Trading Chaos

Stops hit on the long, now in from the daily sell fractal, will just try and hedge a portion of my loss and get out.

EDIT: Ok she dropped hard, hedged the loss and took +5 for myself. Out for the day!

Hi guys,

I was a bit shaken up last night by the move against the original breakout but on examination of my basket of trades yesterday I noticed a few key things:

1. I broke my own rules about which fractal is valid (needs to be formed outside the MAs)
2. Only managed to save my equity curve by following the rules!
3. I traded against obvious resistance established during NY session and confirmed during Tokyo.

So will try and keep things as disciplined as possible from now on, we are trying to make this into a consistent thing here!

Follow the rules and all will be well.

Sells from yesterdays low hit within the first hour of open! Took +80 and got out quick! Obviously there was more room to move but I was afraid of volatility as well as possible buying at the 100% fib line. She didn't make it back above the line but there WAS volatility!

Alright so I missed a good chunk of one of the most explosive moves this month, but I took my chunk, good enough for me.

This might seem awful rudimentary to you all, I mean, selling breaks of session and daily hilos...but hey, it makes money! I'll try something more complicated once it stops...

sinner said:

This might seem awful rudimentary to you all, I mean, selling breaks of session and daily hilos...but hey, it makes money! I'll try something more complicated once it stops...

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As long as it makes money who cares.

I'm having a play around with this system now, very interesting. Thanks for bringing it to my attention, great thread.

nomore4s said:

As long as it makes money who cares.

I'm having a play around with this system now, very interesting. Thanks for bringing it to my attention, great thread.

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Ditto!!! if it works for you, be happy, and don't worry about what others might think.

Alright we are putting it to the test now, I am short AUDUSD from 9010 (avg) 2 positions of sell fractal and AO saucer sell signal. This trade is a classic example of a breakout -> retrace occuring, leaving hourly traders pissed off when their trade fills and goes to -20 in 5 seconds. London open has brought it back into profit a tad though, we will see how it pans out.

Stops 10 pips above last weeks low and near the MAs @ 9070. Just trading small lots as I don't want to risk too much of todays profit. AUDUSD has already dropped 1.5%ish we could be due for retrace.

Blue lines for sells.

Bring one up of the GBP/USD,if you can, it will be interesting as i'n trading it right now
i'm short with intermediate exits at 349

nomore4s said:

As long as it makes money who cares.

I'm having a play around with this system now, very interesting. Thanks for bringing it to my attention, great thread.

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My experience so far (which is just looking at charts : ) is it works damn well for commodities on the daily chart if you can get a broker that will allow you to trade small enough lot sizes for the expectancy to pan out. I don't like it for stocks (prefer pure VSA). I think it is great for forex, especially the two major JPY crosses (not so much AUD/JPY).

Alright guys, at this time of the year I am happy to take what the market is willing to give and run, I will exit both short positions here at +30. Reasoning, as said before could be due for a retrace, US on hols and I can't be bothered sitting around for the next few hours if A/U is going to do its usual breakout -> range -> breakout routine without some big dogs hitting the sell button. As usual, while I type she continues to move to +60 but I am done for the day with +80 JPY pips and +30 USD pips on smaller lots size.

caribean, I am unsure about G/U hey. I have heard rumours BoE will keep G/J and G/U in range for a long time. This could just be wave 2 down on the daily of 5 impulsive waves up. I would prefer to trade another currency right now until I know what's happening with G/U and G/J (even though G/J is like a pip fountain right now I am still sticking to E/J). If trading the pound at all right now I prefer GBP/CHF or inverse correlated EUR/GBP.

In the shorter term, I have included an hourly chart for you, there is 3 green AO bars, this could indicate the downmove is near completion. That doesn't mean it will not continue to move down, just that retrace is more and more likely on the cards. As another trader pointed out today, G/U rarely goes six days in a row in any direction without a retrace...

Yeah thanks man, it's just conversation really, will wait to see what it does around 6200.
I can't go past S/R myself, it's interesting to see someone do well out of this,
I'm genuinely happy for you.

Guys every day on forums like forexfactory I see probably in excess of 100 posts per hour in the "Interactive Trading" section, as newbies and oldies try and predict the next move, post their analysis, bla bla bla.

I don't care if a move is mark up by the banks, or if this is a "push" to fall in the opposite direction. What I care about is following the rules, and banking some pips on the other end.

Seems like a lot of work by a lot of people, meanwhile I just placed buy orders within the first few hours of market open and made a pretty pip or two from what turned out to be a great opening short squeeze.

London hasn't even opened yet...

New long on AUD/USD, buy above the balance line signal. This will be my first balance line trade in quite some time, let's see if we can make it work. Long from a break above the high of the bar labelled "2".

For those accusing the "Chaos" style of being all indicators and whatever, well balance line trades are purely PA based.

Stopped out on that last A/U long, and just now I got snapped by BoJ intervention on U/J.-50 pips on that one. All good, todays gains from the open still leave me ahead onthe day.

sinner said:

Stopped out on that last A/U long, and just now I got snapped by BoJ intervention on U/J.-50 pips on that one. All good, todays gains from the open still leave me ahead onthe day.

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You tried that long did ya? i thought it was good for a lot more, but decided to exit and wait for the next train (i fell asleep before it arrived)

Congestion can be annoying, especially if news doesn't give the instrument a kick in the pants.

At times like these, especially if you only trade a single instrument, patience is all you've got.

Wait for setup. Play the setup. Ignore all the speculation about whether it will go up, or down or bla bla bla.

Ooops forgot the chart!

Talk about frustrating! Here is an M1 chart of AUDUSD showing demand coming in 0.3 (or less) of a pip above where my order would have been filled.

Yes, I put my sell stop a teensy bit below where I would normally put it (put it at 91050) to account for yesterdays range being tight against todays S1.

Well, that short posted above never got hit and I ended up long from the break of the green line posted earlier. Today has been a bit trickier, I took 20 pips out of the market on 3 positions right before it reversed. The current chart formation on AUDUSD is looking decidedly wedge-ish and I don't want to push it. Happy to take what I can and run, with a few lots left on from yesterdays efforts.

Had to use multiple signals instead of clean fractal breakouts like normal to grab the pips, yellow box is entry and profit, I pretty much got out 2 seconds before reversal. As you can see, not a lot of juice, even though there is room to go higher, I am not game to push more positions long into a possible large sell.

I have included arrows to show the signal bars, buy stops placed at their highs from bar close. This chart is a good example of how multiple signals can get you your daily pip quota from even a <10 pip move.

+20 is enough, I won't bother trading London.

I am sort of getting bored posting profitable charts over and over...today was plenty of pips now I am risking 10 of them on a speculative short. Come on RBA!

Anyone got a question or something?

Sinner,

Great thread, thanks for posting.

Just starting to do some reading on this now. I reckon i will paper trade this for a bit to see if i can replicate your results.

how long have you been trading this system live? how long did you paper trade for? have you noticed that your profits have started to become more steady? do you have any stats on your performance?

I am sure that i will have more questions as i delve deeper.

thanks again for a refreshing thred.

Yes, thankyou Sinner!

Just having a quick read before delving deeper tomorrow...

I'm sure will have some Qs for you.

Love your talk about fx and correlation with other markets - all new to me so great info!
Are you looking to take any leads from other markets for your fx trading?

cheers,
inspira

n5032245 said:

how long have you been trading this system live? how long did you paper trade for? have you noticed that your profits have started to become more steady? do you have any stats on your performance?

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Ok I don't want to sound rude, especially because I asked for questions, but this is the standard newbie set of qs and it is not going to be answered by me other than yes I trade this style live. As I said, it is just the accumulation of some well known trading techniques, nothing special!

I did not paper trade this method as by the time I discovered it I was already trading 4-6 hours a day using similar (but not identical) methods. From the top of my head I can imagine there are probably 4 or 5 other well known trading techniques which will be putting orders at essentially the same spots.

As for profits, stats, etc this is the bit that newbies ask the most often about and will not get answer from me. This information, even if I provided it to you is USELESS TO YOU as a new trader. You need to work through a system yourself, not to see that it will make you rich, or that it has a hardcore arbitrary number expectancy that will play out every time because IT WON'T. You need to work through the system yourself to see that there will be winners and losers, to decide when it is safe to trade or not, which signals are useful and which aren't etc. You need to see that there will be losers but this system will save you from big losers and put you in line for a winner next up if the market allows for it. You can see from this thread those points exactly. For me to say I started with $1000 and now have 1 bajillion is not only useless info to a new trader, it is actually a detriment to your technique.

Love your talk about fx and correlation with other markets - all new to me so great info!
Are you looking to take any leads from other markets for your fx trading?

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Yes mate, good q.

My trading watchlist consists of:
USDCHF/USDJPY/GBPUSD/EURUSD (4 forex majors)
EURJPY/GBPJPY (JPY crosses)
AUDUSD/NZDUSD (regional majors)
EURGBP (ratio cross, I use as a sort of risk barometer - when **** hits the fan, GBP always gets dumped for Euros)
the most recent crude oil and gold futures
the most recent SP500/DAX/FTSE/HSI/ASX200/Nikkei futs

So if I am trading during Tokyo I am interested in what SPI/HSI/Nikkei as well as gold and oil (I also might watch coal and wheat futures if trading AUD). By the time London rolls around I am watching DAX and FTSE along with the commods and then as NY opens I will be keeping a close eye on the SP500 futs (ES is their ticker name).

This gives an overall sense of market direction, but I try not to let it influence me too much. It is just good to know for example, if gold is going up and oil is going down I would prefer to trade AUDUSD or USDCHF over the NY session, but if gold and oil are going up together I will make more money trading USDCAD.