Steamroller’s EURUSD Swing Trade Journal

[SteamRoller]

Changed charts to a white background...easier to see and less toner when printed off for my diary

 

[Black Swan]

Hi Black Swan,

I have two methods. One method is to take 20 pip stops, in the expectation that you'll more than likely get stopped out, and keep putting the entry / new 20 pip stop in each time you get stopped out. Advantage of this is is you don't miss a big move by just getting stopped out, and then the market going without you. Disadvantage is in a sideways day, you can get a lot of whips, so drawdown can be a bit fierce...

Second method, I'm using either a volatility based stop, loosely based on ATR for the entry TF, or putting the stop beyond the event that got me in, e.g. if a pinbar bar then above / below the 'other end' of the pin. Either way, this seems to give traditional stops of around 60 pips.

Fascinating, thanks for sharing. I have my best results swinging EUR/USD followed by GBP/JPY. I 'auto' enter a 120 pip stop as part of my trading settings then move it to the HH or LL of the session, or previous day, whilst taking care of the big round numbers. My latest losses are on average circa 55 pips, so not too far from your 60. I've optimised my entry to now enter off a 2hr chart, this has made huge improvements...

Losing on average 55 on a swing, and then most times getting confirmation to swing the other direction, before the stop is breached which is a rare event (perhaps one in ten losses), is as good as It'll ever get for me..

 

[SteamRoller]

Cheers for that, Black Swan.

We should perhaps discuss in more detail, as time goes on and the chart(s) unfold...

 

[Black Swan]

Cheers for that, Black Swan.

We should perhaps discuss in more detail, as time goes on and the chart(s) unfold...

Sure.

 

[SteamRoller]

Setup invalidated.
Watching price action at 1.3860 reaction area. Potential pinbar on 480 minute chart, but not a great looking signal. Would prefer to see 1.3860 Resistance broken and rejected.

 

[SteamRoller]

Sold short at 1.3795 on break below 480 min pinbar. Not an ideal reversal signal due to a small tail on this bar and also stopped short of reaching the 1.3860 previous resistance, but trade fitted the strategy so I took it.

I didn't get around to posting this, so to confirm I'm not making these calls with the benefit of hindsight, I attach a screenshot of the TradeStation trade log showing when the entries were filled etc.

Price has now moved down towards the next interest area, where previous resistance has been seen around the 1.37 RN. Target 1 hit for +40 pips, though T2 just missed (would bank +80 pips) and price has retraced to approx 1.3750.
Stop on remaining 2/3rds moved in to just above the 1.38 RN, at 1.3810.
Stops on this are traditional (not the 20 pip auto replace). Original stop at 1.3845 i.e. 50 pip risk.

 

[SteamRoller]

Friday's short trade hit T1 and just missed the second scaleout at T2.
Currently still short on 2/3rds of the position from 1.3795, but
480 min chart has moved down to the next 'reaction area' at around 1.3750 (half RN). I have identified this as a reaction area as previously on two occasions it has represented resistance on the Daily TF.
Might now turn out to show support here?
As we are at a reaction zone, and a potential reversal away from that (i.e. long bias) looks as if may be in the process of happening (pinbar on 480 min chart), I will trade long off this 480 min pinbar assuming valid price action remains upon open at 22.00 Sunday night.
Otherwise this situation remains biased short and the short trade will continue.

I have shown the 'reaction zones' as I see them on the D chart as yellow bands. This is not an exact science, obviously. I don't imagime for one minute that price will turn immediately and exactly at a horizontal line at an exact price - hence zones of potential reaction that are 30, 40, 50 pips wide.

The only other thing to record is that whilst for the '20 pip auto replace' I am using 2 contracts, for the traditional stoplosses which are placed beyond the entry event, I am using 3 contracts. T1 is close to get some risk off quickly, T2 is at a mid level approx 1.5x stopsize, and the third is run until a chart based exit dictates closing the trade.

 

[SteamRoller]

Short trade hit T2 for +80 pips overnight at 1.3715.
Remaining 1/3 stopped out for +15 at 1.3770.
Overall trade outcome, T1 (+40), T2 (+80), T3(+15). Average = 45 pips.
New long triggered at 1.3770, stop 50 pips, targets T1(40), T2(80), T3 runner.

 

[SteamRoller]

New long triggered at 1.3770, stop 50 pips, targets T1(40), T2(80), T3 runner.

Hit T1 (+40) at 1.3810 and T2 (+80) at 1.3850.
Stop on final contract moved to b/e at 1.3770.

 

[SteamRoller]

Now flat having been stopped out of the last 1/3rd of the long trade.
I've been a bit lucky really as both the last two trades just hit second target before reversing, with final contract stopped out for a tiny profit and break even respectively.

It does however reinforce the fact that even trades that don't follow on and give a 'home run' can still be profitable albeit modestly, and I find this psychologically easier to trade than going for home runs all the time and beng stopped out for a loss on these sub - 100 pip moves...

 

[SteamRoller]

Price is at an interesting area, daily chart 'reaction area'
Will observe price action on 480 min (8hr) chart for potential trade opportunities...

 

[SteamRoller]

Setup invalidated.
Will observe reaction near / at 1.4 big RN.

 

[SteamRoller]

No setups currently 'pending' coming into today, and would not have wanted to take a new position on a Friday, especially with NFP due.
Now that is out of the way will look to watch price action running into the weekly close tonight, and look for a reaction at the 'big' RN at 1.4.
Will look in again Sunday evening and Monday morning.

2 trades this week, 2 modest winners total +85 pips normalised to a single position (+255 across three contracts).

 

[SteamRoller]

Short at 1.3950 - rejection of 1.4 RN, pinbar on daily chart.
Hit T1 (+40) and T2 (+80), final 1/3 'runner' (or stopped out!?)

 

[SteamRoller]

Stop on remaining 1/3 at breakeven, 1.3950.

 

[SteamRoller]

Stop on remaining 1/3 at breakeven, 1.3950.

Stopped out of this on open last night.

I was taking the view that I would try and run profits on the final 1/3rd of the trade, and did infact have a take profit limit order at +200 pips, which frustratingly was just missed last week by a matter of 2 or 3 pips. It does mean that I have allowed a profitable leg of the trade (albeit 1/3) to stop out when there was a significant profit opportunity that I didn't take.
I think this is more frustrating than not capturing a run-away (i.e. limiting the profit of the 3rd contract with a take profit limit) so will set a more realistic take profit on the 3rd contract and / or consider a falling / rising candle stop. I'm going to have a think about this, though I am not altering the other parts of the strategy - I'm happy with reaction area criteria, entry criteria, 3 contract trade management, just not letting good profits slip away once T1 and T2 are hit.

 

[SteamRoller]

No new trades taken this week.
I will watch how price reacts around the 1.4 level into the weekend and the start of next week.

 

[SteamRoller]

Price has approached 'area of interest' at 1.42.
On 480 min chart, rejection bar / inside bar combo.
Short @ 1.4160 SL 55 pips, T1, 2, 3 = 40, 80, 120 pips.

 

[Doomberg]

Just want to thank you, had a look at that trade after you posted it and it was perfect...
You sir, have just helped me earn an extra 75+ pips today

 

[SteamRoller]

Just want to thank you, had a look at that trade after you posted it and it was perfect...
You sir, have just helped me earn an extra 75+ pips today

I have a rule that says I don't place a trade on a Friday, but as I was already positioned on Thursday I let the trade run. Spike down over NFP got T1 and T2 hit, though the big spike back up stopped me out of the third contract which gave a smaller over all result of 65 pips across 3 contracts, so just over 20 pips normalised for 1 contract.
One of those situations where if I'd been around to watch it intraday, I'd have been better off, but no point complaining or worrying about things I cannot influence.

Overall I'm reasonably satisfied with how the strategy is going and my implementation of it, though still early days...