10.4 A Complete System

[lhDT]

Basically, price below 240 MA, RSI is flat and AO is the only concern....I think ideally we need this above zero from what i understand...Although i also understand you don't need both indicators for an entry...

Indeeed, for pending orders, you just need to focus on the RSI2/STO as you don't know when it will be triggered so the AO color.

[lhDT]

Just got an alert for EUR/AUD.
Long pending set at 1.29849, SL 1.28590, TP 1.31156.

Comments welcome.

[lhDT]

Damn, I'm a bit lost with lot size allocation on the second trade.
Somebody can help me do the math ?

ACCOUNT SIZE : US 10.000$ 1$/PIP
RISKING 1% (100$) PER TRADE

LET’S SAY ORIGINAL STOPLOSS WAS 50 PIPS (Long at 1.6050 and SL at 1.6000) SO WE’RE LONG AT 0.20 LOT

QUESTION :
WHAT SHOULD BE THE LOT SIZE ON THE SECOND LONG TRADE (LONG2), IF WE
WANT TO STAY AT “BE” IF STOPPED OUT ??

That also means the SL will be somewhere between LONG1 and LONG2, how to correctly
set our LONG2 allocation (which will be different than the first one) if we still want to risk 1%
on the second trade ?

[barnov]

@lhDT

Just got an alert for EUR/AUD.
Long pending set at 1.29849, SL 1.28590, TP 1.31156.

It will be interesting to see what happens here as the pair from your piccy appears to be heading downwards to the 240MA (LHs and LLs), and the 240MA is in a UT. Could have a new lower entry point assuming the 240ma can hold it and the trend remains an UT - or has it just turned already, and is now going to continue it's upward journey in lne with 240MA.

Regards

Paul.

[mjws00]

Damn, I'm a bit lost with lot size allocation on the second trade.
Somebody can help me do the math ?

ACCOUNT SIZE : US 10.000$ 1$/PIP
RISKING 1% (100$) PER TRADE

LET’S SAY ORIGINAL STOPLOSS WAS 50 PIPS (Long at 1.6050 and SL at 1.6000) SO WE’RE LONG AT 0.20 LOT

QUESTION :
WHAT SHOULD BE THE LOT SIZE ON THE SECOND LONG TRADE (LONG2), IF WE
WANT TO STAY AT “BE” IF STOPPED OUT ??

That also means the SL will be somewhere between LONG1 and LONG2, how to correctly
set our LONG2 allocation (which will be different than the first one) if we still want to risk 1%
on the second trade ?

I read Bob's doc as each pyramiding trade is free. Only the initial trade has risk. So use the same lotsize and place the SL in the middle of the two trades. I believe this simplicity is the intent.

However, if you are willing to risk another 1% you have more options to let it breathe. You can set trade 1 to BE and size trade 2 to any retracement you choose. I LIKE THAT IDEA as we could ride out a 62% Fib retrace instead of only the 50% room the simplified version gives us. Sounds like a fun experiment to me. But 10.4 is a keep it simple deal as written, imho.

Mike

[JonWeathers]

lhDT- As of right now I am doing the same lots size as the first order for easier calculation of the BE point. By moving the SL up for T1 and having same sl for T2 along with same lot size I wouldn't get hung up on the risk percentage increase because at this point you have a free trade. Although by doing this we are going to increase trades that are closed out at BE but we can always reenter.

[aworex]

hi folks could you help me out here my EURAUD chart's stockastic is upside down am i missing something here

[spotdespot]

aworex - it's just price feed variation. Mine looks similar - perhaps a bit closer to the bottom but not like Lio's.

[mjws00]

That stoch is fine. It is clipped at 20/80 by design. If you are comparing it to the RSI template... the stoch is currently showing an extra signal and bottomed vs the RSI flat at top.

Upper stoch is overbought/sell, so place your pendings. Lower is oversold/buy so place your pendings. 10.4 will only go long above 240. Short below.

[McNish]

@ lhDT : A suggestion for you if your not doing it already. I suppose you are doing this on a live a/c ? If yes, then just follow the system as it is on the live. i.e once you enter the 2nd trade, your collective BE should be such that you don't lose anything at all from there. Keep an eye on the targets, an eye on the AO and RSI as now they will be the ones to trigger your exit and decide the P/L of the collective trade. As I understand the system reading it from the manual again and again and practicing it, Bob advocates that it's a free ride from the second trade onwards. This is the crux of it. You enter 1st trade, make x pips or x % sl but once you enter the second trade, that's it, no more losses. adjust the collective sl to achieve this one objective alone, no loss if second trade entered. This is the beauty of the system. Your only risk exposure is on the first one. Once 2nd trade is entered, you have achieved two very important positions, Zero risk with more money. Imagine how many systems can claim this. It's like a win / win from here. You hit sl, no loss; you hit tp, no loss.

Try also a variant on the demo and there you can do all your experimentation. But on live, just go by the book and once you've mastered it, create you variations. Hope that helps.

Edit : How come your sto is showing flat / at bottom where as mine is yet to reach even the AO mid line ??