Jak's Hidden Wealth System - MT4/MT5 Resources

Most people have heard of indicators and are very familiar with their signals (such as divergence), but one thing most people miss is "hidden" divergence. These divergences are not only trend-related, but also identify the moments when rallies in downtrends and declines in uptrends are likely to stall. I built this system around the principle of buying low and selling high in an uptrend, most of the time we don't want to trade on a breakout because breakouts are usually false breakouts. Suffice to say, we hope to capitalize on a clear trend by taking the train. With that said, here are some indicators and terminology that newbies must be familiar with before learning the system:

1) ATR (Average True Range)
2) Candlestick (Japanese)
3) Bollinger Bands
4) Random
5) European Index
6) DNC channel (Donchian channel)
7) Risk/reward equality (difference between stop loss and your first limit or target for all contracts)
8) Hidden Div (when the price makes HL and the indicator makes LL, the reverse is an example of selling) Please go to Babypips.com school for more related information
9) Fractal

Now that that’s out of the way and you know everything there is to know about these metrics and terms, it’s time to dive in deeper. First the indicator is set as follows:

1) ATR (set to 5 periods)
2) Menorah (whatever color desired)
3) Bollinger Bands (20,2 SMA Bollinger Bands)
4) Stochastic indicator (10,4,4 EMA smoothed)
5) EMA (set to 50)
6) DNC Channel (set to 20 and set it to only monitor closes, it doesn't matter as long as it identifies the highest closes in the trend, you don't really need them if you are discerning)
7) Fractal indicator (fractal has 5 bars)

Okay, so that's the indicator. If you cannot get any of these indicator values, please do not ask me about your platform manager as I am not very good at MT4 and other platforms other than FXCM Marketscope

First, let me define the words "range" and "trend", in this system, range is when the price is in trend (down in this case) (which we will discuss later) and then the price crosses the 50 EMA (closes above the 50 EMA by at least 5 candles and the 50 EMA goes up the 5th bar or more (the price can close above 5 times and still not cross the 50 EMA)). A turn is defined as more than 0.2 pips. The market is now in a range and the system is not trading.

The market is "trending" when the 50 EMA rises by more than 0.2 points for 5 consecutive candles after being within a certain range (see above). See picture below

Now that you know what trends and ranges are in this system, let’s review the buy trading signals:
buy signal
1. The trend must be upward (see above)
2. The stochastic must be in place to make the hidden div ( see image below ) NOTE: Only compare the stochastic levels of the fractal, i.e. run the crosshair from the fractal down to the indicator and see the stochastic levels and wait for the current price to be higher.
3. Once in a position where you can hide. Zoning waits for a Japanese candle to form (Doji, engulfing line, piercing line, etc...), then lets %k (fast line) turn 1 pip on the candle closing in the upper half (indicating strength) (random points drawn from 0 to 100), if the candle stoch %k opens with a close lower than 50% of its range, then waits for the next candle and %k moves up again by 1 pip. You now have a trading signal.
4. When drawing a hidden div line, you can draw a line through a peak or valley like I did in the example, but when you have to draw a line through (rather than connecting), there must be a regular div accompanying it.

NOTE: The opposite is true for selling (trend must be down, stochastic %k must be down not up)

Now you have to decide how much risk you want to take on this trade. My "base" risk is 0.75% (seems small? Well, change it to your liking, I don't care) and then I add or remove market "factors" as follows:

Other trade-related indicators: risk increased/decreased by 0.1% if favored/disfavored
Steep Trend: A trend above 60 degrees is a steep trend and may result in a 0.1% risk reduction on this trade.
1 hour b4 small news: risk reduced by 0.1%
Relative to daily/weekly pivot points: If the pivot point hinders the trend, the risk is reduced by 0.1%; if the pivot point supports the trend, the risk is increased by 0.1%.

You can come up with your own market "factors" and how much to risk for your "base". Note that this is the maximum risk (0.75% means my maximum risk is 1.15% and my minimum risk is 0.25%).

Here is the step-by-step process for calculating trade limits (reduce 1/2 position) (all examples are buy trades):

1) Are Bollinger Bands “contracting”? If they use ATR 5 to set your target (1x the ATR 5 value on the signal candle), you must add that value to your entry price once you determine it (see "Entry Price" below). If they are normal trending Bollinger Bands (wide and not shrinking), then revert to steps 2-3
2) Determine if the signal candle (the candle that turns to random to form a hidden zone) closes within around 5 pips of the highest DNC ​​upper channel in the trend (use the DNC channel to identify this) and if it does use ATR 5 to set the target (as mentioned above). If not, return to step 3.
3) Determine whether the Bollinger Bands are above the DNC upper channel high level. If using the DNC cap channel as a limit (minus a pip or two in case the price reverses sharply near it, which sometimes happens). If the Bollinger Bands are not above the highest DNC ​​upper channel in the trend, then use the Bollinger Bands as the first target (minus a few points)
4) If you can only buy 1 lot in a trade (regardless of size), then use pivots or Fibonacci levels to exit 1 lot.

Here is a step-by-step guide to setting a stop loss:
1) Determine your limits (above) and then multiply your pip limit by 2 to get the maximum stop loss distance when using ATR (for example, use an ATR 5 limit because the Bollinger Bands are squeezing the target of 15 pips) In this example the maximum stop loss is 30 pips. If not using ATR limits, find the nearest fractal and place your stop loss there, then find the entry point
2) Now that you know the maximum stop loss distance, find a fractal around this area (but not beyond the maximum) and place all pairs with USD as the last currency pair (e.g. EUR/USD, AUD/USD) 3 pips below it. USD currency pairs (USD/JPY, USD/CAD) are 2.5 pips.
3) If there is no fractal (99% of the time), use a large bar in the direction of the trend as your original stop loss (never exceed the maximum).
4) Now that you know your stops, you need to find out how many pieces to grab. If you trade mini lots (10,000 base currency) and your stop loss is 30 pips, which is 0.5% of your account (you determine that the maximum risk on the trade is 1%, which is $60 on a $600 account), then you will hold 2 lots, which is equivalent to a risk of $60.

entry price
1) To figure out the entry price you need to know your stop loss position and your limit size in points, then take a horizontal line and place it at the current market price after the signal candle. Check that the stop loss size does not exceed twice the size of the first limit (remember that the first limit cancels 1/2 of the position). It's simple, start by entering the market, if the rules are met (stop loss does not exceed 2 times the limit), then if it does not move the order, accept it until it meets the requirements (as long as the order does not want the price to reach the high of the sell signal bar or the low of the buy signal bar)
When to cancel a pending order <br> If the target is an ATR target, cancel the pending order after 3 candles pass or price hits your potential first target I want the price to move 1.5x before canceling the order (because I don't want the price to retrace that much)

Track your stop loss:
Now that you know how to find the original stop, you must know how to track it:

1) As soon as the price forms a "clean bar" (a bar that opens in the lower third, closes in the upper third, and makes a new high since entry), set the stop loss 3 pips below it for pairs with /USD as the last symbol, and 2.5 pips below it for pairs with USD/ as the first symbol. Additionally, a trailing stop is placed at each "fractal" (I have a robot that does this for me if I can't use the clean bar rule while I'm sleeping, but that's just part of trading)
2) Once the first target is reached, the stop loss must be moved (not relying on clean bars or fractals) to at least half of the original risk, and to a maximum of breakeven.
3) Ending stop trailing is summarized in this example, in this example the green line is the entry, the lowest red line is the original stop, while the other red lines are the stop trailing, pink is the first target (based on ATR as price closed above the highest DNC ​​upper channel in the trend): See AUD trade below

I'll post more examples as I come up with more examples and YouTube videos, but for now here are some picture examples:

See both trades below, considering this week's trading has been very confusing due to indecision on the non-farm payrolls data

If this all seems complicated, don't worry, the process is actually quite simple and I'm going to explain it in detail with some YouTube videos. But please note that this system is very powerful and it will lead to huge consistent profits (80% of the time it reaches the first goal). Again, I'm not very good with words, so just ask me some questions and I'll try to answer them. Thank you for reading about this system and I hope you can use it to find hidden treasures.