No Name Trading System

Today I would like to share with you a trading system I developed a while back. I have been using this method since October 2009 with consistent profits. System performance can be viewed at my MT4stats page by clicking on the link in my signature below

 

I will present to you this system in the simplest format possible so that it is easy to understand and will include tips that will help in your implementation.

 

In short, the system consists of four indicators and those are:

 

1) Triggerlines2 (20,5,300)

2) Close Line (20,5,300)

3) Zero lag MACD (12,26,9)

4) Cycle_GJH4

 

The system utilizes 3 time frames to represent short, medium and long-term trends. The time frame of the trend could by anything you are comfortable trading; the only rule is that each progressively higher frame needs to be at least 4 times the prior frame. Personally I use 1Hr, 4Hr, and Daily charts. Since I am not able to be in front of the screen at all times, I have chosen time-frames that will allow me to swing trade the market at a comfortable pace.

 

I use the long-term time-frame to determine trends, the medium-term time-frame to determine setups, and short-term time-frame to determine entry.

 

Types of Trades:

 

1) Trend Trade: a market position in the same direction of the long-term and medium-term trends; position taken at the start of the trend

2) Trend Continuation Trade: a market position in the same direction of the long-term and medium-term trend; position taken after a corrective move or counter-trend to the main trend exhausts itself.

3) Counter-trend Trade: a market position in the opposite direction of the long-term trend. Utilized short-term and medium-term trends to trade; position taken at the start of the corrective move or counter-trend on the short-term time-frame.

 

Tip:

- Counter-trend trades are of highest risk.

 

 

Market Evaluation:

 

The first thing I do is determine long-term trend using the Daily chart. I am looking for descending/ascending Trigger lines, with bar closes below/above the fast Trigger line. In addition, I am looking for descending/ascending Zero lag MACD and Cycle_GJH4. This tells me that a trend has been established.

 

Tip:

- Trade only when trend is established on highest time-frame. If trend is unclear, stay out!

 

Next, I evaluate the medium-term trend on the 4H chart. Initially I determine whether the indicators on this time-frame are in agreement with the longer time-frame or in contradiction. If medium trend is in synchrony with the long-term trend I only trade trend and trend continuation trades. If medium trend is not in synchrony with the long-term trend, I then either stay out of the market, or capitalize on counter-trend setups.

 

Tip:

- Trend and trend continuation trades should always be in the direction of the highest time-frame.

- Trend in the second highest time-frame will last longer when in the same direction as the trend in the highest time-frame

 

Once the state of trend on the long-term and the medium-term is determined, I use the 1Hr time-frame to time my entry in the desired direction of the trade. This means I attempt to obtain best entry price by timing the tops and bottoms.

 

Tip:

- Never base your trades on the lowest time frame alone, only use the highest two frames to determine trade setup.

 

Types of Setups:

 

Whether I am trading trend, trend continuation or counter-trend trades, I always look for 3 setups to trade and those are:

 

1) Fresh Cross: (Trend Trade)

a. Cross on second highest time-frame in same direction of trend on higher time frame

b. All indicators are changing directions on the same bar (i.e. fresh cross or turns on all indicators)

c. Cross must occur on previous bar or higher (bar 1+) and not current bar ( bar 0)

d. Entry is on bar 0 once the cross has been established.

 

Tip:

- A cross is when the two signal lines (Zero lag MACD and Trigger lines) have crossed over each other one bar ago. Crosses on current bar do not count.

- Never trade after a long candle

 

2) Fast Retracement (Trend Continuation Trade)

a. Trigger lines are well separated with steep angle of separation.

b. Zero lag MACD Fast line is well separated from Slow line

c. Price retraces main move sharply in the same candle and in opposite direction of trend.

d. Enter in direction of main trend

e. This is the only trade that takes place on current bar or bar 0 in real-time

f. Will require you to be in front of the screen to catch it

 

3) Slow Retracement

a. Trigger lines are well separated with steep angle of separation.

b. Zero lag MACD Fast line is well separated from Slow line

c. Price retraces main move over several bars and in opposite direction of trend

d. Enter in direction of main trend

e. Entry is on the open of bar 0 once bar 1 retraces to touch the fast Trigger line

 

Important Points to Understand:

 

1) Trade setups should be used as guidelines. As you practice and gain experience you will be able to determine the strength of the setup.

2) Zero lag MACD and Cycle_GJH4 indicators are susceptible to divergence (i.e., they will go one way and price will go another way)

3) If observation 2 above occurs on the long-term time-frame, stay out of the market or take counter-trend trades.

4) ZerloLag MACD will always respond first to changing market conditions and thus is more susceptible to whipsaw/fake-outs as time-frame decreases.

5) Triggerlines will respond second (most reliable)

6) Cycle_GJH4 will respond third

7) Triggerline and Zerolag MACD separation, the wider and steeper the slope, the stronger the momentum and trend

8) Cycle_GJH4, the steeper the slope, the stronger the trend.

 

Money Management:

 

Personally, I only trade at 1:5 leverage. This allows me to risk up to 2% of my trading capital without significant loss to my account. Furthermore, I average cost my entry to allow greater room for entry errors. For example, with a $10,000 account, I will only trade 0.5 lots total at any given trade. I enter the market with 0.25 lots and place a limit order 20 pips away from previous order. The stop-loss for both orders would be the same and set at 2% of account balance (which would be $200 in this case). My take profit is usually based on previous highs/lows or support/resistance levels. Furthermore, when entering a trade, I look for at least 1:2 risk to reward ratio.

 

Exit Strategies:

 

Specifying a single exit strategy I consider is a futile exercise and thus I utilize an arsenal of exit methods. Each method is used at a specific situation which only I deem is appropriate depending on my position, time of day, time of week, news releases, etc. Only you can determine which method suites your trading most appropriately. Below is a list of those methods:

 

1) Set account %

2) Set point target

3) Time of day or week (e.g. close at end of day or close at end of week)

4) Previous Highs/Lows

5) Trend-line support/resistance

6) Fibonacci support/resistance

7) Reverse signal

8) News release time

 

Please note that this list is not exhaustive, but those are the methods that I employ.

 

Important Trading Tips:

 

1) Resist the urge to catch bottoms and tops

2) A safer entry is on pull back or hesitation points

3) Do not trade on anticipation, only facts

4) Indicators on higher time-frames supersede indicators on lower time-frames

5) Do not over-trade, wait for setups, you may not, and most likely will not, have a trade everyday.

 

 

Further Development:

 

I have recently been tinkering with the application of Fibonacci support and resistance levels in a whole new way to complement this strategy. More details on this development can be found here in this forum, but this is a separate discussion.

 

I hope you found this post easy to understand and follow. If you find any point unclear or require further expansion on the subject please do not hesitate to leave your comments with your questions and I will be happy to revise the post to address them.

 

Happy trading.

 

Cheers,

hxxp://www.megaupload.com/?d=HXRM8RUJ

you have got my thanks for your effort!

hello gopala,

this is nice of you, keep it up .

Sharing is addictive,.

however post a pic. of this then we shall all understand beta.

thanks

Please review the attached chart showing the Long-term, Medium-term, and Short-term charts that I use.

 

This is a situation where I am sitting idle waiting for a setup to happen before I jump in.

 

Long-term trend analysis: Overall inclination - Short

 

1) Price closed below resistance level (Short)

2) Trigger lines loosing momentum and are closing (Short)

3) Price bouncing off 34 MA (Long)

4) Zerolag MACD crossed to the down side and well above zero line (Short)

5) Cycle indicator started to loose momentum and curve down (Short)

 

Medium-term trend analysis: Over all inclination - Neutral

 

1) Price well below resistance level (Short)

2) Trigger lines strong momentum to the down side (Short)

3) Price extended far from 34 MA (Long)

4) Zerlolag MACD crossed to the up side and well below zero line (Long)

5) Cycle indicator with weak momentum and curve down (Flat)

 

Short-term trend analysis: Over all inclination - Neutral

 

1) Price at resistance level (Short)

2) Trigger lines consolidated and tight (Flat)

3) Price bouncing off 34 MA (Long)

4) ZerloLag MACD flat with consolidation (Flat)

5) Cycle indicator started to loose momentum and curve down (Short)

 

 

Possible scenarios:

 

1) Long-term trend to continue the impulse wave to the downside with a possible support target at 1.9667

2) Long-term trend to continue the correction wave with a possible target of 1.26037 with divergence on ZL MACD.

3) Medium-term trend to retest price level 1.23168 before continuing down (ideal for entry and could confirm scenario 1 above) for a possible target of 1.21539

4) Medium-term trend to close above 1.23168 with a potential target of 1.24538, then 1.26037.

5) Short-term trend is irrelevant at this point since Long-term and Medium-term trends are not in sync.

 

My instinct tells me that the EURUSD will continue its dive for a potential target of 1.9667, but we don't trade on instinct and so I will wait for my setups to happen

 

Please note that I am not providing recommendations to act on, I am simply sharing with you my personal opinion on what I think will happen. I could be wrong and I have been wrong in the past, so make sure to make your own analysis as well. Uploaded with ImageShack.us[/img]

Edited December 14, 2010 by gopala
images not clear in previous post

Thanks for sharing your method.

 

Your post is articulate and well-composed, many thanks for that as well.

thanks for sharing.

I believe its called pricemasterpro.... I have seen this and many other posts about this and even been to the website where it's COMING SOON. If the system has been working for so long when might you think we can Buy it ? or is this another one for the bin ?

I just had a look at the "no name" system performance before even seeing what the system is about. I'm posting a partial picture which shows the latest trades. I marked the pips column. Although overall profitable I can say I would be "just a tiny bit" scared to trade such a system. Not only the total of pips but the sequence of losses is impressive. Opinions?http://i54.tinypic.com/oka5x4.jpg

Thanks for replying Pip.

I did find the forums where you posted your system. I will spend some time on them. As for the winning trades of course there are but they're accounted for in the final total. I was only scared by the very long losing sequence which would require guts of steel and a blind faith in the system to carry on trading. :)

not that it's important as the point remains but my Excel still gives -339.1 http://i54.tinypic.com/281eo9t.jpg

Please review the attached chart showing the Long-term, Medium-term, and Short-term charts that I use.

 

Uploaded with ImageShack.us[/img]

 

What indicator is drawing the horizontal lines with price, are they pivots ?

and could you provide the link for that ?

Date: 12-28-2010 (this is the one you are missing in your excel sheet Alright) :)

Position:Long

Trade Setup:Fresh cross (4Hr)

Entry Price: 1.31698

Profit Target: 1.32300

Stop-loss: 1.31944

Exit Price:1.32300

Profit: 60.2 pips

 

Cheers,

Pip

Sorry I didn't get your joke on my other post :)