This looks good to me. The important thing is you will probably not find you are tempted to be long when you should be short or vice versa.
Two too many indicators for my preference but each to their own, in a good strategy they help: they are only a real handicap if misused or used in the wrong strategy. Like putting gravy on a fruit dish.
GBP has been very negative across all 7 significant GBP pairs for weeks so good results from a strongly downtrending currency are very encouraging. Yes, do develop something like the SWA that Dennis uses: it generates some trades but equally helpful it forces you to justify why you want to be long currency XYZ when all the other XYZ pairs are bearish.
Sorry but I’m unable to tell YOU IN PARTICULAR what you want to hear.
I know you may think I’m joking with you all of the the time but I"m not. YOU have NO excuse for NOT opening a Futures account with TradeStation. I keep telling you this but for some reason you’re hell bent on this retail spot FOREX thing. I really don’t get it. You’ve got enough capital (that’s my deduction anyway) to be able to trade the new E-micro Futures (and I’ve given you enough links on this) and you’re in the very fortunate position that you are in the US and can open a trading account with arguably one of the finest brokerages on the planet and not to mention the finest trading platform on the planet (and unlike me the cost of the platform and data feeds are included if you have a trading account with TradeStation and that’s valued at around $150 US per month). A person can make a good living trading JUST the four E-micro Dow, S&P, NASDAQ, and Russell 2000. Well maybe not a living with them or with semi-limited capital but for sure could make enough to move the the bigger contracts eventually.
Anyway. All personal choice I guess. But c’mon. So far as I can tell (deduction once again) you’re not of one these underfunded $100 wanna-get-rich-quick-in-a-month dudes as you don’t need to even attempt that I don’t think. Learn to trade proper and with the pros. I’m telling you that you will not be sorry. And even if it’s not deemed as trading with the pros. I can tell you that it is MUCH easier to make money this way than trying to make money in this ostensibly random market. Matter of fact: a good friend of mine, just this morning, sent me an article about something else but in the article the author describes the spot FOREX market to an absolute “T” (and actually it was a FOREX related article so not coming from somebody who has issues with retail spot FOREX like me). Will find it now and tack it onto the end of this post.
As for your chart:
For one thing seems like you could probably just use that MA that changes color (black and white) and do away with the rest to be honest i.e. so far as I can tell the end result will be the same give or take. I of course assume that MA repaints so you’d have to wait for a close. And second: just bear in mind that you’re looking at a pair that for some reason has trended in one direction or another on that particular chart. Find something with “chop” and then see how this holds up and I think you’re going to be miserable with the result.
Here. Now admittedly the article is about volume in the FOREX market but if you forget that for a minute the rest of the quote sums up the retail spot FOREX market perfectly.
“Unlike futures trading, one of the challenges of trading spot forex is its opaque and fragmented nature, with no exchange or central entity facilitating a transparent volume representation. Trading activity via banks, financial institutions, hedge funds, asset managers, individual traders around the clock makes it incredibly difficult to track the real-time aggregated volume coming through the books. Because of this wrongly assumed limitation, many traders have led to believe that volume activity is therefore not available.”
For what’s it’s worth I’m going to start a thread today re: volume, Bill Williams’ MFI, and hope for some VSA contributions. Long story but watch out for it.
That is where I would like to get to but right now I don’t have the money. I’m not a seasoned trader like yourself or TWB and Tommor. and Manxx.
I agree that I am not a $100 acount with million dollar dreams. I take trading seriously and I am always trying to improve. I believe that I have the tenacity, disposition and perserverance to succeed. It may take me longer - I’m more like a mega tanker slow with a huge amount of force and not a cigarette racer - There is no way I could try to trade other folks money and for the the low cost of initial entry for actual money trades forex is my only choice. I’m not in dire straights… yet!!.. but my money I can lose fund has been decimated years ago.
So unfortunately - or maybe not I have to start with forex based minimum openning balance and margin requirments.
So know that I hear you I’m just not there yet financially.
At least you seem to have whittled your number of indicators down to what I would call an absolute maximum. You could probably still carve away some more in time,
I think the key thing here regarding entries is that you have to decide the priorities you are applying to each of the signal generators. I.e. one main indicator provides the signal and then look to the others for confluence. If you only act when all are saying the same thing then it might sometimes get a little confusing what to believe.
But, like with all methods, the key to its prosperity lies more in the exit part of the strategy rather than the entry - and that is an area that gets surprisingly little attention.
The other key area is the policy regarding position sizing and possibly scaling in and out. A consistent, disciplined and gradual expansion of risk and money management will provide the growth if the method is also consistent over time.
I appreciate @dpaterso’s view of forex trading, but I do not share it. ONe can see trends in currency pairs as much as in commodities and indexes. It is just a matter of finding the right gloves to wear…
I cannot comment specifically about ADX or stochastics as I have never used them. But I see no reason why your MA basis should not be productive - if you get an exit strategy to work with it.
I thought the same thing, but of course, any MA structure will “look good” at certain times - and then play hell with whipsawing in a drifty market going nowhere.
My own view is that any collection of indicators will have the same “achilles heel”: They are all based on mathematical formulas and would work fine and consistently if market prices always moved in the same flows, paces and patterns - but that is not the case, as we know!
So any combination of indicators is inevitably designed for a specific “template” of price movement characteristics. When price movements fall into that pattern then all things are fine - but when they don’t, well it is not going to work at all well during that phase. This is why I think there is always a need for personal discretion and experience in deciding when to act and when to stay out.
I’ve done a lot of back testing… manually… And I’m pretty much in the same boat. However, adx seems to give me some needed insight as to strength of moves or developing strengths of moves.
Trading with pending orders gives you great relieve and it is much easier especially if you are not looking constantly markets. It prevent burnouts and many other issues, but again trading without stop loss even with low to no leverage is a risk you are going to take. Trading real account is totally different than DEMO!!! I can assure you will feel this and when the pain is bigger you will eventually take wrong decisions. That’s why best is to practice on live account and learn how to manage not only your trades but your emotions as well!
Just finished the Consistent Trader by Sam Eder - I liked it. Some great intell.
Thanks @MikeWolski for mentioning it in his journal!
Less losing. That’s where winning resides. It sounds so simple that it should be dismissed. My winners can run and do well. My idea of waiting out losers with drawdown doesn’t work for me. Perhaps it would if I had very consistent/proper entries … but I don’t at this point.
SL’s must be embraced and I will follow the idea if it’s close to 50% to SL I will close due to the likelihood - which is an interesting word looking at it on the page - of turning around is minimal. I picked this idea up from either @tommor or @anon46773462. Thanks!
It’s just makes sense. It’s such a simple concept. If my winners are in the higher double and lower triple digits, cutting losers short is a no brainer. So why haven’t I done it?!! Oh yeah - I’m wicked smaht!!
It’s amazing how far down the rabbit hole I have gone!!
I truly believe - and this could be the “red pill” talking! - if I implement prudent SLs, and let winners run based on strategy discussed in this thread, trade the daily chart based on weekly trend, trading in a vacuum could be profitable. Ignore news, ignore all the “systems”, keep winners open, close losers, trade the chart.
Edit: just reread last line and It sounds like a game!
Openned an account with IG US. Will be funding shortly.
Started analyzing trades using I Plotter. It’s a free tool in the Scripts section of the terminal. Similar to the tool in mt4 but it tells you the number of pips you made or lost.
I’m going to go through my biggest winners biggest losers and then take a section out of The middle as there are just too many trades to completely analyze manually.
The last line speaks to the need of keeping a journal for each trade. Doing so I may have improved on the way.
I will compare the entries and exits of the trades in addition to length of hold as my strategy developed over the course of this journal
On a quick glance I’ve held trades too Long based on no stop loss strategy and holding it until it comes back into profit.
for me this is a very poor strategy.
It also shows the true mental head game that I am … perhaps many of us … do is think we’re followng a strategy when in actuality we aren’t.
I would have sworn I was entering on certain triggers and it was far from it
A number of trades where entered into during the day when I’m supposed to be trading the close of New York session daily chart this would mean all my trade should be at the end of the day 5 Eastern standard Time or within an hour or two around that point. They we’re all over the place.
- There is no way I could try to trade other folks money and for the the low cost of initial entry for actual money trades forex is my only choice. I’m not in dire straights… yet!!.. but my money I can lose fund has been decimated years ago.
