I learnt from my mess yesterday, I was confusing systems,
confusing rules, forgetting rules, for example the engulfing
system you pace PO ahead, not just go straight in at
market when EC forms! This is what happens when you
become scattered - trading is hard enough when you're
focused so why invite losers.
So rethink. I'm still following the divergence system
because it is one of the few I know to be profitable
although not to everyone's taste.
it's on a separate PC and separate broker so it
shouldn't cause confusion.
Also it is a slow system, so it adds no extra hassle,
I've seen guys trading this system with most initial
trades winning and all rescue trades winning!
in fact on their results page they record no losers
at all as the system doesn't recognize losers just
because they don't go your way initially, the position
may be closed if it goes 300 pips against you but the
trade is still considered open awaiting the next divergence
with a bigger Lot size. ( absolutely not Martingale ) In
fact these guys never took out a third position as it was
always hit by the second!
You need to start with very small Lot size indeed so that
even if both trades fail you would only lose a maximum of 3%
and that would be a rare occurence.
but its a waiting game which wouldn't suit most traders and
the no Stop suggestion is understandably highly unpopular
but it's really not a big deal if you really trade small - micro
The system is longterm, if you think about it, if virtually all
your trades win you cannot really lose longterm. You have
to start small but its amazing how it builds up.
This has been the only system to be consistently profitable
on a real account until I went stupid - ( which is exactly what
others have reported )
But Big E's system is awesome, - I've never been a scalper
or considered myself to be inclined that way but it really
does seem to work with a bit of practice. I've had a string
of winners this week and only one loser yesterday on this
But the system didn't lose
I think it was AUDNZD which was forming a double top
which straightaway tells you its probably going down.
Big E's system (TDI) was showing green crossing up!
and currency strength chart was showing NZD plummeting!
So I used my 'initiative' and ignored Big E's rule about
trading right into S/R zones. Duh, I have actually been
around long enough to know that anyway
Nevertheless I was sure this trade would plough through
resistance preventing a Double Top from forming
but price didn't plough through anything, it formed a Double
Top and reversed. So I lost due to overconfidence and
presumptuously thinking I know better than Big E. So I
won't make that mistake again.
Today, maybe being Friday there was only one set up
but a very nice one, in fact I would say one of the best looking
one's so far as it ticks all the boxes - most importantly you do
need to get in on the second candle at the latest - these trades
are just quick scalps on the retrace usually - at least that's
the bread and butter of the system
There was plenty more available on this trade and I wasn't
surprised it went on much further beyond the basic 15 pips
but I'm not inclined to try anything smart today - just stick
to basics - 15 pips with 8 pip stop for Lot sizing so that gives
a 1:2 RR. Most trades do win if you are strict about the rules.
I know there is much more that can be made, and I can often
see when that would likely be, but this is a scalping system
and I just want to get the basic 15 pips down first, I can try
adding a second smaller position later if it seems viable
but I'm keeping things very simple for the moment.
I still want to track the EC system but not on the same
broker as TDI system as it messes the broker accounts
and its not obvious which system is making the money..
I could open another Demo account but I don't know if
I really want to get involved with checking for three system
setups at the same time.
I think initially it would be far more sensible to trade the
EC system on the Daily charts where there will never be
I don't normally like Daily charts as they take too long
to mature and you can easily become over exposed.
I like a trade to be closed as soon as possible.
The Divergence system in particular can get like that
on the Daily charts with too many positions opened
so I think I would only ever trade that on H4.
Personally I see a big difference between H4 and H1.
Certainly there is a very big difference between H1
and the lower time frames, but I feel an also big
difference between H1 and H4.
I would probably prefer Daily TF except for the reason
Here is today's TDI trade GBPCAD, big candles, got
in on second candle, nice cross of Green over Red,
plenty of room to Resistance, trading during London
Session for 15 pips