Heiken_Ashi_Smoothed
Introduction
My name is Don Steinitz. I am originally from California and moved to Las Vegas in 1984 leaving all behind for the pursuit of my number one interest “Blackjack”. I was able to make a very good living by counting cards and other methods to obtain an edge over the casinos. Yes I became well know in Nevada as expected but was never arrested or back roomed which to this day escapes me how I was so fortunate. I was also able to take advantage of tilted roulette wheels, sloppy dealers, slot machines that had some minor faults, biased bingo balls and edges in horseracing etc.
I left the game after 23 years to play “No limit” poker since the edge in that game is large enough for the skillful player to make a nice income as well. I also get treated just the opposite as a professional blackjack player who is always looking behind his back and constantly getting escorted out of casinos. I have studied the stock and forex market for about 8 years now and put in about 11,000 hours in front of my computer looking at charts.
This market is by far the toughest game to beat and I am determined to not give up until I find an edge that I can exploit to my advantage. So why would I share this information with you? Because I haven’t been successful prior to finding “Forex Factory” and this indicator. This website is dedicated to serious forex traders and I was able to stumble on what I believe is an indicator that presents a lot of potential. In the 8 years I have never seen such an accurate way to asses market movements and the ability to capitalize on the beginning of a trend.
THE INDICATORS USED
You need to load on your platform three indictors
1. Heiken_Ashi_Smoothed 1a Input setting are: 2-6-3-21b Colors are: Red, blue, red, blue.1c. Width is: 1,1,3,31d. Style is: 0,0,0,02. 4 TF HAS Bar2a Input settings are: 2-6-3-2... 1.02b Colors are: Red, blue, red, blue, red, blue, red, blue2c Width is: 0,0,0,0,0,0,0,02d Style is: 0,0,0,0,0,0,0,02e Level style is: Silver3. 4 TF HAS Bar23a Input settings are: 2-6-3-2-0 Blue,Red, Black3b Colors are: Blue, red, blue, red, blue, red, blue, red3c Width is: 0,0,0,0,0,0,0,03d Style is: 0,0,0,0,0,0,0,03e Level style is: SilverYou need to set your price chart on "Line charts" (candlesticks will work too) but I prefer line charts since we are dealing with closing prices only and candles with clutter up the chart.
EXPLINATION OF THE INDICATORS
So now you have your charts set-up with the three (3) indicators and you have your pricing set to "Line charts". Let's continue......1. On the top of the chart you will see the “HAS” indicator. There are only two colors that you will see red or blue. Red for down and blue for up. There is also another candle that you will see from time to time. It is a red body with a blue wick or blue body with a red wick. I’ll go into that later.
2. On the bottom of the chart you will see the “4TF HAS” indicator display four timeframes off to the right side of the indicator. If your platform is set to 5M you will see 5M, 15M, 30M & 1Hr. You can also confirm the TF's just over the indicator itself which helps if you can't see the right side of your screen for whatever reason.3. On the bottom of the chart we also have the “4TF HAS Bar2” which overlaps the other “4TF HAS Bar” indicator to enable a mixed color bar (bar with a dot in the middle) to display when they occur naturally. Don’t worry we will discuss that later. Thanks go out to “Mouteki” for his help with a modification to this indicator which he named the “4TF HAS Bar2”.
THE RULES FOR ENTERING
Let’s take the 5M TF as our example.
1. Look at the lowest row which is the 5M TF. If the bar directly above the 5M bar is also blue you take the trade long. The best time to enter on ANY TF is just after you see an opposite colored bar on as many TF’s as possible. In this example it’s best to enter after you have seen some red bars on the lowest TF. If you saw red bars on all 4 TF’s just prior to entering long this makes for a better trade. The reason for this is you want to enter at the beginning of a new move or time cycle. If you entered on a blue/blue candles (5M/15M) just after seeing just one row of red candles on the 5M TF, it is possible and highly likely that you are not taking the beginning of a New 5M trend. Either way the entry is ok to take. I mention this only to enlighten you as to what makes for a better entry which will produce more PIPS since you will have gotten in early.
2. Now you have entered and you are on the 5M/15M cycle. Your job now is to sit tight and do nothing until you see your first red candle on the 5M TF. Once this has occurred you will be on alert status since the trade is starting to backfill. In other words some possible profit taking has occurred. But do nothing. Two things will happen at this point forward.
2a. You will see some more red 5M bars, then as the market recovers you will get into blue bars once again or
2b. You will see more red 5M bars and then the 15M row will display it’s first red bar.
In the case of 2a you just continue watching and do nothing. In the case of 2b you wait for the close of the 15M bar and then switch the TF of the MT4 platform to the next higher one. In this case that would be the 15M. If after switching TF’s to the 15M you end up with a red bar on the lowest TF (15M) and a blue bar on the 30M TF you are safe to continue the trade. Remember we are always talking about the bar directly on top of the other bar.
3. If after switching TF’s to the 15M you end up with a red bar on the lowest TF (15M) and red bar on the 30M TF you exit immediately. Remember we always perform ALL functions with a close of bar.
4. So now assume we are clear to stay in on this trade. So are job is to monitor the 15M/30M TF. Again we stay in the trade as long as the 15M stays blue. If it turns red you perform the same function as before. Do nothing if the 15M is red and the 30M is blue. If the 15M and the 30M are both red get out immediately (at the close).
5. Now this can go on for a long time. I will be attaching a trade on the forum that started with the 5M TF and continued to the 1hr/4hr. I just looked at the trade I will be posting that follows this word doc and I would still be in. Lot’s of PIPS were made by staying in and not exiting until the rules tell you to do so.
EXITS
1. I have always said that exits are the hardest part to any trading method. Not just this one but any method. The reason is it is hard to predict the beginning of a trend or the end of a trend. You can see clearly when you are somewhere in the middle.
2. I have two schools of thought that can be used mechanically. One exit is risky and one is less riskier. With risk comes the potential to adjust how much profit you are trying to achieve. I will let the reader decide how much risk/reward they feel they want to manage.
3. When I talk about risk I am referring to how much potential profit one is willing to give back as a trade off for staying in the trade longer.
4. Exit rule #1 (bigger risk)
4a Exit on ANY TF when the lowest and next higher TF both show the opposite color from the original trade. When long you would exit if the lowest TF and next higher TF both are red.
It should go without saying that you reverse whatever I am saying if you take the opposite trade direction.
5. Exit rule #2 (less riskier)
5a Exit on ANY TF when the lowest TF bar changes to an opposite color from the original trade. When long you would exit if the lowest TF bar is red ignoring the upper TF’s.
6. Keep in mind that if you exit on this less riskier method you can always get back in later after the lowest TF bar changes back to the original color based off of the original trade. I say this because you might have exited prematurely to avoid waiting too long for the riskier next higher TF bar to turn red. I will go into another technique that will have it’s own thread. It will be based on what I have touched on here.
7. One of the reasons I have dedicated my time to this thread is for you the reader to help find ways to manage the exits to optimize the ability to keep those hard earned PIPS. I believe we can come up with a filter or something based on resistance or support that can help identify the tops and bottoms more efficiently.
EPILOGUE
1. That about sums up the strategy that you can use to make more money then you could have imagined. This can be your personal ATM machine. If you like what you have read I would appreciate any and all feedback good or bad. Stay tuned for my next word doc about a style of trading that let’s you enter at anytime once a trend has already been established.
Introduction
My name is Don Steinitz. I am originally from California and moved to Las Vegas in 1984 leaving all behind for the pursuit of my number one interest “Blackjack”. I was able to make a very good living by counting cards and other methods to obtain an edge over the casinos. Yes I became well know in Nevada as expected but was never arrested or back roomed which to this day escapes me how I was so fortunate. I was also able to take advantage of tilted roulette wheels, sloppy dealers, slot machines that had some minor faults, biased bingo balls and edges in horseracing etc.
I left the game after 23 years to play “No limit” poker since the edge in that game is large enough for the skillful player to make a nice income as well. I also get treated just the opposite as a professional blackjack player who is always looking behind his back and constantly getting escorted out of casinos. I have studied the stock and forex market for about 8 years now and put in about 11,000 hours in front of my computer looking at charts.
This market is by far the toughest game to beat and I am determined to not give up until I find an edge that I can exploit to my advantage. So why would I share this information with you? Because I haven’t been successful prior to finding “Forex Factory” and this indicator. This website is dedicated to serious forex traders and I was able to stumble on what I believe is an indicator that presents a lot of potential. In the 8 years I have never seen such an accurate way to asses market movements and the ability to capitalize on the beginning of a trend.
THE INDICATORS USED
You need to load on your platform three indictors
1. Heiken_Ashi_Smoothed 1a Input setting are: 2-6-3-21b Colors are: Red, blue, red, blue.1c. Width is: 1,1,3,31d. Style is: 0,0,0,02. 4 TF HAS Bar2a Input settings are: 2-6-3-2... 1.02b Colors are: Red, blue, red, blue, red, blue, red, blue2c Width is: 0,0,0,0,0,0,0,02d Style is: 0,0,0,0,0,0,0,02e Level style is: Silver3. 4 TF HAS Bar23a Input settings are: 2-6-3-2-0 Blue,Red, Black3b Colors are: Blue, red, blue, red, blue, red, blue, red3c Width is: 0,0,0,0,0,0,0,03d Style is: 0,0,0,0,0,0,0,03e Level style is: SilverYou need to set your price chart on "Line charts" (candlesticks will work too) but I prefer line charts since we are dealing with closing prices only and candles with clutter up the chart.
EXPLINATION OF THE INDICATORS
So now you have your charts set-up with the three (3) indicators and you have your pricing set to "Line charts". Let's continue......1. On the top of the chart you will see the “HAS” indicator. There are only two colors that you will see red or blue. Red for down and blue for up. There is also another candle that you will see from time to time. It is a red body with a blue wick or blue body with a red wick. I’ll go into that later.
2. On the bottom of the chart you will see the “4TF HAS” indicator display four timeframes off to the right side of the indicator. If your platform is set to 5M you will see 5M, 15M, 30M & 1Hr. You can also confirm the TF's just over the indicator itself which helps if you can't see the right side of your screen for whatever reason.3. On the bottom of the chart we also have the “4TF HAS Bar2” which overlaps the other “4TF HAS Bar” indicator to enable a mixed color bar (bar with a dot in the middle) to display when they occur naturally. Don’t worry we will discuss that later. Thanks go out to “Mouteki” for his help with a modification to this indicator which he named the “4TF HAS Bar2”.
THE RULES FOR ENTERING
Let’s take the 5M TF as our example.
1. Look at the lowest row which is the 5M TF. If the bar directly above the 5M bar is also blue you take the trade long. The best time to enter on ANY TF is just after you see an opposite colored bar on as many TF’s as possible. In this example it’s best to enter after you have seen some red bars on the lowest TF. If you saw red bars on all 4 TF’s just prior to entering long this makes for a better trade. The reason for this is you want to enter at the beginning of a new move or time cycle. If you entered on a blue/blue candles (5M/15M) just after seeing just one row of red candles on the 5M TF, it is possible and highly likely that you are not taking the beginning of a New 5M trend. Either way the entry is ok to take. I mention this only to enlighten you as to what makes for a better entry which will produce more PIPS since you will have gotten in early.
2. Now you have entered and you are on the 5M/15M cycle. Your job now is to sit tight and do nothing until you see your first red candle on the 5M TF. Once this has occurred you will be on alert status since the trade is starting to backfill. In other words some possible profit taking has occurred. But do nothing. Two things will happen at this point forward.
2a. You will see some more red 5M bars, then as the market recovers you will get into blue bars once again or
2b. You will see more red 5M bars and then the 15M row will display it’s first red bar.
In the case of 2a you just continue watching and do nothing. In the case of 2b you wait for the close of the 15M bar and then switch the TF of the MT4 platform to the next higher one. In this case that would be the 15M. If after switching TF’s to the 15M you end up with a red bar on the lowest TF (15M) and a blue bar on the 30M TF you are safe to continue the trade. Remember we are always talking about the bar directly on top of the other bar.
3. If after switching TF’s to the 15M you end up with a red bar on the lowest TF (15M) and red bar on the 30M TF you exit immediately. Remember we always perform ALL functions with a close of bar.
4. So now assume we are clear to stay in on this trade. So are job is to monitor the 15M/30M TF. Again we stay in the trade as long as the 15M stays blue. If it turns red you perform the same function as before. Do nothing if the 15M is red and the 30M is blue. If the 15M and the 30M are both red get out immediately (at the close).
5. Now this can go on for a long time. I will be attaching a trade on the forum that started with the 5M TF and continued to the 1hr/4hr. I just looked at the trade I will be posting that follows this word doc and I would still be in. Lot’s of PIPS were made by staying in and not exiting until the rules tell you to do so.
EXITS
1. I have always said that exits are the hardest part to any trading method. Not just this one but any method. The reason is it is hard to predict the beginning of a trend or the end of a trend. You can see clearly when you are somewhere in the middle.
2. I have two schools of thought that can be used mechanically. One exit is risky and one is less riskier. With risk comes the potential to adjust how much profit you are trying to achieve. I will let the reader decide how much risk/reward they feel they want to manage.
3. When I talk about risk I am referring to how much potential profit one is willing to give back as a trade off for staying in the trade longer.
4. Exit rule #1 (bigger risk)
4a Exit on ANY TF when the lowest and next higher TF both show the opposite color from the original trade. When long you would exit if the lowest TF and next higher TF both are red.
It should go without saying that you reverse whatever I am saying if you take the opposite trade direction.
5. Exit rule #2 (less riskier)
5a Exit on ANY TF when the lowest TF bar changes to an opposite color from the original trade. When long you would exit if the lowest TF bar is red ignoring the upper TF’s.
6. Keep in mind that if you exit on this less riskier method you can always get back in later after the lowest TF bar changes back to the original color based off of the original trade. I say this because you might have exited prematurely to avoid waiting too long for the riskier next higher TF bar to turn red. I will go into another technique that will have it’s own thread. It will be based on what I have touched on here.
7. One of the reasons I have dedicated my time to this thread is for you the reader to help find ways to manage the exits to optimize the ability to keep those hard earned PIPS. I believe we can come up with a filter or something based on resistance or support that can help identify the tops and bottoms more efficiently.
EPILOGUE
1. That about sums up the strategy that you can use to make more money then you could have imagined. This can be your personal ATM machine. If you like what you have read I would appreciate any and all feedback good or bad. Stay tuned for my next word doc about a style of trading that let’s you enter at anytime once a trend has already been established.
No comments:
Post a Comment