Introduction to Afterspike Trading using Diamonds Trading Signals

Peter O

Special Consultant to the FPA
Messages
3,405
Hi Fellow Traders,


Probably many of you have already given a try to news trading, possibly with our former news trading client called Forex News Gun. This was for making profit on the very spike that is the most straightforward part of news trading. Unfortunately we needed to discontinue FNG due to technical reasons, but spike trading is not the only way to benefit from economic releases.

Diamonds Trading Signal trade plan benefits from trend continuation and its parameters help to identify a spike, entry level, stop loss and take profit. Here are the details of a DTS trade plan:

  1. Set up single click execution on your broker platform, and if possible, pre-determine default stop/loss and default take/profit to a given number of pips, so that when you click to execute your order, your platform will automatically set your stop/loss and take/profit. Do not try this with brokers that don’t offer single click execution.

    If your platform does not allow to pre-determine default stop/loss and take/profit, then after entering the trade, simply set the stop/loss and take/profit points manually.

  2. Pull up either tick, 1-second, 3-second, or 5-second chart, and 15 seconds before the announcement, start paying very close attention to the price action of the currency pair we trade.

  3. If during the first short period of time (in most trade plans less than a minute) after the report you see the price move up or down by given pips or more (you will find numbers in daily trade plans), then enter in the direction of the initial spike at the very first sufficient retracement (given in percentage in trade plans), but only if your spread at the time of your entry is tight enough (also given). Set stop/loss take/profit according to the trade plan.

    The retracement will happen within seconds. Don’t draw anything on your chart, and don’t try to get a perfect entry. As soon as you see the sufficient retracement on your chart, compared to the initial spike, click to enter without any hesitation.

    If the move either up or down was too small during the first spike that means the actual number of the report did not generate sufficient interest in the market, and you should simply skip the trade. If your spread at the time of desired entry is too high, then again, skip the trade.

  4. If after a predetermined period neither your stop/loss nor your take/profit points were hit, then close the trade automatically at market price of the time.

Important Note: it’s absolutely not necessary to know the number that was released for this trade plan. It’s based 100% on price action. Price action decides whether it’s worth trading.

Be patient, and do at least 20 “second wave” trades, before getting frustrated and quitting.

Once you become good at it, you will be able to win on average 7 to 8 out of 10 trades.

Keep win to loss ratio at 1:1. Tweak it only after you are consistently profitable with 1:1.

Remember, it does not matter whether you make or lose 10 pips or 100 pips on a trade. What matters is how much money you make or lose on a trade. When risking 10 pips, simply put up 10 times more lots than you would when you risk 100 pips, and at the end you will make or lose the same amount of money. Yes, spread to pips targeted ratio matters, but these news “second wave” moves have such high probability of success, and it means they somehow make up for the very high spread to pips targeted ratio (2 to 10), which is a small miracle in itself.

For convenience I will always include these steps with specific numbers in my signals so you don't need to come back to here every time.

I think that's quite enough for now. I hope you will see the benefits of these trading techniques soon in your account statements.


Cheers,
Peter
 
Last edited:

DarkForex

Private
Messages
30
I have made a EA for DTS but i dont trade it.

Results are near 0 profit. Maybe i did not trade it long..
 

fajrss

Recruit
Messages
6
So it was Imposible to avoid SL but as long as we following the plan it was OK, isn't it?
 

mtschulnigg

Private, 1st Class
Messages
30
Hello Guys,

Is there someone working with this method that can help?

I want to know if you have an specific platform to work with DTS and a list or selected broker to work with.

I mean in the cases of the 1-15 secs charts, no requotes and one click platforms... I would be great if you can orient me at this one.
 

Zakirussen

Private
Messages
28
Hi Fellow Traders,


Probably many of you have already given a try to news trading, possibly with our former news trading client called Forex News Gun. This was for making profit on the very spike that is the most straightforward part of news trading. Unfortunately we needed to discontinue FNG due to technical reasons, but spike trading is not the only way to benefit from economic releases.

Diamonds Trading Signal trade plan benefits from trend continuation and its parameters help to identify a spike, entry level, stop loss and take profit. Here are the details of a DTS trade plan:

  1. Set up single click execution on your broker platform, and if possible, pre-determine default stop/loss and default take/profit to a given number of pips, so that when you click to execute your order, your platform will automatically set your stop/loss and take/profit. Do not try this with brokers that don’t offer single click execution.

    If your platform does not allow to pre-determine default stop/loss and take/profit, then after entering the trade, simply set the stop/loss and take/profit points manually.

  2. Pull up either tick, 1-second, 3-second, or 5-second chart, and 15 seconds before the announcement, start paying very close attention to the price action of the currency pair we trade.

  3. If during the first short period of time (in most trade plans less than a minute) after the report you see the price move up or down by given pips or more (you will find numbers in daily trade plans), then enter in the direction of the initial spike at the very first sufficient retracement (given in percentage in trade plans), but only if your spread at the time of your entry is tight enough (also given). Set stop/loss take/profit according to the trade plan.

    The retracement will happen within seconds. Don’t draw anything on your chart, and don’t try to get a perfect entry. As soon as you see the sufficient retracement on your chart, compared to the initial spike, click to enter without any hesitation.

    If the move either up or down was too small during the first spike that means the actual number of the report did not generate sufficient interest in the market, and you should simply skip the trade. If your spread at the time of desired entry is too high, then again, skip the trade.

  4. If after a predetermined period neither your stop/loss nor your take/profit points were hit, then close the trade automatically at market price of the time.

Important Note: it’s absolutely not necessary to know the number that was released for this trade plan. It’s based 100% on price action. Price action decides whether it’s worth trading.

Be patient, and do at least 20 “second wave” trades, before getting frustrated and quitting.

Once you become good at it, you will be able to win on average 7 to 8 out of 10 trades.

Keep win to loss ratio at 1:1. Tweak it only after you are consistently profitable with 1:1.

Remember, it does not matter whether you make or lose 10 pips or 100 pips on a trade. What matters is how much money you make or lose on a trade. When risking 10 pips, simply put up 10 times more lots than you would when you risk 100 pips, and at the end you will make or lose the same amount of money. Yes, spread to pips targeted ratio matters, but these news “second wave” moves have such high probability of success, and it means they somehow make up for the very high spread to pips targeted ratio (2 to 10), which is a small miracle in itself.

For convenience I will always include these steps with specific numbers in my signals so you don't need to come back to here every time.

I think that's quite enough for now. I hope you will see the benefits of these trading techniques soon in your account statements.


Cheers,
Peter
Hi Peter, Regarding that Youtube explanation video please.
 
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