Scalping system #7 (Great GBP/JPY 1M scalping strategy)
Submitted by Chelo on November 24, 2007 - 15:39.
So here is a strategy I have trying to work out fot the past month, and I seem to be getting better at it. What would be very nice, is if anyone can help me tune it a bit more.
Currency: GBP/JPY or USD/JPY (though i use it mainly on gbp/jpy:
Timeframe: 1M, 5M, 15M
Indicators: 3 sets of bollinger bands:
1) Period 50. Deviation 2 (RED)
2) Period 50. Deviation 3 (orange)
3) Period 50. Deviation 4 (Yellow)
(the template for this bollinger bands can be downloaded form this post)
Read entire post >>>
Very good point, Chelo.
Thank you.
Regards,
Edward
A comment above mentioned the need for an indicator (or stop) to save the trade from disaster when there is a sustained and quick move along the bbands with the candles staying inside the two bbands (red and orange bands). For example, when you buy and the price keeps dropping along the bband. I have noticed that when the Bands are tight and squeezing, this startegy does not perform well. Has anyone else noticed this?
If you guys think this is valid, I'll attempt to see if there is a correlation with my BB-Squeeze indicator.
Another Brian
blog.tipster.ca (Autotrading Forex)
I dont think bb squeeze has any use in this strategy. what would you be using it for? And this type of trades are not the kind you would like to sit around waiting for them to turn in your favour once they've gone wrong (or in any scalping strategy for that matter).
In my view time is actually more important than strategy, if the trade is not going your way in a x amount of time: get out.
Chelo
Chelo, I'm testing your TS, I never like so much scalping trading but your system seems great, I'm using your system on Eur/Jpy like our friend say above. Good work Chelo.
Best Regrats,
Allen
hi all
i review the system for EUR/NZD it is a fact pair but the problem is the spread it is 10 pips but it cover it quickly.
Hanz
One observation I would like to mention regarding the behavior of price with B.Bands. I have noticed that quite frequently, when the bands start to widen as volatility enters the market, a clue to a sustained change in price direction (not just a retrace then further trend move) is 'predicted' by the B.Band that is on the opposite side of price. Often it starts to "close" before the price-side band does, and that seems to predict a change in direction. After viewing the screen shot included, back and forward test this dynamic and let me know if you find the same "warning" signal.
Thanks,
Keith
Hi Keith,
Yes, it would most of the time behave differently in real time. Each time the price would touch and retrace from BB you would think that the bands are going to narrow, you would also actually see them narrowing for some time, and then, with another wave in the direction of a previous trend, bands would straighten back away, thus leaving you with a false signal.
Using BB as a warning tool would require additional tools to confirm such warning. All in all we would start making a system complex.
Keith, by this comment I don't want to discourage you from studying the charts by looking back at past performance. The way you are trying to understand the price and indicators behaviour is, in fact, right. I have done so in the past and continue doing nowadays looking for new ways to benefit from the market. So, do continue your research. Once a pattern like the one you've mentioned above is spotted go on and test it forward in real time on your demo account.
Kind regards,
Edward.
Hi guys!!
I observed that the signal is different on a MT4 platform compared to some other platforms. I found that when we go half way to the orange band on a MT4 platform it isn't there yet on the Oanda platform. Check this out for yourself. And the signals given on a meta platform seem to be a lot better than what we get on some other platforms.
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