The 3 Duck's Trading System

[fxsnowball]

All out now on the reversal of GBPUSD. No follow through to our target unfortunately, came within 20 pips on GBP.

+10 and +45 for a total of 55 for the day. Not bad for a usually slow Monday

[fxsnowball]

Fxsnowball,

For the 1H trading method without using the 5M, is that as reliable as the system that lasted the 12 years? And do you enter on the 4H or 1H chart? Thanks in advance, i like the way you trade I’m interested in learning it.

I prefer trading off the 1hr chart as I find it cleaner. I’ve tried all time-frames throughout these years and found that anything below 1hr leads to overtrading for me.

I may look to the 5min or 15min to see what’s happening, of course. But my core timeframe is 1hr.

Your experience may vary.

[drum]

I prefer trading off the 1hr chart as I find it cleaner. I’ve tried all time-frames throughout these years and found that anything below 1hr leads to overtrading for me.

I may look to the 5min or 15min to see what’s happening, of course. But my core timeframe is 1hr.

Your experience may vary.

That’s interesting to note, at the moment I’m scrolling back through charts looking where I would have traded and at first glance as a newbie I’d agree the 1hr chart looks lets likely to bite.

Guess that’ll be the 2 duck system.

[fxsnowball]

So an observation on points 2 and 6 -

Point 2 - I am conflicted - as I also find that - as you set b.e. when at 30-40 pips - sometimes / many times actually T.P. here amounts to many more good little trades?? And 3 or 4 of these little ones - is just like the big winner (I am not disagreeing with you at all - I am just wondering if there is sense to taking many little profits - which from my standpoint - then how do you get the big ones? (If you limit yourself to modest TP levels - you may never experience the 100+ levels of winners.)

(Thoughts or comments on my dillemma are appreciated.

Point 6. is where you state to b.e. at 30-40 pips - I am super similar - after about 15 20 pips, I do reduce risk as well - sort of sneaking up the S.L. (Example if in profit 20 pips - - I surely don’t want to risk 20 pips anymore - -I’ll move it to 15 or likely 10 pips risk - - retaining a 30 pip cushion if you will. Do you do this as well or are you a wait and don’t fiddle with it?

I like to give some room for the trades to run. I’ve found the target of 100 pips a reasonable and achievable one. Taking smaller profits of 30-40 pips will work too, but you will not have outsized days.

On the other hand, I find stops of 20 pips or less to get hit easily in the randomness of the market. A good compromise seems to be in the 30-60 range - I took the lower end.

[fxsnowball]

I think i will trade the 3 ducks system like this.

D1 chart to get direction and main support and resistance point’s.
4H to confirm the d1 chart direction and add a fib from last week high/low to new weeks high/low, and add my current support and resistance points as point 1 where D1’s will be point 2.

And the 1H chart as my entry chart, enter when 3rd duck is lined up on 1H and take entry at last price high or low one price hits there not candle close. And place SL at recent high or low on 1H and tp at 100pips and move my SL with price as well move TP as needed.

ANY suggestions?

Thanks

Jason

It’s an adaptation from Andy’s original system. Putting more focus on the 1hr chart does work. However, you need to implement it for yourself and see if it will work for you.

[fxsnowball]

Let me finish my commentary today with a thought on trading psychology.

• My trade on GBPUSD travelled from my entry point of 1.5282 to a low of 1.5195, for about +87 pips.
• It came to about 15 pips from my take profit level
• I ended up getting stopped out (trailing stop at 1.5235), for +45

Should I be mad that the market didn’t hit my Take Profit level? Or that I didn’t maximize my profits by closing at 1.5210 instead of 1.5235? Or, should I re-enter to make back my “lost” profits? Or … Or … Or …

I used to be bothered by the concept of leaving profits on the table. It would lead me to re-enter trades prematurely and get whipsawed.

Nowadays, I realize that the aspects of trading I have full control is:

• the methodology I use to decide whether I will trade for the day (3-ducks)
• where my entry will be
• my stop, take profit and trailing stop parameters

Once I am in a trade, the market can do all sorts of crazy things. I cannot force the market to go my way, give me profits, not stop me out. No matter how much I pray or curse at the monitor.

So I don’t worry about it. I follow a mechanical approach to trade management, giving breathing space for the market to move in my favor, in line with the recent momentum (I am trading a trendfollowing approach).

IF I get stopped out, or reach my take profit target, or take partial profits, that’s all fine. In the long run, the methodology has proven profitable.

And there’s always another trading day, another wave to surf.

PS:
EURUSD and GBPUSD are more than 25 pips higher than my exit now. Mondays…

[drum]

By my reckoning the News from the US, has just pushed both the GBPUSD and EURUSD into sell zones, whihc I’ve decided to give a go, bearing in mind I’m in a practice account, I thought it would be an interesting exercise, had it been my money might have sat it out to see if they bounce back, but hey it’s a practice account, lets see how it fairs. I’ll the post the results later on or tomorrow, depending on how it plays out.

[eddieb]

UsdJpy still looks a good solid buy in the ducks

[MissLexy]

I think that USDJPY have moved too far upwards and buying might be risky at the moment, buying the top of a move. I would wait for a correction before buying again.

[fxsnowball]

Here’s what I am watching this morning.

GBPUSD looks interesting, if only too shallow a pullback last night after the news. This could either mean (1) weakness or (2) that the pullback hasn’t completed and we will have further upside first.

EURUSD is a mess, sideways, and could be news driven. However, I want to participate in any weakness, with tight stops.

[wyntac]

I agree with eddieb about usd-jpy having a lot more potential upside in it.

The dollar is much more attractive for Japanese investors to hold than Yen for a number of reasons. The main ones being Japan’s continued quantitative easing program, a potential U.S rate increase later this year, which will further increase the differential between the two nations, virtually zero inflation in Japan & their slow industrial & production output.

I’m going to use 3 Ducks to watch for more long opportunities in this pair using some of the very helpful guidelines posted by you guys on this thread.

I really like the use of past session highs & lows because since I’ve been watching the charts they seem to react very consistently. I also love the use of the stochastic indicator to help judge entries on the timeframes. This is a very simple yet clever method which doesn’t require a lot of complicated or confusing analysis, a real plus in my book.

Thank you to everyone for supporting this great thread & although I’m very new to trading I’m going to join in with fxsnowball & others to show how I’m using this method to watch for & trade opportunities in the fx market.

So to the usd-jpy. The high of last week was 124.45 & the trend wave low from last week is 123.84 so if the price remains supported above that last low it’s still in trend mode & a strong buy. Also it’s attempting to clear & stay above the 2007 highs at 124.13 which is probably an important level that traders are looking at?

I’ve set a long today off this pullback at 124.80 with my stop back at 124.25 looking for price to remain above the high of last week & continue to strengthen. If it’s a positive trade I will move my stop up initially using the wave lows on the 5 & 15 minute charts & judge if I want to keep the trade for a longer period of time.

If I’m stopped out I will keep this pair at the top of my list for more long opportunities providing it maintains it’s trend structure.

Unfortunately this site won’t allow me to post a chart at the moment for some strange reason?
Oh well, just the text then.

[iasho]

Thanks fxsnowball for the great posts, they’re greatly appreciated.
Currently looking at NZDUSD, isn’t that a good setup given the bearish trend and all ducks lined up?

[drum]

By my reckoning the News from the US, has just pushed both the GBPUSD and EURUSD into sell zones, whihc I’ve decided to give a go, bearing in mind I’m in a practice account, I thought it would be an interesting exercise, had it been my money might have sat it out to see if they bounce back, but hey it’s a practice account, lets see how it fairs. I’ll the post the results later on or tomorrow, depending on how it plays out.

Well both these positions are currently still open but both are carrying a few pips loss at the moment. I’ll let them run and see how we get on, I suspect if FXsnowball does well on his trades from today, I will on mine from yesterday.

fxsnowball, are the green lines on your chart your take profit stops? If they are then I reckon I could learn from that, had I had tighter stops yesterday, I could have made a nice tidy sum, already. I’m now watching my open positions, and your current positions with interest.

[fxsnowball]

No follow-through on the break of the lows on GBPUSD, with an immediate reversal higher.
Stopped out on this one for -30 pips.

EURUSD moved above the SMA and thus invalidated our setup.

Calling it a day today! No clean moves for me to trade.

A quote I like:
Take the easy ones and don’t do anything stupid in the meantime!

[drum]

Well both these positions are currently still open but both are carrying a few pips loss at the moment. I’ll let them run and see how we get on, I suspect if FXsnowball does well on his trades from today, I will on mine from yesterday.

fxsnowball, are the green lines on your chart your take profit stops? If they are then I reckon I could learn from that, had I had tighter stops yesterday, I could have made a nice tidy sum, already. I’m now watching my open positions, and your current positions with interest.

Well I got a kicking on the EURUSD, which I’d been on other side of that spike Still hanging in on the GBPUSD, which has in the last few days repeatedly bounced off a 50 SMA on the 1Hr, heres hoping it just about to do the same, so that I can close my open position from yesterday with some decent profit.

USDJPY has just stuck it’s head above the 60SMA on the 5min chart so I’ve bought into that market, learn from yesterday though and only aiming for approx 15pips profit, and a stop loss of abit less than that. Lets see how this one pans out.

[drum]

USDJPY has just stuck it’s head above the 60SMA on the 5min chart so I’ve bought into that market, learn from yesterday though and only aiming for approx 15pips profit, and a stop loss of abit less than that. Lets see how this one pans out.

Nice little 15pips in the bag

[fxsnowball]

Just had an interesting discussion with a friend, where the following additional setup on GBPUSD came up.

Trend remains down and the pair tested the SMA, being unable to break and close above it.

The bears are reasserting control below 5225.

Note how the break of the 3-bar pattern on the 1hr chart coincides with a break below the SMA on the 5min chart.

This confirms, in my mind, the validity of the multi-time frame approach that 3-ducks are proposing.

[drum]

fxsnowball, can you tell me are the green lines your entry points?

[drum]

Well I got a kicking on the EURUSD, which I’d been on other side of that spike Still hanging in on the GBPUSD, which has in the last few days repeatedly bounced off a 50 SMA on the 1Hr, heres hoping it just about to do the same, so that I can close my open position from yesterday with some decent profit.

USDJPY has just stuck it’s head above the 60SMA on the 5min chart so I’ve bought into that market, learn from yesterday though and only aiming for approx 15pips profit, and a stop loss of abit less than that. Lets see how this one pans out.

Well thats me out of GBUSD from my postion yesterday with a nice big fat loss. With hindsight I shouldn’t have been so greedy and should have set a lower target and and smaller stop loss. Lesson learnt and thankfully while in the practice account.

[Captain_Currency]

It could be one of those weeks Duck Hunters where trend traders will have to first wait on the News releases to see what direction pairs finally want to move in.

ECB On Wed
BoE On Thur
NFP On Fri

Any of the above news releases this week could change the direction of the 4 hour trend on pairs like Eur.Usd and Gbp.Usd.

Rule #1 is always to stay safe.

Andy
Captain Currency