Baruch's Forex System Journal

Baruch · Mar 18, 2004

Quote from Scientist:

LOL! Yeah right Baruch!

The actual truth is, I borrowed on all my credit cards, mortgaged all my houses and bet the farm EUR short @220 this morning, and I'm still holding!

ES short (the biggest play for today) still looking noooice...

OK, Scientist. Good luck with your ES short. Why do you still trade ES? Do you have 2 farms?

Jayford · Mar 18, 2004

I trade ES too.

Its been my bread and butter for quite some time as far as small consistent gains are concerned.

I don't scalp em though. Used to. A bit too crazy for me now. I do 2 or 3 ES trades per day now (vs 50 in the past). I think scalping is very tough. Ya need a high % win ratio if you are taking lots of micro gains.

Jay

Baruch · Mar 18, 2004

Quote from Jayford:

I trade ES too.

Its been my bread and butter for quite some time as far as small consistent gains are concerned.

I don't scalp em though. Used to. A bit too crazy for me now. I do 2 or 3 ES trades per day now (vs 50 in the past). I think scalping is very tough. Ya need a high % win ratio if you are taking lots of micro gains.

Jay

Hi Jay,

5 pairs and 2- 3 ES trades per day. You must be quite busy?

Jayford · Mar 18, 2004

Quote from Baruch:

Hi Jay,

5 pairs and 2- 3 ES trades per day. You must be quite busy?

Not at all, usually bored. I'm not scalping, and I don't day trade two of those pairs (AD, CD). I only make about a half dozen trades per day.

In addition, I only concentrate on one or two pairs at a time (take the best ones). I usually ignore ES mid day (choppy mess), and trade the close when currencies are dead. It really isn't much work. Boredom trading is a larger threat. My techniques don't involve much either. I pick my target and put in an exit order (limit of course), and then just move stops as mkt goes my way. if it goes against me early, its not a very long trade.

Jay

Baruch · Mar 18, 2004

My system is long. I took the buy signal today in CHF and made 134 pips. Very nice.

Did I go flat to soon? I don't know, but the problem with the system is that it don't tell you when to take profit. You can't wait until there comes a sell signal. You will - many times - lose a lot of pips waiting for that.

Instead I use a trailing stop and look for tops etc. But you don't know if there's 0 or 500 pips more to gain in the move.

Maybe I am wrong? Maybe I should in the market always? Long until there comes a sell signal along - and short until their arrives a buy signal. OK, you will many times lose many pips, but some times you will get many more pips than you do when using a trailing stop.

Baruch · Mar 18, 2004

Quote from Jayford:

Not at all, usually bored. I'm not scalping, and I don't day trade two of those pairs (AD, CD). I only make about a half dozen trades per day.

In addition, I only concentrate on one or two pairs at a time (take the best ones). I usually ignore ES mid day (choppy mess), and trade the close when currencies are dead. It really isn't much work. Boredom trading is a larger threat. My techniques don't involve much either. I pick my target and put in an exit order (limit of course), and then just move stops as mkt goes my way. if it goes against me early, its not a very long trade.

Jay

OK, but how do you decide the target? It must not be easy - and sometimes you must say goodbuy to a lot of pips?
And how many monitors do you use?

Baruch · Mar 18, 2004

Quote from Baruch:

OK, but how do you decide the target? It must not be easy - and sometimes you must say goodbuy to a lot of pips?
And how many monitors do you use?

And one more:

Why not use a trailing stop?

Alpha · Mar 18, 2004

Hey Baruch

Do you always use a filter of 10 pips in your technique? Cos lots of times you see that when the cross with the MA is there, the exchange rate goes up just 10 pips more and than automatically you'll buy. Resulting in a loss cos 2/3 it won't go any higher!

Baruch · Mar 18, 2004

Quote from Alpha:

Hey Baruch

Do you always use a filter of 10 pips in your technique? Cos lots of times you see that when the cross with the MA is there, the exchange rate goes up just 10 pips more and than automatically you'll buy. Resulting in a loss cos 2/3 it won't go any higher!

Hey Alpha,

I started by using the 10 pips filter, but I now test trading without it. I think it's OK when the market is in a trading range, but not when it's trending. You just lose 10 pips in profit.

50MA is also also most of the time strong support/resistance, so the market must sometimes try 2 or 3 times before it breaks through. But when it does, it's a important signal, and that's why my systems works, I suppose.

Jayford · Mar 18, 2004

Quote from Baruch:

OK, but how do you decide the target? It must not be easy - and sometimes you must say goodbuy to a lot of pips?
And how many monitors do you use?

I don't complain if I take 90 tics on a trade (my last Euro trade). I don't have to take the entire move. As a market gets more and more extended, the odds of it coming in grow and I don't like to give up gains once I reach a target. I am a retracement trader primarily, so if I leave lots of pips on the table, so what, I'll get in again at a better price or miss it altogether and trade something else. There will always be opportunities someplace.

My targets depend on the market, but its all classical supp/resis stuff with trendline channels, Fib retracements, and previous highs/lows. Volume matters too for adjusting as I go. Once in a trade all I do is monitor volume, and related markets, but just the occaisional glance.

I use two monitors, but thats just cause I am a nomad. I'd have at least 4 if I ever remained in one place for long. Moving to the Caribbean in May BTW.

Jay