Comprehensive Trading System/Methodology

Detailed below is a comprehensive trading system/methodology that I use to trade the forex markets. it can however be applied to any liquid market across any sector.

It is a comprehensive trading system/methodology that incorporates both with and against trend trading, and although I employ it intraday on the lower time frames, it can be applied across any sensible combination of time frames.

In posting it here I am opening it up for discussion/observation/improvement.

Please be aware that this trading system/methodology will not be for everyone but it suits my present trading temperament/tolerances (these may change.) I believe it's essential technical elements detailed and discussed in the docs are widely used to whatever extent by a large number of technical traders.

The pdf docs should be read in this order:

1. DTS Methodology
2. Set-ups Bullet-pointed screenshots File
2. Optimum Trend Re-entry Points
3. Identifying Potential Support & Resistance
4. DTS & M Examples

There is also another pdf giving some basic help concerning the MT4 charting you will need to operate the Trading System/Methodology, this and the indicators and chart templates you will need to operate the system/methodology are attached to the post below.

Good Luck.

The Indicators and Chart templates are in the zip file attachged, and also here is the MT4 Charting Help guide if needed.

Monday 20/10/08

Set-ups at time of writing logged below:

(Times shown are gmt+2 = as mig/alpari MT4 charting)
0902am Rev B, 5min Rev Extr ii (imperfect re 10bol,) 1/5/15min small charts confirm with 5min fib channel breech (ascend) @ potential res = offers, 38.2% 8668-6776...saw +20+
0929am Re-entry 2, (into 5/30m uptrend, 5/30min macd hists above axis) @ pot RBS = Dly R2...saw +30+
0951am Rev A, 5min Rev B, /5/15min small charts confirm with 5min fib channel breech (ascend) @ potential res = 76.4%7632-7136, offers,..saw +20+
1001am Re-ent 1 (into 5/30min uptrend 5/30min macd hist above axis) @ pot RBS = 2nd test of 0929am area....saw +10+
1031am Rev A, 5min Re-ent 1 (into 30min+ uptrend, 30min macd hist above axis) @ pot RBS = prev bids,...saw +15+
NB: set-up came @ a L on 5min, HL on 30min
1056am Rev A seq, 5min Re-ent 2 (into 30m + uptrend, 30m macd hist above axis) @ pot RBS = prev offers, now bids...saw +30+
NB: set-up came @ a LL on 5min, HL on 30min
1118am Rev Extr, no 5min main chart set-up confirm, 1/5/15min small charts confirm with 5min fib channel breech (ascend) @ potential res = offers now reported 7515/25,...saw +15+
> 2nd test of this Resistance resulted in;
1124am Rev B, 5min Rev A ii, 15min Rev B, other factors as 1118am,...saw +15+

G/L

Thanks bbmac - shall check this out and advise on this forum how i get on.

Tues 21st Oct 08

Set-ups so far:

0909am Rev C, 5min Rev Extr, 1/5small charts confirm@ pot supp = not identified,...saw +30+ pips.
1032am Rev Extreme, no 5min confirming main chart set-up, 1/5/15min small charts confirm with 5min fib channels breech (descending) @ pot supp = not identified....saw +9 at best.
1041am better on the eurusd (1min Rev B, 5min Rev C) and on the gbpusd was a Rev B with 5min imperfect Rev A (re macd div) @ pot supp = Dly S1,...saw +30+ (also had confirming reversal set-ups to 1hr, ie 15min Rev A seq, 30min Rev C, 1hr Rev B.)
1135am Rev Aii with, Re-ent 4 (into 30min = downtrend, 30min macd hist + below axis) 1/5small charts confirm @ pot SBr/Res = offers now, former bids area, Y/day's lo, Prev 1hr swing lo... has seen +30+ at time of writing.
(set-up came at a LH, 5 and 30min)

NB: there is a previous 5min intermediate swing lo that ran 7075-98 that offered minor resistance prior to price finding resistance (SBR) at the stronger area mentioned in the 1135am set-up....better to have waited for the potentially stronger SBR as Reversal set-ups to 1hr at the 6995 low

1135am set-up update
Weak Uk CBI survey data has resulted in more gbp selling re that 1135am set-up, now see-ing over 75pips from the set-up...the 5min confirming re-entry type 4 set-up at potential SBR/Res = Y/days lo, Prev 1hr swing lo, offers now, formerly bids is attached.

A perfect Reversal Extreme set-up at 1208pm , no 5min main chart set-up to cofirm, 1/5min small charts confirm with 5min breech of fib channels (descending) @ pot supp = interim bids now 7030/20, Mthly M1 minor pivot,...screenshot is attached....has seen +20+ pips

No with trend follow thru to fresh lows off the 1135am set-up as yet, gbpusd price 203pips off the i/day hi, that pip range well within the 5,10 and 20day averages.

G/L

The screenshot below shows the potential SBR area that the 1135am set-up detailed above appeared at:

Gbpusd dropped during asian session to 6204 area Lo, reacting to BOE Governor King's dovish comments in a speech in Leeds, Uk last evening.

Set-ups this London/European session so far this morning have been thin on the ground, as follows:

0910am Rev Extr ii, no 5min main chart set-up confirm, 15min Re-ent 4, 1/5min small charts confirm @ potential sbr/res = minor 1hr prev swing lo. set-up saw +150+ pips available.
0952am Rev C, no 5min main chart set-up confirm, 1/5min small charts confirm @ pot
supp = not identified. Set-up saw +150 pips available.
** 1030am Uk data BOE/Mpc minutes 9-0 **

1059am EURUSD Re-entry 1 (into 5min uptrend only), 5min macd hist above axis, but not 30min) @ pot RBS = prev i/day (5min) swing hi's. Set-up has seen +30+ pips available at time of writing
NB: set-up came at a HL on 1min and 5min.

Screenshot of this set-up is below:

G/L

Best set-up of the day so far:

1214pm Rev A seq (or Rev Extr..could be either) 5min Rev C, 15min Re-entry 2 (@ a H) 30min Re-entry 4 (@ a H) (re 15min and 30min re-entry set-ups macd histograms 30min - 4hr below axis) 1/5/15min small charts confirm @ potential resistance = 64560 area offers, 50%fib 6603-6204

NB: the 15 and 30min re-entry set-ups coming at a h not a LH meaning statistically less chance over any extended sample of a with trend follow thru to new lows,...this doesn't mean it won't happen!!

Screenshot of the 5min confirming set-up is attached below:

G/L

bbmac said:

NB: the 15 and 30min re-entry set-ups coming at a h not a LH meaning statistically less chance over any extended sample of a with trend follow thru to new lows,...this doesn't mean it won't happen!!

Click to expand...

Clarification of above comment, this is to say that it has a statistically less chance of a with trend follow thru from the swing at which you traded (in this case the 6450 area) ie that if you had used the 15min or 30min set-up as a trigger, you would stand a statistically lesser chance of a with trend follow thru into the 1hr/4hr trend or 2hr/8hr trend respectively than had that Re-entry set-up on both t/f's come at a LH rather than a H.

Confused, Lol, I'm going for a lie down in a dark room.

the screenshot shows the H circled at which the 1214pm set-up occurred, the 15min chart is similarly at H.

Further attampt at clarification: a re-entry to trend set-up after a pullback has the greatest statistical probability when executed at a HL in an uptrend or LH in downtrend on both the chart it sets-up on and the chart time frame above into whose trend you are entering.
These are the possibilities and they stand a statisically lesseer chance of a with trend follow thru to new hi's or lo's as the list decsends.

(using a downtrend example)

Re-entry set-up t/f @ / time frame above (+) @

LH / LH
H / LH
HH / LH
HH / H


Good, that'll be a lot clearer then (!)

2 more oscillator extreme based set-ups in gbpusd in quick succession:

1412pm Rev Extr with 5min Rev Aii, 1/5/15min small charts confirm ' pot supp = minor bids now 6290 area...saw +100+ pips available
1430pm Rev Extr ii , no 5min main chart confirm, 1/5min small charts confirm @ pot supp = i/day hi area/offers,...saw +20+ pips available at time of wrting.

The screenshot is the 5min confirming Rev Aii for the 1412pm set-up

G/L

I will be discontinuing any further posts on this thread due to lack of discussion/feedback.

Thanks,

G/L

bbmac,

Most people who share a trading strategy just do some half hearted post with a few rules. You on the other hand have gone to an obvious huge effort in putting your strategy together, an 88 page manual, complete with charts, templates e.t.c

There is a lot to work through so repsonses may not be quickly forthcoming. But that does not mean your efforts were in vain. Please continue giving us your thoughts and trades using this system.

Agisthos said:

bbmac,

Most people who share a trading strategy just do some half hearted post with a few rules. You on the other hand have gone to an obvious huge effort in putting your strategy together, an 88 page manual, complete with charts, templates e.t.c

There is a lot to work through so repsonses may not be quickly forthcoming. But that does not mean your efforts were in vain. Please continue giving us your thoughts and trades using this system.

Click to expand...

I have responded to you via pm,...thanks for your thoughts, I understand the point you make, so should there start to be any discussion of the trading system/methodology via this thread i will indeed respond to that.

A summation of the best use of this trading system/methodology is detailed below:

Trade the set-ups as they present themselves @

Previous Swing Hi/Lo areas (ie calculate the Zones at those areas per the methodology contained in the Identifying Potential Supp/Res/SBR/RBS doc)

i. 1min set-ups @ a 5min (intermediate t/f) zone

ii. 1min set-ups with 5min set-ups to confirm @ a 1hr zone. (Remember the 1hr t/f is used as a proxy for the 30min trend t/f in respect of previous swing hi/lo areas.)

Where no obvious 5min or 1hr previous swing hi/lo area/zones exist use;

a. Fibs (clusters better)
b. T/lines on 1hr +
c. Previous (Where price has broken)/ Current bids/offers touted.
d. Dly Piviots (S1, R1 etc)


NB: Pre-identify (and make a post-it note if it helps) of the 1hr Previous swing Hi/Lo areas and their zones then note what other factors listed as a-d above [if any] exist in the zone.

You can effect the above for the 5min Previous swing Hi/Lo zones, pretty much by use of the cross hair tool on the charting, although seperate notes made as for the 1hr areas, can be useful.

On starting your trading session

Mark Douglas calls it '...getting in the zone'

For me this consists of having as much pertinent information as I can about the market I am about to trade;

1. Make a mental Note of Yesterday's candle/last 4hr candle direction. Note too the current conditions that exist on the trend and intermediate time frames (trend or range?)

2. Update fibs and Previous swing Hi/Lo areas on the trend t/f chart+, and any relevant trend lines on this trend t/f +

3. Compile an A4 sheet detailing:
a. Asian (or previous session if not Asian, ie London/european or U.s) Hi/Lo
b. Yesterday's Hi and lo
c. Any bids/offers touted in the market
(d. Daily Pivot, S3-R3,)


4. Then pre-identify the Potential Supp/Res/SBR/RBS in the market by making a note of ;

a. The trend t/f Previous Swing Hi/Lo zones
b. The most immediate interemdiate t/f Previous Swing Hi/Lo zone, (noting these zones as price action develops.)

Note whether any of the other factors that may cause support or resistance occur in each zone.

5. Be aware of any upcoming data releases/speeches etc..

I am then ready to start trading aware of the prevailing market conditions (trend or range) on my intermediate and trend time frames and whether these are with or against the prevailing trend on the longer t/f's,) as well as having an accurate idea of which areas in the market may offer support/resistance.

Patience is the next requirement, the patience to await a set-up at one of the zones that I have pre-identified.

G/L.

Hi BB

Just wanted to check. When I load up your template, it does not show any of the bollinger bands etc...

Am I suppose to add it in myself? Sorry did not have time to run through the whole thread and PDF files now as I am in office.

Will be going through it tonight. Sounds very interesting but complicated ... Hope I can understand it.

babymush said:

Hi BB

Just wanted to check. When I load up your template, it does not show any of the bollinger bands etc...

Am I suppose to add it in myself? Sorry did not have time to run through the whole thread and PDF files now as I am in office.

Will be going through it tonight. Sounds very interesting but complicated ... Hope I can understand it.

Click to expand...

Hi,

You must be missing the custom built bols that has the option of a centre line (I blank out the centre line) it is attached here. Bollnocl (boll-no centre line)

As for it being complicated, ...well it's all about identifying supp/res, recognising whether your intermediate and trend time frame are ranging or trending, then memorising the set-ups and having the patience to wait for them at the potential supp/res/sbr/rbs areas you have pre-identified.

Example today 0857am gmt...Rev Extr ii, 5min Re-entry type 2 @ potential sbr = prev 5min and 1hr swing lo zones and 38.2% 6495-6108,...has seen +30+ pips from a 6247bid entry (although into the 30min trend t/f downtrend @ a LH, the set-up came at a H on the 5min intermediate t/f, so less chance of a 'with trend follow thru,' so either stop to b/e or take profit...)

G/L