Well. I’m using the base system. You can learn about it on the Captain’s thread 
For money management I’m using 0.5% of my free margin per trade on my live account just to keep away my emotions. For you who want to know how to do the calculations, this is pretty easy if you trade medium to long term, because it takes about 5 minutes to calculate it. Simply, I measure the pip distance from my entry point to the stop point plus the spread. Then I calculate how much is the 0.5% of my free margin in US dollars (on a normal calculator, put dollar amount * 0.5%), then I divide the resulting number by the number of pips of risk. That gives to me the expected PIP value. On the majors (USD pairs) the pip for full lot is 10 USD. Note that it varies on other pairs, some are bigger, some are smaller. So I use a simple ratio (in Mexico it is know as the “rule of three” or “regla de tres”)
If 10 USD per pip is 1 full lot, then My expected PIP value must be a YYY lots. Then I do
((Expected PIP Value) * (1 full lot))/10 USD.
I round it down and use that lot size. So, for a 100 pip stop loss on GBPUSD and 100 USD account I get
(0.005 * 1)/10 = 0.0005 full lots. So I need a nano account (0.002 US cent per pip) to trade with this, level of risk, because I need lots of 10 USD instead of 100k per full lot. This example shows that I require more equity or nano account, or increase my risk to at least 1%.
Reverse all what I just said for a short trade.
I learnt that there are some common rules that successful traders do:
[ol]
[li]Let your winners run[/li][li]Cut your losers soon[/li][li]Add to winners[/li][li]Your targets must be bigger than your stops[/li][li]Don’t trade based on emotions[/li][li]Use money management[/li][/ol]
--------------- What pairs do I look? ----------------------
I use majors and yen crosses and EUR,GBP,AUD,NZD crosses. This is the list
AUDUSD, EURUSD, GBPUSD, NZDUSD, USDCAD, USDJPY, USDCHF, AUDJPY, EURJPY, GBPJPY, NZDJPY, CADJPY, CHFJPY, EURAUD, EURNZD, GBPAUD, GBPJPY
My trading is evolving (this is a modification of my original method!) and I’m looking for longer term trades, because I found them better, with less stress, more probabilities and easier to manage. I’m using my version of “set and forget” technique.
My chart setup is this:
Chart on 1 hour time frame
[ul]
[li]Donchian channels for 55 and 20 hours. The 55 hour is dotted green channel and the 20 is solid bold purple.[/li][li]SMA(60) [this is the second duck]. This is my solid bold red SMA[/li][li]SMA(240) [this is the H4 SMA60, is the first duck]. This is my dotted dark red SMA[/li][li]SMA(1440) [this is the D1 SMA60, this give the the market bias]. This is my dotted light green SMA[/li][li]I use a zigzag only to see swings, yellow is 1H zigzag, brown is 5m zigzag and dotted red is 4h zigzag.[/li][/ul]
My entries are handled by the script that is posted on this thread; the bold orange line is the entry, the bold green line is the target and the bold red line is the stop. When a trade is active, the orange line disappears and only the stop and target line is shown.
For a list of tasks to do, if you want to trade like me, this are the steps for a long trade. Reverse the steps for a short trade. My script handles the validity of the 3 ducks signal, so I don’t need to worry about it.
[ol]
[li][B]Look for my market bias. I want to see the daily SMA(60) to be pointing up. If it is sideways then I look for another pair.[/B][/li][li]Then, I look for first duck. If price is trading below the first duck, I ignore the trade. The script posted on this thread also cancels the waiting order if the first duck becomes invalid.[/li][li][B]If the first duck is OK, that is the price is trading above it (it could be only a very small touch, like bouncing the line with the lower wick of the candle), then I check if the 55 hour channel has just crossed above the first duck, if that is true, then I place a waiting order just above the 55 hour upper line and the stop just below the 20 hour lower line.[/B][/li][li]If the price drops below the first duck then my order is canceled.[/li][li]If the price closes above my entry point, the script enables it and makes a buy. After that, I don’t handle the trade. I let it to become a winner and hit the target or a loser and hit the stop.[/li][li]I don’t add to winners because I’m trading correlated pairs.[/li][li][B]I never trade against my market bias.[/B][/li][li][B]My target is always 3 to one, so if I risk 1% is to get a 3% profit.[/B][/li][li]If the trade is stopped out, then I must assess all the steps again, like if it is a new trade.[/li][/ol]
The bold points are the most important. I think that the point 3 is the most of them, because it is not very easy to reach a target of 3 times risk if one don’t catch the entry just after the price broke the first duck. Do a visual back test, you will find that if your trade is on the side of your bias, and the entry is placed as I wrote, you almost always end with your target exceeded. But if your entry late, you maybe can’t get the 1:3 reward, but only 1:1 or hit a loss.
If you see the trade late, you maybe still can surf that trade, provided there is enough potential. Let suppose that you miss the initial entry, and the price has moved in the original trade direction. You can enter the trade late if there is enough move to the original target to get at least 1:1 risk-reward. The target and the stop must be the same you would place if entered at the best entry point, the only thing you can move is the entry. So if from your entry point there is enough room to the target to get a 1:1 or 1:1.5 or better, then it is still a good enough trade.
