10.4 A Complete System

[bshoe24]

They may not be taking new US customers, but if you were with them before they moved to Belize, they didn't kick you out.

Their site says they are going through a compliance review. When it is complete, they may open up and take US citizens again.

CJ

It has said that for many months now.

[rebyte2]

This is my pick for the coming week.

EURAUD is in a strong downtrend, with nice entries on pull backs.

RSI (2) is 'telling' us to place pendings for the next leg down.

Also have EURCAD and EURGBP on my alert.

Cheers... Roscoe

PS... Have a great St. Patrick's Day to all those crazy Irish buggers.

[nanningbob]

I wanted to address an issue I have seen a few people talk about: carrying a trade over the weekend.

I think this is a very risky practice, especially on the AUD or JPY crosses or any less liquid pairs. You are leaving yourself exposed to events over which you have no control. If some big global event happens over the weekend, your stop losses will not hold if the market opens well past them.

There is another reason. As the market slows down towards close of business on Friday, you are leaving yourself open to a sudden spike and widening of spread that could take out (and even blow past) your SL's. Here is a PIC of one on Friday on the 1 min chart just as market closed. Sometimes these are rogue “anomalous price spikes” that your broker will correct (hopefully), but some are real.

I happen to think my broker is one of the good guys. After dealing with one of these (and fixing my trade) a while back he explained the risk to me in more detail:

It isn't the volatility caused by news etc, that is an entirely different scenario, whereby any liquidity is depleted super quickly or the prices quotes are pulled and revised equally as quickly. This scenario is the same as a rollover scenario where the is almost no liquidity. As each bank stops quoting then the market becomes less competitive until there are a just a handful of banks left that are offering prices and their prices happen to be super wide.

In normal times there are perhaps only five or six major banks making the market for any AUD crosses, whilst there may be as many as 20 or so banks that are actually quoting prices. Imagine a 'ladder' at the top of the ladder is the best price, the next rung has the next best price and so on. As the major banks that are making market for the AUD pairs stop quoting they drop off the ladder and thus the best price becomes the rung lower. After they've all disappeared you are left with the 'worst' quotes, still perfectly valid, but not from the major AUD players. Perhaps these are speculative quotes from the banks that specialize in JPY pairs for example.

So it isn't a question of news it is a question of liquidity which was essentially gone as the key banks had left the market.

Just FYI this isn't just confined to the AUDNZD this happens to all pairs. One by one the banks stop quoting and thus the market becomes less competitive. The EURUSD which is the most liquid pair quoted widens its prices to maybe 50pips sometimes at market close. This is why market close and carrying positions over the weekend and thus becoming exposed to such events as this and possible gaps are the most dangerous possible trading conditions.

Taking trades and keeping them over the weekend comes down to what kind of trader you are. Short term traders generally do not keep trades over the weekend. It is why I play the reversals off of the Euro Close on Friday night and netted almost 150 pips on several levels on the gbp/nzd. That trade cleaned out one of my worst trades in a while. In fact I used 7 winning trades to close out 4 losing trades and cleaned up my DD. For those who do and understand recovery trading Friday night euro close is your best spot to clean up bad trades. A part time trader could trade just that time and with big enough lots make some serious money. Catching the Friday, I am in profit so I am closing out traders.

Long term traders, ones who use daily charts and up are not bothered by the weekend glitches or bumps in the road. They are following Macro economics, represented by the 240 line for me, and know these temporary reversals are just that. So they will hang in there long term. Grimweasel has posted several times about his longer term trades and the wisdom that goes with it. He likes to hang in there with a trade for days or even weeks at a time. I admire guys like that but that kind of trading is too difficult for me. I really am a sorry trader, but I am profitable so other sorry traders like to follow this sorry trader. LOL I see those 50-100+ pips profits and I just cant sit on them and watch them disappear with a rally/dip in a trend. I rather take them and then reenter later after the next rally or dip. Grimweasel can do that, I am not that patient, mainly because I dont have the time to analyze whether it will continue or not. I am very much of a see a signal on a 4H chart and trade it type of guy. My win ratio hangs around the 75% win mark which means all I have to do is prevent the account killer trade and I will be profitable. Limit all my losses to 1-2% and I will always be on the winning side long term. 10.4 gives me that winning edge, MM keeps my account intact and growing, and best of all, I dont have to think, I just have to trade.

One of these weeks I am going to drive trading Purists nuts by doing over 100 trades in 1 week using a 4H chart. That is what guys do on the 5M charts not the 4H chart. I am one weird trader.

[nanningbob]

I have tested Sto5, RSI2 and Laguirre. My preference is to use the RSI 2 and will be using it on my 4H charts. For those more patient traders Laguirre is for you, for trade happy people RSI 2/ Sto 5 will work. Use sto 5 if memory usage of your computer is an issue otherwise RSI 2 is my choice.

[nanningbob]

OK here is a 10.5 test version. Use this when markets are slow and you want the 20-50 pip hit off of the 1H chart. The rules are simple when you see a signal on the 4H chart go to the 1H and trade in that direction using daily P/S/R and DMS/DMP lines. Lower your lot sizes some, place your SL below the last low/high or P/R/S/MR/MS line. Add some extra levels for 1 or 2 levels and take profit 2 or three levels later. US a trailing stop or Steve's MPTM or Jump EA and keep those small profits.

Rules are simple green line represents the 240 on the 4H chart and is the 960 on the 1H chart.

BUYWhen price is above 960 green line and Sto5 is below 25 buy, set 1 or more buy pendings on the Mid or R lines above Price action. (DO NOT PLACE BUYS ABOVE THE Daily R1, DO NOT PLACE SELLS BELOW Daily S1) let her rip and take those 20-50 pip pops.

SELL When price is below 960 green line and Sto5 is above 75, set 1 or 2 sell pendings on the Mid or S lines below price action. (DO NOT PLACE BUYS ABOVE THE Daily R1, DO NOT PLACE SELLS BELOW Daily S1)

Take Profit at 2-3 lines above your entrance and see what happens. Set some kind of TS or jump stop.

You are going to have more SL hits but the multiple levels should help you over come those. Have fun and this is just a practice run for 10.5. Slow day, go scalping.

[Guest]

awesome, can't wait to test it

[Guest]

you have to wait until you get a signal on the 4h, then take it on the 1h ?

[Wingman]

Just read through a couple pages..... over 197 pages in just 1 month... incredible.... Just download all the files... will try this out tomorrow..

Great work...Thanks

[Wkcfx]

Bob, thanks so much for your great effort and sharing your knowledge! I sure your Birthday, 10 year anniversary, and weekend were all great. Wow what a combo!

Bill

[chye]

Thank u for your new version,Bob.
But do u have any booklet about 10.4 ver5.0?