Home › Forums › Development › Trading Systems – Development › MTH – TZ and her friends for manual trading all TF › Reply To: MTH – TZ and her friends for manual trading all TF
A Trading Strategy for TZ SnS
Please note this is educational only and is no one else’s opinion but my own
Hello all my fellow traders. I wish to write to share my experiences with the great work done by Kiads in “lighting the way” for so many people. We all have very different ideas on trading and also money management, risk taking and so on because each of us has a different risk profile. The following ideas are purely my opinions on how I use the tools Kiads provides as well as others of my own that I like to use. Of the many great ideas he and others have shared here, I like the SnS, Xixi TZ with sequencer and the Marked ZigZag channel indicator. As well I use a supply and demand indicator as well as a Value Chart indicator.
I prefer to trade on the 4hr chart and daily chart so I am not looking at the shorter time frames. I place more importance on trades that have a confluence of indicators AND I also take positions that are weaker or counter trend. These positions are much weaker so I use a much smaller position size on them. For money management I use a very aggressive trade size sequence and this is due to the fact that the methods behind the trades are so very strong. The stops on the trades are also short compared to the profit targets. I think here it is each traders decisions on risk reward etc that becomes their final decision. While explaining how I get to my trade decision I think it is best not to confuse it with my money management style, but I will say that during a trade sequence I will have a maximum capital risk factor of 18%. For this to occur I would need to have 25 consecutive losing trades and I can state that this has never occurred to date.
Ok, I will now walk through a small period on a daily chart to show what I look for and how I place my trades stops take profits etc. you can view the rest of the chart after you follow the trade selections Just as a disclaimer, I do like to trade so I take positions that are not always strong but over time they are profitable, the daily positions are my favourite trades and also the more profitable. PLEASE NOTE, this is just my opinion and trading style and this may not be suitable to others, I am only sharing my own experiences.
The charts have the following indicators:
1. ! MTH b700+ SubSeq 13th Next Star 1.0
2. ! MTH b700+ Mod Xixi TZ with Sequencer Indi
3. ! MTH b700+ Marked ZigZag Channel Indi
4. SupDem (Supply and Demand)
6. !___MTH MT4 B610 Market Time Indi
I will use the USDJPY pair for the recent examples, the broker is Go Markets.
Take Profit Stop Loss trade settings.
4 Hour : Take Profit is usually set at the AH4R range or thereabouts (I set the USDJPY to 30 pips – it is currently showing 28.7pips) The stop loss I set to the low of the previous candle + 5% of that candles range, so if the candle range was 100 pips and the low was say 114.100 then my stop would be at 114.050 – this is calculated on the low not the close so if it is a long pin bar there will be a very long stop, if it is a marubozu candle then it will be a short stop.
When I get to a plus 20 pip profit I will move my stop to entry + 1. This will cause a lot of trades to scratch out but there is always another trade and quite often once the 20 pip mark is reached the trade continues, if the position reverses and takes out the stop then you have had a strong reversal. Also, I am not awake 24 hours a day so I usually do not trade on the 20:00 GMT opening candle.
Daily: The daily trades have one major difference to the 4hr trades, I split the trade into 2 equal parts. For the example let us assume the total trade is .02 lots, we would have 2 x .01 lots. Again I like to use the ADR for a target, if it greater than 80 pips I use 80 pips as the profit target. The stop loss is calculated the same as the 4hr – 5% of the previous candle range. SPECIAL NOTE: when on the sell side I add spread to the stop (depending on the pair or the broker it will vary, I use a hard setting of 3 pips personally so if I have a sell position with a calculated stop of say 114.050, it will set this to 114.080 to allow for the spread).
To set up the split position I do the following: Trade 1 – Stop loss set with take profit at ADR or 80pips whichever is the lower. Trade 2 – Stop Loss set but no take profit
Once a trade moves around 50 + pips in my favour I will again move both to entry +1 and the same applies as in the 4hr scenario, remember there is always another trade! If the take profit is hit on trade 1 then we have pocketed a nice profit and we now have a running trade on the second half of the position. With this trade I will let it run until I get a reversal signal, which is usually an SnS skull in the opposite direction. If you want to aim for a specific target then I suggest you look up Kiads’ post on how he uses his fib retracement for a target in conjunction with the TZ indicator :)
OK, lets get to the good stuff! First I apologise for not knowing how to put commentary onto the chart so please forgive me guys. I will do the daily chart only but I have posted the 4hr as well. A point to note here is if the 4hr and the daily chart “agree” you have a strong trade possibility on the 4hr position.
Daily Chart commencing 16th October 2014
On this Day we have a confluence of ZZ, SnS, S/D , Value and TZ – this is a really strong trade, with many factors in play. This trade opened at 105.90 and my stop was at 105.07 (83pips). The low for the day was 105.500 so we had a drawdown of 40 pips at some point in the day we closed the day at 106.320 and I moved my stops to entry +1 at the start of the following day. I am now in a no loss situation on this trade. The next day we hit a high of 106.930 and achieved the profit target of 106.700. We have now pocketed 80 pips and have a no loss “running” trade. This trade was live until the open on the 24th October when an SnS skull appeared for a reversal signal at which time the trade was closed at 108.250 for a profit of 235 pips + 80 pips.
We now have a sell signal on the 24th, this is a weak signal as there is no confluence. The trade was opened at 108.250 with a stop at 108:440 – note this is a short stop. The position closed the day at 108.140 and then we had a gap up on open to 108.334 and then headed down to close at 107.800. The next open gives us an SnS reversal to buy at 107.800 and we pocket 45 pips and enter the buy trade. The new trade has a stop loss set at 107.560 (24 pips).
We are now in 2 open buy trades as described earlier. The first half is closed on the 29th for 80 pips profit and the stop on the remaining trade is at entry +1 (no loss situation). Price continued to move up and the trade was closed on an SnS reversal signal on the 4th November for 640 pips profit on that part of the trade.
We now have a sell trade on with a 26 pip stop in place. The trade moves down and we get 80 pips on the first half and move the stop to +1 on the second half. The next day price continues against us and the trade is close at the +1.
Our next entry is a sell trade on the 12th November and we have a 39 pip stop loss in place. The trade moves lower and we again get our 80 pip profit and move the second part to entry +1. the market continues to rise and we are again closed out on the second trade at +1.
The next trade is again a sell on the 18th November ad we have a 49 pip stop. this trade goes against us and we suffer a full loss of 49 pips.
The next sell trade is on the 21st November and it results in the first half reaching the 80 pips and we move the second part to entry +1. The next day we get a reversal signal and we close the second part for a profit of 32 pips and open a buy position. This trade is moved up to a +1 but the market turns and we are stopped out at +1 (again a no loss trade)
Our next entry is a buy trade on the 28th November. we have a stop of 50 pips in place. The first part of the trade gets the 80 pip target and we move the second part to entry +1 . The second part continues to move upwards and gets to 380+ pips when a transient zone appears. At this point I convert the trade to a trailing stop of 100 pips which gets taken out on the 8th December and leaves me a 280 pip profit on that side of the trade.
I am sure by now you can see where the next trade will be and it is a very strong “confluence” trade with ZZ,TZ, SnS, S/D and Value candle all saying it is a very good buy opportunity. (Hint – this trade netted around 530 pips total profit and we had an initial stop loss set at 83 pips).
I will leave you to explore the rest of the chart and also the 4hr chart for yourselves.
Happy Trading to all and many thanks to Kiads for supplying these wonderful trading aids
Kiads, I am waiting for your smiley SnS and I can only imagine how that will work :)