10.4 A Complete System

[SteveHopwood]

Some of you have been writing about how CSS kept you from a bunch of bad trades and that is good news. But today I am very discouraged. Not because I lost a lot of money, just a little .5% of my account. I am discouraged because some stuffed shirt in Europe name Draghi (nickname Dragon) went Blah blah blah and the market moved 100's of pips all over the place. Was it based on fundamentals, no. Was it based on indicators, no. 10.4 was giving great signals, no. prices were way outside normal boundaries. What am i supposed to trade anyway.

etc

Yeah Steve you are right in what you said but you shouldnt be.

Well, genius is what genius does. What can I say?.

More to the point, don't beat yourself up. Not sure where the saying, 'Shit happens' originated, but it is very true wherever it came from.

Stuffed shirts come; stuffed shirts go. Dem markets, dey carry on goin' up, den dey go down, den dey go up again, den dey go down again............

Ok, so sometimes they to up, or down, more than usual but there is stuff all we can do about that. At least, until we are all filthy-stinking rich, form a collective SHF National Bank and tell the markets exactly where they are going to go.

[nanningbob]

I kept out of the xxx.jpy during late May except jpy/cad. That thing sucks. SO I have dozens of pendings waiting for BOJ to get there bond buying thingy going. Trust price action, you would have had your pants, shirt house, car two GF and what ever else you owned handed to you in April if you had done it then. So you can be giddy now but I remember everyone crying in their soup that didnt join the bandwagon then because price action didnt dictate it. Price action didnt dictate yesterday's move either. That was caused by some banker going blah blah blah. There were all sorts of nice W's being formed on 4H charts of every xxx/jpy pair until the bottom fell out. Nice double bottoms with price going back up on the back side of those W's and then DRAGONHEAD　went blah blah blah. So much for following that price action crap story. Dont come into my forum talking your fox crap when the fox crap yesterday was dead wrong. There is a fox fur sale going on in downtown Paris today.

[6y588]

I have NOT given up on NB 10.5, but I have been nervous about the BOJ delay and decided not to adjust any of my pending stops, difficult to be out of the market, but which were clear of yesterday's tsunami. Had one UsdJpy trade from a few days ago, which I chose to cut loss (1-2%) and try to make it back next time. Have been using stops for NB 10.5, seldom use limits, never do I trade at market, and I always have a price objective. Buying at market without a R/R usually means having a herd mentality and clueless about price target.

[mjws00]

I see it a little different. I think people are discounting all the profits the macro moves gave. It's perfect in hindsight to say "JUST FOLLOW THE RULES." But you can't have the upside without the risk. There is an edge to be had, but it isn't as simple as it may appear.

I think there is a balance that is found in experience. Bob knew to step aside because something was 'off'. He posted that he punched out a while ago from just holding JPY longs. That isn't coincidence, that is good judgement. It is also what makes it difficult to successfully follow someone else's calls. You are late in, and late out. Or you get stuck "hoping" and hurt your account. Tough way to profit.

There are some good lessons in these moves. But throwing out macro analysis isn't the one to focus on, imho. It is hard not to be hyper aggressive when you see the numbers thrown about in here.

This is one day in a mostly retracing week. I have a board full of RSI2 pegged the wrong way. It will turn, I will tag them as they appear. I'll continue to be jealous of the folks with 50+ trades. I been sitting on my hands all week. For me that is tough.

Good Luck all. I wrote 6 essays and deleted them. We learn the most from the difficult ones.

Mike

[garyfritz]

I lost... Selling JPY... TODAY! How's that for being lame?!

Say, that IS impressive. And as possibly the only person on earth who LOST MONEY in the biggest bull market in history (1985-2000), I'm something of an expert on the subject...

[kwanann]

This reminds me of how people give up or don't follow a system simply because of a single day of failure.

Everyone expects a system to work ALL the time, and that the system is ALWAYS profitable, so the day when it doesnt, people move on to find the next holy grail.

A system cannot fully replicate 100% of the thought process of a person, neither can it replace the experience the person has gathered over the years of trading forex.

Sure there will be profitable days and they will be days where the losses makes you want to give up totally or after a margin call to your account.

The important thing is to treat those as a learning experience. Money lost can always be earned back, but once you give up, thats it.

[TraderDesk]

In my experience explicit rules do not work in trading all the time as the market do not adhere to those say rules. I have seen the best people in engineering, math and psychology brought together to use rules that they determine would work. End results were blown hedge funds...

What for me works is rules for protecting my capital. I can only speak from my experience which tells me that when a trade goes wrong close early. When a trade goes good add more trades. Don't over leverage yourself except when a currency pair is trending strongly and if a retrace starts to happen close early.

10.4/5 is a good system especially for new retail traders. It will teach you patience while helping you to learn and earn at the same time. The component that a trader needs to add to this is risk management that will protect their capital. I was seeing posts here with traders losing up to 90% of their account. No risk management whatsoever. 10.4 is not at fault. This is a system that will have many trades that will go against it's open positions so blindly following it with leverage is just a disaster waiting to happen.

Price action for me will always be true. Why? It is the sum of all the influences within the market. News events are a momentary influence that have a temporary shock on the market and will effect events usually on the shorter time-frames. Fundamental events after their initial shock on the market effect the longer term time-frames(weekly,monthly). I bring this up because I don't want to get caught up with the news in my trading. It will cloud my judgement.

Example: JPY is in a weakening path that is support by a fundamental currency policy from BOJ. When I trade this currency that policy is in my trading strategy. What I must be careful with is not to open trades in an environment where price action is showing me different day after day. Here is where I supplement my system with a visual analysis. Price kept hitting 240ma or slightly above it. Once or twice price hitting this does not mean a bias change but when it does this more then I need to listen to what it is telling me. In this case I listen and closed my buy positions all for profit. It was hard as I kept saying to myself BOJ will do what it did like the last three months but it did not occur. I listen to price action and I made money. If I had listen to news whether fundamental or not I would have been in a negative position or even had to close out.

This post is getting long and my wife is giving me dark looks as I am on holiday here in Greece so I must get off the laptop but I hope that my experiences will give some ideas or additional discussions.

[Jemook]

I'm technical all the way.. Never followed news and never will. I know it's an extreme view but I just don't have the time to keep up with fundies so if I'm ever going to make it in FX trading it has to be charts only.

[nanningbob]

Does any one have the indi that draws line every 100 pips at the 00 line. I have seen people with these but I have never had one. I guess I need a new toy to play with.

[SWG123]

Does any one have the indi that draws line every 100 pips at the 00 line. I have seen people with these but I have never had one. I guess I need a new toy to play with.

This is the one I use:-

SweetSpotsGOLD.mq4

EDIT: Please note that for 5-digit brokers you need to add an extra '0' to 'SweetSpotMainLevels' and 'subLevels' in the parameters.