The "1 PIP" Challenge

[FXSCALPER2]

1 pip is stupid? You don't sound like a scalper to me. I make 10 to 15 pips everyday. Look, my point has been lost amongst the Ego's. If you cannot make 1 pip then you cannot make any. Let it go. When did forums stop being fun?

If you end up with 1 pip on average per trade, that is of course fine. However, setting out to make 1 pip from a trade (or per day) is silly and shows that you really don't understand forex trading. Try it and see what happens over a period of time.

Trading takes skill and that skill is basically about getting the fundamentals and technicals right most of the time and trading with the tightest stops for the conditions. Everything else is just wishful thinking and designed to make people feel good. Trading is about getting out of your comfort zone and all this newbie 'strategies' are tiresome bollox and will, in the end, never work.

 

[arabianights]

I've thought of another idea, although I don't know if it's possible in practice.

 

[Bullish75]

Trading takes skill and that skill is basically about getting the fundamentals and technicals right most of the time and trading with the tightest stops for the conditions. Everything else is just wishful thinking and designed to make people feel good. Trading is about getting out of your comfort zone and all this newbie 'strategies' are tiresome bollox and will, in the end, never work.

Easy Tiger, Lol!

 

[thorset]

Bullish

Sorry - see next post

 

[thorset]

Bullish

I'm here because I was intrigued by your "1 pip Challenge" proposition. I too enjoy playing devil's advocate because, it provides a stimulus to think outside the box and also to reviewing and justifying established beliefs. Of course, experienced people over time become comfortable in their long held beliefs and naturally feel a bit put-out when these are challenged. So, rather than declaring "nonsense" and "humbug", why not enter into the spirit of the thing and, as stated by Bullish, have a bit of fun analysing this preposterous proposition!

Why is it preposterous? Simply because in practice the target is completely overwhelmed by the random "noise" (price fluctuations) coupled to the spread. OK, market exposure would be extremely limited it is true, but what about slippage too. Would your broker honour a brief 1 pip target hit before you then hit your 3pip SL in the next few seconds? Could he match the price for you? Perhaps therefore we should radically revise our old beliefs regarding Risk/Reward ratios? For the proposition to work one would need to allow for a 2 pip + spread SL say. Of course, the R/R is dreadful, but in a trending market - perhaps it would be viable?
:smart:

Compare and contrast!

 

[30XTCi]

Expense column

hopefully no one else was on that trade if they were my apologies its just gone down

tightstops,
Just out of curiosity, after you put the trade on, did it go into profit at any stage before the stop was hit, even by just one pip.

 

[TheTick]

If you end up with 1 pip on average per trade, that is of course fine. However, setting out to make 1 pip from a trade (or per day) is silly and shows that you really don't understand forex trading. Try it and see what happens over a period of time.

Trading takes skill and that skill is basically about getting the fundamentals and technicals right most of the time and trading with the tightest stops for the conditions. Everything else is just wishful thinking and designed to make people feel good. Trading is about getting out of your comfort zone and all this newbie 'strategies' are tiresome bollox and will, in the end, never work.

Context.

Doesn't make sense in FX markets, but fixed income? It's possible to trade a fair amount of size in, for example, the Bund and at 10 Euro's a tick, it's possible to make a decent living. If you bought 1,000 lots and made a tick you'd be fairly pleased with life.

I think the point of this thread got lost on a couple of people. If you are only making one tick, your hit rate needs to be fairly phenomenal. HOWEVER, you only need the market to move by it's smallest possible increment, so there's a high chance it will if you get timing and momentum correct. This clearly wasn't meant as a serious strategy, but it doesn't mean it is without merit.

Incidentally, an idea for the starting point for such a strategy would be an opening range breakout. I use one such system (though admittedly not for 1 tick). One idea would be to use daily trend to dictate long/short, opening 60m for entry then do some anaysis of average on/offside in next 60m, how many stopped out, close on next 60m. Now consider doing that for the opening minute of each hourly bar. Sometimes, it's the simplest or silliest ideas which nurtured can lead to decent trading systems.

 

[Bullish75]

Bullish

I'm here because I was intrigued by your "1 pip Challenge" proposition. I too enjoy playing devil's advocate because, it provides a stimulus to think outside the box and also to reviewing and justifying established beliefs. Of course, experienced people over time become comfortable in their long held beliefs and naturally feel a bit put-out when these are challenged. So, rather than declaring "nonsense" and "humbug", why not enter into the spirit of the thing and, as stated by Bullish, have a bit of fun analysing this preposterous proposition!

Why is it preposterous? Simply because in practice the target is completely overwhelmed by the random "noise" (price fluctuations) coupled to the spread. OK, market exposure would be extremely limited it is true, but what about slippage too. Would your broker honour a brief 1 pip target hit before you then hit your 3pip SL in the next few seconds? Could he match the price for you? Perhaps therefore we should radically revise our old beliefs regarding Risk/Reward ratios? For the proposition to work one would need to allow for a 2 pip + spread SL say. Of course, the R/R is dreadful, but in a trending market - perhaps it would be viable?
:smart:

Compare and contrast!

Hey Thorset,

Thanks for your input. Just back from Holiday and nice to see someone finally got the point of the thread. Of course the target of 1 pip is proposterous. I have never traded with the intent of getting just 1 pip. But if a low yield strategy is good enough then the loss ratio is irrelevant most of the time. I am a scalper and have very tight stops so it rare i come close to it. Also, my broker has nothing against scalping so honouring a 1 pip tp is not a problem. Thanks again.

 

[Bullish75]

Context.

Doesn't make sense in FX markets, but fixed income? It's possible to trade a fair amount of size in, for example, the Bund and at 10 Euro's a tick, it's possible to make a decent living. If you bought 1,000 lots and made a tick you'd be fairly pleased with life.

I think the point of this thread got lost on a couple of people. If you are only making one tick, your hit rate needs to be fairly phenomenal. HOWEVER, you only need the market to move by it's smallest possible increment, so there's a high chance it will if you get timing and momentum correct. This clearly wasn't meant as a serious strategy, but it doesn't mean it is without merit.

TheTick,

Absolutely spot on, thank you.

 

[kaligula]

Hi All,

Okay, hands up who is sick of reading about 100 pip a day strategies or even 20 pip a day strategies:clap: They are fine unless you run out of capital trading it.

i want to see if the scalping and intraday community can rise to the 1 pip challenge. Probably sounds easy to some while others are saying "it's as easy to get 10 pips as 1 pip". Well, people don't realise the power of just one pip. If i showed you a way to get just 1 pip every time and 9 others done the same then that is 10 pips a day every day, not bad when you compound your capital right? If you can pull 1 pip out of a strategy then it is worth it. Okay, some parameters. No point in a strategy that takes all day to deliver 1 pip, we would all starve. So, you have to come up with a way to get 1 pip evry time at roughly the same time everday so we can all tune in. Then hopefully we can fill in the time slots as we go.

I have several that i will share if this gets going. Try keep it simple folks, the less indicators the better (don't want to waste time setting them all up for 1 pip)

Hi,
Such as it is - it looks quite stupid, BUT:
- Quite a big theories comes from such things.
If people interested in theoretical thinking of concepts will come around and start thinking, soon or sooner we can make some really nice findings. Otherwise after a onth we can quit the thread.
I like a challange and will love to hear and share my observation.

Simplyfying: Now I wouldn't think exactly of hounting for 1 pip profit, BUT I'd love to think of it while have nothing better to do while watching my graphs and share ideas.

So I'm in [in some unusual way]



[BTW if this forum gets too messy we can PM, or open some blog or sth]

 

[£10kLoser]

1 pip IS stupid. Why don't you make the challenge for 10 pips - then it becomes something worthwhile...

 

[thorset]

1 pip target - perhaps not so daft?

Promise you won't be cross, you 10pips target blokes - but I've been thinking. LOL!
Before entering a trade we are always told that the Reward/Risk ratio must be over say 2.5 to 1. However, as you know, this figure is influenced by several factors like, market activity,the proximity of S/L-Pivot Point-Fib levels, probable market response to news items. So, it seems that we should not consider R/R ratio as a rock solid governing constant. If this is indeed so, all we need do before committing to a trade then is to ensure that the market has adequate momentum and breathing space in which to move safely. e.g. a channel breakout. The strike rate then should then be easily in excess of 95% provided one is comfortable trading at a much lower R/R figure. What I mean here of course is that the S/L needs to be quite generous. A 1pip target means that the S/L can be 5pips giving a R/R of 0.25 to 1! IMHO this approach, harnessed to compounding, and also given that one is exposed to the market only very briefly, would be viable. Of course, very careful money management is essential, but that is a given for any system. Also, these opportunities happen several times a day and given time, stakes can be raised by several orders of magnitude and thus eventually provide a good income.

At present I'm trying to get to grips with a 5pips 'mongrel' system cobbled together from several generous thread authors. However, if I can find time I'll play with the 1 pip challenge for a while longer.

Meanwhile, good trading to one and all.

 

[Paul71]

Hi All,

Okay, hands up who is sick of reading about 100 pip a day strategies or even 20 pip a day strategies:clap: They are fine unless you run out of capital trading it.

i want to see if the scalping and intraday community can rise to the 1 pip challenge. Probably sounds easy to some while others are saying "it's as easy to get 10 pips as 1 pip". Well, people don't realise the power of just one pip. If i showed you a way to get just 1 pip every time and 9 others done the same then that is 10 pips a day every day, not bad when you compound your capital right? If you can pull 1 pip out of a strategy then it is worth it. Okay, some parameters. No point in a strategy that takes all day to deliver 1 pip, we would all starve. So, you have to come up with a way to get 1 pip evry time at roughly the same time everday so we can all tune in. Then hopefully we can fill in the time slots as we go.

I have several that i will share if this gets going. Try keep it simple folks, the less indicators the better (don't want to waste time setting them all up for 1 pip)

Posting 1 pip trades? How am i supposed to do that using an hourly chart, hourlies are the smallest TFs any trader should use really, 500pip stops and targets that take a fcuking decade to realise (if it ever gets there).

Never go to the market, let the market come to you(hope it knows where i live)

Hold on! Here it is! The market is in our street!

A thread like this was always going to get slaughtered off the 'old dogs', with thier bushy grey beards, wooden legs and tales of woe!

"....never go below 15mins, me laddy! The market serpants and scalp goblins will 'ave no mercy on ya young soul. 'Ave seen men lose thier accounts on the maelstrom dom! 15mins is the low....never go below....they'll take yer dough!...."

Time for a trading shantie, me thinks


Update: Well, i thought it was the market coming to me, but it was just two Eddie Stobbart wagons turning around. It's not all bad though, i've just had a call off the market maker, he and the other specialst have had to pull into a lay-by, they've just lost the commercials and the institutions at the last roundabout and the retailers have gone on ahead (they have sat nav). So we're looking at 2pm today for a big ol' knees up in my garden (hope the nieghbours don't mind).

 

[kaligula]

TIME TO TAKE THE CHALLENGE!

Here's my idea for your challenge, study it and go on with thoughts.

Take some nice high probability strategy with 1:1 ratio. The bigger TF the better.
Now put your 1 pip TP, rest as strategy sais [when entry, 150 pips SL etc]
All trades will win becase of noise.
If any single looser will appear - it means martingale, BUT.
Nezt trade you put 2 contracts instead of one. TP1 = 1 pip and TP2 = SL [as a high probability system would be dreadfull to see 2 or three or so in the row loosers

now let's find a system with nice probability of winner, some for daily chart with small enough SL

I propose some morning breakout. Let's try bigben on EU
set breakout on range between 7:00 and 8:00 AM It must be a holy grail.
Aditionally we can wait for some small range - up to 30 pips to make our martingale not to dreadfull.

Happy?

 

[Hoggums]

TIME TO TAKE THE CHALLENGE!

Here's my idea for your challenge, study it and go on with thoughts.

Take some nice high probability strategy with 1:1 ratio. The bigger TF the better.
Now put your 1 pip TP, rest as strategy sais [when entry, 150 pips SL etc]
All trades will win becase of noise.
If any single looser will appear - it means martingale, BUT.
Nezt trade you put 2 contracts instead of one. TP1 = 1 pip and TP2 = SL [as a high probability system would be dreadfull to see 2 or three or so in the row loosers

now let's find a system with nice probability of winner, some for daily chart with small enough SL

I propose some morning breakout. Let's try bigben on EU
set breakout on range between 7:00 and 8:00 AM It must be a holy grail.
Aditionally we can wait for some small range - up to 30 pips to make our martingale not to dreadfull.

Happy?

1 pip target, All trades will win because of noise, martingale.. tut tut It'll never work.

And here's why...

BID/OFFER SPREAD

The size of this will effectively cancel out noise - and you are bound to enter a trade right at the peak/trough so it will not get limited - but stopped at -150 points.

So by martingales formula your next trade has to be 150x your initial stake to make your money back... DOH!!

 

[kaligula]

1 pip target, All trades will win because of noise, martingale.. tut tut It'll never work.


So by martingales formula your next trade has to be 150x your initial stake to make your money back... DOH!!

How long time you want me to trade so I prove I'm right?
With martingale you're wrong - After loose I open two contracts,
TP1=1pip TP2=SL

I'll trade inside bars between 8am and maybe 3 pm [need to make sure] With approx 2% of beginning stake, rised after one lose to 2% of stake before lose.

 

[Hoggums]

How long time you want me to trade so I prove I'm right?
With martingale you're wrong - After loose I open two contracts,
TP1=1pip TP2=SL

I'll trade inside bars between 8am and maybe 3 pm [need to make sure] With approx 2% of beginning stake, rised after one lose to 2% of stake before lose.

Opening 2 contracts and winning 1 pip won't make back the -150pips from the last trade....

 

[kaligula]

Opening 2 contracts and winning 1 pip won't make back the -150pips from the last trade....

But I'm not closing both contracts with 1 pip gain. I close only one on TP1=1pip second contract runs until cover previous loss TP2=previous SL [f.e. 150]

Do you understand this?
It's much more than one pip, but it's not a challenge part but recovery part of one pip method.

in next post i'll set my rules for challenge

 

[kaligula]

no rules posted yet. Finally I trade inside bars on EU[spread2] EJ[sp3] and UJ[sp3] take 1 pip + spread
If trade lost, next open with two contracts TP1=1pip+spread TP2=50pips+spread
Then martingale fun. Initial risk 2% per each 25 pips. Rised after first full winner after lost 1 pip trade.
Trading time: 7am - 3pm GMT [if last candle is inside bar i keep EO all night and then until new IB spotted. My chart is timed in GMT+2

Today trades:
UJ 11am GMT+2m - +1pip
UJ 2pm GMT+2 - missed because this bar is valid for shorts only, when high<daily open
EU 11am GMT+2 - missed because next bar is inside, what cancelled this one
EU 12pm GMT+2 - +1 pip

TOTAL: 2 pips

P.S.
I'm not trading this cause too lasy and have no instant internet acces where I live, but gonna move in 2 weeks

 

[pipseer]

Hi Bullish,

I think the problem is not that your idea about catching 1pip is out of whack, I think that the problem is that if one can analyze the market correctly, 1 pip is just the beginning.

We've all seen the GBPJPY go 400pips in one day. And I'm sure we've all kicked ourselves the next day when we tried to jump in - under what we perceived were the same conditions as yesterday - but got killed by the stop hunters ... and then price went in our original direction.

Several have already mentioned the means to your 1-pip end: momentum breakouts. This IS the key to any small-pip strategy. What's required? Study, understanding, and patience.

Here's what to do: Study study study. Look at your 15min charts for consolidated, flat areas, places where the candles are tiny and going sideways. This is the breakout area. Set an alarm above and below that channel area. When alarm sounds, look for large candles breaking above or below your channel area. You can add RSI to your chart and if it's crossing it's 50 at a good angle, get in with it.

Here's the biggest problem. Loading up the boat (say 10 lots) for 1 pip will only get you around $100 (at $10/pip). That's a huge risk for only 1 pip. So by waiting for momentum to arrive, you get your pip plus more if you trust RSI and can stay in for a few more. 10-15 pips is a good number. Even 5-6 pips 3-4 times a day is a good living.

Thanks for bringing up this great topic!