Multi-Time Frame Trend Trading

[Graviton]

Hey grav, thanks for you kind words and encouragement!

You’re one of the few that keeps me going towards my goal!

I have a qns btw, iam facing a slight delimna right now i would wonder what you would do in my shoes.

I currently intend to swing trade usd chf as it appears to hit the upper resistance of a channel on 4 hr chart.

However as of right now, it is about 8 more hours till the fomc interest rate news. Which of course is a 3 star event.

So would you actally place a swing trade or would you wait out after the fomc news? We have 8 hours to go, so it’s not exactly trading before after the news. However swing trade might take a few days to work out.

I didn’t take the trade as im unsure what kind of spike the news would bring, however my intended SL is abt 50pips.

So yes, what’s your take on it? Thanks

I understand the logic of your trade, but I think you are early. I’ve been long uchf all week and at the moment it looks like the move up is continuing.

The Fed statement at 2:30 PM EST might reverse the direction of the uchf. I will likely take profit ahead of the statement and sit this one out. You could very well be right on direction and still be taken out with a stop hit by volatility spikes. If your swing trade is a good one, there is no rush to enter as it will run for days. Generally, on swing trades you don’t want to be early to enter. In fact, the strategy is to be late on the entry and early on the exit. That means you give up the first 15% of the move to gain good price action confirmation of the entry, and you give up the last 15% of the move as experienced traders are taking profit by selling to the less experienced late comers. That means you take the sweet middle 70% of the move. The only thing worse than trying to get in early without good price action confirmation of the entry is staying in too long and finding yourself holding a pair that has over run it’s move. Just my opinion.

[Graviton]

Hi Grav and crew,
I’ve taken a couple of weeks out of trading to go back to the books and do some reviewing - works better than trying to trade at the same time and my account needed some flames putting out… The basis of my review has been to attempt to go through my setups and find which ones best take effect of Grav’s great add to method, DNA being one. Of the key things found, (nothing new here, just brings it home having done some good research again)

1. pair selection - wanting trends and/or clean volatility and previous 1weeks of setups to be working at or just below avge.
2. time of day is key to getting a trade quickly into positive territory - ie. volatility.
3. best trades quite often break and run pretty much right of the bat
4. trend is good/ but/ good setups taken against trends with above features inplace also work very well but with side notes of course
   a. don’t go against a very strongly trending market
   b. each s/r level hit going against trend could be the one which turns price back to the original trend / making it psychologically difficult to add to a position

Nothing new thus far… onto the results for 52 trades on 8 pairs over two different weeks (choppy and trend). Pls note the setup is just an average setup - what makes it work well is pair selection, time of day, and, as we go on - gravs add to method (this is where i hit a snag though…)

My current way of trading used fixed targets and stops - so results for this below:

Fixed 15 pip target gives 47/52 or a 90% win rate for +705 pips (less loss & sprd)
Fixed 30 pip target gives 34/52 or a 65% win rate for +1020 pips (less loss & sprd)

Note from here is that there are more trades available outside the hours checked and they still offer fairly good % win rate however they dont give the pips req for the great add to method.

Applying the add to method gives 3times a better % return of 2,775 pips (less sprd & loss, max 30pips x 5), this figure is without the couple of trades that went a fair bit beyond 105 pips, as staying in them was well difficult… And this is where I hit the snag.

The add to results are shown assuming add-to will be fairly straight forward, however this is very rarely the case. So I am now going delving into some add to methods, based on scalp strats and the idea metioned by Grav of looking for the lower TF’s to have turned back in favour. Then its down to attempting to apply the right one to the right market conditions.

A volatile market should bounce off low TF S/R levels on pullbacks allowing aggresive entries, a slow market more likely to follow fib retraces and slowly turn back with price confirmation required. Then there’s trend breaks, and the variables begin…

As I put this thinking down on paper I’m starting to realise that the best add to method may be any and many and that I’ll just have to pay a few pips to find out if I’m right… time for live trading? … This is a much more interesting way of trading than fixed targets and protentially more profitable- but how does one climb inside Gravs head and get it to work…???Grav?

Cheers,
dan
PS. just luvin this thread

Wow, that’s lots of good analysis Dan. It will take me a bit of time to go through your numbers and conclusions and comment on them. There is no need to jump into live trading without a good plan. Your win loss numbers are good to great so it seems all you need to do is introduce the multi-lot to increase your reward without increasing your risk. There is a good way to do this. Looking at your trades, you will see that there is a breakpoint where if you add an additional lot on too early, you reduce your win loss % with small retracements of about 50% of your profit. So, just as an example, if you are trading with a 30 pip stop, you’ll need 60 pips profit on a trade to add a second lot on and not have the trade turn negative with a 50% retracement of 30 pips on two lots. Even better, if the second lot is added at the perfect point, a retracement that is ending, just before another move in your favor, you have optimized that second lot entry, just like a new entry to the pair. This is easy to see in hindsight, but it will take some study and practice to do it correctly real time. I’m trading 4 pairs with multi-lot right now so things are a bit busy here at Graviton Central Command. I’ll get back to your post when things slow down a bit. Good post. Welcome aboard:D

[Graviton]

I understand the logic of your trade, but I think you are early. I’ve been long uchf all week and at the moment it looks like the move up is continuing.

The Fed statement at 2:30 PM EST might reverse the direction of the uchf. I will likely take profit ahead of the statement and sit this one out. You could very well be right on direction and still be taken out with a stop hit by volatility spikes. If your swing trade is a good one, there is no rush to enter as it will run for days. Generally, on swing trades you don’t want to be early to enter. In fact, the strategy is to be late on the entry and early on the exit. That means you give up the first 15% of the move to gain good price action confirmation of the entry, and you give up the last 15% of the move as experienced traders are taking profit by selling to the less experienced late comers. That means you take the sweet middle 70% of the move. The only thing worse than trying to get in early without good price action confirmation of the entry is staying in too long and finding yourself holding a pair that has over run it’s move. Just my opinion.

OK, it’s a couple hours later now and your short uchf swing trade is looking better. I’m out of uchf long with my profit until after the Fed statement, but there is now a 2 candle short cbl on uchd 1H which would make a good short entry. H4 is still trumpeting open though and I wouldn’t normally enter short on H1 with H4 trumpeting open long, though the latest H4 candle looks like it is forming a pin bar top and the midband is flat. For a swing trade, I would want to see a good formation on the H4 to enter and until the bb’s quit trumpeting open on the H4 I would be very careful. Let’s see how this looks after the Fed statement

[fartist]

OK, it’s a couple hours later now and your short uchf swing trade is looking better. I’m out of uchf long with my profit until after the Fed statement, but there is now a 2 candle short cbl on uchd 1H which would make a good short entry. H4 is still trumpeting open though and I wouldn’t normally enter short on H1 with H4 trumpeting open long, though the latest H4 candle looks like it is forming a pin bar top and the midband is flat. For a swing trade, I would want to see a good formation on the H4 to enter and until the bb’s quit trumpeting open on the H4 I would be very careful. Let’s see how this looks after the Fed statement

Yes i understand where you are coming from. I was long on uchf too and exited just before the resistance level i drew, somewhere 1.05400

Made a sudden false breakout from what i see, im looking to enter somewhere around 1.05030, below the swing low and SL would be just above the swing high.

Has a great r:r, cant missed that out!

Thanks for your input, with regards to the capturing 70% of the trend, yes i cant agree more! Perharps i was to eager, i’ll wait and see

[unrepipant]

NB,

Would you mind posting a chart of an example of the breakout rules you are using. I’m lost without a visual. Sounds like from the chatroom it’s been working great for you. Much appreciated.

[Graviton]

NB,

Would you mind posting a chart of an example of the breakout rules you are using. I’m lost without a visual. Sounds like from the chatroom it’s been working great for you. Much appreciated.

Unrepipant, I’m not sure of NB’s detailed method, but I believe it’s a variation on my simple breakout method. My method is to enter the breakout trade when the entire body of a candle clears the horizontal line formed by the outer BB before the breakout started. This produces entries close to Tymen’s method and since I’ve used it for years I’m comfortable with it. It allows a tight stop to be placed just inside the outer BB and I don’t get too many false entries. You might PM NB to get more information from him.

[qwertymyfx]

Unrepipant, I’m not sure of NB’s detailed method, but I believe it’s a variation on my simple breakout method. My method is to enter the breakout trade when the entire body of a candle clears the horizontal line formed by the outer BB before the breakout started. This produces entries close to Tymen’s method and since I’ve used it for years I’m comfortable with it. It allows a tight stop to be placed just inside the outer BB and I don’t get too many false entries. You might PM NB to get more information from him.

Hi graviton,

How much success are you experiencing with your breakout method?

[Graviton]

Hi graviton,

How much success are you experiencing with your breakout method?

I’ve had good success with using this method on 30M, and 1H timeframes. I get too many false breakouts on the 5M for it to work for me, and 15M results have been mixed. It’s just a simple entry method. I think most of the success has to do with trade selection and exit strategy.

[unrepipant]

So Graviton,

Just to be clear is this the correct entry? If so like you said it is very much like Tyman’s method except in some cases with this method you would ignore the size of the candle ala Tyman’s method. I agree, pair selection and exit management would be the key to success.

[Graviton]

So Graviton,

Just to be clear is this the correct entry? If so like you said it is very much like Tyman’s method except in some cases with this method you would ignore the size of the candle ala Tyman’s method. I agree, pair selection and exit management would be the key to success.

It’s hard to tell just what’s going on here, but it looks like a breakout up. If so, I believe two candles before the one you have marked as a Breakout Candle there was a breakout where the entire body of the candle was above the outer BB.

[fartist]

Hey grav! I had a great week, well somewhat a little eureka moment i would say

Here’s why, i have somewhat manage to piece up all the little bits of teaching and info i have gathered from you. So i would briefly go through what i have been taught and let me know if the approach im taking is on the right path.

We have learned how to have proper mm, not letting a good trade turn bad, never let PA hit our SL and protecting our profits and not forgetting optimising our trades! Ahh, i like that phrase.

So this is what i feel about optimising my trade, let me know if i got it right.

I trade the trend, thus i do not take counter trends. So let’s say for example, im going long on the 4hr. In order for me to optimise my trade, i would look for a retracement and enter upon it.

I do not want to go long immediately, but rather only after there is a slight retracement on it.
So what i would do is actually look down into the 5mins chart, i see PA more clearly.

If im long, PA will make higher highs and lower lows, so naturally i would look to enter upon a retracement and making of a higher low. SL can simply be placed at the new higher low, or the previous one. This way, i have a high probability trade of it going into my direction into the long.

If the trade however reverses and hit my SL, i exited with a small loss only.
However as im trading with the trend, chances of it extending further into an uptrend would be greatly increased, thus this would be what you meant when you enter cheap?

And from a day trade, you may let it go into a swing or position trade if it permits.

So did i get right on the optimising part?
I used to blindly enter whenever a trade hits my buy or sell stops, however i am seeing things more clearly now with the optimising of my trades.

And just for stats, i had 1 win this week, 1 small loss, and about 4 BEs. So up 1.5% for the week.

I believed you had done very well yourself this week eh from the breakouts of the yen pairs. Have a great weekend!

[Graviton]

Hey grav! I had a great week, well somewhat a little eureka moment i would say

Here’s why, i have somewhat manage to piece up all the little bits of teaching and info i have gathered from you. So i would briefly go through what i have been taught and let me know if the approach im taking is on the right path.

We have learned how to have proper mm, not letting a good trade turn bad, never let PA hit our SL and protecting our profits and not forgetting optimising our trades! Ahh, i like that phrase.

So this is what i feel about optimising my trade, let me know if i got it right.

I trade the trend, thus i do not take counter trends. So let’s say for example, im going long on the 4hr. In order for me to optimise my trade, i would look for a retracement and enter upon it.

I do not want to go long immediately, but rather only after there is a slight retracement on it.
So what i would do is actually look down into the 5mins chart, i see PA more clearly.

If im long, PA will make higher highs and lower lows, so naturally i would look to enter upon a retracement and making of a higher low. SL can simply be placed at the new higher low, or the previous one. This way, i have a high probability trade of it going into my direction into the long.

If the trade however reverses and hit my SL, i exited with a small loss only.
However as im trading with the trend, chances of it extending further into an uptrend would be greatly increased, thus this would be what you meant when you enter cheap?

And from a day trade, you may let it go into a swing or position trade if it permits.

So did i get right on the optimising part?
I used to blindly enter whenever a trade hits my buy or sell stops, however i am seeing things more clearly now with the optimising of my trades.

And just for stats, i had 1 win this week, 1 small loss, and about 4 BEs. So up 1.5% for the week.

I believed you had done very well yourself this week eh from the breakouts of the yen pairs. Have a great weekend!

That sounds like a good plan. Make sure you have everything written down. As you trade you will see situations occur where you might need a new rule to handle it in the future. Make notes and review them on the weekend and seek to improve your plan as you go along. My plan has lots of details for situations I’ve seen over the years. Since by now, I have a rule for just about any situation, emotions play hardly any roll in my trading. It’s just business.

As you trade this way, over time you’ll see more and more set-ups and get more and more nice wins. You’ll still get lots of BE’s, but that’s OK, because you aren’t losing. Getting out at BE is really a signal of good trading. You’ll get a very few small losses, but you will never have a big loss, and that’s the important part. Take just about any traders statements and replace the big losses with BE’s and he’ll be a winner. I think you know how to do that now and that’s no small accomplishment. All you need now is practice. Stay on the path

[fartist]

That sounds like a good plan. Make sure you have everything written down. As you trade you will see situations occur where you might need a new rule to handle it in the future. Make notes and review them on the weekend and seek to improve your plan as you go along. My plan has lots of details for situations I’ve seen over the years. Since by now, I have a rule for just about any situation, emotions play hardly any roll in my trading. It’s just business.

As you trade this way, over time you’ll see more and more set-ups and get more and more nice wins. You’ll still get lots of BE’s, but that’s OK, because you aren’t losing. Getting out at BE is really a signal of good trading. You’ll get a very few small losses, but you will never have a big loss, and that’s the important part. Take just about any traders statements and replace the big losses with BE’s and he’ll be a winner. I think you know how to do that now and that’s no small accomplishment. All you need now is practice. Stay on the path

Yes, you are spot on! I find myself editing my trading journal every week as more rules are needed to be incorprated for different situations! It’s like there’s something to learn every week, different scenarios and i find myself brain storming what’s the best way out for each different ones. But none the less, it’s enjoyable.
So that’s how you have no emotions, because you have seen almost everything you have seen and know what to do at the very point in time! Awesome.

I still have loads to learn indefintely!
Priceless teachings i have learnt throughout these time.

Btw one small qns, let’s say you have a trade go in your favour 5-6 pips, do you quickly set to BE? Or do you actually give it more room to breath?

[tymen1]

…

Btw one small qns, let’s say you have a trade go in your favour 5-6 pips, do you quickly set to BE? Or do you actually give it more room to breath?

Just calling in here to say hello - I have not posted here for a long time.

I thought I would answer you question for you, [B]fartist[/B]. >>>

What is the average true range (ATR) of the candle you are trading?

Unless you are trading a very short timeframe (1/5 mins), you can expect your candle to have a size much greater than 5-6 pips.

Lets say it a 15 pip candle - now where is your breathing room?
[B]You are choking the candle!![/B] :eek: :eek:

As the price action oscillates up and down during the development of the candle, you can expect the candle to grow and the price action will then go straight thro your BE stoploss and stop you out prematurely.

Why so you think that trailing stoploss indicators such as the PSAR, or maximum point ATR stoploss lines trail at a point well away from the candles?

[B]Breathing room!![/B]

A common complaint with newbies on this forum is that they think their broker is stop hunting them.
Although stop hunting does occur, in this case it is [U]because newbies always set their stoplosses far too close to the price action.[/U] and nothing to do with stop hunting.

[fartist]

Hi tymen great to see you back again!

Yes i understand what you’re trying to say.
In fact i entered on a 5mins TF, and my SL was around 30.

So being ahead 5-6 is about 1/5 of my overall trade.
I lost on that though, as it reversed and hit my SL later on.

So if you asked me on the ATR, on that 5mins TF would be 7pips.

Anyway, i concluded it was a bad trade to start with, jumped the gun too early on that one!

So how’s everything coming along for you tymen?

[tymen1]

So how’s everything coming along for you tymen?

I am making excellent progress on that exit indicator that I have promised to you all.

The work is a little slow because there is an enormous amount of testing that has to be done.
But everthing is on schedule!!

I am just about there with the final testing and decisions, then the programming begins.

[Graviton]

Yes, you are spot on! I find myself editing my trading journal every week as more rules are needed to be incorprated for different situations! It’s like there’s something to learn every week, different scenarios and i find myself brain storming what’s the best way out for each different ones. But none the less, it’s enjoyable.
So that’s how you have no emotions, because you have seen almost everything you have seen and know what to do at the very point in time! Awesome.

I still have loads to learn indefintely!
Priceless teachings i have learnt throughout these time.

Btw one small qns, let’s say you have a trade go in your favour 5-6 pips, do you quickly set to BE? Or do you actually give it more room to breath?

You will have to test this out over time for yourself. It depends on your particular style of trading, pairs, timeframes, etc. It’s easy to test though. Say you set any trade that goes to +5 to Be. You eliminate any loss on any trade that goes +5 or greater. You also eliminate any win on any trade that goes +5, retraces to your entry, and then goes on to produce a win. If you save a marked-up screen shot at the exit of every trade (a very good practice anyway), you’ll have the data to do the analysis. If the losses you avoid are greater than the wins you would have made, it’s a good idea to set to BE at +5. If not, then no.

I wait until a trade goes to +10 or -10 to make decisions on staying in or getting out, because that’s an arbitrary point where I measure good entry or bad entry, and if I exit earlier, it voids that measurement. There is nothing magic about the +10, -10 number though. You might get better results at +5, -5 or +15, -15. This is something you need to test out for yourself and optimize over time. Typically, you will need to analyze 20 to 30 trades to get an idea of what works best for you. I’d suggest starting out with +10,-10 and looking to see if +5, -5 improves your results. if yes, change to +5,-5. If no, then the question is, if you give your trades more room to run, will your performance improve. If you are exiting on a move back to BE after +10, you can’t see from an exit screen shot what your wins would have been would have happened if you had waited to move to BE to +15, because you will have already exited from the +10 position on some trades that had you waited to +15 to go to BE, would have been wins. So, you can run this test the hard way, trading live, or the easy way, using back testing methods on the same timeframes and pairs you usually trade.

It would take weeks or months to run these tests with live trading, where as you can learn how to back test and test and optimize this in a few days. My advice is, you have now moved to the point where you need to learn how to back test and optimize your trading, so you now need to learn this and become an expert on it. Depending on your platform, there are U-Tube videos on using it to backtest and you can also get any help you need from your brokers platform guru. They all have one and they love to answer these questions, as it makes them look useful. So, time to get to work backtesting. This will carry you to the next level in your trading. All in all, learning how to backtest and testing this simple case will only take a short time and prepare you well for the testing you will need to do in the future. Let me know how it works out Happy trading

[Graviton]

I am making excellent progress on that exit indicator that I have promised to you all.

The work is a little slow because there is an enormous amount of testing that has to be done.
But everthing is on schedule!!

I am just about there with the final testing and decisions, then the programming begins.

Great to hear from you Tymen. I expect this to be the icing on the cake of all the good work you have done. I’m really looking forward to seeing it. But no worries, I’m a very patient student. In this business, we are paid to be patient

[tymen1]

Great to hear from you Tymen. I expect this to be the icing on the cake of all the good work you have done. I’m really looking forward to seeing it. But no worries, I’m a very patient student. In this business, we are paid to be patient

Well, the testing and theory is now complete.

This trailing stoploss/exit indicator beats the pants of the PSAR.

I am now doing the programming and it is not and easy one to program.
Moreover, I do not have the assistance of [B]Ken DoubleU[/B] right now as he is on a trip to London for 2 weeks.

However, that simply means that I must learn more myself in order to write programs!!

Bear with me with your patience as I do my best!!

[Tyler_Vegas]

excellent news tymen. cant wait to try this baby out.