NEW STRATEGY AND THE RESULT IS ...

On my last post, I was telling you about a new system. I decided to do forward testing. As usual all testing was done on a demo account. No live account was hurt during the testing period.

The result as you see is superb. There are actually 2 part of testing. The early trades are done on a shorter time frame, 5 minute to be exact. The later part of testing is done on a longer time frame, 1 hour.

I must say the system looks promising on the longer time frame. On the shorter time, I just dont have the time to monitor the trades.

As of now the system is running on my live account. At the moment on 4th June my account is up 40%. Hopefully everything goes well and I will have good profit by end of the month. Will keep you inform on the result later.

NEW PLACE, NEW SCHEDULE AND A NEW SYSTEM

On April 2009, I moved to Kuala Lumpur. A new place requires me to have new schedule. I dont have much time as I would like in front of a PC which means, shorter time for me to trade. It requires me to adapt to the time I have to trade and make a new system.

In my quest to adapt my existing system to a new time constraint trading requirement, I accidently stumble onto a new system. Its a very simple system that has shown good result for the month of April and May at the moment.

Just to show you what I have stumble upon, here is a screen shot of my demo account that I have used to run the test. It doesn't show high accuracy but it shows a return of over 100% last month and a small return this month so far.

Here is the hard part. What if I say that I can actually have an accuracy of 100%. Meaning I can win all the time with this system. The numbers you see there is me using a demo account trading with limited time with no regards for the system rules.

Would it be nice to actually win all the time. I will keep you guys posted on the result by the end of this month. In the meantime I cannot be online as long as I like to. For my friends, I know my YM is not online for a long time but just leave a message and I will answer when I have the time.

LWMA 55

One of my favorite indi is LWMA 55. I dont know why but the price seems to react a lot of this line. People say that MA is a lagging indicator and I agree with them 100% but do not use MA as a signal generator, instead use them as a dynamic support and resistance.

For those of you who love to experiment, try putting LWMA 55 on a chart and see how price actually interact with the line. Its not magic but its a mathematical calculation.

Dont get me wrong, you may not be able to trade using MA 55 alone. Try putting LWMA 13 in there as well and remember they are not signal generators. Treat them as dynamic support and resistance.

Put it into a simple formula. If price > LWMA 13 & LWMA 55 = long. If price < LWMA 13 & LWMA 55 = short.

Try it, you may like what you find. Just needed to add in a filter to improve accuracy.

WHAT FOREX IS NOT

Forex is not a quick rich scheme.
Forex is not easy even though my blog says so.
Forex is not a place for newbie
Forex is not something you can learn overnight
If you needed the money, dont put it in Forex. Seriously. Go somewhere else.
Forex is a journey, enjoy it.
There is no such thing as holy grail coz there is no perfection in this world. If perfection exist in this world it would be boring. No more room for improvement.
Forex is not rocket science. There is no right or wrong. There is only probability.

BIG PLAYERS SEE ONLY BIG NUMBERS

I am typing this from my pc. It a bit of a mess now, the new house still needs a little work and I am not feeling well lately. Maybe its the change in climate.

This week I am going to talk about numbers only. Forex is after all based on numbers. Example, I have a long position on GBPUSD @ 1.4700 with a profit of 320 pips at the moment and still holding.

What I am going to say is big players only see big number. The do not see the last 2 digit. The last 2 digit is for scalpers. Big players only see the 1st 3 or 4 digit only. So if a bank wants to buy or hedge a currency they will give an instruction to buy at 1.47. Thats it. Simple yet people fails to see it.

So what happens at 1.47? The price will bounce of or hover around it but things arent always what they appear to be. What happen is price will have a range between 1.46 - 1.48. That is almost 200 pips wide range. Imagine what happen to your 50 or 100 pip SL?? Now you know why people lose money even though they have the right direction.

These big players have big money they dont mind to stand few hundreds negative pips coz in the end they will profit big time. What they do is they will have a standing order to trade at certain level. Because the total amount of order, the market cannot fill the order in 1 transaction and so price will hover or bounce of a certain level. This is where double top or bottom appear. Behind it is the action of filling orders by these big players.

Example EJ currently have a top of 1.34 and a bottom of 1.30. Big players are playing the game here. At the moment EJ is climbing and there is a big possibility that it will reach 1.34 again. I have a standing order to buy EJ at 1.30. If it hits there is a very big chance for 400 pips gain. Only time will tell.



Attach is a chart of GBPUSD. If you look carefully, you can see my actual entry point. I will explain the rest of the chart in due time.

TRADING ONLY WITH MOVING AVERAGE

At the moment I am rather busy. Moving to a new place and house. The house still needs a lot of work. As a result, I do not have time to update this blog. Trading is still going on but on a shorter timeframe. Result is consistent now. AudUsd is very kind at the moment with no sudden movement.

In the next few weeks I will show you how to trade using only MA. As usual what works for me may not work for you. This is because some of you may not be able to follow the rules of the game.

RULES OF THE GAME
1. Trade based on your capital and the time that you have. The bigger your capital the longer the TF. The more time you have the longer the TF. Vice versa.

2. Only trade at the direction pointed by the MA pairs. If the MA pairs is showing mixed direction, do not trade. The MA pairs must be pointing at the same direction.

3. If a trade suddenly change direction, do not hesitate to close it at a loss and turn the trade. This is the hardest part where most of you failed. Free your mind or become a loser all your life.

4. Keep in mind, there is no such thing as winning all the time. Just make sure you win a lot more than you lose. In the end your profit will grow along with your confident.

Simple system with simple rules. I like to keep it simple. No point of having the most complex system when simple system can have the same result. With this system you will be out of the market most of the time. This is because you will only be taking the big move and avoiding the small move and market noise.

Last advise. Do not anticipate. Forex is not a game of inteligence eventhough this system at full swing will show you possible turning point. I am having a possible turning point for audusd at 0.7200 but I will not take it coz there will be market swing before the actual turn. Why wast time waiting for the big move when you can actually see when its going to move.

In the mean time, good luck for all of you. I will be back once my pc is online again. At the moment I am posting this on a laptop. I dont like laptop, too small keypad, makes it hard to do speed typing.

ITS NOT THE SYSTEM

After more than 2 years of trading, I can tell you a story about forex system. Forex system is a way to trade to have higher chances of profit. Unfortunately not all forex system works. This is because its not the system that is not working. It is you.

What if I tell you that I have a system that consist of Moving Average only. The system can make profit and will minimize you loses or even give you a chance to break even during hard times.

You would be thirll to test it out only to find out that in the end you are losing money and you say the system is crap. The truth is if one person is making money using the exact same system yet you are losing money. So where do you think the fault is? Is it with the system or is it with yourself?

You can never gain profit in Forex until you figure out what is wrong with you. Most of the time when you are losing money you would blame it on the market, news, system etc but never on yourself. Until you figure out what you did wrong, any system no matter how good will fail in your hands. After you realize what you did wrong, then you can make money, seriously.

When you know what not to do, you can trade without any indicator. I myself is trading using only MA now. Took me a while to understand but once you see it, you no longer depending on any indicator. It is your judgement that counts.

I never know what I would learn the further I go in this world or Forex. Right now I am starting to understand why some traders trade without any indicator. The best indicator is in your brain. You just need to develope it. It will take some time. No hurry.