Trust you ll be fine. Well I am new to Forex and new to this system. I joined Forex about two months ago and doing Demo trading only at the moment. I tested each and every system and played with all kind of moving averages cross overs but no use. The problem with most systems like Moving average cross over ones have the disadvantage of very wide stop losses and less reward ratio.
Then I found this 3 Ducks method and it looks very good to me because of the fact that it is highly trend based and thus saves us from side ways market and it uses very low stop loss point. I downloaded your ebook and understood the support and resistant concept on the 5 minute chart for entry. I have been using 3 ducks system for two days now and I already feel the difference. I implemented this system to all my charts two days ago and demo trading solely on 3 ducks system now. Like I said before, the beauty of this system is a short stop loss and due to that a losing trade wont hurt that much.
However I am unable to avail the 1:2 Risk/Reward ratio. When I try that my stop loss is hit. I am trying for the 1:1 at the moment and kind of succeed in getting 1:1. Its too early to say but I hope I ll maintain my 1:1 ratio. It would be great if anyone can tell me how can I manage to go for the 2:1 ratio if possible.
Thanks a million, billion, trillion, zillion Andy You are indeed the captain of currency. I am following you on youtube and here at babypips. Kindly keep the words of wisdom coming.
I have a couple of questions. I want to make sure that I am hunting three ducks properly.
First of all when the price breaks the 60 SMA and last swing high shall we wait for the candle to close or take the trade as soon as the candle breaks both 60 sma and swing high?
Please have a look at the following chart and please let me know if I have pointed the correct entries? The first entry is when the price broke the 60 SMA and the latest swing high and then the 2nd entry would be if and when price breaks the resistance level which I have pointed out. Please reply if I am correct?
Now in the below chart shall we wait for the price to break support level or we can jump to this trade as soon as we see the price broke below the 60 sma? I mean what I want to know that in case of long trades we wait for the price to break the last swing high but what we need to look in case of short trades? Shall we wait until the price breaks the point which I have marked by the red arrow?
Itâs up to you, your risk appetite & your objectives for that particular trade as to how you initiate your entries when they comply with the criteria.
The 1.3585 level would be fine, as would the next step at 1.3593.
Both represent valid entry points in line with the current trend on that pair.
Iâm assuming youâre only using the eur/usd pair as an example for your technical question, because of course you shouldnât be viewing that pair as anything other than a potential [B]long opportunity[/B] at current levels.
But if eur/usd was trading below both the 4 & 1 hour average, thus confirming an established bearish tone, then yes you could consider a break of that highlighted 1.3370 swing point on the 5 minute chart as a valid entry.
You could also make a claim for waiting until price breaks the next lower level at 1.3355, that being the current session low.
Answer to that Q is on page 8 of The 3 Ducks Trading System eBook. Maybe you missed it first time around. You should read the eBook once, twice, three times, print it off and have it for some bedtime reading âŚ
From page 7: âWhat you are looking for on the 5 min chart is for the current price to [B]move above a high[/B], price should also be above the sma when it does move above that highâ. Do opposite for a short trade.
Sharp as a razor !!! Top Marks to AltTab and a sincere thanks for putting the time and effort into been so helpful.
Thanks bro for the explanation. Yes I posted it for the illustration purpose. But are you sure its 1.3370 point and its not a typo? Because I highlighted the part between 1.3357 and 1.3358 in the 2nd chart. 1.3370 is way above!
Thanks Bro Andy for the reply. I did have already print out the book and have read it about 4 times. The thing is I am not good in drawing support and resistance levels so that is why I am confused. I understand that for the long trades price has to break the sma and last high but when you say do the opposite for short trades what does that mean? According to my understanding in case of short trades price has to break below sma and the support level? Am i right?
Yes, that was a typo. Apologies for throwing you off there.
Thatâs right, it does indeed have to follow that sequence.
Locating initial & subsequent levels or areas of support in preparation for a short entry is simply the reverse of what you do when plotting your trades to the long side.
Take usd/chf as a current example.
Price is trading well underneath the 4 hour average & this 1 hour chart clearly shows the bearish tone currently in place.
.9200 is the first level it needs to clear before running up against the next most immediate area of support which can also be viewed on your hourly chart at .9130
To uncover the next potential support area all you need do is keep scrolling out up the timeframe scale until you can identify the obvious level.
Donât complicate the process, price has to negotiate the most immediate level first before it can progress (or get successfully repelled) onto further areas of potential support.
If you dial out to a daily timeframe view youâll discover the next leg down on usd/chf & therefore the most likely area it will encounter support or bids & stops, is the February 1st â 6th low of .9050-20
Once you know that price is setting up in accordance with your 4 & 1 hour guides you can flip across to the 5 minute chart & begin to plot your likely entry & appropriate stop loss areas that meet your risk & objectives for this trade. That initial entry level will likely be focused around the .9200 area which should meet the criteria of your 5 minute average.
Thanks a lot Bro AltTab for the detailed explanation. Now I get it. Basically once the trend is confirmed we will ride with the trend and in case of Long trades we will enter when a latest resistance level is broken and in case of short we will enter when the latest support level is broken on 5 minutes chart. Bro I have a couple of more questions I will be more than happy if you please help me on these:
[B]1)[/B] Bro I need your expert opinion on the following chart as if I understand this chart I will understand all. The price was trending below on all three charts. But where would be our first entry point? The resistance level is the green dots and the support levels are the golden dots. In this case when the price broke the 60 sma there was an established support point at a little below the 0.84985 price which I have marked with the arrow. so shall we wait till the price breaks this point before entering this trade as I see no other support point other than this! and then if we were late to find this trade our 2nd entry point will be when the 0.84885 support level is broker right? But I am just confused for our first entry point. Please clear.
[B]2)[/B] What you think about this chart? Price is down in all three time frames but on this 5 minute chart the 60 sma is pretty straight and not going down. Is it a good idea to take trades when 60 sma is behaving like this on the 5 minute chart? However it is showing clear downtrend on 4 and 1 hour time frames?
[B]3)[/B] I am trading by watching the 5 minute chart first and if I find the price is below or above the 60 sma and has broken a support or resistance level then I look for the one hour and 4 hour charts for confirmation. I mean I donât look at the 1 and 4 hour first to save time and watch the 5 minutes chart first. Is this the correct way too?
[B]4)[/B] Final question, When you see the price broke the 60 sma and also a support/resistance level do you wait for that candle to close and enter with the next candle or do you immediately enter the trade when the 60 sma and support or resistance level is broken?
So many questions bro but please help me on these. I am highly serious to trade solely on this system so wants to clear my doubts before going live with it.
Thanks for your continuous support bro
Please reply. Thanks!
The filtering process is crucial when considering & preparing trades with 3 ducks & if you become proficient at sorting the wheat from the chaff (high from low probability pairs) & employ rigid discipline in discarding those low probability candidates it will reduce the frustration levels you will experience considerably.
In my opinion eur/gbp is merely chopping around aimlessly which can be very quickly evidenced on your 1 hour chart over the past 10 trading sessions.
Just ask yourself whether that pair really represents a potentially high probability continuation opportunity on Monday morning. Iâm pretty sure you can locate far cleaner technical candidates than that pair to focus on going into next week.
And that last paragraph leads nicely into your 3rd question about the initial identification & prioritizing aspect of 3 Ducks.
If youâve read Andyâs e-book & studied the many examples posted within the thread you will already know the correct & logical timeframe sequence that needs to be followed to ensure youâre only considering higher probability opportunities.
Re-read the first post on this thread again & revisit the e-book & think about why itâs more logical to assess the wider (higher top down sequence) background picture first before executing your entries via the smaller 5 minute timeframe.
usd/cad is still a shorting opportunity for me until 1.0250 is compromized.
A resumption of the move down through Fridayâs low (where further sell stops are building) would be a likely opportunity for 3 ducks potential based on the type of technical behavior Andy usually employs & advises.
Remember, everyoneâs risk appetite & entry criteria will be different. The structure of this model is constant but the entry, risk & eventual profit objectives are personal & individual.
Again, this has been explained many times by Andy in his material & by others in their comments throughout the thread.
Itâs not necessary to wait for a candle close, but if your personal preference is to wait & it is supported via your testing & research feedback, then by all means employ that tactic.
Thanks a lot again for the very detailed explanation. Bro I am learning a lot from you. I understand the case of EurGBP pair as it looks very volatile at the moment and I agree its better to look for some nice trending pair.
About the USDCAD you said that:
[B]usd/cad is still a shorting opportunity for me until 1.0250 is compromized.[/B]
A resumption of the move down through Fridayâs low (where further sell stops are building) would be a likely opportunity for 3 ducks potential based on the type of technical behavior Andy usually employs & advises.
What made you say this, that its a short opportunity [U]until 1.0250 price is broken[/U]? I did check daily charts and hourly charts but I didnât notice the importance of this 1.0250 price level? I can see the pair is trending down but I donât understand the significance of 1.0250 point so please help me on this. I want to learn this predicting before hand to buy and sell till a specific price level is reached!
Now about the candle close, I know Andy did mention that to each his own method but I was asking what you do? Reason is you are actively following this thread and also posting actively so that is why I need to know your strategy with this system.
I took the GBPUSD Long trade at 1.57231 when all ducks lined up and price has broken the resistance level on the 5 minute chart. I set 20 pips TP and 20 Pips SL but after a while my trade stopped out in a loss. I want to know that did I take the correct entry and its just that the market reversed or is there any mistake on my part?
Then I would suggest you take your time & have another look at the 4 hourly chart again & note where the moving average is currently residing in relation to the 1.0250 swing level on the move down on that timeframe.
In order for you to begin preparing to trade to the long side of usd/cad where does price need to be in relation to the 4 hour 60sma?
You donât need to predict anything. Thatâs the whole point of using the moving average guides on combination timeframes.
The average is simply a visual aid that encourages you to focus your attention on pairs that are exhibiting the types of momentum flows via those 2 hourly timeframes that offer you a higher probability opportunity.
Youâre seeking a general pattern of lower highs & lower lows or higher highs & higher lows via the 4 & 1 hour charts in order to trigger you into a trade on the 5 minute timeframe.
Andy wasnât referring to each his own when he was talking about the candle close.
3 ducks offers a logical framework from which to base your entries, trade management & exits from. Thatâs the bit he was referring to when he mentioned each person needs to personalise it to suit their own requirements.
Never mind what I or anyone else is doing, thatâs not going to help you one little bit.
You need to establish your own style based around your individual risk appetite & short or medium term trading objectives.
There are plenty of chart based & commentary examples throughout the thread that clearly explain the background & foreground set up & even advise a couple of different entry techniques surrounding breakout & pullback entry criteria to suit different styles.
I would once again [B][U]strongly[/U][/B] advise you to take your time & re-read the content because the answers to every question youâve asked is available multiple times within the thread.
With regard to your recent gbp/usd entry.
The Asian business hours donât usually attract a great deal of volume or liquidity outside of their own regional pairs.
Itâs notorious for stop hunting, particularly if prices are near key round numbers or major swing points where stops & resting orders usually tend to congregate.
Although 3 ducks operates a defined technical structure you still need to use your discretion when appraising potential entries & exits.
On my chart a 20 SL would not have been hit, and your TP would have been, so you backed a winner!
I donât think it was such a bad entry. But then again, Iâm no expert!
You donât need to be an expert Wayne.
All you need do is use a little common sense & follow the advice & recommendations about using the set up criteria to help stack the odds as much in your favor as possible.
How many times have folks been advised on this website only to play ball when the likelihood is that sufficient volumes & liquidity are available before placing bets on certain currency pairs?
Iâve seen those posts on this very thread numerous times with accompanying reasons & explanations as to why it makes perfect sense.
I donât know about you, but betting cable running 20 pip stops early into Tokyo trade first thing on a Monday morning doesnât register too high on my high probability potential scale.
Youâll win the odd bet every now & again by virtue of the law of averages, but the objective is to maximise your odds as often as possible & Iâm afraid that tactic falls way short.
Thanks a lot bro for your detailed explanation. I already read 50 pages of this thread and now reading more. I trade late nights when major markets are not functioning so I think maybe that is the reason too that my trades are not met sometimes. I start trading about 6:00pm GMT and trade till about 4:00am GMT so what you suggest are the good pairs too trade in this time?
Thanks.
Thanks for your reply but I donât know how to check for sufficient volumes & liquidity. Do you mind explaining please?
Kashif,
He already gave you a big hint about matching volumes to their own regional currency pairs in this comment.
If you havenât already done so I would urge you to take a walk through the school topics which can be accessed via the home page of the site.
It explains a wide range of different material related to the forex market including most of the questions youâre asking on this thread.
Try & get used to using a search feature both on the site & in general as it will unlock a mine of information & link you to other associated material.
It might also pay dividends if you were to actually finish reading the whole thread first in order to familiarise yourself properly with how the strategy works & digest the many instructional videos, chart examples & excellent additional contributions from the other experienced posters.
Market is highly volatile for the past few days. Its very hard to trade as even when the ducks are lined up there is no strong trend. Almost all pairs are pretty choppy.
You are indeed the captain of currency. I am following you on youtube and here at babypips. Kindly keep the words of wisdom coming.
