Advanced system #1 (Midnight setup)

Thanks Edward. That was crystal clear. All the effort and time that you take out of your day to answer the posted questions are greatly appreciated!

Jason

Sure Jason,

If to speak about Pivot points, the primary weapon here is monthly Pivot points.
(I found weekly pivots to be extremely useful for 4 hour trading, but too tight for daily trading).

Pivot Point level itself is, as a rule, a big battlefield zone you don't want to end up in. Then other pivot levels R1, R2, S1, S2 play their role too.

The rules I use are as follows (monthly pivots):

#1 Expect a battle at pivot levels, don't be involved.

#2 When I'm in a trade and see any of the monthly pivot points nearby, I set my profit target at those levels. In simple words, I want to exit and escape an upcoming battle...

#3 To be more specific, here is the rule I created not so long ago. Once a daily bar hit any of the pivot levels, exit if you were trading, then notice bar's high and low values - that's going to be a "no trade zone" for the future. All next price bars that close inside this zone are not valid to trade upon. Do not set new orders till a fresh daily bar Closes outside (e.g. above/below) the high/low values established for "no trade zone".

#4 Fibonacci levels if found close to Pivots, always strengthen market support/resistance around such levels.

I look to set Fibonacci study on weekly and monthly charts. However, as we know, it isn't always clear what tops and bottoms to connect for the study. I look for the clear and obvious setups. If I don't see one, it is fine. I don't bother much and survive without Fibs.

To your trading success!

Regards,
Edward

P.S. For all traders who would like to learn basics of Pivot point trading I'd suggest reviewing this source http://www.fxpivot-points.com/

Hi Edward,

Can you please elaborate on when you don't trade with this strategy? You mentioned on one post that you look for price hovering on pivot points or fib lines. Can you please explain this further?

Thanks in advance,
Jason

Hi Tony,
I cancel orders that weren't hit the next day.

Regards,
Edward

Edward,

Thanks for a great web site and for some really good strategies!

I know you say this is "set and forget", but Oanda doesn't have OCO orders. When do you cancel the order that hasn't been hit?

Tony

Thanks so much Edward! This is great information. It's amazing how pivot lines coincides with market trends. This is a wonderful website. I used to lose all the time in the demo accounts until I found this website!

Jason

Hi Jason,

You may do it by hands with online calculator, the one like Forex Pivot Points calculator.
To calculate weekly pivots you look at the weekly candle (the one from the last week) and determine its High, Low and Close values, which you put in the calculator. Same for monthly Pivots, using monthly candles.

There is also a good short cut => ready pivots at ActionForex.com

Regards,
Edward

Hi Edward,

How exactly do yo calculate the weekly and monthly pivot points? I'm sorry if this is a newbie question but such is my status =)

I'm using OANDA and can only do daily pivot points with the pivot tool.

Thanks!
Jason

Hi Isidro,

Thank you for the bright idea.
I never thought of this before, but it looks very logical and I think you should really try and test it well. It would be great to hear your testing results.

Regards,
Edward

Hi Edward, here is an idea i want to discuss with you, maybe you did think that before...

What i was thinking is if we could filter volatility, i wrote a custom indicator for this strategy to see it on the charts and realized that at times of volatility there are many entries that get triggered and ended in loss. So what if we take into account the size of the candle, so we can enter only if the candle size if greater than 70 pips (just an example), and also if the bar before this one also has a body of at least 50 pips and the two candles are both positive/negative. This way i think is more safer to enter a trade because we ensure that in fact the pair is trending at least for two days and the sizes of the candles give us the feel that the price is going in one direction. Also this way, we just set an entry order in one direction of the trend.

Did you think something like this? if so, what is the reason you didnt include it into your rules?

Best regards

Isidro

Hi Isidro,
I leave an opposite order for the same day. However, the next day it must be deleted as it becomes invalid. A new order according to new data should be set.

Regards,
Edward

Hi Edward, I have a question. Lets say a Long order is filled, would you expect the Short order to gets fill? or just delete the Short order after Long order is filled?

Isidro

really like this strategy it is how im already trading, also an added tip is to have an 8 period RSI with a 8 period EMA attached...... when they cross over its a buy with rsi going up, sell when going down!
mike

Hi Martha,

We put Stops not 3 pips away from the entry, but 3 pips away from the lowest low when Buying and 3 pips away from the highest high of the candle when Selling.

So it would be a buy stop: 1.0134 with a Stop loss at 1.0020 - 3 = 1.0017
and a sell stop : 1.0015 with a stop loss at 1.0129 + 3 = 1.0132
Regards,
Edward.

hi edward, i am martha rodrigues from italy...sorry if my english is not so good..
i like this strategy, and i have one question for you..

You placed you look for yesterday candle..and this candle must have 90 pips range (high - low) including the shadow..than we put 5 pips stop buy at the highest of the candle..and 5 pips at the lowest of this candle..and put stop loss 3 pips for every positions..oke, it worked..but my question is, you know the price of the market is going back and fourth,,, i give you the example.

1. yesterday candlestick have :
highest : 1.0129
lowest : 1.0020

than we put :
* buy stop : 1.0134
sell stop : 1.0015

* buy stop lost : 1.0131
sell stop lost : 1.0129

then now, the new candlestick is appear..it reachs 1.0134 and our buy stop is ges filled..after is going to 1.0137, the price is going back to 1.0130 and go forward again to 1.0138..(the price is back and fourth)..because is going back to 1.0130, our stop lost is get filled..my questions is, is that possible we put our stop lost only 3 pips? because the price in the market is goes back and fourth..3 pips is very easy to get filled..(except the market is going very strong and our stop lost not get filled, but commonly the price is going back and fourth)..i hope you give me the solutions..thanks edward..

Martha Rodrigues