I am considering making adjustments to my trading plan. I have been refining my strategies and learning alot and I think that should be reflected in how i trade. It could be luck for last week but i really think i am starting to have my strategy gel. Also i want to remove some of the higher risk trades 2:1 and 1:1 but increase the sizes of the better ones 3:1+. To make sure I have enough action because these levels are quite hard to find I add AUS/USD and EUR/GBP. I think its good to add a non-usd pair i can trade during news and a comdoll. I know patience is an issue for me so by giving my self 2 extra playgrounds I will still feel active.
Risk Management: everything will be in Reward:Risk and then % equity per trade
[B]OLD PLAN[/B]
1:1 - .25%
2:1 - .33%
3:1 - .5%
4:1 and above - .66%
[B][I]NEW PLAN[/I][/B]
This will not just be level size but also include my SL (which is usually between 25-30 pips)
[B]
[I]3:1 - 1%
4:1 - 1.25%
5:1 & up- 1.5%[/I][/B]
Total Risk in Market: 3.5%
[B]OLD PLAN[/B]
Max trades in 1 day: 5
[B][I]NEW PLAN[/I][/B]
There will be no more max trades. if i can find 100 trades that meet my criteria I will take them. But my limit will be based on how many losers i am having. This is more of a psychological walk away and rest. Because the zones will be forming no matter what you do so if there is a good zone you should take it. not caring how many trades you have taken before or how many you would take after. Though i havent even reached my 5 at all.
[B][I]
Max losers in 1 day: 3[/I][/B]
Weekly Goal: 50 pips
Time frames: [B][I]1 hour level+ is a longer term trade[/I][/B]
I would really like feedback on my new strategy. I am trying to remove the higher risk trades but gain on having bigger lots on the larger targets. Since this will greatly reduce the amount of trades I can take I really need to profit much more from the trades I can take.
Derek, the fiber failed trade was using a level that had multiple supply zones develop in a very similar price range. Essentially, that level had been used multiple times. check a 15 min chart and you’ll see. It wasn’t a terrible trade, it was just one that didnt’ work out more than anything. You could be pickier about your “times touched to a zone”… but it still wasn’t a bad trade. B+ trades provide a positive expected value…but more losers than A or A+ trades. So be it.
In the old system the entire level would be giving me my risk reward. But since they are small (15-25) pips I would set my stop at 30 minimum. So my overall RR was much worse, I thought because it is spot forex I need a large SL because of the nature of it. But now I will include my level plus my extra stop loss pips and the level must still offer 3:1.
I will definitely review my records and see what my win rate vs timeframe. I know that 1 hour is the most consistent. Deeper analysis will take place over the next few days as I revise.
Seems like you already have incorporated pa but only indecision pa. Strength pa is what’s up. Do you use 15m often?
As well your stops should be beyond previous highs/lows in my opinion. Never set numbers but you can calculate r:r from the stop to tell you if the trade is worth it.
@Hoysauce
Yes but also the 3rd level were we saw the strongest reaction was the most distal level and the one farthest away on the supply demand curve. So i would expect the largest reaction here. I think we use the same zones just in different ways. I use limit orders and you use market orders. Yes the reaction in the middle zone could have been better but it did move up. Just not as far as i had hoped. I am a serious fan of the limit orders. I will try to use more opposing zones as my profit targets. Other than that i think we do pretty much the exact same thing. You wait for price confirmation, i try to be part of that invitation that goes out to people to join the party. Mine is a bit more aggressive but hey to each there own. I really appreciate your looking at my thread and please continue to give feedback.
So you weren’t long after the first bear pole as there was still a supply of sellers? The second bear pole which you traded after shows a doji candle (lack of seller supply and potential trend turn around) which wasn’t present after the first pole.
Basically you were looking for a lack ability to sell (no more willing sellers at that price) with which to go long as the price must rise before the current asset holders will sell again?
These Demand levels (green) are really wide and have so much ranging and congestion above them. The only one that looks reasonable is the bottom demand level. It offers the most and is distal. But if i were to trade either of these levels I would look to decrease my risk. I would say at the Bottom demand level is ‘Acceptable’. The Supply levels look much better the inner smaller level is much good. Price has gotten close but never touched it. The larger farther out level is quite good and is offering enough to take on its own but the position size would be small. I think both supply levels are trade-able the distal larger level being the best of the 2.
4h:
The only thing revealed here is the Demand level circled. It had price just sprint away twice leaving just large wicks. this implies a good amount of strength. I tried to take a trade here last week but i didnt get filled. Leaving me wishing I did.
CABLE:
Daily:
Demand level 1 is still live because price just bounced away so quickly. It was 5 pips from reaching the level but never did. Demand 2 is quite wide. But that’s OK because its the distal level and has never been touched before. Since price has left it it has never gotten close. Both of these levels are good. Supply 1 is a good level as well. Having 1 level before it and never been touched. Supply 2 has been touched before and as you can see it has created a price reaction but got very messy and price has not moved down as much as it did the first time. This level is unacceptable.
4H:
The only interesting thing here is this minor supply level. on the other side of this curve it was a minor demand level. Price has already entered it and has created a wick inside. Its quite interesting to see it frozen in time like that. You could still take this level as the price is at the lower limit of the level, but it would be a short term scalp. I would keep this to my smallest lot size and be very aggressive with my SL.
Basically the exact same picture we saw last week.
4H:
This gives us something much more interesting. The supply level on top is definitely tradeable. The orange was a demand level that was created and I am watching the reaction to it. I did not take a long there. I am waiting to take a long at the green lines at the bottom. This is where it has been testing the long term lows. I have an order down there.
USD/CHF
Daily: is pretty much exactly the same as last week. No new daily levels were created that were really large and had a good R:R
4H:
Now this is a different story we have a good demand level here that is quite good. One of the largest moves away we have seen. Breaking the endless ranging we have been having.I have been looking to get long in here for quite some time. I think this is a good place to do it.
Supply level 1 is good. Even though price has been there before, this last time it was there it moved away faster and farther than the 1st time. It also cleared out the ranging area that came before it. Demand 1 at this point is not good, price has pierced the level about 50% which in my book negates the level. Also the 2nd candle after was a pinbar, depending on what happens next if it moves quite far away then it could be considered again but until then it is now used and unacceptable. Both Demands 2&3 are Excellent levels, price has never gotten back there, they have huge reward risk ratios and very clean upshots from there. I would love to get a trade when price reaches there again.
Daily:
Here we get to see a great way to reduce risk and make sure we have a very strong price reaction. Although this level is deep into the other level we may not get fills. (this is one of the reasons 35% of my orders don’t get filled) Its a very conservative technique and on this level it decreases your stop loss by half drastically increasing your reward risk ratio. I would rather not get filled and have an order at a level inside a level than get filled on a smaller position with a large SL.
4H:
The demand level to the level of interest does meet my requirements. But price has been ranging right above it for quite some time making it less attractive. The level of interest is a supply level and we will see where price goes from there. Lets watch the reaction. Supply Level at 4H is good. Very close to a higher time frame level, clean fast drop away with out price getting close to it at all. I am definitely looking to get in on that one.
(I hate this 4 images a post thing, it makes me spam my own thread.)
Supply 1 has been hit many times and price is currently rebounding from the last time it was there. This level is unacceptable and will be not be used. Supply 2 is quite large because of the pinbar but it is untouched and had 1 solid candle push down and price has never gotten back there. I think thats a good level because of the lower quality level before it. I would look to reduce my risk on that one but I will take it if i get the chance. Demand 1 is a good level as well. Great rise up out out that price range and tight level size as it is. depending on how it gets back there it could become excellent. Demand 2 is large ugly and far away. It had a great rise out of it but, the price action inside that zone is really nasty. I may stay away from this one just looking at it from here, but i am sure if you drill down as price gets closer you may find a nugget.
Daily:
The supply level is the star here. It is a level inside a larger time frame level, however there is a caveat. That level has been broken more than 50% but not by much for a weekly level. Also it has level on top of levels. with a strong drop away, this level is excellent.
4H:
here is a demand level. but its got a lot of wicks down to it. scalpable with some babysitting. not something i would just let run on its own. nothing else really i saw that i liked.
That’s all for my weekly analysis. Wow this becomes a lot of work with this many currencies. But hey this is how we prep our selves for the game ahead.
SO my win rate is 60% over all. Broken up into TFs
Less than 1H: 60%
H1: 50%
4H+ 50%
Unfortunately my expectation is really low. Negative for the higher time frames but my sample size is really really small there considering i only have 6 trades in the 1 and 4H categories combined.
Less than 1H: +6%
1H: -20.8%
4H+: -26.9%
So actually my higher time frame trades cost me money. Which is really strange. Anyway this only over 16 trades. But this will affect how i change my system
So How will I change my system based on this analysis which overall says i have a negative expectation?
I think a lot of my higher timeframe limit orders are getting hit while I am away. Which is what i want. However they are not triggering optimally, either 2nd touch, or a lot of congestion below, or some other reason to get out of the trade. I am going to deal with this by only placing orders that are within 150 pips and canceling all my orders at the end of the week. (i had a order trigger on Friday after i was done for the day and it was horrible mistake) Placing them again on monday taking note of the new conditions.
I will focus more on where it seems i am doing well, which is small time frame trading. I believe this is because of the supervision I can give to the order when it is executed. Avoiding spots that cause the problems above.
I have added more currencies to my plan. Each day I will focus on [B][U]2 ONLY[/U][/B] for my short term trading. For higher time frame orders i can just place them and look away.
I will reduce the risk of the higher time frames and slightly increase the risk on lower time frames. Making 1 R:R system. This goes hand in hand with #5
Because I will be increasing risk slightly on the trades I make the most I am going to be more selective. My minimum level + stop (at least an additional 5 pips above my zone) will be [I] [B]3:1[/B][/I]. This must be shown on the largest time frame on which the level was detected.
If after touching my zone and moving in my direction. If it is not shooting away quickly (max 5 candles at the time frame in which the level was identified) I will close the order. A lot of my stop outs are where there is price reaction in my direction. But It doesn’t move away quickly, therefore there is not as great of a supply/demand imbalance as i had expected. So I should just walk away with a small lose or gain and move on to a better spot.
This started the week off horribly. But we soldier on. So basically I had this order sitting here since last early last week since i started watching AU. But sometime after I stopped trading on Friday it triggered. This is a reason i added failure adjustment 1 above. I paid lots of carry over interest and got stopped out. I didn’t even notice until i started up my charts today. Really a gross thing. I will have to cancel all my orders on Fridays.
Net: -24.8
FIBER scalp
This was a small scalp from the 1hour level. not much of a move up and the price action was choppy. I removed 33% at 17.2 pips. Moved SL to BE+2 and ended up getting stopped out with 1.4 pips.
Now you may be asking yourself wtf are you doing taking such small pip TPs and SLs. well UJ has been having tiny ADR. So i though if everything is relative it would be taking like 15 pips or so SL on say cable or fiber. So i took it and the level measured up like any other. Even though my pip amount gained was tiny the amount my account grew was the same amount on any other trade where you need 30-50 pips. So I am happy with that. Also another perfect wick fill, yay!!!
(red line SL, green line entry, blue line TP, arrow candle filled, thumb PROFIT!)
Net: +12.3 pips
my emotional trade/ embarrassing moment.
EUR/GBP
price: .88459 SL:.88769 TP: .88159
OK so i pressed this button on while on the go. I used a market order with my default settings which is 30TP 30 SL and .4% equity. This was a real mistake. I saw a level on my iphone put the order in. This was Fing stupid stupid stupid. So we left the coffee shop and went back home. I looked at the laptop and realized WTF am i doing and closed out. Realizing i had just come off a good trade, feeling good and ****y. Even a bit stressed by the rest of the day from other stuff and that was why i traded. I immediately closed it for. Thank the pip gods that this lot size was smaller than my previous win or else i would have been more pissed. So i stopped the bleeding and watched a movie instead.
Had 1H level here and the daily trend was up. Heck we have been moving up like crazy, been trying to find a spot to get long in UC for ages. Maybe i took to long who knows anyway. I got wick fill again (getting better at that btw which i am personally proud of) It moved in my direction quite well then just fell off like no othere. stopped out.
Net: -24.7 pips. to the next trade!!!
At the time of this writing i am currently short AU at .07073. we will see when it completes what happened by i am off to bed. Cheers and good pippin!
