Working Man Asian Session Setup

Hi everyone, the system I’m currently using has landed me over +1100 pips in April and so far I’m up +700 in May. Here’s the basics of the system.

UPDATED 06/08/11
Pair: GBPUSD(seems to be working well with the other major/quick movers)
Time Frame: 1H
Indicators: Megatrend
100 period SMA
Trading Times : 8:00pm Eastern Standard Time

Entry rules for Long:
Go on the weekly chart.
Megatrend must be GREEN
Price must be above 100 SMA
Go to Daily chart
Megatrend must be GREEN
Price must be above 100 SMA
Go to Hourly chart
Draw Fibo lines from the closest swing high from the previous day to the closest swing low. (For Europeans etc just use the beginning of your trading day, to the beginning of the previous day)
Open 2 pending Buy Stop orders at the 50.0 Fibo line.
The Take Profit of the first trade will be Fibo Extension 1, and TP for trade 2 at Fibo Extension 2.
Set the stop loss of both at the 0.0 Fibo level.

Once the TP of trade 1 gets hit, move the Stop Loss of trade 2 to breakeven. I use an EA for this.

Opposite for a sell. Megatrend must be red, price must be below 100SMA on both Weekly and Daily chart. Draw fibo lines on 1H chart from most recent swing low to the next closest swing high. Use the 50.0 fibo level as entry points, and 0.0 level as stop loss.

Note, if the trades don’t get triggered by the start of your new trading day, close them and start new pending orders.
I recommend starting new trades every day, even if you have trades that were triggered and haven’t hit the targets yet.

Here’s a run down of the examples provided.
GBPUSD30m.jpg - Megatrend green, slanting up. Fibos drawn, two pending Buy Stops entered at price 1.6336. Both with a stop loss of 1.6306.
Target 1 = 1.6385
Target 2 = 1.6464

GBPUSD30m2.jpg - Target 1 gets hit 11 hours after the trade is open - or half way through the day. Target 2 gets hit 32 hours after the trade is open.
Net profit for this trade = +177 pips

GBPUSD30m3.jpg - Day two. Target 1 from previous day was hit. Target 2 is still active with a SL set at breakeven.
Everything is still pointing in a LONG direction. Two new pending orders placed at 1.6425. SL for both at 1.6380.
Target 1 = 1.6497
Target 2 = 1.6614

Target 1 hit 7 hours after the trade was placed.
Target 2 hit 7 DAYS after the trade was placed.
Net profit for this day = +261 pips

That’s +438 pips in 2 days of trading. Set up takes 5 minutes a day. Not to mention 2 more successful days after those two.

  • UPDATED *
    I’ve added a template file along with the indicators used. I’ve added the Swing_ZZ indicator, helps with drawing the Fib lines.




30mbreakout.zip (18 KB)

Thanks for sharing, two questions: 1) Do you wait for the Asian open (which for the US means a working man could come home and apply the strategy) and 2) where does one find the Megatrend? Thanks again, d.

Dobro, I sit down at my computer at 8:00pm EST, a few hours into the Asian session. I myself am a working man with young children at home and that’s the first available time for me to hop into the market. If you look at the screen shots, I mark the start of my trading period with a vertical red line which lines up at the 3:00 period. My broker is GMT +2, hence the 3:00 start time. It only takes 5 minutes too to set up the pending orders.

I’ve attached the Mega Trend indicator as well as the EA I use to move my SL to break even for trade #2.
Set the Mega Trend indicator to Period 144 (default) and the method to 1.

Also note, do not trade during choppy periods! I will post a SS of what to avoid in future responses.
I’ll also try posting some clearer pics as well, those nasty jpegs lost a lot of colour and they’re blurry :frowning:

Thanks.

Mega_trend.zip (3.21 KB)

MoveStopExpert.zip (884 Bytes)

Avoid trading on days like these.

Flat Mega-Trend

OR

Choppy market (up and down in a random fashion)

I use 3% of my balance/trade as well. Compound after each successful trade and you’ll see those pips turn into large sums of cash! If you want help figuring out what 3% or 5% of your account is and how to tie it into Lot size, just ask!

Here’s a screen shot of today’s trade (05/15/11). The pending order was placed at 8:00pm EST and was triggered at 9:03pm EST.

Order price = 1.4061 (100 fib line - 4 pips)
Stop loss = 1.4158 x 2(61.8 fib line + 4 pips) = -100 pips x 2 = -200
Target 1 = 1.3918 (161.8 fib line +4 pips) = 143 pips
Target 2 = 1.3682 (261.8 fib line +4 pips) = 379 pips
Reward/Risk ratio = 2.6:1

Will post the results as they occur!

Starting tomorrow I’ll be in the babypips.com chatroom at 8:00pm EST every day (except the occasional Tuesday) if anyone has questions or needs help or would like to discuss improvements to the system!

This one looks good based on the price action alone! Should be a nice trade.

That was another reason why I nabbed this trade. Looking at the 1H and 4H shows a pretty strong down trend. That could be used to filter out some bad trades. Any thoughts?

It appears that it is getting really choppy and expanding exponentially. Hopefully, you don’t get stopped out before it drives downward.

This morning (6:00am) I was sitting at -50 pips x 2, and my other trades hadn’t been triggered yet (I’m testing EURUSD, USDJPY and AUDUSD along with GBPUSD). Still, that’s only 1/2 of my stop loss so it may result in win still once the NY session opened up. I’m at work now so I can’t see how the trades are progressing. This is on the EURUSD pair as well, the first trade I made with this pair to see how it performs.

Only time will tell!

I just did some back testing with this technique on the GBPJPY pair and it looks profitable.
Had I started May 1st, I’d be up 317 pips from May 1 - May 9.
For the month of April, I would have landed 860 pips.
March, however, would have been slightly less profitable, only landing +350 pips. Note: I lost about 300 pips on one trade day at the time of the Japan earthquake, right when prices dipped down bigtime before the Jap banks threw in billions to keep the market up.

On that one trade that lost 300 pips, the price moved about +160 or so pips in our favour, then plummeted. It may be worthwhile in protecting profits, say moving the stop loss to +50 once it hits 100 pips, or even 150 pips. Or on those big trades to move breakeven on both after say 100 pips. Had I followed that, it would have been +658 pips for the month.

Can anyone else suggest a way to protect pips etc? Or to improve upon my method?
Much appreciated!

Well the trade that got triggered last night hit the stop loss, resulting in -200 pips, ouch!
Nonetheless, I set up another EURUSD trade. Chances are this trade won’t be triggered though, looking at the long term down trend in place on the daily charts.


If T1 and T2 get hit, I’m looking at +216 pips.
Stop loss = -45 x 2

Wouldn’t be better to trade asian pairs ie the yen, kiwi,aussie, etc. Yes, the E/$ is probably still the biggest traded pair over a 24 hr period but the smallest market, the Asian, would probably feature currencies favoring that region. Just asking.

That’s the beauty of this system. As it is a breakout system, sometimes the breakout occurs during the UK or the NY sessions. The JPY tends to breakout as you said, during my trading session. Here’s a GBPJPY trade I scooped up last night for a total of +170 pips.

The other 3 trades I have pending (EURGBP, USDCHF and EURUSD) have yet to be triggered and it’s 6:00am for me.

I hope this is what you’re looking for. Has both MQ4 and the EX4.
If this doesn’t work, try googling for it I suppose.

I’ll add a template file to the first post to make it easier for everyone as well.

megatrend.zip (4.11 KB)

Alright folks, I have some pretty interesting data here.
GBPUSD on the 1H time frame.
In April 2011, using modified rules on the 1H time frame produced 9 winning trades, and out of those 9, 4 hit T2. Also to note: 0 losses. None.
+901 pips for the month. This may be a fluke or just a lucky month but I’ll do some more back testing to see if I can validate the info.

Here’s the rules I used:
Long : Megatrend must be GREEN at 8:00pm EST (GMT-5). Set up two pending orders using the highest point of the day. The highest point is from 8:00pm EST the day before to 8:00pm the current day.
Draw fib lines connecting the highest point to the closest swing low. Note: the closest swing low doesn’t necessarily have to be the SwingZZ indicator. The closest swing low may be no where near the what the SwingZZ is connecting to.

Use fib rules according to normal

Opposite for a short : megatrend must be red.

Most of the time, the trade will not get executed. 9 trades in 22 trading days isn’t a lot, but if we can find other pairs that this technique works with then we’ll be cashing in on the long run.

The problem with all indicators is that they lag real time. If you go back with almost any of them, they look very good when backtesting. The real test is if it can be done live. As you know, the megatrend relies on current pricing action and can change color. Just something to keep in mind.

Yup, and of course the colour can change while I’m sleeping/working before the trade gets triggered. Fortunately it seems to be working well as I have been testing and tweaking this method since about January and started on a live account in April.

Here’s another trade that hit T1 from yesterday’s pending orders.

+58 pips. Unfortunately T2 got stopped out at break even. C’est la vie.
I make that +228 pips yesterday added with the +170 from the other trade.

Things were slow today. Only 1 trade was triggered on the EURJPY pair the whole night. No worries, typically you get 7-10 trades per month per pair. Most pairs look choppy at the moment anyhow. I’m expecting a big move soon on most pairs, that’s where this system will really kick in high gear. Keep an eye out for the moves!

Well things sort of picked up this morning a bit. I still have yesterday’s EURJPY trade active, they’re sitting at +45 each this morning. I moved the stop to break even - Another EURJPY trade got triggered and is up +20 each. I moved the stop because if the pair moves against me, I don’t get -4 trades, only -2.

The other 3 trades that were triggered this morning are sitting at +24, +16 and +11. Only time will tell if they hit the T1 or T2. Will post the results with some screen shots.

:18:

Hi Windsflow,

Been going through this thread and wanted to know if you are on any other forum like FFactory. This systerm is simple and can be followed by newbies too. I see it works better on just the Yen pairs right?

I am hooked on this thread and will be testing it out soon. By the way, the EA’s you use, did you write them yourself

The time you mention 8pm EST = GMT-5 I am trying to determine what time that will be in London as I am based in London. To help with that, which part of the world is that as I can easily work with the location please. Sorry for this.

Thanks for sharing this here.