Macfibo system

[sufiansaid]

Dear Sufi, do I see well that there is a part which is missing from version 1.2?
That part is what to do or not to do before or after a news candle.
Why did you left it out? I think it is important, and happen frequently.

It is true I included News Candles/ Big Candles as part of Macfibo filter in version 1.1. Why did i left it out for version 1.2? Mainly due to the potential ‘subjectivity’ in identifying a ‘valid’ big candles whilst news candle is easier to identify but what about news candle BEFORE the actual news happen… I do not doubt it is not important. My main audience for this thread are mostly traders who haven’t traded live longer than 12 months so I believe it is more beneficial for everyone to keep things super objective and simple for now.

I did however already reccomended somewhere in the page what can you do before or after news reaction in regards to Macfibo. I will state it again just for you :D…

[B]Here’s what I do before News :[/B]

If Macfibo signal occur say 3 hours or 4 hours before a MAJOR Economic Announcement or happening (such as Ben Bernanke will testify, some big shots like Euro Bank big guys, Bank of England guy etc etc will be on TV, FOMC, GDP announcement, NFP…), I will take the trade normally… if 1 hour or 30 minutes before the news, price yet to hit TP… I will move my SL to Breakeven if I am in a green… I will tightened my SL say from 1:1 to 2:1 or even 3:1 if I am not in the green.

I also manage my trade based on the consensus of the economic data. For eg the NFP. If concensus is IF MET or BETTER, will make the dollar stronger, and I am in a EURUSD sell, then I will normally keep my SL @ 38.2 (normally) because I am trading WITH the concensus. If the concensus IF MET or BETTER, will make the dollar weaker, and I am in a EURUSD sell, then I will manage the trade in the way that I make my risk EVEN smaller… if i am already in a green, I will move my SL to BE… if i am already in a red… well, I’d move my SL even smaller.

[B]What I do after news :[/B]

If the the news caused an activation of Macfibo, depending on the size of the candle (Can you see how it can be subjective to other newbies? What I see as second nature will be like guessing to others… hence I left it out for now), I will TP at 127.2 regardless of S/R lines… if the candle is SOOO big it covers certain % of daily range, I will just ignore the signal.

[B]Here’s my reccomendation, providing that you know the CANDLES that activates Macfibo caused by fundamental forces, then IGNORE the signal. There will be plenty more signals in coming days.[/B]

[sufiansaid]

No problem with the delay, you get loads of questions on this system and I know you’ve been busy!

I probably didn’t explain myself correctly. I’ve been trying to automate the back test using an algorithm on the probacktest feature on igindex. I assumed that everyone who does back testing uses a similar process but I must be wrong as you mention that you do it manually. I can see the benefit of doing it manually as the automated process isn’t either to create complex algorithm and it’s good to get a feel for the trades individually. It’ll just take a bit longer ; )

Yes it will take a bit longer I agree :)… On the pseudocode, I believe there is ateast one programmer here in the thread perhaps that person could help you with it. He’s the guy who offered to write a Macfibo EA. I am sorry I am not much of a help on this matter. Anything else I can help you buddy? (Nope, I can’t trade for you ehhehe… its illegal in my country HAHAH…)

[alfa2]

… if the candle is SOOO big it covers certain % of daily range, I will just ignore the signal.

Thank you very much for the detailed explanation. Unfortunetly the quoted advice arrived after I have entered and stopped out from long USDJPY (did not reach 127 after the news candle). However your ideas will be useful for the future. Thanks again.

[sufiansaid]

Thank you very much for the detailed explanation. Unfortunetly the quoted advice arrived after I have entered and stopped out from long USDJPY (did not reach 127 after the news candle). However your ideas will be useful for the future. Thanks again.

I might said this many times but losses happen. Congrats on sticking to your stops. Keep posting, keep reading.

[khaila]

Hello Sufiand??
How to creat Fibonanci??

[Confirmado]

Hello Sufiand??
How to creat Fibonanci??

Use the fibonacci retracement tool in your trading platform

[richhand]

Sufian, when you record your results do you include all 5ema 20sma crossovers or only the crossovers away from SR lines and also news announcements?

[Yaman]

Its not been a great week for me so far.
Yesterday a buy of UsdJpy hit my S/L just as the news came out that made the price jump right through the TP level at 161%. Thankfullythis was using a demo account so it all counts as learning.
I need to pay more attention to news events if I am going to make this system work for me.

It is the sort of news based signals that invalidate EA’s in my opinion. An experienced trader should at the very least consider the fundamentals of a currency pair before entering a trade as part of the trading plan, but an EA cant do that. At least not one that I could write.
I have tried to programme this system (only the initial signal) but the back testing results are no where near as good as manual back testing.
This could just be my dodgy programming skills but i think it is also the fact that when manual testing i can see the SR lines and make a judgement to TP at 127 or not enter a trade at all because the signal candle was suspiciously large.

[caliphtrading]

1st Trade Using Macfibo and Custom Parameters

Finally, entered a trade using my parameters and Macfibo. Decided to ignore the RSI signal!

Took profit on half of the position entered at 127.2 Fibo because of a 4 week low line just beneath 168.1 Fibo. Move hard stop to BE for the rest of the position.

[earquake]

I will try to develop an EA based on this strategy:

• Macfibo Main Signal
• Daily and Weekly S/R filter for TP and SL decision.
• If trigger bar Volume > Kx50_SMA(Vol) the signal will be ignored.

[camelacml]

If u are coding just for ma cross over indicator or ea, dun sweat on it… There are few in the google search…sometimes sl need to set at the right place and it will be a wonderful trade…loss trade is inevitable in 4rex…

[camelacml]

Looking forward to it…

[earquake]

If u are coding just for ma cross over indicator or ea, dun sweat on it… There are few in the google search…sometimes sl need to set at the right place and it will be a wonderful trade…loss trade is inevitable in 4rex…

MA cross is made in 2 minutes, the problem is everything else.

[sufiansaid]

I just want to say wouldnt it be better to focus all your energy in testing the system manually as it will give you MORE than EA generated results could ever give. This is just my opinion but in my years of trading, EA generated results (EA backtest results) never reflects the true nature of a system… it either could give you ridiculously AWESOME results or ridiculously HORRIBLE results.

Yes manual backtesting is slow process. Automated backtesting is Quick and easy. I don’t know about you but I don’t believe in short cuts. I treat Forex trading as real business, and if it requires me countless hours and days testing the system thoroughly, so be it.

I am sorry but I will not ever rely on EA particularly in setting up a trade for me. I might be interested however if someone would create an EXIT EA for me (5ema cross 8sma). If my suggestions counts for anything, I suggest that you backtest the system manually according to the rules (original or modified). I can give hundreds reasons why I believe manual backtest is better but I will tell you just this two reasons :

a) Macfibo is not ‘a simple method to code’, errors and bugs are imminent.
b) It is simple enough to be traded on your own.

A lot of programmers over the years have tried to code Macfibo EA. Some claimed to successfully coded it 100% as the original rule but as I tried to check the EA, I noticed the EA would TP all the way to 261.8 instead of 1.618 (i believe the inaccuracy of it’s PT B), it would ignore S/R or worse, ignore the 5x8 crossover. You can’t blame me to be very skeptical in using a robot to do the backtest for me… nevermind trade live for me.

Having said that though ehhehe… you want to do your EA, write your EA to make backtesting easier, well it’s your choice and i wish you good luck. I wish EA writing or discussion about how to code this how to code that wouldn’t become the new theme of the thread.

God bless…

[sufiansaid]

Sufian, when you record your results do you include all 5ema 20sma crossovers or only the crossovers away from SR lines and also news announcements?

Hi Richhand, can you rephrase your question? I don’t quite get what you mean.

[sufiansaid]

@caliphtrading

1st Trade Using Macfibo and Custom Parameters

Finally, entered a trade using my parameters and Macfibo. Decided to ignore the RSI signal!

Took profit on half of the position entered at 127.2 Fibo because of a 4 week low line just beneath 168.1 Fibo. Move hard stop to BE for the rest of the position.

Why you broke your rule and ignore the RSI signal?

[richhand]

Hi Richhand, can you rephrase your question? I don’t quite get what you mean.

Yes sure, let me try explaining the scenario better. When we see a crossover (Asian, London sessions), two things can stand in the way of a good trade - a major news announcement and SR lines. We would normally avoid trading when these things are apparent. However, the crossover has still occurred and I am wondering if you have still record the results (as shown in this thread and pdf file) OR have you ignored the outcome of the crossover and not included the results?

A simpler way to put it may be: do you only record the results when you take a live trade?

[sufiansaid]

Yes sure, let me try explaining the scenario better. When we see a crossover (Asian, London sessions), two things can stand in the way of a good trade - a major news announcement and SR lines. We would normally avoid trading when these things are apparent. However, the crossover has still occurred and I am wondering if you have still record the results (as shown in this thread and pdf file) OR have you ignored the outcome of the crossover and not included the results?

A simpler way to put it may be: do you only record the results when you take a live trade?

The results is based on rules documented in version 1.2

EDIT : I log EVERY signal, regardless whether I take the trade or not.

[richhand]

The results is based on rules documented in version 1.2

EDIT : I log EVERY signal, regardless whether I take the trade or not.

Got you, that is what i thought really but just wondered. How do you manage the news? Was I correct in stating that this system is best ignored when a large announcement is due such as the US unemployment claims coming up?

[sufiansaid]

Got you, that is what i thought really but just wondered. How do you manage the news? Was I correct in stating that this system is best ignored when a large announcement is due such as the US unemployment claims coming up?

I already answered about this issue here