It may not be as sparkly as the Heikin Ashi approach but it is very much more reliable.
The parabolic sar is a standard trailing stoploss indicator amongst experienced traders - I did not just suddenly cook up the idea myself!! :o
Welcome back. 
Soldier on.
Persevere and advance!! 
I also been trying to find ways to cut my loses and hold onto BB sausages longer.
The parabolic sar/mid BB method for exits is all you need.
Also I been looking into the ADX to see if that could help with identifying the end of a sausage/bubble.
Forget it, [B]TraderAlan[/B]. :eek:
I have looked at all this stuff years ago - If it was good, I would have told you so early on in the thread!!
However it looks like no matter how hard I investigate, you always have the better answer! And you always seem to discover it so quickly!
Thatās why I run this thread!!
I have all the experience from my stock trading years, I have a semi photographic memory and I have a copy of Steven B Achelisā book "Technical Analysis from A to Z. 
please ignore, if I have missed the question, but
I believe the question was , why do you enter at point A on - and I remembered you donāt actually enter at point A - -it was a cue that you should enter ā Tymen pointed out to enter at point E2, as noted in the quote text above.
He didnāt say enter at point A.
Thank you for attempting a clarification.
I really do not understand [B]Gerardās [/B]question.
But I will have to make allowances for the fact that he is a new trader here on this thread.
What can I say, itās exciting stuff! Glad youāre around Tymen.
OK, last post for the night - have a gander at this beautiful trade!! >>>
Lets go thro the letters to see the stages in this LONG tradeā¦
Candles A/B are the CBL pair with a blue line extending as the entry line.
A red dashed line extends from the bottom of the extreme candle - this is our stoploss.
Candle C is the entry candle.
We take TP1 at the mid BB, then we look to take TP2 at candle D butā¦
At candle D, we see that the outer BB are expanding powerfully and the mid BB is going up - sure signs of a BB walk coming up.
So we delay TP2 to get the benefit of the BB walk. 
At point E, the PSAR crosses the mid BB and hence the mid BB takes over as the ultimate stoploss. A touch of the mid BB from hereon means immediate exit.
We now smile, smile, smile as we wait, wait, wait and watch the price action go up, up,up. 
We follow the parabolic sar with our stoploss - shown by the little red lines across the sar.
At point F, we have a parabolic sar inversion with a long wicked, red candle.
The trailing of the stoploss along the sar is halted, and the red line extension, (shown), touches the lower wick of the red candle.
However, we only exit if the CLOSE is below the parabolic sar, which is not the case with the red candle, nor with the next 2 green candles under the inversion.
At point G, the parabolic sar reverts to standard form, and we restart the trailing of the stoploss along the sar.
At point H, the special trading rule from post #3887 on page 389 which saysā¦
If, after an inversion and restoration of the parabolic sar, the price action hits the outer BB, exit at that point.
ā¦applies!!
Point H is a very excellent exit indeed!!
If you look carefully, you will see that this is a BB sausage with 3 false retracements before the final geniune retracement after H.
After the 2nd false retracement, the trade appeared to be a BB bubble.
Note that at no time did we concern ourselves with whether this was a bubble or a sausage.
We just traded!!
And so we gain the most from a trade - and that we did with an air of mastery and complete confidence!!
[B]Simplicity is the most complex beauty.[/B]
Your hours of soldiering on have paid many dividends! You have provided us with a truly [B]excellent[/B] exit method, which sometimes enables us to take our Final Profit [B]near the peak[/B] of a BB Walk or Sausage. I cannot thank you enough!
Happy pipping!
Tymen,
I just want to clarify the entry for myself.
Candle C doesnāt need to close above A because itās in a squeeze? Anything other than a squeeze and we would have to wait for a smaller candle than the CBL to close above itās highest point?
Also, these work equally well on any timeframe down to about 20M (just less pips, the further down you go)?
Ah I see your example is a 15min chart.
Yes this helps. The way the bottom chart shows it, I thought you were entering on the extreme candle and not waiting for the price to go through your cbl.:rolleyes:
Hi VulcanClassic, I donāt think we are using the rule which requires a smaller candle to close above/below the CBL candle to enter.
We are just using a standard 2 candle CBL.
If the extreme CBL candle is larger than the previous candle, then use both candles to construct the CBL.
If the extreme CBL candle is smaller than the previous candle, then use just the extreme candle to construct the CBL.
I think thatās all there is to it!
Wow Tymen, Iām impressed. Iāve only had a short time to run this in demo, but the bottom line is itās keeping me in good trades much longer than other methods Iāve tried. Just in the short time Iāve run it risk reward numbers have soared.
Sometimes the weekends just interrupt my fun 
Iām looking forward to demo trading it more next week. Iām hoping someone with good simulation skills can run this through a good test and see what difference they are getting vs. the simulation runs on the original BB DNA method. Any volunteers?
I also like that itās simple, no worries about different rules for managing the trade in a bubble or sausage. Really, thereās no need to have to decide if itās a bubble or sausage, just enter on a CBL out of a squeeze and let it go. Great work Tymen!
Correct!!
So we donāt have to wait for a close above or below the CBL, it just needs to touch it?
I am glad you like it.
You are the best judge of what I present here, I think.
Just in the short time Iāve run it risk reward numbers have soared.
Well, if it has done that for you, then what will it do for the others with far less experience!!?
Much impoving of trades, I hope!! 
Hi Tymen & Gravitation,
Impressive trade Tymen! Congrats!
Two things are unclear to me at the moment, so iāll ask right away:
[B]1. Cutting loosers short[/B]
Gravitation wrote a lot of good stuff about cutting loosers short.
That saved me a lot of pips already and made me have one of my first winning weeks last week. Thats cool!
Now Tymen if i look at that impressive trade above i notice that after you entered with the CBL the trade comes pretty close to your StopLoss.
Whats the ārightā way of dealing with such a situation?
I think i would have exited that trade and [I]maybe[/I] re-entered later.
I think thats what Gravitation would do. But i have the feeling that you would stay in tymen, trusting in your CBL. Is that right?
Its just a little bit hard for me to tell when to ācut a looserā and when to stay in. Maybe thats always a problem
[B]2. Mid BB / PSAR as StopLoss[/B]
Say iām in a LONG-trade that goes in my favor and i am in a BB-walk.
PSAR & mid BB are heading up and i move my StopLoss with the PSAR.
[U]Question:[/U]
The PSAR is still below the mid BB.
Is the mid BB already my ultimate StopLoss?
Or does that only appy when the PSAR has crossed the mid BB?
If thats the case i could just move my StopLoss along with the mid BB until the PSAR crosses it.
I would say that the mid BB is always my ultimate stoploss when im in a BB walk. Its just a little unclear to me.
Okay, thats it.
My trading improved so much the last 4 weeks. Im getting better and better results. Thanks to the Tymen-Gravitation-Dreamteam
Happy trading everybody!!!
There is no āright or correct wayā
[B]Graviton [/B]and I have different ways of dealing with these stoploss situations.
[B]Graviton [/B]will bail out quickly if he thinks the trade is going AWOL.
This is called [U]micro-managing[/U] a trade.
This works fine if your suspicions are correct because it will save you a lot of pips in losses.
[B]I see the situation a little differently.[/B]
My approach is the time honored one - a trade is not finished until the price action either hits the [U]stoploss [/U]or hits the [U]take profit[/U].
This is called [U]macro-managing [/U]a trade and allows you to leave the computer and return later.
If you lose, you move on to the next trade.
If you lose, the number of pips you lose = 2% of your total funds by calculation beforehand.
I believe that the advantage of this macro method is that [U]you are allowing [/U][U]for breathing room[/U] in your newly started trade, so that any retracement can regain momentum and go on in your favour.
If your are [U]wrong [/U]in bailing out quickly, [U]then you miss out[/U] on the entire trade.
If you did not bail out early when you should have, then you hit the stoploss.
But then you should only lose 2% of your funds.
I believe this to be the [U]correct use of a stoploss[/U] - otherwise, why have it.
[B]It comes down to the theory of a stoploss and why you have them in the first place.[/B]
[U]In stocktrading,[/U] there is no leverage and hence no margin.
A drawdown is, therefore, easily handled.
A stock will never lose its entire value unless it is delisted - you are then careless for selecting that stock!!
So a stock can go down in value, but with no leverage and no margin, your equity can absorb the drawdown until the stock goes up again.
In stocktrading, with no leverage or margin, a stoploss is not really necessary.
[U]In forex[/U], we have [U]leverage[/U], and, therefore, a margin.
Without a stoploss, our margin would become our unwilling stoploss!!
Therefore, a stoploss becomes essential.
We then allow for the possibility of price action hitting this stoploss but in doing so, we have already allocated no more than 2% of our account to do this.
Again I say, this is the correct usage of this tool.
We live to trade another day.
As you can see in my examples, not only is the win/loss ratio high, but the risk/reward ratio is also extremely favourable!!
When the PSAR is still below the mid BB in a LONG trade, the PSAR takes precedence and is the stoploss until the crossover.
Note, however, that the price action will never hit the PSAR.
The mid BB takes over when the crossover takes place.
If thats the case i could just move my StopLoss along with the mid BB until the PSAR crosses it.
You must always move the stoploss along with the parabolic sar [U]only[/U].
This may sound all strange to you but it works!!
The exitence of the PSAR on our chart give us encouragement (because price action will never hit it) and so we need not worry about bailing out of a trade early.
The only time when there is a possibility of price action hitting the stoploss without our control is the period between the entry and PSAR reverting to standard form.
In the chart above, the PSAR reverts to standard form at the green candle just before candle D.
I hope these answers help you.
Thank you very much [B]Tymen[/B]!
You answered my questions in great detail!
That clarifies many things for me!
I noticed that you and [B]Gravitation [/B]think a little different about StopLosses.
[U]And thats good[/U]. For me as a new trader its absolutely great to have a look at this tool from different points of view.
I can understand both theories and i absolutely like both.
Now i will just try and test which suits my trading style best.
ā[I]Truth is whatever works.[/I]ā - i read that somewhere. Somehow that fits here. I just need to find out what MY truth is
To be sure, I think the [B]Graviton [/B]and I would both agree that you should set a stoploss at the pointā¦
ā¦ where you believe that [U]if the price action goes there[/U], then the price action will no longer go back in your favour.
In other words, [U]the point of no return.[/U]
I have set the stoploss position at the end of the wick of an extreme candle because that is candlestick theory.
However, for you, the point of no return, (the stoploss), may come a lot sooner.
If so, you should set your stoploss line at the position that [U]you believe is the no-return point. [/U]
This point may be well before the wick end of an extreme candle.
Of course, if you [U]set your stoploss too soon[/U], you will suffer from what a lot of newbies sufferā¦[U]the premature stopping out of trades.[/U] Many a thread on this forum has been devoted to just that subject!!
Being an experienced trader, it would not do my reputation any good if I fell into that trap. :o :o
So that is what I seek to avoid here and hence I set the stoploss where it is in this DNA method - at the wick end of the extreme candle.
Do you trade this method?
You question is far too vague for me!! 