Scalping system #7 (Great GBP/JPY 1M scalping strategy)

I am still tweaking this system, and I found a very good combination of indicators to filter bad trades:

1)the laguerre indicator.It must be used in 5M timeframe otherwise it will give too many false signals:

here is how the indicator works:
TimeWarp.doc

download indicator:
Laguerre.zip

setup for the indicator:
gamma: 0.66
ccount: 9500
levels: 0.15 - 0.45 - 0.75

Only trade when system conditions are met + laguerre indicator (IN 5M CHART) is going in the direction of your trade and past 0.15 for long and 0.75 for short.

2) I found a version of the stochastics indicator called "Stochastic DiNapoli" which gives much better signals than the common Stochastics indicator found on MT4, also set to 8,3,3 and levels at 70 - 30. (though Chalesi's recommendation works fine, this one will be a bit more reliable)

Indicator:
StochasticDiNapoli_v1.zip

Wait for Stoch to cross over 70 for shorts, and cross below 30 for long.

Summary of conditions that must be met:

1) Wait for price to bounce of bolinger bands

2) Check Laguerre in 5M timeframe (trade that direction only when cross over 0.15 for longs or below 0.75 for shorts)

3) Check StochDinapoli in 1M, cross at or below 30 for longs, cross at or above 70 for shorts

This will filter most of your bad trades.

Chelo

Dear All,
I still backtest this system,but wondering any improvement for BB and MA setup.
Hope any buddy could help me here
tks a lot
Ele

Do you primarily trade the 1 minute chart or do you sometimes use the 5 minute chart as your primary trading decision tool? What are the average number of candles you normally use to determine exit on the GBP/JPY 1 minute chart?

Thanks for your help

yeah all cool ...thanks guys for sharing...and special thanks to Chelo

Matrix

Great system. Try filtering some bad trades by using 5minutes and 15minutes time frames with stochastics indicator set at 8,3,3. Only enter trades that are in the direction of the major trends. I did about 56 trades with 7 losses.
Best of luck.
Chaleshi

Could you please submit an actual account statement (with a longer period)?

thank you!

Edward
Happy New Year..
It works great on Eur/Jpy .Even easier because of the lower spread than Gbp/Jpy.

Edward

Thanks for all your comments, I am trying 100 EMA, and it seems to be working great. It is great to see so many people interested in this strategy, and willing to improve it.

Thanks to you all
Chelo

Totally agree, Ele. I also saw it being useless when the market is trending well. I'll continue watching charts this week and post updates on my research.

Hanz, thank you for your suggestion, I will look at RSI as well.

Regards,
Edward.

Dear Eward,
I also tested your system as usual.But finding some time zone will be useless,especially 8 GMT,and opening time of USA market.
But for some involatile market, it will be effective.
How's your comment?

Regards,
Ele

Dear all,
can we use the RSI setting 10 to catch the good signal for trading?
i just review it on friday and it works fine.
what is your opinion?
best regards,
hanz

dear gentlemen,
i try this strategy but i faced a big problem some times the candle when it breaks the bollinger band the lower line for example and i put buy order after that the price forthe next candles don't go up it contineu to go down the candle don't close out side the line and made ahuge number of pips.
how can we avoid this suituation.
or is there filter tofilter is false signal?
waiting for your reply
best regards,

Hello everyone,
Here is my observation.
I found no indicators yet to suggest, but I tested various Bollinger Bands settings and looked at Ele's suggestion and got next:

Setup: GBP/JPY 1 min
BB (200, 2, -2)
BB (200, 3, -3)
Remove middle line on Bollinger Bands or make it black/invisible. Instead of this line we will use EMA 100. (I also tried EMA 200 for this purpose, but finally stopped at EMA 100)

Entry and exits rules are without changes. Use 100 EMA for exits or go for 5-10 pips per trade. Looks to be quite accurate.

I'm going to leave this setup on my background charts and if I find additional interesting approaches or some indicators to add I will gladly provide my comments.

Best regards,
Edward.

Ele

Thanks for taking interest on this strategy. I have been testing it for about two months now, and the first one was a complete disaster, until i got to sort of "know" how the pair behaves in such a small time frame, it takes lots of hours of observation. how do i avoid the risk of a trendy market?, by scalping the trend, if you check the detailed statement that I posted you will notice 80% are short positions, that cause i was scalping the down trend. When in a trend the price usually bounces off the middle line of the Bollinger bands on the direction of the trend.

About average profits: there are none, average profits will be given by your money and risk management, profit objectives etc. I think that anyone able to make a consistent 20% a month should be more than happy.

Some other tips:
I find mondays to be a very complicated day to trade this strategy

always check res and support levels on larger time frames...and obey them

One of the biggest risks of scalping strategies is over-trading. As you can see on the statement I pulled 102% in a week, but that was just pushing it, and testing the strategy, it should be by no means your weekly objective, because if that is the case you are sure to blow your account in no time.

Test it, test it again, test it some more, and still it will be never be fool-proof

I am going to test how the 40,2 setting works and i tell you my results

Best of lucks and thanks for the suggestion.
Chelo

dear Chelo,
I found 50,2 maybe bigger, how about 40,2 will be same?
I wondering some trendy market is risky for the system. So would you tell me how to avoid such risk?

regards,
Ele