Best Thread The 3 Duck's Trading System

[perfectagent008]

Nigel-P, the AU short from 1.0343 was 100% based off of 3 ducks?

 

[Nigel-P]

Nigel-P, the AU short from 1.0343 was 100% based off of 3 ducks?

Hi perfectagent008, I'm not quite sure I understand the question - are you asking whether I take other analysis into consideration before taking a trade other than the 3 SMAs?

The answer is yes - I don't think anyone can do analysis of anything in a total vacuum, whether you want to admit it or not. We all have biases and opinions, conscious and sub-conscious. It's the hierarchy of the analysis that's important - for me, unless the 3 ducks line up in the direction I think the market is going to go, I won't be in the market.

So, being honest and admitting my opinions, I would say that I have had a bias over the last year or so to short currencies against the US dollar. I made hay with selling the euro during the summer but since have sat out a 1000 pip rally, until I shorted again two weeks ago.

On the other side of coin, the man sitting next to me could be a huge euro bull - neither of us are wrong, if we both made money.

The key is to make sure that you stay out when the market isn't doing what you think it should do. If I, being inclined to short the euro, were trying to do so during the recent 1000 pip rally, I probably would have blown my account. But I didn't enter short once. Why? Because the 3 ducks never lined up to allow me to short.

So with the Aussie trade yesterday - I suppose yes, I think that the US dollar is going to strengthen again so I am looking to sell pretty much anything against the dollar. But only if the 3 ducks line up, which they did yesterday on the Aussie, as I show below. You'll see me shorting the euro again over the next week or so too, hopefully, if the ducks line up. But if the 3 ducks don't line up I won't lose anything if I am wrong in that view, because I won't be in the market.

Bear in mind, I am not saying that this type of analysis is a good thing, I'm not. If anything it's a bad thing because it sometimes keeps me out of good trades. But at least I'm not losing anything when the market is moving against my view, and that is the main thing. If I am making money when I am right and never in the market when I am wrong, I am happy to go with that over the long term.

If you are asking whether I use just the 3 ducks for trades and no other method, you'll see further back in this thread that I use the three ducks and one other simple price action pattern to enter trades. I'll not be discussing it here though, because this is the 3 ducks thread. There is no magic to it, you will find it in any book or forum, often analysed to death. I like to think that I have developed a really good feel for these two methods and I am more than happy just to concentrate on them.

Ultimately, all these methods you read about on here and in books are simply ways to enter the market, that is just a tiny part of trading. In my view, risk versus reward and discipline are far more important. If you have those two on your side you will trade any entry strategy successfully.

I hope that has answered your somewhat cryptic question perfectagent008, if you were alluding to something different I'm afraid you're going to have to expand a bit more!

I have the diagrams of the trade below. Bear in mind that the 4 hr SMA has had 5 bullish candles since my entry so the SMA has been pulled up to nearly flat now. When I entered it was looking just as I like it, pointing down in the early stages of a trend. When I get in on these that is one of the ways how I maximise risk and reward. 10 pip risk for a few hundred pips or more if possible. It happens more often than you think.

I am reminded of the story of the gamblers betting on holes in one in golf. Everyone, including the bookies, were of the view that holes in one happened rarely in golf. The odds the bookies offered reflected that. A group of gamblers realised that holes in one occurred way more often than the odds suggested. They spent a year betting heavily on holes in one and made millions, before the bookies changed the odds. Same thing with low scoring matches in French football.

Sometimes things happen more often than you think - 1:50 risk v reward trades are not that uncommon.

Back to the charts, on the one hour chart the price you can see that price was below the 1 hour SMA, same goes for the 5 min SMA, so for me it was a valid 3 ducks trade.

As I am always trying to reiterate here - how I trade the 3 ducks is just my style - there are more ways than one to skin a cat and I have no doubt that people on here are successful with trades that I mightn't take and vice versa. Just practice and find out what works for you and your preferences. Trading as much about personality as anything else. As long as price is above or below all three SMAs, it's valid. Anything else is just noise.

Good trading

Nigel

 

[kwilo]

Hi perfectagent008, I'm not quite sure I understand the question - are you asking whether I take other analysis into consideration before taking a trade other than the 3 SMAs?

The answer is yes - I don't think anyone can do analysis of anything in a total vacuum, whether you want to admit it or not. We all have biases and opinions, conscious and sub-conscious. It's the hierarchy of the analysis that's important - for me, unless the 3 ducks line up in the direction I think the market is going to go, I won't be in the market.

So, being honest and admitting my opinions, I would say that I have had a bias over the last year or so to short currencies against the US dollar. I made hay with selling the euro during the summer but since have sat out a 1000 pip rally, until I shorted again two weeks ago.

On the other side of coin, the man sitting next to me could be a huge euro bull - neither of us are wrong, if we both made money.

The key is to make sure that you stay out when the market isn't doing what you think it should do. If I, being inclined to short the euro, were trying to do so during the recent 1000 pip rally, I probably would have blown my account. But I didn't enter short once. Why? Because the 3 ducks never lined up to allow me to short.

So with the Aussie trade yesterday - I suppose yes, I think that the US dollar is going to strengthen again so I am looking to sell pretty much anything against the dollar. But only if the 3 ducks line up, which they did yesterday on the Aussie, as I show below. You'll see me shorting the euro again over the next week or so too, hopefully, if the ducks line up. But if the 3 ducks don't line up I won't lose anything if I am wrong in that view, because I won't be in the market.

Bear in mind, I am not saying that this type of analysis is a good thing, I'm not. If anything it's a bad thing because it sometimes keeps me out of good trades. But at least I'm not losing anything when the market is moving against my view, and that is the main thing. If I am making money when I am right and never in the market when I am wrong, I am happy to go with that over the long term.

If you are asking whether I use just the 3 ducks for trades and no other method, you'll see further back in this thread that I use the three ducks and one other simple price action pattern to enter trades. I'll not be discussing it here though, because this is the 3 ducks thread. There is no magic to it, you will find it in any book or forum, often analysed to death. I like to think that I have developed a really good feel for these two methods and I am more than happy just to concentrate on them.

Ultimately, all these methods you read about on here and in books are simply ways to enter the market, that is just a tiny part of trading. In my view, risk versus reward and discipline are far more important. If you have those two on your side you will trade any entry strategy successfully.

I hope that has answered your somewhat cryptic question perfectagent008, if you were alluding to something different I'm afraid you're going to have to expand a bit more!

I have the diagrams of the trade below. Bear in mind that the 4 hr SMA has had 5 bullish candles since my entry so the SMA has been pulled up to nearly flat now. When I entered it was looking just as I like it, pointing down in the early stages of a trend. When I get in on these that is one of the ways how I maximise risk and reward. 10 pip risk for a few hundred pips or more if possible. It happens more often than you think.

I am reminded of the story of the gamblers betting on holes in one in golf. Everyone, including the bookies, were of the view that holes in one happened rarely in golf. The odds the bookies offered reflected that. A group of gamblers realised that holes in one occurred way more often than the odds suggested. They spent a year betting heavily on holes in one and made millions, before the bookies changed the odds. Same thing with low scoring matches in French football.

Sometimes things happen more often than you think - 1:50 risk v reward trades are not that uncommon.

Back to the charts, on the one hour chart the price you can see that price was below the 1 hour SMA, same goes for the 5 min SMA, so for me it was a valid 3 ducks trade.

As I am always trying to reiterate here - how I trade the 3 ducks is just my style - there are more ways than one to skin a cat and I have no doubt that people on here are successful with trades that I mightn't take and vice versa. Just practice and find out what works for you and your preferences. Trading as much about personality as anything else. As long as price is above or below all three SMAs, it's valid. Anything else is just noise.

Good trading

Nigel

Hi Nigel, I just wondered if during the '1000 pip rally' that you refer to above, did the 3 ducks line up to go long? If so, then did you dismiss the signal and, if so, for
what reason? Does your view of market direction override the 3 ducks setup?

 

[Nigel-P]

Hi Nigel, I just wondered if during the '1000 pip rally' that you refer to above, did the 3 ducks line up to go long? If so, then did you dismiss the signal and, if so, for
what reason? Does your view of market direction override the 3 ducks setup?

Hi kwilo, Absolutely, there probably were loads of 3 ducks set ups on the way up which I missed out on. To be honest, because I had done so well selling it just weeks before, my mind was in sell mode, so I was waiting for the market to turn around again, but it just kept going. But I wasn't losing any money during the rally, and that's the main thing.

My fundamental view, or any other analysis, always comes second to the 3 Ducks in terms of getting into trades. So say for example I think a particular stock or index or commodity is going to go up for whatever reason. I don't just open the trading platform and click buy. I open the chart and look at the 3 ducks. I wait for them to line up for a buy and then I execute the trade. That is a key part of trading, you wait for the chart to confirm to you your plan before you execute it. Jesse Livermore was always saying this, for good reason.

I'm predisposed to selling the euro because I think the whole idea of it is nuts. When the the ducks line up on the euro to the short side I sell, against anything that looks like a good setup, not necessarily the USD. I rarely buy the euro. There are raging euro bulls out there that will disagree with me and that's fine, markets go up and down, we can both have different opinions and both make money. If you are a euro bull and are making money, fair play, I take my hat off to you.

I also think that precious metals are going to appreciate because central banks are printing money. The European Central Bank, The People's Bank of China, The Swiss National Bank, The Federal Reserve, The Bank of Japan, The Bank of England are all printing money flat out, some have committed to do it indefinitely. So the three ducks lined up nicely this week and I am in a long silver trade from $32.60. But for most of this year I have only been half right on this because the market has been largely ranging. But I have made money when the market has gone up and been standing to one side when the markets went down.

Will I sell silver or gold to the short side if the ducks line up for a sell? Probably not. I'll probably wait for it to turn around for a buy signal. As I said before, this is not necessarily a good thing, because it can keep me out of good trades, but at least I'm not losing money when I am wrong. One of the trading wizards said that the best traders are those that can change their opinion within a few seconds. I can't do that. I am a news junkie - I love to know what's going on in the world, the economy etc, so I can't help but have opinions. I might well be a better trader if I just turned off the news and traded the charts, but it's very difficult to to do that nowadays. So I rely on the ducks to keep me out of trouble.

So my advice is - if you aren't interested in fundamentals - that's a good thing, and just stick to what the charts are telling you and trade from that. You'll do well.

If you are interested in fundamentals, try to just trade what the chart is telling you, if you can. If you can't do that, like me, then at least the 3 ducks will keep you from trading when your fundamental view is wrong. Then it is very satisfying when the market turns around to your fundamental view, the 3 ducks line up, and you start making money. You might just need a bit more patience.

Hope this makes sense.

Good trading

Nigel

 

[prst]

Nice system captain..
am planning to use it for positional trading on stocks.
this would be long term.
would use daily charts for entries and exits.
mainly focusing on weekly charts, and guided by monthly charts...

 

[perfectagent008]

Nigel-P thank you very much for the solid write up and explanation. Everything was clear. Hope to take some of these live as they have worked well on demo.

Thanks for posting your charts!

 

[Nigel-P]

Nigel-P thank you very much for the solid write up and explanation. Everything was clear. Hope to take some of these live as they have worked well on demo.

Thanks for posting your charts!

No worries - sometimes I think there is a lot more learning value in the losing trades than the winning trades. Every loser can teach you something - sometimes we can have a tendency to book a loser, be frustrated and angry about it and then erase it from memory in the search for the next trade. Taking a few minutes to go over a loser, looking back at the price action, the moving averages,etc, can be very beneficial.

Good luck with the live trades! Post any questions and I'm sure someone here will step in to help.

Nigel

 

[ChattiFX]

Will I sell silver or gold to the short side if the ducks line up for a sell? Probably not. I'll probably wait for it to turn around for a buy signal. As I said before, this is not necessarily a good thing, because it can keep me out of good trades, but at least I'm not losing money when I am wrong. One of the trading wizards said that the best traders are those that can change their opinion within a few seconds. I can't do that. I am a news junkie - I love to know what's going on in the world, the economy etc, so I can't help but have opinions. I might well be a better trader if I just turned off the news and traded the charts, but it's very difficult to to do that nowadays. So I rely on the ducks to keep me out of trouble.

I love this paragraph, I think it really sums up something I believe, that there is no right or wrong way to trade... what works for one person doesn't work for everyone and it is a case of finding what works for you...

Now all I have to do is find "my" way haha...

Although I don't follow the 3 ducks system I really enjoy your posts Nigel and have picked out some valuable pointers.

Cheers.

 

[stephensteve]

Hi Guys, thanks for all your info on here,

I am at a bit of a loss as to exit a trade...!!!

I have got a trade going but am reluctant to get out..any info would be appreciated,

thanks, Steve

 

[neil]

Hi Guys, thanks for all your info on here,

I am at a bit of a loss as to exit a trade...!!!

I have got a trade going but am reluctant to get out..any info would be appreciated,

thanks, Steve

Get the free e-book and read it. All the info you want is within.

 

[Nigel-P]

Hi Guys, thanks for all your info on here,

I am at a bit of a loss as to exit a trade...!!!

I have got a trade going but am reluctant to get out..any info would be appreciated,

thanks, Steve

Hi Steve, if you have the ebook you'll see that Andy generally advises that you aim for a positive risk v reward ratio, i.e. your profit should be bigger than the loss you were prepared to take had the trade gone against you. If that is the case, well done, you have a very good trade on your hands, anything more now is a bonus.

Post a chart if you want and I'm sure someone here will chip in. Obviously any advice given will be opinion only and it is up to you to make the final decision when to close a trade. As long as you base your reasons for closing on sound criteria, rather than just a whim, you will be fine.

Remember, you don't need to time an exit perfectly to the exact pip. All you need to do is to take a chunk out of the middle of a trend and you will be doing well. Allow the market time to show you when a trend is starting and time to show you when it is finishing. Your job is to take a bit out of the middle.

Good trading,

Nigel

 

[Captain Currency]

Hope you like coffee Duck Hunters ....

Preparing like a Pro Trader before the Forex market opens - YouTube

Enjoy your weekend,

Andy
Captain Currency

 

[Captain Currency]

 

[stephensteve]

...NIGEL , thanks for your informative reply, it has helped,

CAPT C. thanks for the info above, I shall pore over it a few times more..

thanks, Steve

 

[yogesh12]

...NIGEL , thanks for your informative reply, it has helped,

CAPT C. thanks for the info above, I shall pore over it a few times more..

thanks, Steve

Guys does this system really works?? i have seen in many forums and i read his guide also.. i tried for 2 days and i always lost it... it breaks previous high goes few pips up.. i enter the trade and after few mins it falls down... any help?

 

[donovan5]

Guys does this system really works?? i have seen in many forums and i read his guide also.. i tried for 2 days and i always lost it... it breaks previous high goes few pips up.. i enter the trade and after few mins it falls down... any help?

Yes it works but you have to give a trade time to work out,it's not a scalping system.
It isn't magical you have to apply discretion but it is a solid method for joining a trens with the odds in your favour.
If you are interested in 3 ducks you should read through the thread especially Nigel P's posts.
If you were looking for something where you grab a few pips and are out quickly then maybe TRO's stuff is better for you.
But yes it works

 

[rsh01]

Guys does this system really works?? i have seen in many forums and i read his guide also.. i tried for 2 days and i always lost it... it breaks previous high goes few pips up.. i enter the trade and after few mins it falls down... any help?

crikey, you tried a system for 2 days, taking trades which last a few mins, and you think thats a long enough period to pass judgement.....sigh, you could not make this up.

 

[yogesh12]

crikey, you tried a system for 2 days, taking trades which last a few mins, and you think thats a long enough period to pass judgement.....sigh, you could not make this up.

i was just asking if this really works... i din say that it doesnt works.. before investing more of my time, its better to get suggestions

 

[rsh01]

i was just asking if this really works... i din say that it doesnt works.. before investing more of my time, its better to get suggestions

and if you had bothered to read this thread, or tried testing it for slightly longer than 2 days (just open up a chart & look at the trending pairs & numerous times you can enter on pullbacks / breakouts etc when 3 ducks are in line) you wouldn't have had to ask such a dumb question.

Nigel P even goes into detail just a cpl of pages back saying the skill is in MM, among other things (learning PA for entries/exits also). what more do you want, me to just send you some cash?

edit: and if someone says yes to your question, are you any wiser? and if they say no? get it? do some work, ppl on here are willing to help if you do.

sorry to CC & others for interrupting the thread.

 

[yogesh12]

and if you had bothered to read this thread, or tried testing it for slightly longer than 2 days (just open up a chart & look at the trending pairs & numerous times you can enter on pullbacks / breakouts etc when 3 ducks are in line) you wouldn't have had to ask such a dumb question.

Nigel P even goes into detail just a cpl of pages back saying the skill is in MM, among other things (learning PA for entries/exits also). what more do you want, me to just send you some cash?

sorry to CC & others for interrupting the thread.

1. Its not a dumb question. I have been watching it for few days (in my spare time) but actually tried only for 2 days and it din seem to work so i asked suggestion and ur opinions so i can proceed further. I dont see anything like "DUMB"!!! You know this so it sounds dumb for u. No one is Master in Everything.

2. FYI: i din read all of the pages!! i googled.. this forum came up.. saw that its active so i asked here.

Next time dont be soo rude with newbies..