Daily EUR/USD - by S.R.G.

[S.R.G.]

Hello traders,

I am about to refine my trading and need to feel a bit more accountable , don't we all!
So before I start I would like to ask fellow Trade2Win members if there is any interest in me starting a new thread for this?

This would in that case be the rules:

FYI - Please read:

If enough people think this could be interesting and no one opposes (oh no, not another one...) I will start of on Monday morning: 2005-04-25.
This will not be a live/direct trade/post thread since I am focusing on trading, nothing else. So I will try to update each day's trades with screen shots and comment sometime past 17:00GMT.
Hopefully will this thread be of enough interest to fellow forex traders, to follow along by offering their comments/questions and keeping me accountable .​

Time frame (glaring time):

mostly 06:00-13-14:00 GMT​

Account:

Live - GFT​

Maximum Draw down:

$Max 75 (25pips)​

Size @ position:

3 lots @ fade in​

Currency:

EUR/USD​

Price is displayed as:

Candlestick​

Time frames:

60min - Trend, Fibonacci, shortMACD​

15min - Price action, %B(a relative momentum indicator), shortMACD(8/12),
EMA 20,50,100​

5 min - When fading/managing the trade.​

My thoughts of trading:

Trading is not science or just "feeling lucky", it should be an evaluation of probabilities. What indicators (or not) you use should actually not matter as long as you keep on using them long enough so you can start identify re-occurring scenarios. i.e. before price will go up, most of the times, the indicator/s (price action) will look like this a.so. So probability will be on your side, price action sets the final decision when the trade will trigger.​

Strategy:

Sit tight and wait until either:​

A. %B >1 or <0​

B. MMACD is around h/l areas of old reverse points.​

Action: ​

Buying/adding on break out of prev high/low or 5min congestion area with support of MMACD, %B​

Hard targets, just to be avare of:​

Pivot Point​

Even numbers 00's and 50's​

Daily/weekly/monthly h/l's​

>60min Chart Fibonacci levels​

100% Range​

Exits​

Initial S/L -> manually trailing placing below/above 5min congestion.
Main focus is on average break even.
On BUY orders or S/L - remember the +3 pip spread.
​

Additional​

News releases:
Do not enter new trade 60 min before major news release.​

No action:
If trade does not turn profitable within 10 x 5min bars. Tighten S/L max​

Adding of positions:
Maximum positions 3 x 3lots (at present)​

 

[FetteredChinos]

yup. please go for it. the more analysis the better.

pleased to see you use round numbers (a particular fave of mine )

FC

 

[nextgen]

support

 

[Dave1971]

Sounds interesting, thanks for making the effort.

 

[commanderco]

yup.

pleased to see you use round numbers (a particular fave of mine )

FC

FC
Can you enlarge on why you favour "round numbers" please

 

[S.R.G.]

FC
Can you enlarge on why you favour "round numbers" please

Commanderco,

Even though you did not address the question to me here is my 5 pip.

During intra day trading round numbers (50's and 00's) seem to be used as targets to that extent, that I can be more of a benefit to the price vs them that simply ignoring. Then also if a fib retracement or a PP is in the same area....

You have a higher probability for people jumping on/off the trade.

But that is what I believe.

S.R.G.

 

[FetteredChinos]

purely psychological reasons.

plus, viewing it another way, and a method that i used to use:-

with forex, money management is more important than in stocks/future IMHO.

therefore pretty much any entry point can be worked into a profitable system.

therefore exits/stops are more important in FX than anything else.

pick a price level. any level. if above it, go long, if below it, go short. stops above/below swing highs/lows

may as well pick 00 numbers for the psychological reasons as the price level.

it does work...

trust me, im a trouser specialist..

FC

 

[Roberto]

with forex, money management is more important than in stocks/future IMHO.
therefore pretty much any entry point can be worked into a profitable system.
therefore exits/stops are more important in FX than anything else.

Albeit from my limited exposure to "anything else", I completely agree.

trust me, im a trouser specialist.

People will talk. Oh - I forgot: they already do.

 

[ptc]

Can you explain what's your definition of 'Maximum Draw down' ?
thanks

 

[S.R.G.]

Can you explain what's your definition of 'Maximum Draw down' ?
thanks

Ptc,

"Maximum Draw Down" is the bottom (or top when selling) distance I can place my initial S/L. I write maximum since if I see price action which allowing me to place a S/L within the distance of point of entry and initial S/L I will use it instead.

I tend to see forex trading as:
Either you are in short < 60-90min or thereabouts - then it is better to have a tight S/L and rather have some extra trades before it goes your way.
OR
You are in to the trade for >90min and then you will need have a much higher risk tolerance, thus a larger initial S/L.

Since I at the moment only am following the EUR/USD and everything seems to be a bit "Topsy turvy" due to a lack of fundamental information pointing in one direction - I noticed (for my type of trading) when initially wrong, make sure to get out.

Regards,

S.R.G.

 

[S.R.G.]

Update,

I did spend the whole weekend figuring out how to make one indicator in GFT's Chart Studio (so now I am in for a divorce) ;-).
This lead to me being able to update the tradeplan by using my favorite indicator (%b).

 

[S.R.G.]

OK here vi go....

As you can read from previous post I did some minor changes during the weekend to my trading plan, to the better I hope.

I was a bit late this morning, so instead of jumping right in to the trade (which I by the way which I did) I "paper traded" it according my rules.

Lines are drawn by hand:

Red lines indicate S/L levels
Blue lines indicate entry/additional entry - stretching from BO point to entry.

S.R.G.

 

[S.R.G.]

Second trade today,

%B and shortMMACD(green) was indicating a pull back.
Medium and Longer (Red, Blue - lines) still downward momentum, so expect pull back to be short.

Entered short 1pip above first 5 min reversal BO - nothing happened for a long time - indication that a pull bak perhaps was not that likely.

Will add an additional rule to ThePlan,

If Trade is not profitable within 10x 5 min bars, tighten S/L maximum.

Result so far: -19pip
Dollar profit/loss(-): -57

 

[S.R.G.]

Here we go ,

Another missed trade, which would have been profitable!!! It really sucks. But if I am not sure I will be able to manage the trade all the way, I rather stay on the side lines.

As yesterday I did try to catch a couple of pip on the pull back - which most likely would have made me a couple of pip in profit - but after yesterdays long wait ,for a trade to turn in to profit or getting stopped out, I implemented the 10 x 5min bar rule.

Result this trade: -11pip
Results so far : 2 trades and -30pip
Dollar profit/Loss(-): -90

 

[S.R.G.]

Second trade late in the day,

Another pull back trade.
Not a lot of pip made, but it is not the pip that counts in the beginning.
It is slowly getting the feeling of seeing the confidence build regarding the indicator/s used VS price action.
So far I have proven to be right, but I stood on the sidelines for two major moves, since I do not want to trade on "half distance". So I am still at a small loss.



Result this trade: 3.5pip (average of 2x3positions)
Results so far : 3 trades and -26.5pip
Dollar profit/Loss(-): -71.31

 

[S.R.G.]

2005-05-27 - Trade1

So no more "stand on the side and miss a opportunity", I am in from the beginning.

First %B crosses 0 from below.... then wait for shortMACD to confirm trend... then trade BO on 5 minute chart.

Today I did also apply the 10 bar no profit rule.

Actually you do not need these two indicators to trade break outs. While trading longer time frames in stocks I never used indicators to much. But I noticed my problem especially trading 5/15 min charts I always entered on the wrong side...

So a while back I started to play around with different indicators to help me find something that would prevent me from entering to soon.

Which indicator you end up with does probably not make to much of a difference, since it's main purpose is to give a reference on where the price action is compared to it's usual behaviour. The main thing is to make sure you get to know it/them inside and out.

Additional
My rules say that I do not enter a trade 60 min before any major news.
I was in a trade already, where not a lot was happening
I did tighten my stop after 10 bars
I did remove the adding on another 3 lots by BO of prev high, since this would have mean I had to break the rules.
News got out, terrible for USD, price when up.... but not to that extent I would expect... not a first. So news was out , the trade turned profitable and the news was not good vs expectations - this ment I could add on another 3 lots early in what I saw was the beginning of a move without risking any money (since initial profit left me break even at worst)

Result this trade : +32pip
----------------------------------------------
Total result so far : 4 trades and +5.5pip
Total dollar profit/Loss(-) : + 216.7

 

[S.R.G.]

2005-05-27 - Trade 2

What goes up must come down.... well at least to a certain extent.

%B cross below 1... shortMACD turns below signal line... and I am entering a position on the first 5min break out.

It did move slow... but as long as it moves the right direction who can complain.

Result this trade : +11pip
----------------------------------
Total results so far : 5 trades and +16.5pip
Total dollar profit/loss(-) so far : + 318.7

 

[S.R.G.]

Thursday/Friday I will be out of town = No trading.
So have a great weekend!!