I’ve been using the MT4 strategy tester with my new Expert Adviser. Something very interesting that my coder put in without being asked (it can be switched off) is an emergency stop if price crosses the 200 SMA. It ignores just one bar that crosses to the wrong side but if more bars go over it closes all trades if 2 of 3 bars close on the wrong side. No idea if this is useful, but we shall see.
Hey. How’re you doing.
As I understand it that’s exactly the way the as advertised system works. I THINK anyway. Sir Connors is not specific about this. The way I sort of understood things was that if you were in a trade or even in a partial trade and price closed above or below the SMA then you’d not scale in any further and just let the trade run. Not sure. That’s how I did it when I started out this time again this year anyway and it worked a treat. Many times I’ve seen it happen where price has traded and closed above or below the SMA only to reverse and go back above or below (matter of fact this has happened this past week already). I actually am not sure which is best. But you seem to have the tools and and edge now so maybe you can fill me in.
This SMA is a funny thing though. As things stand right now I should not even be short those two positions right now. But then when I start obeying it then the next thing I miss trades. It’s weird. I don’t actually have the answer to it. At the moment I’m ignoring the SMA in lieu of having mental (fixed) stops. But if you asked me TODAY I’d say do NOT ignore the SMA. But if you asked me next week I’d say don’t bother with it. If that makes any sense.
Would tend to agree with this. This doesn’t reflect on @GilasTrading it’s reflection of the the inability of most new traders to discern what’s needed to achieve the ability to perform consistently and how quick and expensive lessons through losses can be.
It happened to me when I was trading options years ago.
They see what they want to see and know “it won’t happen to them” because they are “different”! 
KC
Yes. That’s why I always said I’ve spent over 8000 hours studying, charting and trading the past 2 years and 4 months. But what I’ve never said before is I spent another 5000 studying, charting and trading Philippine stocks 
I also say I’ve lost over $30K and blown up a dozen accounts, literally. But people tend to gloss over those statements and prefer to think I have some holy grail indicator or something.
It’s almost like a rite of passage sad to say…
Everybody, myself included, thinks they’re the ones it won’t happen to starting out.
“Not me! I’m the exception!”. 
I read an Interesting book called How to Start an Investment Company With $500.
Of course the author knows this can’t be done.
It speaks to what to do and what to expect starting out in forex. Talked about starting out in a micro account. Talks about getting your mind straight in terms of losing in winning trades. Has great exercise in the beginning to help with all of this.
I think it’s a great starter for short money.
MHO, YMMV & no affiliation. I am not selling or endorsing anyting,. Blah blah blah and all that other crap.
KC
Good morning. And ■■■■ it!!! When am I going to learn!!!
This trading system NEVER let’s me down. But what do I do the other day?? Out of sheer impatience I close out Hong Kong at a small profit because it was just hanging around and going nowhere. And just LOOK what happens of course!!!
By the way @Spudfan: this a classic example of what we were talking about yesterday or over the weekend. I was long a portion already when Hong Kong started trading below the 200-day SMA. Price hung around below the SMA. And, well, the rest is history as they say. This being said: I’d like to come up with a clearly defined rule and that doesn’t get chopped and change on a whim. Will post about this a little later.
Hong Kong 50
This is kind of perfection. This is not real trades, just a reconstruction by the strategy tester. Each vertical red line marks the closure point of 1, 2 or more trades. If you look closely you might see dotted blue lines for each of the trades placed. If only all trading were this easy.
Very nice. I do see the blue lines. As I say: very nice.
Well. With this system trading certainly doesn’t need to be difficult let’s face it. Kinda been my point to others really. Deaf ears though. Deaf ears.
Because it isn’t … This represents 9.7% loss on the account.
Hence calculating your position sizes based on that info. above and incorporating a hard or fixed (mental) stop!!! LOL!!!
Were you saying something?
That is a great tool - open/close trade lines. I have found it very helpful in analyzing closed positions. Thanks for posting @Spudfan
Not at all, I’m hearing you. But the only way I know to respond is to test multiple options by means of the strategy tester
I wasn’t referring to you!!! LOL!!!
You and are the only two working this system which befuddles me somewhat. Seems to me that even if you and I were making 100% per day with this we would still be the only two.
From where I sit and just looking around at the various things going on around the forums: it’s the only active one that makes money and that does not rely on copious amounts of conjecture and massive amounts of interpretation.
I could be the third musketeer in the future because I’m looking in this system deeper now - I have the book too by Connors for this system thanks to you dpaterso.
Hello. And WELCOME Third Musketeer!!! LOL!!!
Well: if I can help with anything let me know. Glad to.
Well that’s pretty much me for today I guess.
Was hoping to get some short signals on Oil but no luck today. I’m now ignoring any tier 0 trades (those 1-day or first day signals) i.e. I don’t have the luxury of being able to add five times (if required) to a position anymore unfortunately. Not worth the risk for me right now.
Took profit on Gold this morning. Was still a valid short trade and I’ve not even looked at it again today. But I never scale-in on Friday night because I was nervous about these two over sized positions that I have in error. So I figured well just close it out for a box of cigarettes and have done with it. Suppose I’ll be mighty pissed if it tanks for the next few months like it did last year at pretty much this exact time hey!!! LOL!!!
Have scaled-in further to my S&P and Dow shorts. Still valid trades. Just too big. But hell: I’ve come this far. Of course: much fewer trades now on other instruments. I’m now kind of employing the logic that under normal circumstances my total risk across all instruments at any one given time could be as high as 50%. So I’m just saying that on these two positions my fixed mental stop will simply be increased proportionately i.e. the total risk overall on the account is the same just with two or three trades. And given that they almost always turn to profit (hope I don’t live to regret THAT statement) well I’m not too concerned. Will probably be singing a very different tune if these things go pear shaped obviously.
So yeh. That’s about it for today.
Oh. Nearly forgot. Full disclosure.
Short the following but with CORRECT lot sizes again (no mistakes):
NASDAQ. Tier 1.
FTSE. Tier 1.
Australia. Tier 1. (Wasn’t going to trade Australia again but I’ll take what I can get at this point).
Pending orders:
Short Euro Stoxx 50. Tier 1 and Tier 2 (late entry).
Short CAC40. Tier 1 and Tier 2 (late entry).
Short Nikkei225. Tier 1 and Tier 2 (late entry).
Short NASDAQ. Tier 2.
Short DAX. Tier 1.
Theoretically: should have gone in at market on all of the above just before the close. But today a weird day because of the opening gaps. So decided to use pending orders instead to try and get into the trades at better prices. All pending orders placed as close as possible (above) today’s closing prices as allowed after hours. Point is: because of the gaps and on the other open positions I used entry limit orders place at the opening prices of this morning’s bars so got in at much better prices than had I gone in at market on Friday. Also has resulted in not having to scale-in further on the Dow and the S&P because price obtained this morning far better than the close today so if I did scale-in again I’d be worsening the price.
Would love to short Spain. Alas. Due to minimum position size and maximum risk allowed on my pathetic account: no can do.
P.S.
By the way (and it has no bearing on this trading system but I just mention it for the sake of interest): these last few up days do not appear to be supported by volume. For what that’s worth I guess. I don’t know really. Seen it many times where prices are going up but volume is going down. Sometimes: prices will tank. But other times (normally when these algos. jump in because of some or the other programmed parameters e.g. prices have moved up three days so go long type of thing) the volume starts picking up and then drives the prices higher. Anyway. Just an observation. Those that are VSA experts would know far more about this than me. Just thought it interesting to observe.
Let me just qualify the above though:
Volume was dropping while price was going up last week except on Friday when volume increased and then fell again today. I mention this because you must look at PROPER volume (even Yahoo Finance will do). It you look at the your average MT4 chart it’s deceiving and incorrect. And but ONE of the many reasons why I always jump in when somebody is looking at volume but not at a proper broker. The volume you see on your average MT4 screen is meaningless in my opinion and in some cases simply reflects volume being traded by traders at the brokerage. And given that most lose: that’s a pretty slippery slope I’d say. There is a GOOD reason why professional traders subscribe to professional charting packages and pay exchange fees just to get this information. Why your average retail trader figures they’re getting this all for nothing in MT4 is beyond me. And it gets even worse (even less meaning) for FOREX.
And now that I’ve probably pissed off some more budding retail FOREX millionaires (more than once today probably): it is DEFINITELY time for bed!!! LOL!!!
I’m still up. This is what happens when you nap late in the afternoon.
Was just reading through this thread from the beginning. Seems like a flipping lifetime ago that I started it. Been only a month or so. Found it funny that I said I’d follow the first few trades through and be done with the thread. So much for that!!! LOL!!! HOWEVER: there has been a LOT of good that’s come out of this. I have to say I am now very confident when it comes to correct risk based position sizing and the implementation of fixed hard (mental) stops. Unfortunately it’s become very clear to me though: in order to do this right there’s no point in even thinking about trading this if you don’t have a BARE MINIMUM of $20K USD (or a spread betting account where all price quotes are in the same currency as that of your base currency and are not converted). And the reason for this has nothing at all to do with leverage but everything to do with being able to manage risk correctly. It simply is what it is. Try this with a couple of hundred $$$ and you may as well just give me the money toward my rent. Simple as that. And as blunt as that. BUT: for those fortunate enough to be able to trade with those types of amounts there is no doubt you’ll make money and which should be in the region of between 5% to 10% per month on average over a year.
Anyway. I think I’m pretty close to detailing the entire system but this to include position sizing and risk management (which is sadly lacking from the as advertised system and I can already see what a big difference correct position sizing makes and how it is in harmony with risking a fixed percentage of your account per trade). The as advertised system has worked just fine for me over the years. But I can tell you that I’ve just been very lucky to have not ended up on the wrong side of some of those dreadful trends that have developed when you’re already in a position and price hasn’t stopped and looked back not even for an instant. It really has been pure luck on my part that this has not happened to me. But the introduction of risk based position sizing and hard stops??? Keys to the kingdom for this system I believe. And to put it in perspective: at the time of my momentous Gold trade last year I had R100K in the account at the time. I would have lost R5K on that trade. NOT R70K!!! And if that’s not proof enough of concept then I don’t know what is.
I also see two versions of this. One higher risk and one more conservative. Should not be an issue to document. So I guess I will get to it in the coming days.
I am also going to update my CFD Position Size Calculator software this now to include risk based position sizing. Hopefully I get this done before time runs out!!!
I am going to go out on a limb here and ask for a favor:
If you’ve read this thread you will know the predicament that I’ve ended up in. And there is no guarantee at this time anymore that it’s temporary. So at the risk of embarrassing and degrading myself and coming across as no better than a beggar: I would ask that if you do trade this system and you do make some money out of it that you at least think of me. On what basis and how much is up to you. Nothing I can hold anybody to. No agreements. No contracts. Just goodwill and maybe on a pay it forward basis is all. Whether you do or you don’t: I will still do my utmost to support you and anybody else and maintain this thread and the system for as long as I can hold on.
Later.
(Hey. That’s neat. Three asterisks gives you a separating line in a post!!! LOL!!! Believe it or not just found that out by accident i.e. not purely to highlight my plight above!!! LOL!!!).
Thanks for sharing this.
Really is my pleasure.
Was something I wanted to do anyway in a few months time. Just never realized I’d be doing it now is all.
I honestly believe it’s the way to go. The system itself has not let me down in five years (subject to my warning re: stops in my previous message), So I feel pretty good about going out on a limb here with it. And I reckon for the serious trader and who has proper capital: this is good. Not by any means in the +100% per day category that’s for sure. But it is what it is. And I’ve learned the hard way since 2005 I can tell you. I’d rather have 5% or whatever per month consistently over time than quadruple a trading account in one month only to lose it and more monthly for the next eleven months of a year.
