dancingphil wrote:Following on from what I have said in earlier posts about how I use Bob's 10.3, and how I use Babalu4u's DP Fib levels for Counter Trend (CT) trading.
To recap what the old wise man said; "To master a new skill, learn the conventional wisdom and do NOT do that".
To recap my personal trading style;
1 I never use SL - as a non-American I am a prolific user of the 200% hedge protection with or without BE turned on in Steve's MPTM EA.
2 My
typical Lot size is "Free-Margin/1,000'; that is, normally I use 1 Lot per $1000 in my account. I cannot spend pips, I can only spend dollars. This post and the image is about using
large lots wisely for very tasty scalping. With this 10.3 Fib Level 3 CT strategy, I am being even more ambitious and using "Free-Margin/500" - meaning 1 full Lot per $500 in the account. The signal seems THAT clear and reliable to me!
3 My account is at 400:1 leverage, and my criminal does not bust out trades until 90% of the account is stuffed. That gives my hedge plenty of room to do its thing, and the scalp is extremely reliable so I "fully load the boat".
Which Pairs to Trade this 10.3 Fib Level 3 CT strategy
Looking at the charts of a medium size sample of currency pairs so far, it is very clear that not all pairs are suitable. Over the next day or so I will fully flesh out from visual back testing which ones seem cool to work with.
I will be identifying them by opening a chart for each pair on the H1 and H4 time frames, loading my template in the zip from my earlier post here -
http://www.stevehopwoodforex.com/phpBB3 ... 478#p30478 and then looking for how often that it happens on any day that the DP Fib Level 3 is popped AND retraces sweetly to easy pips profit.
OFTEN you will see the Level 3 Fib breach then retraces 200-300 pips; but not always...so trade management is important.
NOT ALL PAIRS WILL WORK; in particular I have already seen that when there is a Level 3 Fib breach on the GBP:JPY, it does not retrace and instead continues well past this level often for days into a multi-day new trend direction.
As such on the GBP:JPY, it in fact could work much better to use a Pending Stop order to ride this new trend direction. And as it seems to be a trigger for a new trend direction, a TP in the order of hundreds of pips makes more sense.
In the pic below, I was still examining different pairs when I caught the GBP:CHF when it was 60% into its retrace. I jumped on it manually anyway when it was already back at the Fib Level 1 and I set the TP to be the OTHER side of the DO/DP lines. At 1 Lot for the $500 demo account, it scooped up 54.8% profit in one hour. Had I caught it on time; it would have netted 126% equity profit. Also exciting (but NOT part of this SCALPING strategy) is that often on this pair the retrace is actually a signal of a multi-day new trend direction; eg worth 200-300 pips.
But this thread and this post is about big and reliable SCALPING kills.
This IS a Set and Forget Scalp Strategy
Bob, like many of you have day jobs. This 10.3 Fib Level 3 CT scalp strategy is therefore perfect for most of you. Actually I have designed this for my son in Melbourne, because he wants to trade but his day job is frustrating his ambitions.
When you refine the pairs as to where the 10.3 Fib Level 3 CT rules apply reliably, set your chosen pairs at the beginning of your day with pending orders for the day, deleting yesterday's pending orders of course because once a day you have a new set of DO/DP Level 3 Fibs to trade off of.
As for the issue of what time frame your criminal is geared to - THAT issue is not relevant here. I will refine the list of workable pairs; but I am not eating your meal for you. Do your own double checking that the pairs I will list in the next day or so will also work for you.
The rules are simple:
1 Check the pairs on your own system, after loading Bob's and Babalu4u's work.
2 See for yourself which pairs do pop the Level 3 Fib AND retrace to at least the other side of the DO/DP level for that day.
3 Add your pending Limit Orders at both the DPFibS3 and DPFibR3 levels - that is, you are going to work and you have no way to know which way a Fib Level 3 pop could occur, or if it will occur. So set your pending orders above and below the DO/DP at the Fib Level 3's
4 Consider if you want to also Add pending Stop orders for those pairs that do NOT retrace from a Fib Level 3 breach so as to ride a multi-day new trend direction.
5 Go to work!
Correlation Issues
Today, there were several 10.3 Fib Level 3 breaches. And yes because of correlation issues some happened at exactly the same time. If you are a timid trader, then this strategy would have seen all your relevant 10.3 Fib Level 3 pending orders triggered because you would have sufficient equity in your account available to feed them all.
I on the other hand using 1 lot per $500 could only sustain one trade at the same time. And I couldn't give a rodent's bottom about that. With today's correlation Fib Level 3 popS, the first one to trigger would fire the order; any others would error out as "insufficient money".
NOTE: I have NOT checked this for a trending market. And this entire thread of Bob's for the 10.3 is about
Scalping Range Trading conditions. In all probability this strategy will want the pending Limit orders replaced with pending Stop orders using a trend filter to confirm it is a ranging market.
Meaning that if one of our resident genius coders does invest their time so kindly in this strategy....I think you know what I mean.
Think in DOLLARS profits people; you cannot eat pips.
I trade Forex for the money, and I see no value or glory in the pips count being made.
Phil
10.3 FXSystems4.JPG
In Short you Unknowingly Become a Swing Trader by Default through this Concept as Opposed to Being a Scalper
Thank You like I have Said you have Finally Confirmed my Suspision so I have nothing further to Say but to Thank you Again for sharing hmmm some of those wonderful Trade Secrets.....