Profitable trading thanks to MoneyTec forum

[dee]

Hi everyone,

This weekend I looked at ADX as a filter. I changed my risk on ASCtrend to 3 and had the ADXfilter at 12 periods. Generally around the time of the ASC signal you will see the DI+ and DI- crossing, indicating a change in trend. If the main ADX reading is 20 or greater, the trend is strong.

I have only visually backtested this and it looks good. I recall someone here mentioning Jan27 & 28 being bad days. By using the above, no trades were entered on the 27th and the 28th was a winner. With the ADX as a filter I did not wait for a movement of 30 pips before jumping into the market. I felt that the signals are strong enough to enter. Ohh one more, but not necessary, if ATR is less than 15, the market is most likely ranging and it's not a good idea to jump in (unless its the open of the London market and not much was going on in the Asia session) I set this to the same period as the ADX, 12.

Some thoughts about money management. I was thinking about entering 2 lots (or however many that is divisable by 2). Once the trade has entered say 20/30 pips profit, exit half and move the stoploss to breakeven (entry). This way you're ensured some profit and you can let the rest ride the market with an appropriate trailing stop.

My visual backtest shows that when everthing is in order, the price rarely drops back to entry. We'll see how this works in real life. Check this out. Play around with this but keep your other indicators on the screen. I did and that's why I like this so much.

gl & gt,

dee

edit: I forgot to mention that if DI+ is greater than DI-, an uptrend is forming. If DI- is greater than DI+, it's a downtrend...and should match your down ASC signal.

[pumpkinpie78]

Thanks Dee,
I was just sitting here looking at ADX and trying to make some sense of it, right before I read your post. I've decided to throw out the trade entry at 30pips rule. There are definitely better ways to enter a trade. Also, a lot of times, entering at 30pips away will only result in a reversal. The momentum of the market also plays a big role in when to enter and exit. For example, if I went by the rule of exiting when ASCT lights up on the 15min chart, I would have exited prematurely today in GBP/USD and EUR/USD (still riding the down trend from Friday ). Another thing that I've noticed are the daily pivot points. Price likes to hang around these points. Also, thanks Compro and ZenSeven for your input. I'm beginning to think that 300-500pips/week is possible. Anyone on my side, lol?

[pjhcantab]

Pumpkinpie,

I'm trying to work out different entry signals, to find a way around this pesky 30-pip rule. I see you have AOL instant messenger -- if you come online this morning, send me a message: it's "harriscantab" -- or anyone else who makes it on this morning.

..

[compro00]

working around the 30pips is bad move. I would say reduce it to 25pips.

Check out the attachment on price action.

[pumpkinpie78]

Originally Posted by compro00

working around the 30pips is bad move. I would say reduce it to 25pips.

Check out the attachment on price action.

Interesting attachment. Having a mechanical trade entry rule certainly has it's benefits because it's emotion-less.
Today is probably the worse trading day ever, I don't even think scalpers can make pips from this kind of market.

[compro00]

i've been monitoring. Mark3 system is good for London time. Roughly from 7am - 5pm GMT.

[pumpkinpie78]

PJ, it was good to see you this morning. To answer your question about exit signals. I have quite a few, ASCT lighting up, EMA crossing T3, Parabolic SAR on 5, 15, 30, 1hr time frames. For example, if market is trending smoothly and uniformly for two or more days, I would exit when ASCT lights up on a 1hr chart and that's what I did with the downtrend of GBP and EUR from last Friday (I also look at the daily and weekly chart to get a general idea of where price is heading when a day trade becomes a swing trade). For something like a 100pip spike, I might exit if ASCT lights up on a 5min chart or I might exit because I was too excited, . Usually I'll use Parabolic Sar, if I'm not around to monitor the market.
I'm not currently trading my modified version of Mark3's system (which is on page 16 if anyone cares to look). But I am tracking it in both the EUR and US session, and keeping an eye on other people's development of the system. I would love to trade an emotion-free mechanical system, but for now, I'm looking at different things - Fib. Lines, Pivot Points, candle stick and chart patterns for scalping. So far, it's as good as a coin toss, which might not be a bad thing if I have my risk and money managment right. For the regular day/swing trades, I'm also looking for trends in RSI, STOCH and ADX. Let say all three of these indicators were trending up, breaks the halfway mark to indicate pressure on the buy side (for ADX, it would indicate increasing momentum), at the same time ASCT, Heiken, EMA's & T3 are all confirmed for buy, whether price has moved 30pips ahead or is already 40pips ahead, I would probably pull the trigger.

[pjhcantab]

Well, it looks like the dollar upswing has definitly come to a halt. Does this mean that we're going to be in an extended (weeks or even months) period of range trading? And, if so, what do you think it does to our system?