The 3 Duck's Trading System

[eddieb]

Hi.
Set up a SELL order on 31st for 50k eurusd which triggered just before markets closed at 1.20992.
TP closed this morning with 49 pips drop for profit of $245.00
Nice start to the New Year

[eddieb]

Just opened SHORT on gbpusd, 50k @ 1.54305, training SL at 15 pips, no TP will let this one ride

[rindoan]

The fact that on 4hr the 60sma hadnt dropped below price for a few weeks. Have since realised that the 1hr and 5min charts may have crossed under/over in that period, so that may have provided opportunities to go short.
Thanks

I take about 15-20 trades a month so I would beg to differ on the point of this strategy not giving a lot of trading signals (and I even consider myself selective).

Just opened SHORT on gbpusd, 50k @ 1.54305, training SL at 15 pips, no TP will let this one ride

Best of luck with the trade.

Personally I would consider a 15 pip SL on a pair that has an average daily range of abt 100 pips to be extremely aggressive and if you keep up with those tight stops you will get stopped out a lot even if you did have the direction of the market right.

For your my personal stops depends on the volatility of the pairs and to some degree of recent price structure.
For a pair like the EURUSD which currently has an ATR of 99 pips I usually have a SL of around 20-30 pips and a pair like USDJPY which has an ATR of 139 pips I have 25-40 pips.

With a 15 pip stop in a 100 ATR currency pair you are highly likely to get taken out by normal market movements even in your selected direction.

In terms of where you bought the price had moved abt 140 pips downwards in an 8 hour period period to where you entered and if you consider the daily ATR of being abt 100 then that seems extremely stretched to me.

For now your trade seem to be working in your favor but would would keep a very very tight stop if I was you as I would not be the least bit surprised if price pulls back “soon”.

Above just my thoughts on the trade and as I started with saying best of luck on the trade.

[eddieb]

Hi Rindoan.
Once my SL had reached break even I let it widen to 20 pips, may let it widen a bit more later.
I chose 15 pips originally based on my money management and on where resistance levels seemed to be when I entered. I never enter a trade without a SL and as my account grows I will take wider SL positions

[rindoan]

Hi Rindoan.
Once my SL had reached break even I let it widen to 20 pips, may let it widen a bit more later.
I chose 15 pips originally based on my money management and on where resistance levels seemed to be when I entered. I never enter a trade without a SL and as my account grows I will take wider SL positions

What do you mean with your SL reaching break even? Did not know a SL could get into break even
Also do you mean to say you widen your SL once the price moves in your direction?

Further can you elaborate a bit more of how your money management works as I don’t see how it would make sense to keep a tight SL with a smaller account and larger SL with larger account if you look at it from a % based point of view (I assume you don’t)?

[eddieb]

What do you mean with your SL reaching break even? Did not know a SL could get into break even
Also do you mean to say you widen your SL once the price moves in your direction?

Further can you elaborate a bit more of how your money management works as I don’t see how it would make sense to keep a tight SL with a smaller account and larger SL with larger account if you look at it from a % based point of view (I assume you don’t)?

Hi,
I’ll start with money management.
I try not to risk more than 2% of my own money on any 1 trade. So, if I have $4k in my account I don’t like more than $80 at risk. A standard lot of eurusd risks $10 per pip, so if I trade 50k units it risks $5 per pip meaning I can lose 16 pips before my $80 is gone.
If I had $8k in my account I could trade the same 50k units but would have to lose 32 pips to wipe out my 2% as this would now equate to $160, so I could widen my SL without compromising my 2% risk limit.

I set my SL around S/R levels, and within my 2% rule. I also set it as trailing, so that as price moves in my favour the SL follows it until it reaches or passes my breakeven figure. Currently, as my SL is tight, I then increase the number of pips it trails price by, so widening my buffer zone.

[rindoan]

Hi,
I’ll start with money management.
I try not to risk more than 2% of my own money on any 1 trade. So, if I have $4k in my account I don’t like more than $80 at risk. A standard lot of eurusd risks $10 per pip, so if I trade 50k units it risks $5 per pip meaning I can lose 16 pips before my $80 is gone.
If I had $8k in my account I could trade the same 50k units but would have to lose 32 pips to wipe out my 2% as this would now equate to $160, so I could widen my SL without compromising my 2% risk limit.

I set my SL around S/R levels, and within my 2% rule. I also set it as trailing, so that as price moves in my favour the SL follows it until it reaches or passes my breakeven figure. Currently, as my SL is tight, I then increase the number of pips it trails price by, so widening my buffer zone.

If you are looking to trade 2% risk per trade why would you have a fixed unit size and widen the stop loss per trade instead of adjusting your position size to your account size?

Say you are trading a 4000 usd account and you have a 15 pip SL and that works out so well for you that you now have an 8000 usd account. Basis your method you would then widen the SL to 30 pips in order to still keep the 2% risk.

If a 15 pip SL has worked out for you why would you not keep the 15 pip SL and enter with a 100k position instead of a 50k position to still maintain the 2% risk?

The way I manage my money is always trade 2% of my capital on any given trade, same as you.
First I look at the pair and I look at where my entry would be and then I look at where a logical SL would be. The SL would usually be over/under logical structure but the actual pip size varies.
After I find out my entry and SL I calculate the difference between them and use the position size tool on this site to calculate the actual position size I will need with my SL and actual account size at the time.
Position Size Calculator: Free Online Forex Position Sizing Calculator
Sometimes I trade position sizes that are 700k other times 2000k it all depends on how big of a SL I have.

My point being you should not adjust your stop loss to fit the risk you want but instead you should find the SL you want in a logical position and then adjust your trading size to match accordingly.

My 2 cents at least.

[eddieb]

If you are looking to trade 2% risk per trade why would you have a fixed unit size and widen the stop loss per trade instead of adjusting your position size to your account size?

Say you are trading a 4000 usd account and you have a 15 pip SL and that works out so well for you that you now have an 8000 usd account. Basis your method you would then widen the SL to 30 pips in order to still keep the 2% risk.

If a 15 pip SL has worked out for you why would you not keep the 15 pip SL and enter with a 100k position instead of a 50k position to still maintain the 2% risk?

The way I manage my money is always trade 2% of my capital on any given trade, same as you.
First I look at the pair and I look at where my entry would be and then I look at where a logical SL would be. The SL would usually be over/under logical structure but the actual pip size varies.
After I find out my entry and SL I calculate the difference between them and use the position size tool on this site to calculate the actual position size I will need with my SL and actual account size at the time.
Position Size Calculator: Free Online Forex Position Sizing Calculator
Sometimes I trade position sizes that are 700k other times 2000k it all depends on how big of a SL I have.

My point being you should not adjust your stop loss to fit the risk you want but instead you should find the SL you want in a logical position and then adjust your trading size to match accordingly.

My 2 cents at least.

Hi.
I have been trying different position sizes, today was my 1st gbpusd trade so I am still feeling my way with it.
I usually trade eurusd which seems to work quite well for me. Typically my position size varies between 10k and 50k depending what time frame I am trading for.
I do set my SL at logical positions, but these must be within my MM rules

[PullinPips]

Hi dxchen,

Yes, I know, but my experience says putting s/l means we are confirming our death well before its time. In this regard I would say if you are watching your trade then don,t put limit or stop. Market moves up and down everyday. keep the trade running until you get some profit. At the end of a month when you feel some pending trades are not going in favour …then cut it off. By that time you would have covered your losses by more profits in your favour. This is what I do. It is risky but it pays. One more thing, you must have sufficient balance to stand up with such open trades…then only you can take such risk. Any one having any better idea to survive please. Thanks.

Sharad, Auckland
New Zealand

I’ve read about this approach to trade management in another thread, I must say that I’m very interested in finding out more… Thanks for sharing

Tyrone

[eddieb]

I’ve read about this approach to trade management in another thread, I must say that I’m very interested in finding out more… Thanks for sharing

Tyrone

The problem comes the day your internet connection is down or your stuck in a meeting and cant get online while your profit evaporates into a stinking loss that wipes out months of earnings

[eddieb]

… sorted it

[Captain_Currency]

Hey there Duck Hunters,

A quick market scan and it looks like our First Duck (H4) would favor:

selling set-ups on:
Eur.Usd
Gbp.Usd
Eur.Jpy

Good trading to you for the next few days,

Andy
Captain Currency

These are not trade recommendations. The 3 Ducks Trading System is best used as a set of guidelines with discretion in addition with your own market analysis and trading ideas. I do not accept liability for any loss or damage, including without limitation to any loss of profit which may arise directly or indirectly from use or reliance on such information.

[eddieb]

Thank you all very much for such nice and easy method of trading. I am currently forward testing it on my demo account and would like to ask you for advice of trades which went wrong (is it my bad application of the method or just bad luck).

Please comment if I used the method correctly:

1. Getting short:

Maybe not trade 4h charts which are so much extended from the SMA?

The m5 chart doesn’t meet 3 ducks criteria, price should be under the sma and lower than the previous low.
Also, why are you using other indicators?

[haridas100]

Thank you all very much for such nice and easy method of trading. I am currently forward testing it on my demo account and would like to ask you for advice of trades which went wrong (is it my bad application of the method or just bad luck).

Please comment if I used the method correctly:

1. Getting short:

Maybe not trade 4h charts which are so much extended from the SMA?

and

2. Short:

[eddieb]

Thank you all very much for such nice and easy method of trading. I am currently forward testing it on my demo account and would like to ask you for advice of trades which went wrong (is it my bad application of the method or just bad luck).

Please comment if I used the method correctly:

1. Getting short:

Maybe not trade 4h charts which are so much extended from the SMA?

and

2. Short:

Again the 3 charts aren’t in agreement

[haridas100]

M5 chart was under last low. Dashed line from down to up shows, how the trade went.

This is zoom:

[haridas100]

@eddieb

Again the 3 charts aren’t in agreement

This is how the chart looked after the stop loss. Second case M5 zoomed:

[haridas100]

There were not in agreement after the trade. I think they were according to the system on the beginning of the trade, no?

[compact]

This is how the chart looked after the stop loss. Second case M5 zoomed:

The entry area indicated on that pair represents approximately 140% of its current average day’s range.
Quite simply its run out of gas & you’re going to really struggle with this (or any other) model unless you pay much more attention to important characteristics such as that before triggering entries.

Most of these instruments put in their optimum range coverage during the london business session. Triggering entries at or near the inception of the european business day, especially when they’re setting up with plenty of the day’s range in the tank, will offer you the most favorable odds.

[eddieb]

This is how the chart looked after the stop loss. Second case M5 zoomed:

Thats clearer, thanks. The disadvantages of using mobile devices to view babypips
Although your entry was lower than the previous low, it was only just and you got unlucky. Another day you might have got away with it. Perhaps let another candle complete next time before trading.