Cowabunga System Daily Update: Monday, 11/26/07

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Main Trend

Current Trend= The trend remained down until 3am EDT. From 11pm – 3am EDT, a new trend change candle formed and changed the trend from down to UP. After 3am EDT, the trend remained up the rest of the day.

Today I looked for short trades until 3am EDT. After 3am EDT I only looked for long trades.

Today’s Surf

11:15am EDT- There was a moving average crossover for a long trade. RSI was greater than 50, stochastics were trending up, and MACD was negative and gaining value. This was a valid entry. The entry was at the close of the candle at 2.0682 with a stop at the most recent swing low at 2.0647. Since I was 18 pips away from the nearest 50 or 00 level, I put my initial target at 2.0700.

Entry: Long at 2.0682

Stop: 2.0647

Initial Target: 2.0700

2:00pm EDT- My target was hit. Price made a clean break of my target so I moved my stop to 2.0700 and set my next target for 2.0750

3:45pm EDT- Unfortunately I was stopped out at my first target at 2.0700.

Trade Result: +18 pips; R-Multiple: 0.51

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  • JeffNLisa

    I got in at 2.0684. As I was launching my position for this trade, I set my stop at 2.0647, but since that was a 37 pip risk, I set my t/p at 2.0721 for a 37 pip gain. Then I thought about it, and realized you would probably set yours at the next 00 point, so I went back and reset it to take half my position off at the 00 point. Then I set the other half with a 10pip trail, which rode all the way up to 2.0738, and then stopped at 2.0728 for a total of 44 pips on the second half of my position. A great trade either way! Jeff

  • JeffNLisa

    I got in at 2.0684. As I was launching my position for this trade, I set my stop at 2.0647, but since that was a 37 pip risk, I set my t/p at 2.0721 for a 37 pip gain. Then I thought about it, and realized you would probably set yours at the next 00 point, so I went back and reset it to take half my position off at the 00 point. Then I set the other half with a 10pip trail, which rode all the way up to 2.0738, and then stopped at 2.0728 for a total of 44 pips on the second half of my position. A great trade either way! Jeff

  • cosgrove

    Surfer, how do you feel about 10p trailing stops after the initial target gets hit? Not enough room for price to move, and they’ll get triggered too easy? JeffNLisa’s example makes it sound like a good idea. I can’t think of too many times when it would be a bad idea.

  • cosgrove

    Oh, also, are you adding the dotted rectangles on your chart with an editing program? I can’t find that tool in xtick.

  • PipSurfer

    JeffnLisa- Awesome work!

    Cosgrove- You are always welcome to make tweaks to the system. However keep in mind that this system has been tested to work with these exact settings so you may not get the same results if you tweak it. But the whole point of this blog is to give you a basis of where to start so that you can add on and modify it to fit your trading style. And those dotted rectangles are drawn on by an editing program I have. hope that helps! Happy trading.

    -PS

  • PipSurfer

    JeffnLisa- Awesome work!

    Cosgrove- You are always welcome to make tweaks to the system. However keep in mind that this system has been tested to work with these exact settings so you may not get the same results if you tweak it. But the whole point of this blog is to give you a basis of where to start so that you can add on and modify it to fit your trading style. And those dotted rectangles are drawn on by an editing program I have. hope that helps! Happy trading.

    -PS

  • JeffNLisa

    Thanks PipSurfer! Cosgove, I normally will use a 15 pip trail, because I’ve gotten 60-70 off of a 100 pip move with a 15 pip trail; where with only a 10 pip trail, I’ve gotten stopped out with only 10-30 pips off a 100 pip move. Also, just my opinion, I would NOT use a trail on the original position. You take a risk of stopping out your whole position on what would otherwise be a big winner. If I am going to be here, what I do is just watch it. If price makes a clean break of the target, I will sometimes move my stop on half the position to the target level, to lock in that profit, but still get a chance for more. And then put the trail on the other half. If I’m not going to be here, I just set half of it to take profit at the target point and set it to put the training stop on the other half when it gets to the target (which you can do with EFX). There’s no perfect method of course it’s just what feels right to each person. Jeff

  • JeffNLisa

    Oh, and also, if it gets more than 15 pips over the target, then I will sometimes change it to be a 15 pip trail on the whole position, since then you can lock in at least the first target of profit on the whole position. Sometimes that gets you quite a bit more on the whole position.

    Jeff

  • JeffNLisa

    Thanks PipSurfer! Cosgove, I normally will use a 15 pip trail, because I’ve gotten 60-70 off of a 100 pip move with a 15 pip trail; where with only a 10 pip trail, I’ve gotten stopped out with only 10-30 pips off a 100 pip move. Also, just my opinion, I would NOT use a trail on the original position. You take a risk of stopping out your whole position on what would otherwise be a big winner. If I am going to be here, what I do is just watch it. If price makes a clean break of the target, I will sometimes move my stop on half the position to the target level, to lock in that profit, but still get a chance for more. And then put the trail on the other half. If I’m not going to be here, I just set half of it to take profit at the target point and set it to put the training stop on the other half when it gets to the target (which you can do with EFX). There’s no perfect method of course it’s just what feels right to each person. Jeff

  • JeffNLisa

    Oh, and also, if it gets more than 15 pips over the target, then I will sometimes change it to be a 15 pip trail on the whole position, since then you can lock in at least the first target of profit on the whole position. Sometimes that gets you quite a bit more on the whole position.

    Jeff