What Really Turned My Trading Around

[shahrin]

1 + 2 - You might want to reread a bit. This is a bit hard to catch initially since all of us are ‘stuck’ into thinking in terms of MT4 timeframes. Let them go. I did mention about this before. I don’t trust the given MT4 timeframes. My timeframes are swing based timeframes that have no relationship to MT4 timeframes. These swings timeframes appear on any MT4 timeframe. The MT4 timeframe merely acts as a function of zoom in/ zoom out, since price is compressed.

Thanks Rel for the respond,
but I wonder why the swing lines looks ok on M1,M5 and M15, but looks pretty short and incomplete on tf H1 and higher… do nt know how to set the indi’s input properly… could see long n bold swing lines on your D1 chart but not on mine…

[Bigbear]

Good. You actually know this in good detail. This is actually one of my secrets! Nice! I do trade in this manner using this context when I see the opportunity.

I look at EURJPY and AUDUSD only. I let my technicals tell me 1st thou. If I see something ‘weird’, like both pairs ranging, I do check EURUSD for a while to see what is really going on. I used to use the xxxUSD + USDxxx method for quite sometime, since USD is the primary currency of the world.

But nowadays I avoid doing that too much, but read it with context of news + market volatility. Its a very useful method, but I find it too manual and difficult for less experienced traders (which is actually a bad sign; even experienced traders want simple methods, not matter how solid the idea/logic is). I think you had seen through the screenshots that I had created various tools to help me ‘lessen the load’.

Then I just focus on the best pair that has the most potential for movement. You should know since all markets are interrelated, one is better off trading only 1-2 instruments. Thats it.

Come to think of it. EURJPY makes sense… JPY is strong and EUR is weak against USD… And the cross of it will give a very trendy move in one direction .

Hmmm… Since i came into this world very recently… There is much of it missing… I am still trying to read markets in terms of news… I did not get when you said using market volatility…
Btw, i have seen your screens… Oh my I got confused to see what the lines are connecting…
I tend to see charts as plain as possible without anything… Trying to get the flow of the market, going with the flow.
Just a weekly/daily snap as to get the current trend & back to 1-5-15-30min charts during trading…

I have around 4 monitors in front of me… So i arrange screens like this, along with DowJones & Commodities.
But i agree with you , that we can trade only 1-2 instruments .

Let me tell you one thing, For this new year, i have decided to close all my trades/positions in +ve. Call me crazy , But It’s a challenge for myself. But to do the same in real account. Account size should be huge though

[shahrin]

Here how it looks on M15 tf… am I drawing it right…

and looks incomplete on D1…

pls comment…thanks Rel.

[Bigbear]

Yeah, initially its confusing. This is because I face a few unusual challenges / ideas :
1- I believe its possible to give me all the information I need on 1 screen. One look, thats it. Then trade. Done.
2- My table and room aren’t too big. Don’t have space for more monitors.
3- I like mulitple timeframe analysis. I’ve seen how effective it is. But it also means having mulitple charts opened OR switching chart timeframes around. Like how you said, ‘weekly/daily snap as to get the current trend & back to 1-5-15-30min charts during trading’. I want to avoid this burden badly.
4- I don’t trust in the standard candlesticks, no matter how good they are, the flaws IMO need to be addressed.
5- I needed a suite of indicators that can do 1,2,3,4 combined. Wow. Yet at the same time be as plain as possible, giving me only what I really need.

Yup, this year will be a challenge for me too in terms of account sizing. I am looking at going up. Its also a good time to do so too, since I got my tools all covered and completed 90%, the rest is about psychology/in my head. It also means a change in lifestyle to suit my careful handling of the increasing equity.

Market Volatility, simply means how fast price/money is moving around + in + out of the market.

In FX, we have many pairs. We measure Pair Volatility 1st. This is easliy done by getting the average daily range for the past 20 days. Get as many as possible. Then gather all the information. One will see that some pairs are skewed with widen ranges most of the time. Some other pairs have their seasons. There are also seasons where none (!!) of the pairs are moving enough.

Think about it like a drop of water on still water.

Rel,

If you can understand and read the markets, one look is all you need to put on a trade. I am still a amateur, Who has not gone through all the stages. Acting hyper, If you should call me
Have given much thought for “trust” in candlesticks… someday looking forward from you to see what the flaws in candlesticks are
I really liked your way of analysis. You know like the re-tracement in terms of pips… I have been trying to do all these visually. But with your way , its actually comfortable. But i havent tried any of the indicators you have put here yet… Will do it sometime and let you know how i feel.

All the best, How your challege works out for you… Would love to know the progress.
Cheers!

[shahrin]

I have played around the setting…
I changed the wave 2 setting to …extractcandlefromtf2= 1, noofcndlepercc2=300.
Is this called as H5 swing on the bold lines?..hope I got it right.
What is 'CC2" stands for?..thanks Rel

[Bigbear]

Relativity,

I am thinking small correction till 1585 levels… And up move…

[QUOTE=Relativity;308395]A closer look.

[Bigbear]

I may be wrong but, Its too soon for that much correction… Till 1560/1530.
And the number of trapped traders are also less, for a swift kind of down move… Path of least resistance is up.

Let’s see how it turns out. We will get to know once dow Jones opens.

[Aztrader2]

Hi Rel…

apart from the fact I’m totally lost… (I still haven’t understood how & when enter a trade, because you said not each break of a channel is good. Many times, price makes fake breaks also if longer TFs channels are far from them, i.e. there are no major trendlines to make price stop there. Yesterday we had a break of Upper Daily channel of EU, but It was too early for me (asian session) and I didn’t know how to enter. I made a long @ the break of previous 15 min swing around London open but made few pips, because price stopped there for long time… then, it shooted up again…)

I see in your charts some trendlines not drawn on the Barros swings… how do you draw them…?

[Aztrader2]

You have to define what is a fake break. Seems that your definition of a fake break is not what I see.

Post charts. There is no other better way to learn other than posting charts.

Those are trendlines drawn off Barros Swings. Just smaller swing TF thats all.

Hi rel, in that chart I was not identifiing a fake break… just didn’t saw thinner lines of Barros swing…

Here are some examples of what I call “Fake Breaks of the channels”.

In this case we have 2 Fake breaks. Expecially the first one had all the characters of a good break (>20 pis from daily high, break of the high of breaking candle). And, also if I didn’t draw it here & you don’t want me to use… , the daily high bounced from 78.6 fibo of previous daily down swing. Infact, price didn’t made much more way up before plummeting down (see next image)…

Here is another example. Plz don’t take care of white horiz. lines…

Both charts are of EU 15 min Tf and Barros swing set@ 15 Min & 5H swings.

[Aztrader2]

I need to see your higher timeframe charts before making a better conclusion.

Here is it: Green Arrow is First image in my previous post / Red Arrow is second image. Weekly Channel is not visible (so, there’s plenty of space above & below and actually doesn’t affects price movements, apart from general down direction).

[Aztrader2]

No, I don’t see it:
First: price broke daily channel (contracting)>UP
Second: price (as usually) retraces toward the broken trendline… but made it after the fake break of my first image. So, there wasn’t anything against the decision to go short @ the first break of 15 min channel… or if there was something, why after few pips up, price went short heavily? It made it just to catch Stop Losses…:33:
Third (second image): price went down (as usual) to previous channel and bounced up from it and made a break of 15 min channel. So, why not to go long there?

Now I have some question wich arises from these two charts: Price broke a contracting daily channel… but went back into the channel (Actually still didn’t broke the low of the old channel). Was it a valid break (about 90 pips)? If not, how can we know if & when is a true break?

[Aztrader2]

This is my chart: why trendlines are wrong?

[Aztrader2]

Squeeze completed on M15 swing. Long.

The completion of squeeze concides with price moving 20 pips off extreme. (!!!)

What is squeeze?

[shahrin]

What do you see?

It’s a candlestick formation…so called railway tracks?..just guessing…

[Aztrader2]

Always ignore the current wave, regardless if the channel is broken or not…

Sorry for late reply, but had tech issues with my Internet connection…:mad:

So, if I understand well, I “MUST” ignore current wave…? OK, but, if it breaks channel, what have I to do then? Must I wait for a retracement @ break level (but that was the case in my previous 2nd image and didn’t worked). Or must I wait for a break (low) of the new swing wich is going to be? Or another bounce in new formed donward channel (See Image)?

[Aztrader2]

Nope, look at how the lines tell us something big is going to happen. When price squeezes like that, it wants to get out, so just pick your direction.

I went short, but I got my SL nicked. Damn… having my off days. I was up 1:1 earlier. Maybe I shouldn’t try to trade bubbles at all.

So if thats the case, the adjusted overall trading plan is to watch AUDUSD / EURJPY / EURUSD / Gold / CrudeOil. Then forget those that already have bubbles.

There must be a typo: in your post #161 You said You went long…

[Aztrader2]

Ah thats clearer. #1 and #3 are ideals. #2 is possible.

Ignore the current wave when drawing the lines. Then after drawing, observe that wave.

Yes… it’s clearer now…

Some hints to better identify entries @ point #1 & #3? (Mainly @ #1, because in the second case we have a new downward trendline which helps us). We wait for a bounce from old trendline and break of the low of a candle or so?
If price doesn’t reach old trendline (sometimes prices moves strongly in the breaking leg and doesn’t retraces too much), can we use a break of a lower TF ascending (retracing) channel or just a swing?

[Aztrader2]

You made me realized what is ‘wrong’ with my methodology.

If you look at my last 2 trades, I could had taken profit but I didn’t. It later became a loss. I thought I was using the indicator, but careful thinking and reflecting through it, I wasn’t! I was still relying on my experience. So what went ‘wrong’?

I went through my trading logs again to see what did I do right and wrong. Turns out that my last 2 trades are actually correct, but I failed to spot something on a tangible level : inside swings. These inside swings affect how trendlines are drawn. I need to account for this; I had thought about this problem before, but never found a indicator based solution to measure it correctly. Now is a good time!

I found out that I trade with the indicator successfully when price is symmetrical. When price is not symmetrical, I fall back to experience and have losing streaks. This is bad. But thank goodness my winning streaks make up the losses. Still, if I can improve my bottom line, why not?

The inside swings are making price less symmetrical. The solution is to make trendlines that account for both symmetrical and non-symmetrical price swings. My current indicator only does the former, not the latter.

I also have to trust my statistics more than ever before. So if I really read into them further (wow, never really went to this stage), this means my primary trading tools now boil down to :

1- M15 + H5 MTF Barros Swings
2- M15 + H5 MTF Trendlines that account for inside swings
3- GMMA modified to capture H5 swings

Thats it. I say this is enough to capture 20 to 60 pips daily, provided the entries are precise. I say this based off experience + statistics. The rest of the tools are for perspective, but will do away with them for now (not to confuse you! lol)

We already have 1.
2 and 3 I will code them when I get home.

If you are having a hard time, this means I am doing something wrong. Please pardon me for my faults! I have to map my experience into the indicators more than ever before.

I believe I finally got it. Its not as hard as I thought previously.

Glad to have been useful to help you discover some bugs in your methodology. At least, I 'm giving you back 1% of what you’re giving to me…
Anyway, we never stop learning. Knoweledge is endless. We learn something, try, make mistakes, learn again from experience and improve ourselves… Then we make new mistakes or learn/discover something new… and process goes on…

What do you mean for “inside swings” ? Those of lower TFs respect M15/H5?

[shahrin]

I also have to trust my statistics more than ever before. So if I really read into them further (wow, never really went to this stage), this means my primary trading tools now boil down to :

1- M15 + H5 MTF Barros Swings
2- M15 + H5 MTF Trendlines that account for inside swings
3- GMMA modified to capture H5 swings

Pardon me, what is GMMA? sorry to interrupt…sort of moving average?

[Aztrader2]

Mhhhh, very nice…
Did you already got it, or those yellow lines are a Linear Regression Channel?