Price Levels - Weekly High/Low, NY-Close
Please note the following:
If you sell last week's high (PWH-Sell) and buy last week's low (PWL-Buy) you can get some good results.
Here's what I do: I place buy limit and sell limit orders for the following currency pairs: EURUSD, EURGBP, USDJPY, GBPJPY, GBPUSD, EURJPY.
To determine my stop loss, I (currently) use 20% of the weekly ATR (4). This percentage is the same for all six pairs.
Basically what happens is that on Sunday evening I put the price of the previous week's high and the previous week's low into an Excel spreadsheet along with the ATR (4) and then, using a 1,5 Risk Reward Ratio (RRR), I placed a sell limit order and a buy limit order for each pair. Which is a total of 2*6= 12 Orders per week.
Typically I trigger 4 to 6 trades per week, but I don't take that number seriously because 4 weeks is such a small sample size.
By the way, I can post the Excel document if anyone is interested.
IMPORTANT NOTE: All trades expire at London close on Friday, if any trades are open, regardless of whether they are profitable or break even, I will close them manually. For me living in Switzerland, if there are any questions, it's 6pm.
OK so now here is my point:
For example, in the past two weeks I made a total of 2*6 = 12 trades, 5 of which were profitable and 7 of which were losses. The equation is as follows: 5 times 1.5 winning units minus 7 times 1 losing unit. So: (5*1.5) - (7*1) = 7.5-7= + 0.5 units won. For example, if I risk 50 euros on each trade, I will gain 25 euros during this two-week period.
NOTE: This calculation is incorrect for two reasons: it does not include spreads, and it does not include overnight interest. But this is pretty much the gist of it.
This trading method leads to losing trades because it is based on the assumption that the ranges I impose on the currency pairs (PWH and PWL) will be respected. But of course, we don't always have range-bound markets and we have to deal with breakouts. So what I want to do is refine this approach by eliminating one or the other trade that hits my stop loss.
There are a few reasons why my SL (determined by the percentage of weekly ATR (4)) is achieved:
1. The percentage was too small. Problem: If I gave the trade a larger stop, it also had to travel further to reach my target profit. SL is 20% of ATR, which is quite large, as you can see in the accompanying Word document. My stop loss went from 226 pips to 684 pips, which is quite a lot. Transactions usually last more than a day or two.
2. We do have a breakout. This is my main problem. How can I "know" in advance that this time the pair won't bounce off PWH or PWL? Of course, we have no way of knowing, because if I had, I wouldn't be posting on FF but selling my predictive abilities to some rich guy on Wall Street or elsewhere. But: I hope to eliminate one or the other loser. This means not even placing a sell or buy limit order initially.
(In simple terms, just one less loser per week over a two-week period yields the following result: (5*1.5) - (5*1) = + 2.5 units. That's pretty good if you ask me. In simple terms, this is (yes, I didn't account for compound interest, but let's make it simple for now) If I risk 1% per trade, that's 2.5% in two weeks. Know that a savings account will give you a return somewhere in between, 0.5% per year to 2.0% (inflation is between 2.0% and 3% - except in Switzerland where we have negative inflation or deflation) which is actually good).
So: I need something to let me decide whether to place a trade, confident that it will bounce higher or lower.
I was thinking about something that came up in the Seneca Pilots thread: Wrapping up last week's conference.
Obviously, two of the four conferences are important, New York and London.
I prefer London but if you can help me please write here.
Here are the ideas I will test:
If we put it simply, we can say that the highest price of the currency pair last week was $20 and the lowest price was $10.
Now a couple of things could happen: I make a sell trade of $20 and I make a buy trade of $10, right? For example, in the case of PWH selling, I give it $2 to let it go up to $22; in the case of PWL buying, I give it another $2 to let it go down to $8 in order to hit the stop loss. The target reserve ratios are 1.5 respectively: $17 for short positions and $13 for long positions.
So far, so good.
Now: Let's say the London session close is close to PWH (in this case: $20), say $18 or $19.
Q: Is this in itself a good enough indicator that I will see a breakout? (No, 100% accuracy is not required, as I said, one losing trade a week can be avoided and I'm happy...).
I don't use metrics (ATR doesn't count here, on my screen it's jumbled, I just look at the numbers it gives me, I don't care about some visual formation or anything).
If the London closing price contains some approximate information about where it will go next, how do we define it? Is there a ratio at which we are more likely to trust than to distrust?
It might look something like this: the further away the weekly close is from the PWH or PWL, the more likely it is to hit it. So the ratio might look like this:
During sick leave: 20$
Workload: 10$
Last week's London closing price: 17$ --> I don't accept a short position on PWH.
OOORRR: We can look at how the closing price is formed: if we examine the daily candle chart, was there a significant move in last week's closing price, or was the closing price gradually higher (or lower, if it was a fairly bearish week)? My feeling is that if the price goes up significantly with a big move in price, it is more likely to bounce back rather than break out of that level for order flow reasons (e.g. some player with bigger pockets (UBS or some other institution) tries to push the price to a certain level by buying BBIIGGG and then shorting it.
Well, that's how I see it. Will you help me with this problem?
Again, please don't spam me, you know I don't like your get rich overnight, give me $99, be a millionaire next week products.
Thank you so much.
In the attachment you will find a screenshot of last week's prices.
Take care of yourself.
If you sell last week's high (PWH-Sell) and buy last week's low (PWL-Buy) you can get some good results.
Here's what I do: I place buy limit and sell limit orders for the following currency pairs: EURUSD, EURGBP, USDJPY, GBPJPY, GBPUSD, EURJPY.
To determine my stop loss, I (currently) use 20% of the weekly ATR (4). This percentage is the same for all six pairs.
Basically what happens is that on Sunday evening I put the price of the previous week's high and the previous week's low into an Excel spreadsheet along with the ATR (4) and then, using a 1,5 Risk Reward Ratio (RRR), I placed a sell limit order and a buy limit order for each pair. Which is a total of 2*6= 12 Orders per week.
Typically I trigger 4 to 6 trades per week, but I don't take that number seriously because 4 weeks is such a small sample size.
By the way, I can post the Excel document if anyone is interested.
IMPORTANT NOTE: All trades expire at London close on Friday, if any trades are open, regardless of whether they are profitable or break even, I will close them manually. For me living in Switzerland, if there are any questions, it's 6pm.
OK so now here is my point:
For example, in the past two weeks I made a total of 2*6 = 12 trades, 5 of which were profitable and 7 of which were losses. The equation is as follows: 5 times 1.5 winning units minus 7 times 1 losing unit. So: (5*1.5) - (7*1) = 7.5-7= + 0.5 units won. For example, if I risk 50 euros on each trade, I will gain 25 euros during this two-week period.
NOTE: This calculation is incorrect for two reasons: it does not include spreads, and it does not include overnight interest. But this is pretty much the gist of it.
This trading method leads to losing trades because it is based on the assumption that the ranges I impose on the currency pairs (PWH and PWL) will be respected. But of course, we don't always have range-bound markets and we have to deal with breakouts. So what I want to do is refine this approach by eliminating one or the other trade that hits my stop loss.
There are a few reasons why my SL (determined by the percentage of weekly ATR (4)) is achieved:
1. The percentage was too small. Problem: If I gave the trade a larger stop, it also had to travel further to reach my target profit. SL is 20% of ATR, which is quite large, as you can see in the accompanying Word document. My stop loss went from 226 pips to 684 pips, which is quite a lot. Transactions usually last more than a day or two.
2. We do have a breakout. This is my main problem. How can I "know" in advance that this time the pair won't bounce off PWH or PWL? Of course, we have no way of knowing, because if I had, I wouldn't be posting on FF but selling my predictive abilities to some rich guy on Wall Street or elsewhere. But: I hope to eliminate one or the other loser. This means not even placing a sell or buy limit order initially.
(In simple terms, just one less loser per week over a two-week period yields the following result: (5*1.5) - (5*1) = + 2.5 units. That's pretty good if you ask me. In simple terms, this is (yes, I didn't account for compound interest, but let's make it simple for now) If I risk 1% per trade, that's 2.5% in two weeks. Know that a savings account will give you a return somewhere in between, 0.5% per year to 2.0% (inflation is between 2.0% and 3% - except in Switzerland where we have negative inflation or deflation) which is actually good).
So: I need something to let me decide whether to place a trade, confident that it will bounce higher or lower.
I was thinking about something that came up in the Seneca Pilots thread: Wrapping up last week's conference.
Obviously, two of the four conferences are important, New York and London.
I prefer London but if you can help me please write here.
Here are the ideas I will test:
If we put it simply, we can say that the highest price of the currency pair last week was $20 and the lowest price was $10.
Now a couple of things could happen: I make a sell trade of $20 and I make a buy trade of $10, right? For example, in the case of PWH selling, I give it $2 to let it go up to $22; in the case of PWL buying, I give it another $2 to let it go down to $8 in order to hit the stop loss. The target reserve ratios are 1.5 respectively: $17 for short positions and $13 for long positions.
So far, so good.
Now: Let's say the London session close is close to PWH (in this case: $20), say $18 or $19.
Q: Is this in itself a good enough indicator that I will see a breakout? (No, 100% accuracy is not required, as I said, one losing trade a week can be avoided and I'm happy...).
I don't use metrics (ATR doesn't count here, on my screen it's jumbled, I just look at the numbers it gives me, I don't care about some visual formation or anything).
If the London closing price contains some approximate information about where it will go next, how do we define it? Is there a ratio at which we are more likely to trust than to distrust?
It might look something like this: the further away the weekly close is from the PWH or PWL, the more likely it is to hit it. So the ratio might look like this:
During sick leave: 20$
Workload: 10$
Last week's London closing price: 17$ --> I don't accept a short position on PWH.
OOORRR: We can look at how the closing price is formed: if we examine the daily candle chart, was there a significant move in last week's closing price, or was the closing price gradually higher (or lower, if it was a fairly bearish week)? My feeling is that if the price goes up significantly with a big move in price, it is more likely to bounce back rather than break out of that level for order flow reasons (e.g. some player with bigger pockets (UBS or some other institution) tries to push the price to a certain level by buying BBIIGGG and then shorting it.
Well, that's how I see it. Will you help me with this problem?
Again, please don't spam me, you know I don't like your get rich overnight, give me $99, be a millionaire next week products.
Thank you so much.
In the attachment you will find a screenshot of last week's prices.
Take care of yourself.
Attachment to original post (1)
📦 Summary of post attachments (1)
Below are all the files shared in the reply (1).
💡 Featured Recommendations
✍️ Latest by the author
- •
- •
- •
- •
- •
- •
📌 Popular topics
- •
- •
- •
- •
- •
- •
- •
- •
🔗 You May Be Interested In
- •
- •
- •
- •
- •
- •