GBP/USD 123's

[Pipmaster1]

The 4 hr 123 isn't looking too bad!

 

[Pipmaster1]

Hey Headless Chook

Price does some crazy things sometimes. That 4 hr 123 came down and hit my first limit, giving me a profit of 3.2%. Price then hit the #2 price to the pip (1.5079). So the #2 point was not broke. If the rest of order gets stopped out it'll only be a loss of 2.13%, giving me a net profit of 1.07%. Its not a lot but it is a profit, and its a profit on a formation that fell apart. If price hits my limit the Net profit will be 9.3%.

 

[Pipmaster1]

well price continued up and stopped me out. So this trade only profited 3.44%. On to the next 123. :rambo:

 

[Pipmaster1]

That 4 hr 123 trade bumped up my record up a little bit. I would like to see another trade this month, but we'll see.

 

[Pipmaster1]

That FIB Sequence chart is pretty cool. Perhaps its time for price to move down again? After seeing a move like this I'll be looking for some profit taking which would be a small retrace and could possibly form a #2 point. I'll be watch price as it moves towards the 40 EMA.

 

[Pipmaster1]

Look at this 30 min 123 that I missed last night. Although there maybe another one forming up on the 3 hour chart. My charts won't load for some reason, probably because the market closed. Will be checking back on that formation next week. Everyone have a nice weekend!

 

[4xpipcounter]

After viewing many of your charts, it is hard to conceive how you have had any losses, only because your 123 formations all seem to just do what they're intended to do. In other words, the 123 is formed, then the 2 is broken, and off it goes. I saw this equity chart and see that you are about 14-13 in W's--L's.
Any rate, you seem to have a good thing going, and it is working out well for you.

That 4 hr 123 trade bumped up my record up a little bit. I would like to see another trade this month, but we'll see.

 

[Pipmaster1]

After viewing many of your charts, it is hard to conceive how you have had any losses, only because your 123 formations all seem to just do what they're intended to do. In other words, the 123 is formed, then the 2 is broken, and off it goes. I saw this equity chart and see that you are about 14-13 in W's--L's.
Any rate, you seem to have a good thing going, and it is working out well for you.

You are correct, once the formation sets up correctly it is a high probability set up. However no method is 100% correct. There have been a few times where I'll get in at the #3 point and price turns against me before hitting my first limit. I've tried to filter those out the best I can. Thanks for taking the time to look the charts over, I love this stuff and enjoy talking about it with other traders!

On a side note about that equity curve chart: Since this program is based in Excel and I am by no means very good with Excel. The trading stats can be a little misleading, the overall profit and percentages are correct, however here is the problem. Let say I get in at the #3 point, I've made it clear that I have two limits and one stop for this entry. I have to enter that as two separate trades in excel so the numbers come out right. So if the first limit is hit and then the other half of the trade is stopped out and I make 3.44% on the trade overall like I did on the last one. Excel shows that as 1 win and 1 loss, when in reality that was one trade that made 3.44%. So there really are fewer losses than the trading stats are showing, also the equity chart would be smoother than it shows, but thats the best I can do with Excel. I hope that wasn't too confusing?

 

[Vaco]

Great trading pipmaster,

With regard to the stats your are better off analysing it as 2 trades, if you then give the 2 trades a different name, A and B for example you will be able to view which limit is more profitable over the long run. It may be tht after a year of stats you may decide to scrap one limit or the other based on the results.

Regards

VAco

 

[Pipmaster1]

Great trading pipmaster,

With regard to the stats your are better off analysing it as 2 trades, if you then give the 2 trades a different name, A and B for example you will be able to view which limit is more profitable over the long run. It may be tht after a year of stats you may decide to scrap one limit or the other based on the results.

Regards

VAco

Thanks Vaco,
Thats a great idea, I was planning on just doing that manually at the end of this year. But naming them like that would be a lot faster!

 

[Pipmaster1]

here is the 3 hr 123 that I'm watching. may take a little while. I'm wanting price to reach the 76.4% line and give me a short entry at the #3 point. Also notice the Fib Sequence Chart, the #2 point on the 3 hr chart failed to close below the 89 Fib Extension, which is good. Good in the context that the buyers may have the strength to make a #3 point. We'll see...

 

[Pipmaster1]

Well apparently price wanted to set up on the 6hr chart. We have a nice clean #2 point, just waiting for the retrace to make the #3 point. Could be a little while hence the 6h time frame. :cheesy:

 

[Pipmaster1]

I came to the charts a little later this morning. So I wasn't here when price first made it to the 76.4% line. The formation does look good. Also take a look at the FIB Sequence chart. the #1 point is where price pushed through the 233 Fib Extension. Since I wasn't focused on this in real time I'll let it go and perhaps there will be a retrace after the #2 point is broken. Does look good though. Only time will tell, keep in mind this is on a 20 min time frame, which is considered on the small side.

 

[Pipmaster1]

i do love the Fib chart!

 

[Pipmaster1]

This big uptrend is not doing me any favors for my 123's. 123's is a way to catch a trend change. Look on this 12 hour how far price is away from the blue 40 EMA. Could be awhile before I see a set up.

 

[Pipmaster1]

I haven't watched Gold very much in the 123 context. I have seen a few that work pretty good. Here is a 12 hour that looks pretty good...never know.

 

[Pipmaster1]

This is what I'm seeing right now. The trend is normally your best friend, but 123's work as the trend in changing, so there hasn't been many opportunities this last 3 or 4 weeks. I'm watching the 8 hour right now, just because of how big this uptrend its the only time frame that looks ok. The FIB Sequence chart has crossed, but price needs to at least closed over the 55 fib but I'd like to see a close over the 89 fib. Be nice if we could get more than one trade a month!

 

[4xpipcounter]

Pipmaster, I'm just curious. I know you use various TF's. I attached a 15-minute chart. First, pardon how busy it looks as it contains my methodology. But it seems that there are 2 significant 123 trade setups. Would you agree, or do you not scope down to a 15-minute TF?
BTW, just my opinion, but I think this is it for the UP. I think we are on our way to 1.5720 and even lower.

This is what I'm seeing right now. The trend is normally your best friend, but 123's work as the trend in changing, so there hasn't been many opportunities this last 3 or 4 weeks. I'm watching the 8 hour right now, just because of how big this uptrend its the only time frame that looks ok. The FIB Sequence chart has crossed, but price needs to at least closed over the 55 fib but I'd like to see a close over the 89 fib. Be nice if we could get more than one trade a month!

 

[Pipmaster1]

4xpipcounter,

Well I look at the 30 min to chart to start with. So there are times that'll trade the 15 min chart but it don't happen very often. However price was pretty flat on the 30 min chart so I knew it'll be even more flat on the 15 min. I tried to post a 15 min chart with the same number of candles as you posted. I use the 40 EMA to justify my #2 point, and the only one that sorta qualified was the one at the 15:15 candle. The #3 only retraced to the 50% line, not far enough for me to enter at the #3. Basically the whole formation is sloppy and really isn't right, for me at least. Which is why I was looking at a much deeper retrace of this up move to form the #2 point. Again a retrace from a #1 point to the 40 EMA to form the #2 is very important. Hope that helps....

 

[Pipmaster1]

4xpipcounter,

I see you also said that price maybe go going to 5720. Here is why I think that may be true. The 30 minute is where I start to look at the 123's and get an overall context, then I chase down where the next possible #2 will form, then there is the FIB chart that shows the FIB Sequence. General rule is when price closes over one FIB sequence line it has a high probability to go to the next line. I realize that the 13:00 candle only closed over the 55 FIB line by one pip but it looks like price is going to fall. So my bias is certainly bearish and my first target would be 1.5827. Doesn't mean I'm in short, but certainly means I'm not long!