Best Thread Correlation Trading - Basic Ideas and Strategies

[NVP]

morning all......

testing a couple of tweaks this morning prior to main action............not bad actually and EU been kind so far

N

 

[NVP]

N,
Not to be rude, but looking at previous screenshots etc, it appears you're looking at gross, not net, pips. Deducting for costs, you will actually have netted significantly less.

Also this approach is flawed:
1) You are clearly over-trading (even as a scalper)
2) 2-3% risk/trade is too high
3) If your stop loss was less than 1 pip you would continually be stopped out
4) An avg 1 pip/trade profit is too low (costs are too big a % of your gains), see point 1) above
5) I also don't believe you (or anyone else) is doubling their account most days

Win ratio alone is meaningless. If you calculate expectancy & trade risk this approach is leading you down the wrong path. Hope you take this in the way it was meant, i.e. constructive criticism.

hey DJ - constructive feedback always appreciated - no worries

I said theoretically doubling account most days - no one sane does that in principle as we all have levels of risk we know are enough per trade and to sleep at night

and apologies - I am set at 1.5 pips hard S/loss at the moment but I bail earlier than that (yes my system is able to be that sensitive and fast to react with me at the helm)

2-3% works for me ..........and my drawdowns are virtually non existant most days .........sorry if that sounds impossible to people but its true ....look at this morning .........(last post).......

I'm just pretty comfortable with what I do now ...and should be after so many years ...if I wasn't then I shouldn't be still trading

my system is far from perfect - I overtrade alongside a lot of other things - massive room for improvement ...............so always the eternal student ......but my #1 priority is to make money and I do that ................1 day at a time !

cheers
N

 

[NVP]

Can I just get clarification on a few points sir?

If you continue to use 2-3% why would you need to adjust stake size v capital?............as capital base rises then absolute stake values rise ........apologies if this was misleading ....I am at a level where I am happy at 2-3% and I withdraw funds to maintain capital base


You're using a sub 1 pip stop? - 1 pip soft stop and 1.5 pip hard stop

You maintain an average 85% win rate?..no I said yesterday was a 85% win rate .I can be lower than that on worse days


You make an average of 1 pip profit per trade, today obviously higher?.......after commission etc I aim to make a 1 pip profit per trade but can be lower on bad days


You made 148 trades today for a 249 pip net profit? So presumably you risked less than 148 pips to make that?..........I risked 1-1.5 pips per trade to do that

You typically use between 50:1 and 33:1 leverage across all pairs? (yep - on my favourite and trusted EU)

Based on an 85% win rate, an average of 1 pip profit per trade and using leverage of between 2-3%, you're doubling your capital base, every day? - theoretically anyone could ...........if you are staking 1/50th of your capital base each trade and making more than 50 sucessful trades a day on these returns then you can theoretically double your base - agaon theoretically

cheers guys - now back to more trading......... :smart:

later
N

 

[NVP]

still on low stakes as not happy with my laptop speed

back later - gotta do some chores
N

 

[Forexmospherian]

still on low stakes as not happy with my laptop speed

back later - gotta do some chores
N

Morning N

I dont think Pat knows you ( and me ) are (ex) accountants lol

I will say I am always after scalps with RR's ideally over 1 and most days get RR's of between 3 and 5+ on a few trades - it make such a difference

If you are getting your entries so well timed and spot on - maybe you are taking many trades that will not make over 3 or 5 pips - which basically is my minimum requirement - and that's net

I reckon with a bit of fine tuning - you could reset your set up to cherry pick the lucrative 5 to 15 pip moves and even with a 3 or 4 pip stop - you would be far better off

Speak to you later and have a good day

Regards

F

 

[tar]

hey DJ - constructive feedback always appreciated - no worries

I said theoretically doubling account most days - no one sane does that in principle as we all have levels of risk we know are enough per trade and to sleep at night

and apologies - I am set at 1.5 pips hard S/loss at the moment but I bail earlier than that (yes my system is able to be that sensitive and fast to react with me at the helm)

2-3% works for me ..........and my drawdowns are virtually non existant most days .........sorry if that sounds impossible to people but its true ....look at this morning .........(last post).......

I'm just pretty comfortable with what I do now ...and should be after so many years ...if I wasn't then I shouldn't be still trading

my system is far from perfect - I overtrade alongside a lot of other things - massive room for improvement ...............so always the eternal student ......but my #1 priority is to make money and I do that ................1 day at a time !

cheers
N

Theoretically you will blow up in no time ...

 

[NVP]

Morning N

I dont think Pat knows you ( and me ) are (ex) accountants lol

I will say I am always after scalps with RR's ideally over 1 and most days get RR's of between 3 and 5+ on a few trades - it make such a difference

If you are getting your entries so well timed and spot on - maybe you are taking many trades that will not make over 3 or 5 pips - which basically is my minimum requirement - and that's net

I reckon with a bit of fine tuning - you could reset your set up to cherry pick the lucrative 5 to 15 pip moves and even with a 3 or 4 pip stop - you would be far better off

Speak to you later and have a good day

Regards

F

cheers guys - always working on my scalping .........I will get more efficient but as they say its all work in progress :smart:

 

[NVP]

Theoretically you will blow up in no time ...

cheers ..not today though

about 100 pips up in profit so taking a break

last few trades - excuse low contract values but again I am now trying to tweak something to improve the system :smart:

N

 

[NVP]

hey all

got tied down today and didn't get back to charts - and we are away for the weekend from tomorrow

see you all next week
N

 

[NVP]

hey all

tied up this week on some finance consultancy work - will try to get back in trading saddle as soon as possible but may be a while

N

 

[NVP]

will try to get back in saddle next week ...........tied up elsewhere

Sorry
N

 

[NVP]

morning all ...........had a chance to play for about 15 mins

this was best move.Eu sat up for sells at 0926........GU was looking like a sell approaching the news as well

back hopefully later
N

http://www.trade2win.com/boards/dis...ert-retail-forex-trader-4519.html#post2551382

 

[NVP]

nice scalps called live from here .......:smart:

http://www.trade2win.com/boards/dis...ert-retail-forex-trader-4525.html#post2551564

 

[NVP]

more live calls

F should pay me commission ?

N

http://www.trade2win.com/boards/dis...ert-retail-forex-trader-4530.html#post2551704

 

[NVP]

5282 the high so far

callin them live gang.....calling them live

N :smart:


http://www.trade2win.com/boards/dis...ert-retail-forex-trader-4561.html#post2553246

 

[NVP]

not bad...............not bad



http://www.trade2win.com/boards/dis...ert-retail-forex-trader-4580.html#post2554044

 

[NVP]

have to say this bull action on the GU/ EU is great in last few hours but I am increasingly watching for cracks.................

take it from me

1) this is big divergence
2) the usd rarely stays as top bear or bull currency for long

hmmmmmm
N

 

[NVP]

looking back at morning the usd index only really kicked serious butt for about an hour ..............7.35 - 8.45 am GMT (8.35 - 9.45 BST)

usd dumped and we got some grrrreat European buys ............100+ pips on the GU and EU

rest of morning distinctly average

later
N

 

[NVP]

ok i'm trying to scalp European sells on usd pairs ......

the green usd below on 20ma FXCorrelator is doing ok with some flurries north (buy usd) but just wont fly ............

such is life

N

 

[NVP]

hey gang

apologies for not loading up as much as I used to ..............busy times

if any newbees track back through this (long) thread you will see that really all I am trying to show is that understanding what individual currencies are doing is very useful to predicting pair movements...........

once traders start to look I believe it helps the trader understand market dynamics and how currencies work in the G8 closed environment

my core indicator is a simple strengthmeter called the MT4 FXCorrelator - available in the links area below plus a few other things that may help

heres my little workhorse showing last weeks action......the bold green line is the USD and the Blue line is the Euro ............

remember this is the relative strength/weakness of individual currencies .......so if you can match a stronger currency (above zero) to a weaker one (below zero) then that pair is definitely worth trading as the momentum/dynamics are there.........

naturally this is not perfect - nothing in trading is ............but sometimes the magic does work

look at this week..............and follow these rules for any momentum based trading signals


1) NEVER TRADE 2 CURRENCIES ON THE SAME SIDE OF THE ZERO

2) NEVER MAKE A TRADE WHEN ONE OF THE CURRENCIES HAS DIVERGED TOO MUCH (EXPERIMENT WITH THIS TO FIND O/B and O/S LEVELS )

and then you can add literally hundreds of rules ..........:smart:

you can see below the 1hr TF 20ma setting of my indicator here sets the scene for trades during the week ..............

look at the ticks ..........that's where you really s/be hammering the EU for trades ..............

look at the crosses ...............don't trade ........not worth it as the dynamics/rules are wrong

simple yes ................effective ?..............well its a start ....right ?.......

N