Well I’ve mashed it around in my head a few dozen times, and it seems you are right AK. He is NOT adjusting for EDT, and just calculating his pivots on New York standard time all year round. What I am trying to grasp then is where my London Open kill zone goes wrong.
According to Clint’s calculations, London opens at 8am in London, 2am in New York, and 4pm with me in Tokyo. ICT says he monitors 2am-4am NY time, so that would be 8am-10am in London. This means the kill zone starts dead on London Open, and runs for the first 2 hours of the session. It was my prior understanding that we were monitoring an hour either side of London Open, with the crosshairs trained directly on the open. It now seems that the crosshairs are aimed at an hour after the open, but could come on the Open or two hours after the Open. This actually makes more sense to me.
The thing I can’t get my head around is the fact that he doesn’t alter the pivots all year round, but he must have to alter the kill zone. If he didn’t alter the kill zone then he would be out of sync with the big boys. Why take the trouble to recalculate kill zone and then not bother with pivots too? Maybe it was a mistake, or maybe just a force of habit to always alter his pivots +5.
Well, thanks for everyone’s help. It certainly clears up the mystery of why I was seeing lows up to an hour after kill zone - that right there should have been my wake up call :56:
I agree with you. Michael (ICT) has mentioned that there is not much difference (as far as his methods are concerned) between his [B]midnight New York pivots[/B] and [B]midnight London pivots[/B] — which are 5 hours out of sync with each other.
In fact, [B]7 hours[/B] doesn’t make a significant difference.
I use the end of the business day in New York (5pm New York time) as the start of a new “forex day” (because I have always done it that way), so that’s the time that I calculate my daily pivots.
This means that my pivots are 7 hours out of sync with Michael’s pivots. Still, I can use my pivots together with Michael’s methodology, and trade successfully.
I’ve tried to figure out how this can be — and the only theory I can come up with is that, when there is a difference of more than just a few pips between these different pivot systems, the smart money that moves the forex market tends to respect the [B]zones[/B] between them, rather than pinpointing exact pivot levels.
Whether that theory has any merit or not, the fact remains that you can be a little lax about the time of day that you calculate your pivots.
But, the same cannot be said about the “kill zones”. You need to get those right, based on your time zone. And then, you need to be careful to make the appropriate adjustments when London and New York go onto, or off of, daylight saving time.
Which is where my kill zones were originally! But if you look at my screenshot of the ‘Z’ day again, and then compare it with the video, there is discrepancy wouldn’t you agree?
Thanks Ali! Grad hasn’t even started and I’m already hung over! =P
And sure does! I will be trading as of next week, 3 hours during LO and 3 hours duing LC. NY Open is 5am here, so I’m still going to have to avoid that one. I’m going to really practise during summer and dedicate the majority of my time doing this. I just recently got a scholarship of around 5K, which luckily, goes directly into my bank account, so who knows? If I am seeing some consistent gains, I will deposit that. (Rest assured though, I have other scholarships which will pay off the majority of my fees! )
And even during university, as I’ve already applied for my courses, first year will be quite relaxed, about 90mins of classes daily… So I will probably be trading “full-time” as well. At least that’s the hope!
Good luck to everybody! I’m seeing more avatars, that’s awesome! Really like yours, Ali, what is it??
I have recreated your May 19 EUR/USD 5-minute chart, and I now see SOME of the problem you are having. I will post a chart a little later, along with an email conversation I had with Michael (back in early April) about the kill-zones.
Alishijo - Try changing the clock on your computer to your broker’s local time. I was having issues with my platform not calculating pivots as I wanted it to, even though everything was set to my local time. Switched it over to my broker’s local time and everything works fine now. Using TradeStation, not MT4, but still might be worth a shot. I was getting pretty frustrated for a while.
It seems like they are throwing money at you, Clark! Just don’t go and throw it to those sneaky FX professionals.
My avatar…it’s Bob Dylan. Everyone needs a trading buddy, and he is there to keep me company at 1am when everyone else is in bed. I bet those big banker dudes don’t get to crank up the tunes and sing to their charts:D
Took a London Close scalp on Cable. Trading with a 0.4 lot. TP1/0.1 was taken at the swing I keyed off. TP2/0.1 was taken at 127% extension. SL/0.2 taken as it came back up to BE. Would still be in the trade if I had not factored in the spread on the SL BE, but that wouldn’t have been true BE. Overall I am happy with my new risk control management, and happy to have broken the 4 trade losing streak for London Close trades.
EDIT: Actually now starting to second guess the way I took profits on the scalp. I think I am holding too much back for the more extreme ‘38% of the daily pip value’ level. Think it might be better to take 50% at the swing I am keying off, a further 25% off at 127%, and leave 25% for the last 38% retrace level. The worry is that just one loss will wipe out 2 trades like tonight’s, and that really ISN’T good. Any ideas, folks?
Here is my 5-minute chart of the EUR/USD for May 19, showing the 3 kill-zones. The rectangles are the three 2-hour “kill-zones”. The dotted lines represent the “cross-hairs”.
As you can see, I agree with your London Open kill-zone, and I agree with Michael’s London Close kill-zone. But, my New York Open kill-zone is different from both yours and Michael’s.
In early April, I had a conversation via PM with Michael about putting together a time-conversion table to show the kill-zones in various time zones.
Here is a portion of one of Michael’s replies —
Clint:
Thank you for your feedback and it means a lot to me…
Let me see what you have on the time chart given what is noted above…
Include a field or area that incorporates the hour buffer before and after the targeted Kill Zones. Essentially, they can be as much as 4 hours but typically 3 hours or less… with the cream of the crop setups forming at the windows addressed above. This is my answer to news, Daylight Savings, Market Volatility and plain ole’ just in case.
I think the disagreement between your kill-zones, my kill-zones and Michael’s kill-zones may be due to the fact that the overall zones — the “buffers”, as Michael calls them — can vary in width from 2 hours to 4 hours.
Here’s what everyone can agree on:
The London Open is 3am (NY time), the New York Open is 8am (NY time), and the London Close is noon (NY time). These times are the “cross-hairs”. The kill-zones are centered on these times.
We look for set-ups in the period beginning 1-2 hours before the “cross-hairs” and ending 1-2 hours after the “cross-hairs”.
So maybe London Open needs to be a 3 hour kill zone from 2am to 5am NY time.
I realize that my NY Open is really short at just one hour, but I am sure that ICT originally said that in order to avoid the main news, we should be looking to trade after 8:30am NY time. He also said on that first London Close video that LC trade could set up anywhere from 10am to 1pm NY time…a 3 hour window. I definitely remember him saying ‘don’t be concerned with the long time frame…’.
I don’t actually have any problems with the London Close because I have seen enough positive results with those times not to be concerned. There aren’t too many trades that come in the first hour (there are some!), but there are quite a few that come in the minute it turns 11am in NY.
Well, my brain is done for the day. What I do know is that it is nearly 3am here, and it has been a looooong day. Thank-you again for all of your insights.
For future reference, the swing needs to be at least 20% of the daily pip value to meet entry requirements. 38% retracement of the daily pip value is a take profit level after entry. I am sure it will become clearer when ICT presents the long awaited London Close tactics.
Once I can post pictures on the forum (finally just a few posts away) I’ll show you what I was looking at. I had set my fibs at a longer term price with a low at 10:00 and a high at 10:30 (EST) on my 15 min chart. I see the trade setup you used had the high from 10:30 but used the low at 10:45.
There were actually overlapping fibs right around the OTE using both of those timeframes, so it actually gave a stronger signal if I would have seen where you placed your low.
Currently in a demo trade on the EU, short at 1.4117 (OTE) so going to see how it pans out.
Took the same one. Missed my TP at the 1.27 ext by the spread. Exited manually at 1.6179.
As for having your losing trades wipe out your winning trades, why not aim to take full profit at 1R? Your winning percentage should give you enough confidence to exit all scalp trades at 1R instead of scaling out.
Go over all your london close trades and recalculate what your profits would have been if you had not scaled your position, and instead, exited the whole position at your TP. You may be surprised at the results.
I agree with you. On a personal experience, I’m having better results aiming for smaller profits (30-50 pips) than going for the big one or scaling out.
Overall my results are just a little bit higher, not an overwhelming difference, but my win% is higher and psychologically that has helped A LOT.
I’d like to know the experience of other members as to how they manage their trades and how this has been affecting their results.
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