Hi Jadd, very nice thread. You seem like a very serious and dedicated person and I really think thats what it takes to succeed in anything in life.
I’m not even close to being a proffetional trader or anything, just want to point out some things that you may already know , but hopefully will give you some ideas for future development of your method.
It looks like a few pipets or even 1 of confirmation to your reversal signals could avoid most of the bad trades in the examples!
The other thing - about indicators - I agree with you about the lagging, but there are ways of using these indicators to help you in real time such as bollinger bands as S/R levels etc…
Either way I think the next step is really defying where to look for your PA signals and when - and there are of course many options.
I’m not really trading this way any longer. Or using price action at all, on any time frame.
I found my biggest failing was in attempting to predict market direction. I no longer try to do that. Maybe it works for some people (although I have yet to see any evidence) but not for me.
I have done a lot of reading, and I think there is some truth to what Malkiel laid out in “A Random Walk Down Wall Street”. So I decided to design a system that is not unidirectional, in order to be consistent with the Random Walk Hypothesis. Volatility is my edge - as to which direction the market moves, I couldn’t care less anymore.
I am new around here and also fairly new to forex. I understand the Random Walk Hypothesis. I would love to understand your systems which are not unidirectional and how you cater for this. Any chance you could point me to a post where you have already explained it or would you care to explain it for me. You don’t have to go into the exact details of your system but I would love to understand the concepts around it.
Hey mate. I don’t want to give out too many details. But I can point you in the right direction.
Everything is automated. The demo test is going well and I will be putting it on a live account in another couple of weeks unless some sort of catastrophe hits the demo account.
Price will eventually reach a point either X pips above, or X pips below the current price. It is a certainty. You can use pending orders to exploit this.
Just sit down with a chart, draw some equidistant lines away from the current price on it and see if you can figure out a way to make a profit regardless of which direction the market goes.
It is tempting to use Martingale (or other gimmicky betting systems), but that is [I]not[/I] the answer and will only result in a margin call eventually.
Thanks for the pointers. That is more than enough information to get me started doing the research myself. I prefer to find and learn the techniques myself after receiving some guidance from those who are more experienced.
Hi,
I always thought that price action is the best trading system but after a year of trading (± break even) I don’t think that it is the right way. So I agree with you that predict market direction is … probably not possible. Even if there is great PB on daily chart market reacts to it maybe in 50% cases. In my eyes all people look at price action like it is holy grail but the true is that is all about statistic and mathematics. On price action you can be profitable only if you use big R:R ( it is all about statistic). I think that if you use same R:R to random trades it will have probably same results maybe not so good but there will be not a huge difference).
So lots of people try to find entry signals and something like that but the main thing is statistic and mathematics. And people completely ignore this part of trading. I don’t mean only R:R but based all trading system only on mathematic and statistic information can be one of the possible way how to trade. Just an idea ;). I still try to find something like that. I agree that trying to predict market direction in not possible and it is in many ways overrated.
Agreed. I’ve found random entry systems (1:3 R:R or higher) to be profitable on pairs that tend to trend like EUR/USD.
If I had the skill I would create a neural network to learn past price action and see what the statistics are on how often they play out the same way. But I don’t, so that’s moot.
I think that the basic is to find pairs that have tend to trend. In this pair you can apply higher R:R. Trade on choppy pairs is really difficult. Don’t know if it is possible to find information like: this pair on this timeframe in this time have tend to trend … if you have this information … than you have big advantage. And in many ways lower time frames are better for trading when people use high R:R. On 1M charts are really long moves in one direction. You almost never see this type of move on 4H 1D or higher TF.
Just my opinion
