I wanted to pop back here and update with some new findings since I started playing around with a pattern called Flying Buddha taken from an old trading system called Building an Equity Millipede thanks to some idea sharing with another member here. Cheers Pooler
I am sure Steve will remember this and a few others that have been around long enough. The thread that was started at FF is now 6 years old and still active (
http://www.forexfactory.com/showthread.php?t=245149). It's quite an interesting read.
In short the Flying Buddha pattern is a candle that has it's low higher than a 5ema or it's high lower than 5ema and the idea is that this marks a possible reversal point. The only problem is that it is not particularly accurate and is just as good an indication of possible trend continuation rather than reversal most of the time.
When I started learning from Captain Jack's thread here I could see that what he calls levels match up rather well with the areas where Flying Budhha's occur and whilst we may not know which direction price will go from these levels we absolutely do know that price will at some point breakout so I have been testing a few different ways to capitalize on movements either way from these areas of possible trend continuation or reversal. And for anyone already adept at trading Captain Jack's teachings you can choose to just trade one side or another from each level accordingly.
One of the ways I have been practising is with Greedy Wotsit setup as a trade helper placing buys above daily open price and sells below only once a Flying Buddha has occured on previous candle and closing all then starting again once we reach the next Flying Buddha candle. This seems to solve the weakness I experienced last year just gridtrading from the daily open as there is the potential for price to move much further over a few days/weeks from a flying buddha than just in one day alone and it means that short term ranging of price until a breakout is no longer an issue (with a Greedy Wotsit grid placing buys above and sells below obviously the further price moves before we have to close the better).
I use 2 x ADR for the grid size comprising 5 orders either side. I use the on screen buttons to trade this manually and GW running in the background setup to bank 1000pips and stop trading if there is a big price spike or black swan type event on a particular day.
I am also experimenting with additional triggers to close all and send new grids like when a daily candle has closed across the 5ema too. This enables profits to be banked along the way and avoid losses when price reverses on the next candle which happens quite often after a 5ema cross.
Trading the D1 charts in this way requires less than 5minutes a day and the account I started 4 weeks ago for this has grown from 500 to 998 so almost +100% already.
I've attached a FB indicator which prints little arrow above/below the Flying Buddha candle setups and my template and Greedy Wotsit set file. You'll also need the EA from post 1.
I will update here at the end of Febuary again and happy to answer any questions in the meantime if anyone is interested. I am calling this FBG - Flying Buddha Grid.
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