A month of GBP/JPY through the eyes of ACD Methodology Mark Fishers ACD Methodology from The Logical Trader
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Monday Jan 21st 2008: 3am - 3pm EST
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Comments for Jan 21st 2008:
I'm going to do something a little different today, one of the tenants of the ACD system is to draw the lines and trade what you trade WHEN that particular market opens. With Currencies we trade pairs so often its applicable to take the opportunity to draw your ACD lines twice a day. GBP market opens at 3am EST, Asian open really starts around 6pm-7pm. In the chart above you can see how redoing your ACD lines and even your pivots are a good idea if you want to trade the Asian session at 18:00h.
Could the system have made you money today?:
Monday was more or less a bust for signals until the NY close. There were a few A-Down signals which you could have traded but nothing would have really happened until the end of the US session. Going by the rules your stop is beyond the other side of the opening range, so yes these are all good signals. I find issue with that trading currencies specifically this pair, the opening range can be quite large and blow out any "single trade risk:reward ratio". The system generates enough good signals that you could argue this but safety first! (Monday was a US holiday with low liquidity, one reason for the lack of volatility).
The signals generated after 6pm EST when I had redrawn my lines would have generated some pips quicker. A-Up failure with success on the retest, followed by C-Up and strait up to the Central Pivot before reversing. This was some good predictable price action.
1. A-Up probably missed as it was too fast. Just let it go.
2. C-Up was fast too though you could have traded the retest to grab a few pips on the way up to the Pivot.
3. Though not part of the ACD system specifically. Trading off
the pivot was a good opportunity on this evening. To enforce the
importance of plotting your pivots you can just see the next day
at 3am (London open) where price spiked up from the lows to bounce
again off the pivot.
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