1 hour trading system

On back testing this looked a very good system, i have tried it this week with not the best results.

Am i doing it wrong Remo?

Here are my trades, 8-9 high / low, 2-3 pips above or below, target difference between 8-9.

dl.dropbox.com/u/21384991/FTSE%201HR%20Trades.xls

First day small loss, 2nd day both long and short, cancelled each other out, today long and short as well, hopefully will cancel each other out.

dl.dropbox.com/u/21384991/FTSE%20100%20%28DFB%29.png

Should you buy 5-8 pips above? I'm trading using IG.

Many thanks in advance.

Is this what people say when they say "thats trading"!!

hi Longtermview

The trouble with systems is you have to stick with it solely. If you trade any thing else you will start to doubt yourself. Even after a few trades.
You have to judge the system over the long term and not a few days.
The breaking of the first hour high is the signal so 1 pip should be fine same with the low.
The only problem is you some times find that it reverse back down as you enter.Due to the resistance or support factor.It still a signal thou so have to stick with it.

Test this system out over months.
It does work over the long term.
Most people will give up after a few trades go wrong.
This system work due to the fact your actually trading with the very short term trend as such determined by the first hours trading.

Out of say 20 trades you may get 13 right and 7 wrong one month then next month 11 right 9 wrong but generally speaking it normally is more wins than losses.
Dont take my word for it .Test this thoroughly as I adjust my entries depending on gaps and other factors.

Bottom line
its a system and it needs to be tested by you over a long time.
I personally dont use it as i find it too boring but thats only because i like trading every thing. This system requires discipline and you cant really trade any thing else with it as your likely to give up.

Im also not a fan of free charts like IG so wont trade based on them . But thats just me. Ive had bad experience with them in the past and they may have improved since but once burnt(or a few times in this case) never go back with there charts.
If you put an IG Chart side to side with Metastock or Updata chances are there will be a few errors on IG Charts.Like extreme moves all of a sudden. which messes up the dynamics of the charts.

hope that make sence
remo

The Key to using this system is of course patience, however more importantly you should also note the next candlestick to confirm the break.

i.e if it breaks to the upside more positive results will be yielded if you get a second candlestick confirmation, i.e another green candle, same applies on a break to the down side, red candle break of lows, followed by second red candle.

Well that what i've noticed and works for me..., perhaps you can included that in your back-testing....

longterm_view wrote: On back testing this looked a very good system, i have tried it this week with not the best results.

Am i doing it wrong Remo?

Here are my trades, 8-9 high / low, 2-3 pips above or below, target difference between 8-9.

dl.dropbox.com/u/21384991/FTSE%201HR%20Trades.xls

First day small loss, 2nd day both long and short, cancelled each other out, today long and short as well, hopefully will cancel each other out.

dl.dropbox.com/u/21384991/FTSE%20100%20%28DFB%29.png


Should you buy 5-8 pips above? I'm trading using IG.

Many thanks in advance.

Is this what people say when they say "thats trading"!!

Heres my 1 hour trading chart for the last month.
Like i said i dont trade this myself as i find it to boring.
I also adjust for small gap downs so slight modifications

last 20 trading days
12 wins
6 losses
2 neautral

Remo,

Many thanks for your quick and detailed reply.

I will stick to the 2-3 pips above to allow for IG. Your right about it reversing, it’s done that countless times in the 3 days I’ve traded it!!

I am only trading this system as I don’t have too much time.

I’m pretty resilient and I will keep trying, it works perfectly with my work and only takes up a few minutes each day.

I don’t really earn enough to Buy Updata and Metastock and I haven’t really got the time or space at home, but I am making changes. I am re-arranging my house shortly to buy a computer and a desk, I have an ipad and I find it impossible to trade off this. I am making changes at work so I do not have to price tenders at home in the evening, which should free up time for trading in the evening and looking for chart set ups. If I then start earning enough money I will buy Updata or Metastock.

I am amazed at how many different types of charts you view, gold, gbp/usd, azn, even wheat!!! You must spend hours searching for set-ups.

Many thanks.

I use this system occasionally as well, but not independently as remo suggests as I do like to trade other stuff and also learn more as well. I use the system with a few adjustments, which I am not advocating and obviously DYOR, but they are things that I apply to the system to find an optimal strategy for myself. Examples are:

1) I only trade the break one way (first break), so in your example on the FTSE yesterday I would have lost as opposed to your break even.
2) I wait until a few days haven't worked and then I trade using it. This I know probability wise is like flipping a coin, or roulette where each spin/toss is an independent event, but I am happy to use this method and ignore the technicalities of probability. For example, the DOW today from memory (no chart on me that I can check easily as at work) has had 3 unseccesful days in row using my system (DYOR) so I will be stumping up on it today when I get to check.
3) I look for other key support/resistance levels which may affect the trade. eg on the DOW today if it is inside the trading range highlighted by Remo yesterday, I would target the full profit with all of my position, if it is outside then I will take some profit off the table prior to hitting this level and have the stop adjusted tighter following a 1 miute chart.

As Remo said, if using something, test it and either continue testing it or using it over a longer term as anyone can have a bad week/month with any strategy.

Regards.