The Most Profitable Trading Pattern You Will Ever Encounter

[leonlee0116jl]

Short AUD/JPY on the 4hr, nicely in profit already! system pulls through once again, also multiple confluences such as trend line break and retest. Few hundred point drop here.

Yes! I’m in AJ and NU. Green pips now.
You let ur trade run until next week? Or close all by today?

[Jimmy_Big_Pips]

will hold until it hits my target of 9000, will move stop to break even so it is risk free! if it doesn’t go my way there will be nothing gained and nothing lost!

[isutommyt]

GJ up 366 pips
NU up 30 pips

So far so good. Need to figure out how/when to alter stops now.

[PhilipPirrip]

GJ up 366 pips
NU up 30 pips

So far so good. Need to figure out how/when to alter stops now.

You need to go back to my earlier posts which have pictures.

The idea is this…both of your trades are shorts. So the EMA 20 crossed below 50. But back when the 20 above the 50 there was a high, this is THE high.

Then the 20 EMA crossed below the 50. During that period stochastic moved from oversold to overbought. Then you entered when stochastic crossed. Now there was a low formed during that period, this is THE low.

Now if you are using MT4, select the fibonacci tool and click from THE low to THE high, so that the 100 is at THE low and 0 is at THE high.

Now you move stops to break even after a CLOSE below 100. Then move stops to 100 after a ClOSE below 127.2 and so on.

[isutommyt]

@PhilipPirrip

…Then you entered when stochastic crossed. …

Thanks for the refresher, I know I had read it and just needed to go back to it.

Question on stochastic cross. Is this when the main line crosses back below 80 or is it when the main line crosses the signal line? The red or blue arrow in the picture (I realize they are the same time in this particular picture, but not always the case)?

[Dosojin]

hi Philip. thx for sharing. just to make sure is this the correct setting?

[PhilipPirrip]

@isutommyt

Thanks for the refresher, I know I had read it and just needed to go back to it.

Question on stochastic cross. Is this when the main line crosses back below 80 or is it when the main line crosses the signal line? The red or blue arrow in the picture (I realize they are the same time in this particular picture, but not always the case)?

Main line crosses signal line. But you enter after the close of that candle.

[Forexmike]

You need to go back to my earlier posts which have pictures.

The idea is this…both of your trades are shorts. So the EMA 20 crossed below 50. But back when the 20 above the 50 there was a high, this is THE high.

Then the 20 EMA crossed below the 50. During that period stochastic moved from oversold to overbought. Then you entered when stochastic crossed. Now there was a low formed during that period, this is THE low.

Now if you are using MT4, select the fibonacci tool and click from THE low to THE high, so that the 100 is at THE low and 0 is at THE high.

Now you move stops to break even after a CLOSE below 100. Then move stops to 100 after a ClOSE below 127.2 and so on.

Thanks again…i think now i finally got it, how to draw the fibs

[meads797]

[QUOTE=“Forexmike;688549”] Thanks again…i think now i finally got it, how to draw the fibs ;)[/QUOTE]

Yeah Philip, thanks very much for your patience and detailed explanations. I finally understand how to properly trail the stops using Fib retracement/extension. It took a bit of practice and repetition before it was clear to me.

[doughayman]

If we neglect fib extensions. We exit a long position when the following happens:

1. The 20 Ema crosses below the 50 EMA.

2. Stochastic moves to overbought area (80+)

3. Stochastic crosses below its moving average.

As I said since you are testing the system on the stock market, I’d only trade long entries. The idea here is the trend in any stockmarket is always up and this is a trend following system.

I hope this clears it up.

Philip,

Something still not working for me with my model.

On # 3, do the Stochastic crosses have to occur inside the Overbought/Oversold areas, or anywhere after the Stochastics have already moved to the Overbought/Oversold?

Thanks.

[Jalapenofan]

Yes, same from me, thanks for taking the time to explain so nicely a really solid system. Here I leave a pic of the NZDUSD trade:

[PhilipPirrip]

@Jalapenofan

Yes, same from me, thanks for taking the time to explain so nicely a really solid system. Here I leave a pic of the NZDUSD trade:

You should fix your fib though. You have three arrows. The red one in the middle, that’s the high. The 0 level of the fib should be there.

Remember, its the high before the EMA crossover and the low after the crossover.

[doughayman]

You should fix your fib though. You have three arrows. The red one in the middle, that’s the high. The 0 level of the fib should be there.

Remember, its the high before the EMA crossover and the low after the crossover.

I was under the impression that the High and Low were calculated AFTER the crossover; this is not the case, Philip?

[molonist]

I highly recommend buying multiple signals at once or basket trading. look at the results. not only does it increase the probability of positive occurances it also helps one to limit their exposure to a single currency or spread the risk

[molonist]

wow that was poor quality lets try that again

[PhilipPirrip]

I was under the impression that the High and Low were calculated AFTER the crossover; this is not the case, Philip?

No, when short we take the High from before the crossover (the one we set the stop loss above) and the low after the crossover (before stochastic move to the other extreme)

I’ll try to do a post on Fibonacci drawing.

[afz]

This is an example of using multiple timeframe for entry to avoid some false signal. The stoch on H4 crossed a few times, after several attempts it finally go down. Entry is there in H1 charts.

Phile an explaination if this GBPAUD short would help a lot like me

[doughayman]

OK, thanks.

1. So is the converse true then? On a Long the LOW comes from BEFORE the Crossover?

2. Also, for Exiting (other than via Stops), after Stochastics are in opposite Overbought/OverSold area, does subsequent final Stochastic
   Cross (final exiting condition) have to be in the Overbought/Oversold region or can it happen anywhere outside these regions?

Trying to nail these rules down for model, which still aren’t giving expected results.

Thanks again.

[Jalapenofan]

You should fix your fib though. You have three arrows. The red one in the middle, that’s the high. The 0 level of the fib should be there.

Remember, its the high before the EMA crossover and the low after the crossover.

OK! That explains why I thought the 127 was too close to 100, better now, thanks.

[molonist]

Sorry I’m new to this guys… maybe this shows up better