Jerome's Journal

[Jerome32]

After eighteen months of tedious journal keeping,
the following must be the absolute pinnacle

It surely doesn’t get any better than this. If I
could only be patient enough, how could I ever lose?

Price has moved far away from Bands and Envelopes

It always comes back to Envelopes, and usually returns
to Bands

How do we know that price wouldn’t drop anymore?

Easy answer, The Engulfing candle along with the
angle up and cross of Solar Winds Histogram

You don’t need anything else

TP is either Distal Band or return to Envelopes,
whichever comes first

Previously, a similar ( but more risky) such trade on D1
could take four months to hit TP

On H4 it would have taken five days

Perfect

[Diabolo888]

if it repaints then back testing will always give much better results than live because it adjusts itself using future information.

[Diabolo888]

In my view there is no holy grail. The key to success is to manage your losses. Most of us who have been trading for some years will have our own favourite systems which will probably have a success rate of above 60%. The issue is the losers which deplete our winnings. Manage these and you will make money.

[Jerome32]

Actually, there is such a thing as the Holy Grail, but not
a permanent one. Greg Jones proved that with the
Strategy 10/20 on this site

He was winning every day for several months - what’s that
if not a Holy Grail?

But years after that, I see Greg still asking for advice regarding
other guy’s systems. I’m curious why he would do that if he
had a permanent Holy Grail.

No disrespect to Greg, unknown to him, he was a great
inspiration at the time

Regarding my repainting indicator - it is brilliant. It doesn’t
repaint in the usual negative sense, it just keeps current
and the arrow moves with the price to tell trend is still
moving well

My point was, it would look better retrospectively,if arrow didn’t
move after signalling a new trend, as it could be seen to have
made you 200 pips for example, but by staying current as trend
progresses, it would seem less profitable than it really was

I guess as soon as you use a word like ‘repaint’, it just provokes
negative comments, which isn’t surprising - it’s a conditioned reflex.

Incidentally, I remember one world famous teacher, possibly Mark Douglas
recommending you always keep seeking the Holy Grail

• even though it doesn’t exist

Because in the process you discover some amazing strategies

see next post for example

[Jerome32]

Not sure what the moderators will make of this

I received an advert from marketeer Cynthia Macy

She has a lot of videos explaining her systems, based on
volatility. If not the Holy Grail. it is definitely a very profitable
system, similar to what I’ve been doing lately. her videos
contain a lot of good trading insight

and it’s all colour coded to make entries and exits really
simple

but here’s what always grates, is when they start talking about
their ‘custom indicators’, costing just $297 plus extra for the
advanced strategy template

I have them both for you. Took me under 10 minutes to replicate
with standard MT4 indies plus one or two others that are freely available
everywhere

Mainly it’s ADX
Donchian Channels
MACD
SupertrendProfit
Trend Strength % indicator ( highly recommended )
AutoFib Zones
Heinken Ash candles

I need to watch the videos again, as I’m not sure how she
incorporates the Donchian channels

This is Cynthia…

and this is my version, feel free to send me your $297 I’ve combined
both systems on one template

[Jerome32]

But last week has been my most balanced week in Forex
for quite a long time. some great winners on both Live and Demo
and no attempts to self sabotage

I will rebuild the account, gradually without stress.

I’m finding H4 ok, not too disimilar to D1 but not dragging on
indefinitely

But there’s a lot of charts to check!

I’m thinking, arrange my currencies in order of preference

JPY AUD NSD CAD there is no question these are where I
do best with

EU, GU, and anything with CHF in it have only negative
memories for me

and if there is going to be stop hunting, it seems more prevalent
on the Majors.

so if I find a couple of decent set ups on my preferred currencies
I will stop there, if I find nothing, I may give the others a look

[Jerome32]

The Totally Awesome Forex system!

I’m not American, nor do I watch American teen movies,
but I thought I would irritate myself by giving this system
a name I will remember.

I’ve had so many million dollar insights, that I usually forget
within 24 hrs

This time, I really want to get this down with as much detail
as possible

because, if I don’t do it now, while it’s still fresh, it will just get
forgotten

Of course, nothing is original. This system borrows from my own
work over last year with the Bands. They are still one of my main
criteria in making trade decisions. but I have been helped by
the Nexus system by Russ Horn, Las L. is great, especially his
Envelope strategy and explaining about the ADX cross, and Cynthia
Macy expands on the ADX theme.

This is starting to sound like an Oscar speech

So I will upload the screenshot first and give rules and comments after,
but first, I want to remind myself of something that just came into my
head - a system that utilizes the autofib trading zones with the Bands.
it completely conflicts with totally Awesome, so I want to check that
out later

meantime, here is the TAFS

You will note the vertical lines on both templates
we will call upper Bands and lower Nexus

On Nexus, CCI is bearish so we are only looking to go short

On the first example, Price had been moving down consistently,
and trend Strength indicator might be useful here, then price retraces
up to the 61.8 Fib level. is is time to resume the downtrend?

On Bands template, price moves out above both Bands and Envelopes
and then re enters both with a Bearish Momentum bar. This happens at the
cross of ADX. Not quite crossed? very good point. Cynthia Macy uses the
expression regarding ADX ’ cross or kiss’. Las L. only referred to a
clean cross of green over red. ( Big E I believe noted a similar situation
on the TDI )

but a ‘kiss’ can be a touch where one line bounces off another that can
be as insightful as a straight cross

so imagine two scenarios on ADX.

green is moving down and decisively crosses over red, green keeps
moving down and red keeps moving up denoting rise in volatility

or Green is moving up, kisses Red, recoils back down and Red recoils
back up,

In both cases a sharp divergence has occured and would seem, to all
intents and purposes, to be identical in outcome

Would you believe this! I just checked TDI, not part of the TAFS, nevertheless
on each of the vertical lines TDI green crosses perfectly over red, above 50
level crossing down!!

So now we have the Totally, Sick, Wicked, Awesome Forex System

yup, that’s irritating enough to remember

Before we leave the Bands template, the big question is, how many pips
to Distal Envelope or Band? is the risk worth the reward?

We have 24 pips to bottom Envelope, no deal, but 74 pips to Distal Band
which is hit six times before price moved up

So now, looking down to Nexus Template, we are following the Red Line of
the CCI histogram. We need to see that red line Cross through, either down through +100 level, or up through the - 100 level.

The other two examples are very similar to the first

but here is an all important distinction

On second example, distance is 50 pips to Distal Envelope, but 116 pips
to Distal Band, you could have TP1 AND TP2, it would suggest that

but the third example is even more interesting:- distance to Distal Band
is a mere 24 pips, no deal, but a worthwhile 48 pips to Distal Envelope
which is always hit, as often as Bands, but it doesn’t shift about

In actual fact, there is unlikely to be a problem with Bands in this system.
Yes, there can be a problem with Bands, but that only really happens on either
Lower time frames, or when Trade drags on for weeks on Higher time frames

So here is probably the real highlight of this system, one that takes away 90%
of the stress of trading, it is really 100% mechanical.

especially knowing when to Exit. If there is sufficient pippage available,
target Distal Band or Distal Envelope, and if both are worthwhile, consider
setting TP1 and TP2.

Making it completely Set and Forget, which is what I need.

for a Mental Stop, you might consider getting out if price closes
back into the Envelopes, or use that as a warning sign, and get out
if ADX Green crosses back over Red.

Of course that would need monitoring so would not be set and forget,
in which case use very small Lot size and wait for TP to be hit, or
place hard stop above thr recent swing High/Low

I don’t like hard stops, but I do need to set and forget.

So now finally, all paid clients of TAFS, can get the upgrade to
the Totally Sick, Wicked, Awesome Forex System for a massive
50% discount! or in other words, pay twice for something thats
already freely available, and takes 10 minutes to put together.

Here is how it looks:

[Jerome32]

The system I mentioned above in passing, just came to me
out of the Ether, the AutoFib to Bands system

Seems to work every time on Higher Time frames

When price is at the upper Red Zone or Lower Blue zone,
it should be due for a reversal.

Is there a reasonable distance to Distal band?

For Sell Trades

If CCI line crosses down over +100 line and aligns with a red candle
enter trade targeting Distal Band and next Pivot beyond.

In the example given, which is current, price retraced 38.2

and should now hit both those profit targets

You can check on Monday/Tuesday

[Jerome32]

The Revised Bands System

I’ve been trading the Bands now for five solid months,
Anyone who knows my Forex temperament would
know that’s an eternity for me to stick to one indicator.

but I think I’ve really optimized it now

The screenshot should be self explanatory

Cross or Kiss of green to red ADX ( there is one kiss
near the end that would have won, but we were already in )

Confluent with Solar Winds Histogram. Never oppose unless
Histogram has started to angle up.

Bullish ADX cross must be confluent with a Bullish candle, typically
bullish colour, but a stalky candle excepted any colour.

In the sample below there were 9 qualifying trades and they all won for
+819 pips.

Two set ups marked with red arrow didn’t qualify because there was no
space to Bands , they arrived before even starting so to speak

This is very similar to Totally Awesome and equally profitable.

The final trade hasn’t hit Bands yet, Does anyone seriously doubt it will?
Watch Monday or Tuesday.

and I believe trading the AutoFib Zones to Bands is free money
because price will usually reverse from red or blue zone, and price
invariably returns to Bands

So if you have both, on higher TFs you should usually win

Here is the AutoFib to Bands system again

These two systems are more than enough, but there is just one more
that’s a bit different, an Ichimoku Trend Strategy

It is extremely profitable!

Cross of ADX where price is confluently Bullish/Bearish, and has just broke
out of Ichimoku cloud. Target Pivot.

Ideally, a healthy Trend Strength percentage reading. We don’t have one
here. but we do have 90% reading on D1

We see a dragon Harmonic signal for added confluence

I also have a Purple line that denotes the 20 MA on 5 x higher TF
Price must always be moving away from Purple to be moving in
same Trend Direction as D1.

We see price has retraced to Purple Line and TZ1, this often happens
(marked in small yellow box )

TP can be Pivot, especially if close to opposite TZ1, extremely accurate.
Obviously set up must be confluent with Solar Winds

I don’t necessarily want to trade every set up on all four systems,
maybe just pick the best of the best, regardless of system

and a tie breaker would be the set up offering the highest RR

Here is the Ichimoku Trend System

[Jerome32]

These are the Pairs I will mainly be trading on H4 TF

[Jerome32]

After 18 months of endless theorizing, I now need total clarity

I am trading the Revised Bands System for simplicity and
extreme profitability

I will especially look out for set ups on the AutoFib Zones to Bands System
but only on the preferred currency pairs.

If I see a really compelling set up on the Ichimoku Trend System
I will trade it

I will keep Position Sizes small and build up my account gradually

[Jerome32]

and over and above just about everything,

I will trade only through WOS Wide Open Spaces

[Jerome32]

Monday Morning!

Not inspiring, although I have opened one small trade

Cross of MACD and ADX.
Looks like it might be returning to upper trendline

but price has breached Daily Pivot which usually signifies direction
for the day, but better, has retested Pivot level and resumed the
upward direction from that level.

All this well below bands, have targeted Distal Band in the R2 region.

If price decides to breach Daily Pivot to the downside I will consider
set up null and void

I am not overly excited by this trade, but its the best I can see on H4
and I’m not desperately looking at other TFs.

Gold looked promising on H4, a perfect AutoFib to Bands trade. Clearly
price always returns to Bands

Not in this case I doubt

Look at Daily and Weekly charts, you would have to be very shortsighted,
or obsessed with your system, to not notice the Strong Bullish bias on
the higher time frames. My guess is that trading an H4 reversal here
would be suicidal

Finally, I almost took this trade, actually I did take it and closed for a small
profit.

Too bleary eyed to notice the prior double bottom, now likely to turn to
double resistance.

Its possible that price might move through that level to hit the bands

but we can hardly say we have WOS here, this is a classic case of
total absence of WOS!

Whenever we have a great set up but no WOS, we have an opportunity
to take a punt, or gamble. it might pay off, sometimes does, but pure
gambling nonetheless

[Jerome32]

Have placed Buy PO on USDJPY

Pretty self explantory.

has hovered above Pivot all day

Impulsive up move retraced down 61.8
then tarried up at 50.0
now hovering just above 38.2

has been respecting trendline

If PO triggered it should hit R2

[Jerome32]

One Winner so far today

Opened some good trades.

One mistake, GBPNZD, It will very likely keep moving down from trendline
and hit the Bands. thats not even relevant

After opening the position I looked left and noticed the 22 bars of congestion.
that is a serious level of congestion that is likely to re offend

I quickly closed the position for a 7 pip loss.

Perhaps looking left before might be the smarter thing to do!

That said, my results for february have been very good. unlike
last September with my ‘legendary’ 100% win rate, ( if you don’t
have a stop loss you can theoretically never lose )

I now have a very realistic 50% win rate and my Stops were
only hit twice in 17 trades. excluding one trailing stop which closed
in profit.

but there were many trades I evidently pulled out of for a small
loss, average around 10 pips or so

high win rate is not desireable, many pros have a win rate below
50% but a very high RR

I hope I am on the right track, I seem to be settling in to H4 ok
trades will no longer be dragging on for four months. I don’t
need that.

the major advantage of not having a stop is that TP will usually
be hit eventually,

the downside is that Lot size must be very small, trades can really
drag on, and on Majors especially. you can fall foul of stop hunting

At the moment I have a stop for safety, which permits a reasonable
Position size, but I usually close manually if the trade doesn’t appear
to be working out.

If I find I’m getting a problem with stop hunting, I may review the situation.

One important factor from my previous success with the bands is
trendlines. I had forgotten about them

If there is a break of trendline, and WOS to the bands, there is usually
money to be made

Just about all the money I have lost has been self sabotage, not due
to a faulty strategy.

I seem to be far more balanced in my trading these days.

The pain of 35% DD is a marvellous teacher

I did very well to climb my way out of that, but its not an experience
I want to have again.

Keep Lot size manageable, and you are not fazed by the odd loser, or even
a run of losers, should that happen.

WOS is everything!

In the screenshot below, no sane trader would try to break through that
upper level of congestion, it stands out as a danger zone

but by failing to look left, you miss exactly the same thing lurking below,
you sometimes get a feeling you will be lucky, and you might be, like
horse racing punters sometimes win on a lucky hunch

but the odds are always stacked against the gambler, we need everything
on our side

[Jerome32]

Although TP was easily hit on USDJPY above, I lost due to SL hit,
pure and simple.

In the two potential set ups forming below, likewise what do I do?

In both cases price is far from bands and should return to them.
I have isolated the prime WOS that I will be targetting

but look at the indicator windows - they are obviously pointing
in direction price has been moving ie away from bands. by the
time they suss that price has reversed, it will probably be too
late to enter

there may be a conflict here

using Bands as a gauge, a tool, is very helpful, price should
return to them, especially when accompanied by reversal
candlestick pattern.

and in such situation, price should certainly move through WOS

if I can get indicator confirmation, this is probably as good as its
going to get.

To use stops or not is a thorny issue, of course its far better
not to use stops providing Lots size is extremely small

it does build up with a high win rate its true

my main bugbear was trades dragging on for moths, and without a stop
that did happen on D1

but H4 may be far more workable

Its just getting the right psychological balance

I don’t like losers!
I don’t like trades dragging!
I like to see my account growing steadily, not a few cents a month

I may not be able to have it all

[Jerome32]

I went Long the EURGBP

It was far below Bands and price always reverts to Bands!

How do I know? because I devised a system that says so.
Has the system been profitable?

No, its caused nothing but stress and DD

nevertheless I saw the Harmonic pattern so I was in like a shot.

I closed for 68 pip loss because I increasingly believed I had
chosen the wrong direction.

So what made me decide to go short when I was already way below Bands?

Everything!

Currency Strength for one, break of key Support and break of Fractal - the
list goes on and on

Whether its Bands, Divergence, or Harmonic Patterns ( which has now
conveniently disappeared ) you can get too blinkered

if everything is screaming out ‘Short!’, it may be worth hesitating before
going Long

That said, if my new position does now return to Bands for an even bigger
loss I will be somewhat demoralised to say the least

It is possible, as it could still respect that solid Support level.

This is a tough game

[Jerome32]

I thought EURGBP was returning up to Bands from a key level
but it moved down instead, I jumped out for -68 pip loss

Then I saw price was clearly moving down so I went short

Almost immediately price started moving up to Bands

I got the feeling I was never going to win

but the truth is, quite likely, both assessments were correct,
price does go up and down mostly.

So, looking at H4, D1 and W1 bearish trend strength is over 80% on
each TF

On H4 price has bounced down off 200SMA . crossed down over 50EMA,
then retested and bounced down off that key level

It has also totally broken key prior support level

So the EU is down against the Pound overall, but price does nonetheless
return to Bands, in this case up.

So I believe my original trade was correct, price will at least hit Proximal
Band at around 50% Fib, before continuing its overriding Bearish descent.

So I am short with an extra Sell PO at break of next Fractal, two short
positions with TP at next major key level.

In the meantime, either now or at some point soon, price will likely return
up to Bands before resuming the prevailing downtrend

This seems to me to be the most likely scenario, so I have put my money where my mouth is.

and most importantly, just accept I could be wrong, a victim of Brexit madness
and numerous other unknown Fundamental factors that I wouldn’t even
understand even if they were known.

If I make such analysis regularly, I should have an edge and come out ahead,
but I am definitely going to lose trades along the way.

I need to detach from certainty and read up some Mark Douglas.

[Jerome32]

Panic Sets In!
Looking at the trade above, I called it perfectly right. Price went
up exactly to that key level of prior Support turned Resistance,
then went down, exactly according to plan.

But leave a trade over the weekend, and how often there is
mischief afoot!

The trade has gone horribly against me, on a Live account, I’m
losing a lot of money!!

Price has reversed to the Upside! It was 84% Trend Strength down
on Friday, now its 91.6% Trend Strength to the upside!!!

I’m finished!!

In a state of absolute panic I need to reverse my position, close
the trade and go Long!

Thats what I always do, thats what most traders do when they
panic

The adage is true, ‘cut your losses short and let your winners run’

but that isn’t the same as continually reversing your positions
everytime you panic

The solution, first and foremost is to stop panicking

So lets look at this ‘tragic’ trade, just how bad is it?

Looking at the red shaded areas we can see how dire the situation
is - we see a Double Bottom and the price has duly reversed against me,
and we see the ominous Trend Strength confirming just how ‘wrong’
the trade was. - and I was so sure this pair was bearish on H4 D1 and W1!

So now I have lost all confidence in my trading analysis

This is what usually happens in these situations. I just despair that I
will ever be consistently profitable, that charts will only ever be
psychologists ink blots to me, and I only ever read imaginary
patterns that don’t exist in reality

Sometimes it seems like that.

but after I calmed down, I didn’t close the trade

and I made another calm analysis of the current situation

What we see from this screenshot is that price was respecting the 200 SMA
on the way up, and seems to be respecting it on the way down

so all is by no means lost

and what about the current price action?

Firstly we note a very nice cross down over CCI, and just as promising
is that we have what looks like an Bearish Engulfing Pattern forming

Of course, if all this was happening at the 200 SMA level that would
be even more encouraging, but the present moment, it looks like
price is not planning to breach that highly significant MA

Maybe it will, but in the meantime I see no reason to panic, in fact,
panic is the very thing that blinds you to what might be really happening

Unfortunately this trade has dragged on for 12 days now, far longer than
most. but still far short of the 4 month touch I was getting trading the Dailies

In fact you can work it out - if 4 months is possible on D1, then 21 days must
be proportionally possible on H4

and I can probably cope with that, and it is preferable to dropping to H1.

If we do get a convincing close above 200SMA, that is surely the time
to ‘cut losing trades short’, but at the moment, there is nothing to suggest
that this is a losing trade

In trading, a clear head is the prime thing, when panic sets in, there
is nothing that can save you, you will be acting in blind desperation

Again, Isn’t this why is it so easy to double your demo account, but so hard
to avoid DD on your Live account?

[Jerome32]

21 days on H4 eventually became 24 days, but still
better than 4 months on daily

the trade went completely against me

I previously said that only a close above 200 SMA
would cause me to ‘cut losing trades short’

I didn’t do that

as rrram2 reminds us, that adage is BS

I’d forgotten

There are two provisos to never closing a 'losing’
trade

1. You are able to read the charts sufficiently well to see
   the overall trend on the higher time frames

2. Most importantly, you trade with very small Lot sizes
   that enable you to add on, where others are getting stopped
   out

Invariably things do work out, but it can take much longer
than you would like

A stop loss does ensure the trade doesn’t drag on

No stop loss gives the trade all the freedom and time that
it needs before going your way

This is not what I want but it is the reality of the situation

Unfortunately I like big winnings and small or no losers

A mature trader readily accepts the impossibilty of that
mentality

risk is always in some proportion to reward

For me, I still need to develop patience

If I go in small with no stop, profits will be small
and delayed

but they will build up over time, if I am patient

With my current trade I went 400.00+ DD but now
am about to close around 300.00 up. it took 24 days

I don’t desperately need to improve my trading skills,
that isn’t really the problem

its everything else that’s the problem

even this trade was starting to get stressful with
the DD

All the while the DD is stressing me, scared money
will always lose

This is probably the most profound truth I need to
focus on

I have dug up my old prosperity consciousness self
hypnosis tapes, brilliant, using different metaphor
stories in each ear very powerful!

not specifically Forex related but that may not matter

I need to change my emotions toward money and
prosperity at the deepest level. If I succeed in that
I believe success in forex will be attainable

if I don’t, there is no system or fancy indicator that
will save me