’ll change long before the week is up.
The short term MAs are still MAs of the weekly bars. We have to remember that a MA is just an average of the past X bars closing data, so they apply to the short term weekly trend. That’s why we can easily see the long term trends (the ones we want to trade with) with the super long MAs, they almost turn into straight trend lines with a strong trend.
I’m a little confused where we start drawing the lines (no pun intended) between short/medium/long term trends with the colors though, and when it starts to matter. Red through green = short? Turquoise through purple = intermediate? Pink through burgandy = long?
Thanks for that smack up side the head, cosgrove. I’m thinking short term means “today” for example, whereas, like you said, it’s still applied to the weekly chart, only it’s more recent weeks.
So, when I’m looking at the short term MA’s and Stochs, I know that’s the movement over the last 2-4 weeks, for example, and can trade “short term” that way, as in “this is what should happen this coming week”. Got it.
oh and I forgot to mention, my long position on the GU was stopped out friday, and the AU will most likely get stopped out if it doesn’t gap up on the open Sunday
Hi all. Great thread so far. I have one question. It seems when I load up the ingotsrainbow with stochs template I am missing some things. mt4 tells me it cannot locate:
Magnified Market Price.ex4 and b-clock modified.ex4
I have been following this thread with interest. It is certainly a very appealing method for trading the daily/weekly charts you have developed Ingot.
Two reasons for this post:
Could I please ask Ingot (or anyone else) to set out their “golden rules” for using/interpreting the MAs and Stochs (i have my own ideas but only based on a couple of weeks thought so wanting to compare with more experienced users)
Based on my own interpretation of the method, I have entered 3 trades (on a demo account for now!) Please criticise/comment/congratulate on my decisions based on your interpretation of the charts when i entered.
Trades were:
long EUR/USD at 1.4427 with stop 250 pips away
decision based on strong weekly and daily uptrend with daily on a pullback (from MAs). Daily stochs were forming a rope peak in oversold zone and according to Spud this implies we are near the lowest low of the uptrend
short USD/CHF at 1.1525 with 250 pip stop
obvious correlation to EUR and same reasons i.e. weekly/daily downtrend from MAs and daily stochs forming rope peak in overbought zone (i.e. highest high in downtrend)
Both the above trades entered at 7am GMT on 17th (can’t post charts as in the office!)
short USD/CAD at 1.0077 similar stops and similar reasons - although here the daily rope was more developed than in the other two
CAD trade entered at 9pm GMT on 17th
Thanks - and keep up the good work everyone on this thread!
PS - i am aware that there is some fundamental dollar covering going on ahead of the holidays but was basing the trades purely on the charts for now
I’m waiting for this as well, and I think we’ll get to see it when Ingot comes back from vacation.
And guess what happened last year around this time? And the year before that? That’s why I love charting, because everything is so cyclical! It’s all built into the charts for you already
I just want to thank Ingot and everyone else who is involved in further developing this trading method.
I have setup a demo account to beginning testing this trading system. The stops seem to be the most difficult thing to gauge. I’ve started with a 200 pip stop… we’ll see how it goes.
I’ve gone short EUR-JPY with Daily, Weekly and Monthly MTF stochastics pointing down. I’m not sure if I’ve gone to early or two late. Hence, a practice account.
