All right, this is going to be my trading log thread. The system I am going to use is based on MPs thread that you can find here if anyone wants to read up on it. Very usefull stuff!
While MP is kinda experienced already, I myself have to admit to be a n00b and so I am still lacking the skills to make use of all the indicators. So I have basically combined his insights with two EMAs for simple interpretation and strict money management.
IMPORTANT NOTE: this system has not been tested yet and is a “work in progress”. I am beginning to demo-trade it with the beginning of next week and it has not really been backtested yet, since that is kinda difficult with the flexible changing shin-channel. So dont burn your real money with it (yet ).
Here are the rules for my trading:
Setup:
1 hour chart
Shin_true channel applied to the 4-hour chart (visible in the 1-hour chart, too but based on 4 hour candles)
EMA 10
EMA 5
Currency pairs:
to many to list - I will try to only open up on little correlated ones though. After some time I might decide to stick with those that worked out best.
conditions for a long trade:
A one-hour candle has touched the bottom of the Shin channel or closed near it
the EMA 5 crosses over the EMA 10, indicating an uptrend
the MA-cross candle closes within the lowest quarter of the Shin channel
conditions fo a short trade:
A one-hour candle has touched the roof of the Shin channel or closed near it
the EMA 5 crosses below the EMA 10, indicating a downtrend
the MA-cross candle closes within the highest quarter of the Shin channel
Position sizing, target prices and stop losses:
initial stop loss will be at the bottom (long trade) or top (short trade) of the channel-touching candle
the overall position will be sized according to my preffered risk level of roughly 2%, depending on the distance from the MA cross candle to the initial stop loss. Since I will be starting with 10,000 virtual �, that means about 200 � max loss.
the position will be split into 4 packages of the same volume
the target prices will be 1.) half way between the EMA-cross candle and the center line of the Shin channel, 2.) at the center of the shin channel, 3.) half way between the center line and the other side of the shin channel and 4.) at the other side (roof or bottom) of the shin channel.
once target price 1.) has been hit, the stop loss for the three remaining positions will be moved to break even.
Further restrictions:
I will not enter a trade against the trend if it is very strong according to the shin channel
I might close my positions early if the price hovers around the center line for a very long time and it seems like it is not able to push through it to the other side. I dont intend to turn into a robot because of this system and turn my brain off.
I might not enter a trade in case there are major news (like intrest rate changes etc.) going to be released soon for the currency pair according to the dailyFX-calendar.
I might not enter a trade if the borders of the Shin channel have been strongly penetraded shortly before - in that case I will wait for an update on the channel.
Charting and brokers
I am actually demo-trading with Oanda, but charting with MetaTrader 4 from some other broker (who has worse spreads, but offers unlimited MT4-Demo-Trading hehe )
Attached is an example chart of a text-book long trade. The price hits the bottom of the Shin channel at the bottom (green line) which gives the first heads up for a possible upcoming long trade (marked with the thumbs up). A few hours later the EMA 5 crosses over the EMA 10 at the candle marked with an up-arrow, confirming an uptrend.
The long-positions are open now, stop losses set to the lower red line at 0.6247. Then the price crosses over the 25% line (marked with the first red check) within the Shin channel (this line has to be drawn manually - wish it would be possible to get that one showing automaticly heh) -
first position is closed with profit and the stop losses of the remaining three positions are set to break even at 0.63182. Later on the price hits all other TPs, marked with the red checks.
I guess the overall profit here would be like 500 �, which equals a 5% gain in my account already. But of course, everyone can find a text-book example for his system on historical charts.
So I will see how this baby works out next week…
hey trooper totally appreciate you post and look forward to following it.
Was wondering instead of demo trading why dont you trade for cents (pennies), demo is a complete waste of time other than getting familiar with a platform.
I think you’ll be far better off trading micro lots on a mini account
Pretty simple answer: people say demo trading is easier than trading with real money. Thats understandable for me, but I have not even been profitable demo-trading for much longer than a week yet.
As said, I am pretty new to this still. Once I am making profit on demo for one or two month, I might open up a real account with 200 � this summer - just to get my feet wet.
Besides that, I am still studying economics. That means I dont have a real job yet - so I am not really looking to waste money untill I have my grade in a year or so.
Trade 1:
EUR/USD
Monday, Feb 9th, 08:00 CET
Short
Open: 1,29022
SL: 1,29940
[I]Result: The Shin channel turned in the middle of the trade and the move over 1,30 just killed my stop loss.
228 �
[/I]
Trade 2:
USD/CAD
Monday, Feb 9th, 08:00 CET
Long
Open: 1,22608
SL: 1,21290
[I]Result: first TP hit, remaining SLs were set to break even and were triggered soon after. + 14 �[/I]
Lets see how these work out. A bit risky since its Monday morning… I might not trade at that time if it proves to get bad results on the long run.
).
