My Trading Holy Grail

Just type "Steve Alexander" in YouTube's search field...
https://www.youtube.com/channel/UC473fZWBGoUzlivmGjjHRew

 

I don't so much depend on the concept of a "Holy Grail" as I do the principle of recognizing "the signs of the times." What made the biggest difference for me was when I abandoned the use of standard indicators to find what amounted to the "south winds, red skies, and clouds in the west" of candlestick charts for me personally—which turned out to be key moving averages.

The traditional 10-, 20-, 50-, 100-, and 200-period moving averages (from my perspective at least) lacked the precision I desired and were not as smooth as I needed them to be, so I came up with my own alternatives.

Whether I'm using a 60-minute chart, or a 1-minute chart, I still rely on the same key moving averages, but adjusted to the differing time frames. For example, I purchased this USDCAD call option with a strike price of 1.3300 because my two primary intraday trend lines (white and goldenrod) suggested the pair was ending the New York session with a turn north.



It didn't matter whether I was looking at my one-minute setup or my five-minute setup because the intraday trend is represented exactly the same no matter what time frame I'm looking at...

 

Agreed on the moving average part.
But time frames do matter, for example, daily and that's where you can predict intraday trends.
I used to monitor 1 minute chart but now I pay less attention to it.
That said, I guess I hardly have a losing day. At one time, I had a winning-day run for 3 months without a single day loss.
All the best with your trading ...

 

Yeah, I've had a number of contributers to this site express disdain or contempt when I mentioned a 90%+ daily success rate goal/expectation in the past, but it really is possible if one day trades (Forex) using precise and accurate indicators accompanied by a good working knowledge of price action.

 

I don't disagree with you at all. What I meant to convey is that I have the very same graphics on my five-minute charts as I do on my daily charts, so that I do not necessarily have to switch back and forth. However, my five-minute charts also have additional information that provide greater and more precise detail so that I can time entries and exits to the pip/second. (Unfortunately, one-minute charts focus in to such a degree that the information from daily charts either will not fit or is almost always out of view.)

 

for me i have something like that going on with ES. I have not ventured in Forex but would like to try that market also, in not so distant future. Why did you guys choose Forex over ES? any particular reason?

 

Yesterday I added what I am calling "The Yellow Brick Road." These two moving averages are virtually the same and, as far as I am concerned, tell the story as to whether any given currency pair is intraday bullish or bearish at the moment, probably my best "Holy Grail," if there actually were such a thing, to date.

Expiated's "Yellow Brick Road"


I was planning to use a full set of data to smooth them out instead of the sampling of data that generated the above squiggly lines, but this would have eaten up a LOT of memory. Fortunately, in deleting a number of chart setups I tested during March and April, I discovered that the center line from the Adaptive Price Zone (APZ) indicator I learned about last week looked very similar to my Yellow Brick Road (YBR).

I therefore adjusted the default settings a bit and deleted the APZ's bands and got almost an exact match, so that I will not have to go to all that trouble coding a memory-eating YBR after all, but can instead use the center line from Lee Leibfarth's APZ indicator in its place!!!

Generated from Lee Leibfarth's Adaptive Prize Zone:

 

1. I live in the USA, where the law prevents me from day trading stocks unless my account balance is greater than $25,000, which it is not. Since I can generate a profit every single day via day trading, but find it impossible to do the same when swing or position trading, this puts a big cramp in my style. Forex has no such pattern day trading rules.
2. The Forex market is open 24 hours a day all week long. Hence, I don't have to worry about gaps up or down each day, and I am not relegated to 6.5 hours a day, as I was with stocks and indices (indexes). Of course, I could trade futures and indices from other countries, but by the time I was aware of this, the minimum opening balance was prohibitive for me. But with Forex, I can trade with a balance of just a couple hundred bucks. (When I was first learning to trade, I was living off savings, and since I was a break-even trader at that time, my savings eventually ran out.)
3. I can short currency pairs any time a like. When I was trading stocks, there was always a hassle as to whether any shares for shorting were available. Of course, I could trade reverse ETF's (offered by ProShares, Direxon, etc.), but I found having to switch instruments depending on whether I was long or short to be somewhat annoying as well.
4. The fees and commissions for trading stocks are too high in my opinion, and even though I was using bargain brokers, they too eventually raised their fees, or were bought out by outfits that subsequently raised their fees. As a tiny retail trader, trading Forex can cost me as little as pennies, and in fact, sometimes Swaps actually ADD to my account balance. Also, because I am a day trader, often I don't have to pay any fees (Swaps) at all.
5. I could probably deal with it much more proficiently now, but back when I was trading stocks and indices (from 2007 to 2012) the volatility of the first 15 minutes to an hour made it difficult for me to time the best moment to jump in and the best moment to take profit. (Though as I suggested in other posts, I now have the tools to time such moves down to the penny/second.) With Forex, the intervals/candlesticks "feel" smaller, so it is much easier to "see" exactly when intraday trends are reversing.
6. And finally, thanks to leveraging, I can make as much money with a $500 Forex account as I was making with a $15,000 stock market account.

 

really good points, for me also due the PDT, i transitioned into futures. Isn't forex more expensive interms of commission and buying the real time data feeds. Also whats the best pair to trade, i am also located in USA. east coast.

 

I trade via OANDA using the MetaTrade 4 platform they offer, which means there is no charge for data feeds, and I have no idea what people are talking about when they mention commissions in connection with Forex. I believe that outside of the spread, the only cost I incur comes from margin if I hold a position overnight (Swap?) which I almost never do as a day trader. The record pictured below is typical, where my total deductions after ten trades amounted to -16¢, and if fact, two trades later (my 12th trade, not pictured) I received a Swap of +20¢.



Since my lot size was only 0.05, I was making only a few bucks per trade. If I had been trading through my old broker, E*Trade, each transaction would have cost me $6.95, or $4.95 since I make more than 30 trades per quarter, so that it would not have even been worth it to trade at all!

To me, there is no best pair. There are some exotic pairs that I think are really BAD, and it seems to me that it takes a somewhat larger account balance to trade the Cable (Sterling/Pound) pairs, but other than that, I will trade any of the majors (i.e., AUDJPY, AUDUSD, EURGBP, EURJPY, EURUSD, GBPJPY, GBPUSD, NZDJPY, NZDUSD, USDCAD, USDCHF and USDJPY).

On second thought, often USDCAD and USDCHF do not travel a lot of distance, but USDCAD moves like CRAZY on news, so if you get in early going in the "right" direction, there are times when even these pairs can offer significant gains.