Scalping FX with Cyrox Rainbow

[prawn_86]

this was from about an hour ago.

Ended up breaking even.

At this stage im working on my entries. Another couple weeks and i'll try to combine my entries and exits together. one step at a time, im in no rush to start with real cash...

Short 1:
Was looking for a breakdown (obviously). Also looked possible from the 1 min chart.
That spread really does kill you when you get something wrong


Short 2:
Entered waiting for a break of support. trend was down and pink WMAs were spreading. Decent entry, didnt hang on long enough (again)


Long 1:
It had dropped like a stone and i was looking for a rally back up. Got 1 pip nett out of it, which i was happy with, as i didnt know if it would continue downwards. I didnt expect it to rally as high as it did, although i guess it makes sense...


Feel free to comment/critique

 

[tayser]

Short 1:
Was looking for a breakdown (obviously). Also looked possible from the 1 min chart.
That spread really does kill you when you get something wrong

You did exactly the right thing: you got out when you felt it go against you.

Short 2:
Entered waiting for a break of support. trend was down and pink WMAs were spreading. Decent entry, didnt hang on long enough (again)

Higher probability entry, good work.

Long 1:
It had dropped like a stone and i was looking for a rally back up. Got 1 pip nett out of it, which i was happy with, as i didnt know if it would continue downwards. I didnt expect it to rally as high as it did, although i guess it makes sense...

If you had held (don't worry about it, if it makes you feel better I'm 6 months into this and still get out too early (I have no prior trading experience however - I'm a complete newbie in the holistic sense! )) this is pretty much perfect - you took the contrarian view.

Trade #2 is taking the contrarian view of the most recent trend too, but overall it's trend continuation - these are the two types of trades / entries you're going to be doing and you pretty much got them right.

Although you shouldn't worry about this yet, this is what I'm practicing at the moment: Trade #2 could (and eventually, when you get loads more screentime, should) be entered earlier to maximise the pippage. 98.97 would have been good there, look for the lower highs, moving further away from the .00 level all in the context of the slower timeframe trend.

heh, I think I was watching you in EFX's demo market depth, I was tempted to get in just after you exited on your 2nd trade - but this is what has killed me in the past: entry is far too late and you get whipsawed if you stick to your mental 4-5 pip S/L etc - this is the hardest part for me, restraining myself (comes back to complete newbie status ).

cheers.

 

[prawn_86]

heh, I think I was watching you in EFX's demo market depth, I was tempted to get in just after you exited on your 2nd trade - but this is what has killed me in the past: entry is far too late and you get whipsawed if you stick to your mental 4-5 pip S/L etc - this is the hardest part for me, restraining myself (comes back to complete newbie status ).

cheers.

Yeh i also noticed that. You almost have to enter BEFORE the actual drop on the shorter timeframe.

Im starting to look at a 1min chart now, to see what way the trend is going, and as the rainbow squeezes on the 1 second chart i will enter the way that the 1 min chart indicates the trend SHOULD go.

It all practice, but at this stage im really enjoying myself

 

[tayser]

Yeh i also noticed that. You almost have to enter BEFORE the actual drop on the shorter timeframe.

bingo!

Anyhow, I've done enough, lots of little piddly trades tonight

Time Order ID Message Event TIF Orig Trader ID
17:06:48 0vw002s:02ur-00 Buy 850000 AUD/JPY @ Market on MBTX [expiring: 23/05/2008] (850000 traded at 99.07) Filled GTC
17:20:23 0vw002s:039c-00 Sell 850000 AUD/JPY @ Market on MBTX [expiring: 23/05/2008] (850000 traded at 99.09) Filled GTC
18:46:54 0vw002s:07sp-00 Sell Short 850000 AUD/JPY @ Market on MBTX [expiring: 23/05/2008] (850000 traded at 98.83) Filled GTC
18:49:03 0vw002s:07z7-00 Buy 850000 AUD/JPY @ Market on MBTX [expiring: 23/05/2008] (850000 traded at 98.82) Filled GTC
18:49:23 0vw002s:07zu-00 Sell Short 850000 AUD/JPY @ Market on MBTX [expiring: 23/05/2008] (850000 traded at 98.78) Filled GTC
19:03:00 0vw002s:08n2-00 Buy 850000 AUD/JPY @ Market on MBTX [expiring: 23/05/2008] (850000 traded at 98.74) Filled GTC
20:52:08 0vw002s:0gl6-00 Buy 850000 AUD/JPY @ Market on MBTX [expiring: 23/05/2008] (850000 traded at 98.82) Filled GTC
20:52:28 0vw002s:0gmp-00 Sell 850000 AUD/JPY @ Market on MBTX [expiring: 23/05/2008] (850000 traded at 98.84) Filled GTC

last trade from above:

Entered on the assumption that it was heading back up to the Pivot level at 98.87 - and it kept going.

 

[disarray]

going to add my setup here. i've been playing for a while with oanda then moving to ninja and efx (thanks tayser and all for the thread) and the current setup is nice. considering we are retail muppets at home pc's using free software, the ability to realtime hook into this market is sweet.

i like having the */JPY currencies open because you can see wider trends which adds confirmation to a move. one of the main points behind linuxtrolls original post was identify the time frame then hop on its opening trend, so i've been doing AUD/JPY from 10-11ish am, EUR/JPY at 6pm and GBP/JPY at 7. i've played around with higher timeframes (and 1 min does seem to offer great potential) but these tick charts are just so efficient and tidy. a 2 point spread is nothing to pay for access to this game. my problem is also discipline but the mantra has good guidelines for that.

 

[Trembling Hand]

my problem is also discipline but the mantra has good guidelines for that.

I have never really understood that comment.

"Trading discipline is 90 percent of the game."

I completely disagree. What is the point of being disciplined if you have a method that has a negative expectancy.

You aren't going to blow up tomorrow but you will die a certain death. Sticking to the plan is not 90 % of the game. Its the plan that counts. And when you have one that you know works you don't need discipline to stick to it. greed will keep you there just fine.

I think people confuse symptom with cause.

 

[disarray]

discipline is just controlling the fear and the greed. i understand where you are coming from as a professional trader, with access to means and methods that retail traders don't, but i think we might be playing different games (albeit on the same field). this game is "hop on the short trend", the method isn't much more complex than that. the discipline is nothing more than deciding whether or not to enter, when to bail out or when to take your pips which has been the most important factor so far. obviously i'm a novice so appreciate advice in this area, its just how its seemed so far.

 

[tayser]

nice setup Davros, err disarray

 

[Trembling Hand]

discipline is just controlling the fear and the greed..

Yeah fair enough.

 

[prawn_86]

Well that sure as hell didnt work out as planned. I think i was lucky to get out at B/E after all that. I was working on my "holding longer cause i exit to early". Didnt go too well

Original target was 99.05, confirmed by a double top on the 1 min chart. Each time it reached 99.2 it was stalling so i continued to open more shorts.

99.1 acted as stronger support than i originally thought, so had to exit then.



21:08:16 AUD/JPY Executed Bought 90000 AUD/JPY at 99.14
20:43:34 AUD/JPY Executed Sold Short 30000 AUD/JPY at 99.13
20:54:00 AUD/JPY Executed Sold Short 30000 AUD/JPY at 99.15
21:00:11 AUD/JPY Executed Sold Short 30000 AUD/JPY at 99.17

 

[tayser]

Vive le demo accounts!

 

[Andy_aus]

Thanks Tayser for spending the time and effort for posting all this stuff. Am fascinated by this method and might buy the ebook to check it out. Ive been looking at Forex markets for the last month or so.. mainly using pivot points, but i might start paper trading this method and see how it goes.

Does anyone use IB brokers in here to scalp? I have an account through them at the moment and i know that they offer some pretty tight forex spreads. Also do you guys know what the tax ramifications are with IB brokers... as far as i know they are still in aus. I wire the money to them via citibank in sydney.

PS. read the whole thread today in my lunch break.


Thanks again mate.

 

[prawn_86]

Playing around with Europe open.

What they hell was that spike? It went to .35 and then in the 1 sec it took for me to click my mouse it was at .29.

Never seen that before

Nett of 1 pip because of that spike

Long 1: 2pips
Long 2: -4pips
Short 1: 3pips

 

[prawn_86]

And im done for the night. Only got 5 pips nett but im happy with that.

Slowly starting to pick it up and get a few decent entries...

 

[tayser]

How to exploit natural S/R and get one pip while you're at it!!

Time Order ID Message Event TIF Orig Trader ID
20:05:40 0vz002s:0dep-00 Buy 900000 AUD/JPY @ Market on MBTX [expiring: 26/05/2008] (900000 traded at 99.48) Filled GTC
20:06:46 0vz002s:0dhx-00 Sell 900000 AUD/JPY @ Market on MBTX [expiring: 26/05/2008] (900000 traded at 99.50) Filled GTC

it may only be un/eins/uno/satu/ichi pip, but it's still positive!

Andy_aus: don't thank me, thank Trollmann, but in his absence, I'll say what he would say: charge on, make milllllllllions.

 

[Andy_aus]

Ill do some charging once i do some serous saving. Too many oppurtunities not enough capital right now

At least its not the other way around.

Thanks again.

 

[Andy_aus]

By the way... can u give me a link as to where i can go to purchase the ebook? Im sorry if it was posted previously but i cant find it reading this thread.

 

[tayser]

www.cyrox.com Sign up on the forum there too.

Also to anyone who's scalping AUD/JPY - the commission on EFX has just gone above 1 pip as the exchange rate's now above 100 yen to the 1 Aussie.

 

[shodd]

Hello all,

Just wanted to say a quick hello as I'm new to this forum. I started looking into trading Forex to supplement my longer term investing (ASX mainly) about 3 months ago. After a lot of scratching around and testing out various systems I've decided to concentrate on Linuxtrolls rainbow method. After reading the mammoth Forexfactory thread and purchasing the e-book I believe that his system fits my persona best.

Have been trialling LTs method now for a couple of weeks with some promising results. I look forward to sharing my results with you all and I also hope to be able to contribute positively to the discussion in the future.

 

[tayser]

The more the merrier! Welcome.

Are you sticking to EUR/JPY as the e-book suggests? or?