Well! at least finished reading the entire thread! It was a useful reading, i finished a little tired, but with a bigger knowledge.
I’m already trading position like method and I think that big time frames are the right ones for retail investors like us.
I’m also using 3 ducks system to get my bias of the market. I found it to be useful for filtering wrong trades and the set and forget approach gives best results.
In my long term trading I’m having a little problems with exits. They are very well defined but I end giving some profit to the market. I think that is common with trend following strategies.
I don’t feel very comfortable with not setting stops, so I place safety ones and also my approach to money management is defined to the SL I place, so I never risk more than 1% of my account on a single trade. This makes me feel right, sleep well and trade comfortable. Also I know that if my internet fails for a week, I can’t lose more than 1% per trade, that could be 30% at most if I had all 28+ pairs open. This obviously makes my profits smaller, but I feel good with that.
I did some back test and found this methodology good, winner and easy to follow. Not that trading is easy, but that with so big stops, small positions and clear trends, it is easy not to get worried about my trades, and easy to not fall by my emotions.
So far, I’m very interested and added this thread to my subscriptions on BP.
Thank you for sharing MG99
I’m ready to see your charts about placing stops both to take profits or to limit losses.
I think the 3 duck it’s a good way to identify the bias I’m trying it but using it in the daily, 4H and 15m to give me a more long term view of the trend so far I have mix result. I’m not good at price action alone yet that’s why I’m implementing some indication like Sma and Ema
Hi Guys, well not a particularly good week to start, as I see most pairs extended and looking for retracements along with my nemesis JPY pairs haunting me again. In the end I killed most trades on Wednesday, I don’t know why.
Here’s my stats, I am of the opinion that most breakouts fail and my experiment this week goes some way to prove just that, hopefully next week will be a better week as I will be waiting for retracements before rejoining the main trend now.
Yes I find that entering in the retracment, after a daily candle suggests the trend may be resuming, is the better place to enter. I too had long EURJPY & CHFJPY trades which at the beginning of the week got up to almost +200 pips between them…then whatever happened, they fell back down to almost -200 pips between them …and now are more or less breakeven. I will leave them over the weekend cuz the signs still favor up. I only had the 2 trades open cuz they were the only ones in a retracement except EURCAD which finally gave a bullish candle in it’s retracement yesterday so now I have 3 trades open…and like you said the others were right at support or resistance for a possible break. Those ones, I will wait for them to retrace again even if they do break…and that could take another week…arrgh!..lol
I’ve been tinkering with this over the weekend and guess what I’m going to be doing?
That’s right, selling the USD across all pairs! The best buy appears to be AUD/USD.
The strength meter is built around the last week’s candle and basically if the body of the candle is over 50% of the total range then it scores 1. and if the close is within 25% of the top it gets a 0.5 and vice versa for bearish candles being minus.
This shows that last week they started to sell off the usd big time.
Any thoughts on the deadly gaps that greeted us after the weekend on JPY and EUR pairs?
Are these game changers for you or is your bias unchanged?
They basically killed my unrealized, and i’m wondering how to deal with it.
As of right now, i’m thinking patience is the right move, but would love to hear your thoughts on it.
The only one I was in over the weekend was USD/JPY short ( I think this profit has almost been wiped out by now on the move up during the day), which played in my favour and also engaged my CAD/JPY short (now closed) with a profit this am. I was going to go long on EU and GU last night in my efforts to short the USD, but both looked like bullish behaviour was creeping in and I did’nt go with these two. I am currently shorting USD only atm. I think Mondays are usually slow and some people do not trade them, prefering to wait until they get a better bias by entering on Tuesday.
Personally, if the trade is hurting, I would close and wait. If you are on demo or it’s still in your risk zone, then why not wait until tomorrow before deciding. I guess you were long EU? which seems to be trying to come back up but the news must have upset a few large traders and who are probably in the same boat I suppose.
Edit: I think we should be looking at putting stop losses in place, whether we actually put them in or not but certainly, we should be looking at a % we are comfortable at losing. I was reading the Turtles over the weekend and they always had a stop loss of 2% per trade where they would close the trade as soon as price hit that level, period. But if price came back to their breakout level again, they would re enter the trade. They didn’t appear to have many successes, as most of their trades resulted in losses, but they made up for it on one or two trades per year which paid off handsomely and they were able to load them up with up to 4 entries. The successful ones were the ones who consistently applied the rules no matter what.
I started the week shorting the USD going off my strength meter, but since the Cyprus bank raid, things are looking like the opposite for now. ie risk off. I’m totally unsure atm, playing it as it comes.
I went through the school of pipsology on BP. Tried trading for a couple weeks using MACD ADX and stochastic and looking for cool shapes and what not. I was discouraged because like MG said there really is no such thing as oversold or overbought. Which is what makes this thread refreshing.
All that to say, I have been trading what I THINK is MGs strategy, and would like some help. See pic:
I hope this picture ends up easy to read. I placed a market sell order at the end of the NY day at the strong bearish candle (see fourth from the right candle) The next day it seemed that the candle jumped and the trade went against me. Here are the questions that I have:
Looking at the seemingly long term down trend was I hasty in placing a sell at the place I did (dotted green line at 1.4182)?
After noticing the third candle after my sell I placed a SL, did I place it at the right place, according to MG’s strat?
Should I remove my SL since there could be a reversal of this mini trend/retracement
NOOB question: Are retracements only at FIB points? If not, whats the difference between a trend reversal and a mini-trend?
REading this thread from the very beginning has been VERY educational. Thank you MG! And those contributing to this thread.
Firstly, Mastergunner’s thread is a trading methodology, not a trading system as such. He stated how he trades, but most of us trade differently but within the methodology of the thread, namely to have more than a single trade on at the same time across the major pairs as you are aware.
I don’t wish to answer for him, but he jumps on an established trend when there is a pull-back following a reversal back towards the main trend, but he will wait until there have been a couple of days’ movement towards the trend following the reversal signal, usually when price passes the 38% fib level. I see you jumped on the trade a little early, as some of us would have done!
I think the problem we are having now is temporary indecision by the big players who move the markets as to which way they are going as a result of the Cyprus bank raid announcement. Hopefully this will soon get back to normal.
In answer to your questions:
1 Basically, yes a little hasty, we are all different in the way we trade.
2 There is no right or wrong place to put a stop loss, it all depends on your risk. Mastergunner and I will generally place a stop loss (Mastergunner only places them to protect gains or in the case of stopping a runaway train) beyond the last significant support/resistance area in the trend. If it is to limit a losing trade, I would either put it just beyond the last swing high or low, depending if long or short. Sometimes I will place it above or below the entry candle if I don’t trust the market conditions.
3 Once you have put your SL in place, never remove it, only move it nearer the price. After all it was placed there for a reason in the first place, right?
4 I’m not sure what you mean by a mini trend. Retracements can happen anywhere but usually occur at key support/resistance areas. It’s a good practice to mark them off on the chart as areas to watch for reversals, SL placements and profit taking. Trend reversals is a difficult thing to quantify,as everyone will have a different view on when it has changed. Take the trade you took, I have toyed with this entry a few times and rejected it on the grounds that price has now made a significant higher low, the first sign of a trend change, but has not yet made a higher high and price is starting to go sideways, so my jury is out atm.
I appreciate you guys stepping up and fielding these questions. I’ve yet to read anything that really needs to be corrected. Appreciate it.
I said I was going to post some examples of stop losses, but I just haven’t allocated the time yet. So instead of the waiting for my to do list to thin out I will suggest you guys post some examples that you think, and I’ll provide feedback where it’s warranted.
I’ll be back hit or miss these next few weeks as business has been keeping me extremely busy. I’m sure when the tax season is over it’ll slow down a bit and I can start stalking this place again.
