This is the thread of "symbiosis strategy", it is one that I've personally traded and do trade live on and off for a few years now. I will not link all proof of profits but some of it will for sure be here. The goal of this strategy is to create balance, not profit. Let me be clear about this, as a trader you do not aim to make profit with this strategy only to position yourself in such that you are in balance with the market. Profit though is a bi product that happens if you do this correctly.
How is it all done? Well for starters it is a strategy of trade on two charts, it can be more but .. i will explain that later. Chart A is for the actual trading, here i place trades, i go long and i go short. Chart B is for investing, not trading, here there are only long trades.
On both charts there will be stop losses used but they are not present at the start of a position, it is only once a position is profitable that a stop loss is placed into position to safeguard the small profit that is there.
On chart A there will be hedged trades, meaning that if i have 3 long positions there will be 3 short positions. It can also mean that on chart a i have 3 long positions and 1 short position with 2 pending short stop sell orders below it all. Because 3 long + 3 short is 0 here, that is balance and what we look for.
On chart B there are no hedged trades. I will make a picture explaining this, but not right now. Chart B is traded with commodity indexes mostly and chart A is traded with anything that i like, currently USD/CHF. If there are several charts B open, then that is because i might be trading sugar on one, gold on one and then maybe oil on another etc..
On chart B the trader puts on positions and does not care what happens to them. If profit comes there then stop loss is created by method discussed here. When it happens that the trades on chart A create profit that opens up the opportunity to use this profit to place trades on chart B. For example if a profit of 150 USD has been made then chart B can place one trade at the price of 15 on a silver chart, because 150 USD is what the value is if this position goes all the way to zero.
It is up to the trader to use the profits created by chart A to fund the trades on chart B and also for the profits on chart B to fund trades back on chart A if more margin is needed. If done correctly chart A will make profits and these will be used to place trades on chart B, also when chart B makes profit new trades on chart B will be made thinking that chart A does not need the additional margin earned. This is why this system is called symbiosis, one chart feeds the other but they are non dependent still.
Taking a position
The criteria to take a position are the same on chart A and B, other then on B we do not use hedging. On the charts there is an ichimoku cloud (only) not the span or the other two lines, there is also an indicator below the chart. Currently i like the stochastic indicator, which is used to gage market strength/cycles and or divergence.
Positions are to be taken when a price action formation formulates on the chart. The price action formations used are; engulfing bar, pinbar with max 10% headpin and minimum 1/2 tail, doji's are used and harami signal is used if it confirms a level in price. Doji is used as a warning sign and if equality is needed, trades can be placed upon this.
I will not go into detail explaining these price action signals as that would have me write an entire book here. I leave to the trader to learn about price action, please read from the author Nison. Do not read from another source unless you are Japanese and have the books from the 1800 century
Only look for long positions if price is below the ichimoku cloud and short if price is above it.
Take positions so that your account becomes equal, this applies to chart A only. That means that if you have 3 long positions you should only try to find short positions. Preferably 3 longs for 3 shorts = balance. I like to have a maximum discrepancy of 3 positions, meaning that if i am long 10 positions then i like to have at least 7 positions short. Where 10 - 7 = 3 = maximum discrepancy. Remember that you do not have to place market orders to make balance but can use pending orders, so that if the market goes in the "wrong" direction you are filled and keep the discrepancy up to date with the market.
i use this image again later..
look below B and C, if i was long 5 orders and only have 2 orders short i would place pending short orders below B+C to create balance.
Creating stop loss
This method is exactly the same for chart A and B. Stop loss created when a trade is in profit, by enough size. How much this size is depends on the time frame used.
When i have time to trade i use m15 charts from 08:00 to 16:00 after that i like to use h1 charts. On these charts i like to lock in profit once i see 15 pips profit. Once 15 pips is on the table make a stop loss of 1-2 pips.
Stop loss can also be created after a position is less then 15 pips profit, if price reaches a new level = goes through a high and closes there. Or a reverse price action signal is on the chart. When new information has come to the market and the chart is showing it, if the chart is weak then lock in profit. Also like i said if the market made a new high we lock in profit because we simply do not want to give back that which we have. If another higher high is created we then again move stops to lock in more profit.
look at this picture:
I was short since yesterday, price went up from the point B and later closed below B again. The bar C did this close. Because of this i created a stop loss locking this in, just above the formation at B.
Position sizing is used by the formula: (free account equity / 3500 = lot size) . that means that if you have an account of 100 USD you will use: 100 / 3500 = 0.028 ==> 0.03 lot size for orders. This is for leverage of 500 on an instaforex account. If you are an experienced trader you could experiment with the 3500 number, i feel that using a value of down to 2500 is possible. Using a higher number will make trading go slower in general, because there will be more free equity to use.
Free margin management
I like to use 20% as a number for this. Once i am using 20% of my margin then i close all my positions and restart from none. Using the above formula for an account of 100 USD that means you will have many many positions. If you have an equity of 118 and use a margin of 1.4 then you are using 0.01% of your free margin. The formula for this is: (margin / equity = X percent)
Consider using an Islamic account for this strategy. Having no swap is good here.
If you as a trader do not grasp the FULL EXTENT of this strategy then do not attempt it, because it will surely destroy your account.
Also please do not post BS in this thread, i will surely report it.
But please do ask questions, i will answer them as time allows me. More examples will follow!
---------- Post added at 07:17 PM ---------- Previous post was at 07:00 PM ----------
here are some examples of price action entry signals:
---------- Post added at 07:20 PM ---------- Previous post was at 07:17 PM ----------
here is an example of when the market changed, we had a short but the bull harami appeared and since that is a reverse signal we lock in the profits.
---------- Post added at 07:28 PM ---------- Previous post was at 07:20 PM ----------
on this image we have at least 3 long positions, but if price goes under the reverse line we want to go short to equalize the positions. keeping a max difference of 3.
but if price would go up from here, the short would not be filled and we would be left with pure profit. though on this example price goes short and we can continue locking in profits, here on the short side.