Wolfepack Trading Method - Reversal scalping

wolfepack

Member
Hello all - I've been using the new tools for a few weeks now and wanted to share the way I've been grabbing some reversal scalps with it - I'll call it the wolfepack method for lack of a better name, lol.
I've got 3 windows open and overlapped on my traders desktop (works for a one screen set-up):

The Scalping Currency Matrix Histogram
Currency Matrix Dashboard (only paying attention to the Day Trader portion of the window - left side)
Scalping Matrix Dashboard (only looking at the far right side of the window)

Here is how I use them, I have my brokerage account open and loaded to 5 min charts on another screen - I only use a 2 screen system to trade. I pay most attention to the Scalping Matrix, that is why it is infront - I wait for the PBT to over extend in the dark green or dark red, if the Global Trend Value is in the lighter green or red, I need one more histogram to also over extend with the PBT - otherwise just need the PBT, then I look at the Currency matrix dashboard (Day trader) to confirm that both currencies are maxing out on that chart - for a trade to exist they normally hit the 90-100 levels, and then move my eyes finally to the far right to watch the Scalping matrix histogram. This seems to be the first indicator to reacted to the reversal. I normally only watch one to 2 pairs max at this point. The entry point of your trade (takes a bit of practice to nail it) is confirmed by 2 things, the traders desktop indicators and simple price action on your 5 min candlestick charts. The first part of the signal is the Scalping Matrix Histogram, those 2 lines associated with the hot pair will make a sharp hook in the opposite direction - and it will be a sudden sharp hook, a noticeable one, then the Day Trade bars will move in their opposite direction, and finally the PDT will make its reversal move - all 3 of these will happen pretty quickly together I've noticed. Then hit your price chart on your trading platform and look for some simple price action to indicate a reversal or pull back , a doji or pin or hammer or shooting star - then enter in the reversal direction. I use a 20 pip default stop to start and adjust my take profit depending on a few things. I will look at daily pivot levels as target sometimes and confirmations of reversals as well - it's nice to see when the reversals happen at daily pivot levels - an added bonus for confirmation! My target will be one of 3 things usually - 6 to 10 pips - a daily pivot level if it's not too far away (less than 20 pips) or if your reversal is in the same direction as the Global Trend value (great trading opportunity) - then I will look to use the daily pivots as targets for sure - maybe even a couple of them. I will move my stop to usually 5 pips or even break even once I'm up 6 or 7 pips and then manage accordingly. If your trade is 15 pips or so against you, you just need to work on timing - sit on your hands a bit longer!!, or maybe your trade is news related - ALWAYS check new before your trade - if there is high impact news approaching, just wait an hour or so before you trade. Trumps daily rants have impact too, so maybe pay attention to make sure he isn't talking somewhere! Also, check the spreads before you trade - need small spreads for scalping. I'll keep adding to this thread and feel free to add your own info as well!!
 

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wolfepack

Member
So far this week has been great for this method - just follow the rules outlined above, spend a bit of time practicing and you should be good to go! One additional bit of info, have a look at the instructional material in the Traders Desktop link on the Scalping Matrix - it will help you enhance the trades with this system - when the Global trend value is weak specifically - this will help you capture more pips. You can also look at the global trend value for bigger gains another way - if the global trend value is in the opposite direction of your trade - hold for bigger gains! Remember - trust the system and practice trade first!! The best way I have found to find trust in this or any system is to keep track of a sample set of trades - say 20 trade - follow the trading rules, keep detailed notes of each trade and then review the results after the sample set - this will help to train your brain the fully trust the system. A good book to read is called Trading in the Zone by Mark Douglas - it is a MUST read for any trader!
 

wolfepack

Member
One thing you will notice is each pair will have it's own subtle differences. The JPY pairs, like the CAD/JPY are slower to get to the turning point, or the consolidation point once the PBT becomes maxed out - so be patient - WAIT for price action to confirm the turning point. This system will take you about a month to really learn it well enough to begin trading with real money. Remember to practice practice and practice before you trade live funds. Once you 'get it' you will be very happy you invested the time in learning it! If you are a short term trader like myself that is!
 
Hi , I am an old user of this system , why you don't add a littel panel like in a old version , that advise when a cross touch the dark green o red area with written time happened and send an email and alarm pop up . In this way we avoid to stay a long time to watch the panel . Thanks
 

riffster21

Member
Staff member
Hi , I am an old user of this system , why you don't add a littel panel like in a old version , that advise when a cross touch the dark green o red area with written time happened and send an email and alarm pop up . In this way we avoid to stay a long time to watch the panel . Thanks
Yep, we are building this now. We should have it online soon. I sent out an email to all of the Pro Members. Did you by chance get the email? Just wondering if our emails are making it to inboxes. Thanks.
 

gophers58

Member
Hello all - I've been using the new tools for a few weeks now and wanted to share the way I've been grabbing some reversal scalps with it - I'll call it the wolfepack method for lack of a better name, lol.
I've got 3 windows open and overlapped on my traders desktop (works for a one screen set-up):

The Scalping Currency Matrix Histogram
Currency Matrix Dashboard (only paying attention to the Day Trader portion of the window - left side)
Scalping Matrix Dashboard (only looking at the far right side of the window)

Here is how I use them, I have my brokerage account open and loaded to 5 min charts on another screen - I only use a 2 screen system to trade. I pay most attention to the Scalping Matrix, that is why it is infront - I wait for the PBT to over extend in the dark green or dark red, if the Global Trend Value is in the lighter green or red, I need one more histogram to also over extend with the PBT - otherwise just need the PBT, then I look at the Currency matrix dashboard (Day trader) to confirm that both currencies are maxing out on that chart - for a trade to exist they normally hit the 90-100 levels, and then move my eyes finally to the far right to watch the Scalping matrix histogram. This seems to be the first indicator to reacted to the reversal. I normally only watch one to 2 pairs max at this point. The entry point of your trade (takes a bit of practice to nail it) is confirmed by 2 things, the traders desktop indicators and simple price action on your 5 min candlestick charts. The first part of the signal is the Scalping Matrix Histogram, those 2 lines associated with the hot pair will make a sharp hook in the opposite direction - and it will be a sudden sharp hook, a noticeable one, then the Day Trade bars will move in their opposite direction, and finally the PDT will make its reversal move - all 3 of these will happen pretty quickly together I've noticed. Then hit your price chart on your trading platform and look for some simple price action to indicate a reversal or pull back , a doji or pin or hammer or shooting star - then enter in the reversal direction. I use a 20 pip default stop to start and adjust my take profit depending on a few things. I will look at daily pivot levels as target sometimes and confirmations of reversals as well - it's nice to see when the reversals happen at daily pivot levels - an added bonus for confirmation! My target will be one of 3 things usually - 6 to 10 pips - a daily pivot level if it's not too far away (less than 20 pips) or if your reversal is in the same direction as the Global Trend value (great trading opportunity) - then I will look to use the daily pivots as targets for sure - maybe even a couple of them. I will move my stop to usually 5 pips or even break even once I'm up 6 or 7 pips and then manage accordingly. If your trade is 15 pips or so against you, you just need to work on timing - sit on your hands a bit longer!!, or maybe your trade is news related - ALWAYS check new before your trade - if there is high impact news approaching, just wait an hour or so before you trade. Trumps daily rants have impact too, so maybe pay attention to make sure he isn't talking somewhere! Also, check the spreads before you trade - need small spreads for scalping. I'll keep adding to this thread and feel free to add your own info as well!!
Good Stuff! What would you say your win rate is?? Thanks!
 

wolfepack

Member
Good Stuff! What would you say your win rate is?? Thanks!
Hi, I've been off the trading grid for a few weeks due to other commitments so when I get back into the groove I will circle back and report more info here - but as far as wins goes - if you can nail the timing correctly you should be winning at least 75% of your trades, the key is patience. When the reversal hits, you will see all of the indicators move in unison, The Currency Matrix Dashboard (Day Trader section) and the Scalping Matrix Dashboard and the Scalping Currency History Matirx Dashboard - I call it the big market 'sigh' - they will have reached their exhaustion levels all together and it's like the wind is let out of the move and you will see them all move or relax or retreat together - you really will. With the new features coming I think it will help us all nail this trade system together better because you will be able to see these notification levels on the live charts and be able to spot the price action moves better for timing your entry! And see some historical data to use as info for practicing your trades - it all sounds very exciting!!
 

stearno

Member
Wolfepack,
Thank you for sharing this. I look forward to watching it and practicing next week.

Is it a requirement for the Day Trader Currency Matrix 's both sides of the pair must be above 90 to take the trade?

Second clarification, what are you looking for on the scalping histogram? Like AUD/USD price is going up. Are you looking for a sharp hook where AUD goes into the green and USD goes into the red? Or did you mean that AUD hooks down and USD hooks up.

Thanks.
 
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stearno

Member
Wolfepack,
Thank you for sharing this. I look forward to watching it and practicing next week.

Is it a requirement for the Day Trader Currency Matrix 's both sides of the pair must be above 90 to take the trade?

Second clarification, what are you looking for on the scalping histogram? Like AUD/USD price is going up. Are you looking for a sharp hook where AUD goes into the green and USD goes into the red? Or did you mean that AUD hooks down and USD hooks up.

Thanks.
For example, in the attached, what needs to be different to take the trade?

Also, in the manual it says to not take trades when the Global Trend is higher than 1 or lower than -1. Do you include that as one of your rules?
 

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wolfepack

Member
For example, in the attached, what needs to be different to take the trade?

Also, in the manual it says to not take trades when the Global Trend is higher than 1 or lower than -1. Do you include that as one of your rules?
Hi Stearno - in your example I would like the Red (NZD) bar on the day trader histogram to hit the 100 level before I would take the trade, and to address part 2 of your question - my trades are usually counter trend scalps of 5 or 6 to 10 pips, so the global trend value is usually pretty high or low against you. If the NZD got to 100 level then I would consider this as a good opportunity. WAIT for the market sigh I describe in part of my tread before you enter - you will see the scalping histogram take a sharp turn in the opposition direction, so for your example you would see a sharp curve downward with the NZD, this usually happens first, then the Day Trader bars and the PBT bars tend to make the move at the same time - this is the market sigh I mentioned - once you trade this enough you will notice this, you will see all or alot of the bars on the Scalping Matrix Dashboard retreat from their hi's or low's all at once - even ones not necessarily related to your trade - this is your signal to place the trade. Sometimes you will see a quick 6 or 8 pips, take them! Other times the trade will go in your favor then retreat a bit, but usually not too much in the negative, and then back to your target area - this is where you need to practice - wait for the market sigh before you enter! Literally it looks like you let the air out of a balloon. Otherwise you may get stopped out - as once the Day Trader matrix is high or lower, the market has momentum, so it's critical that you wait for the market sigh or the balloon to lose it's air before you jump on them. NOW if the global trend value is really low, like 1 or -1, or even better when the global trend value is in the opposite direction of the PBT - then revert to the trading method in the manual and go for more pips, as these are reversals back in the trend direction, they don't happen as much, but they make you more cash!
 

stearno

Member
Hi Stearno - in your example I would like the Red (NZD) bar on the day trader histogram to hit the 100 level before I would take the trade, and to address part 2 of your question - my trades are usually counter trend scalps of 5 or 6 to 10 pips, so the global trend value is usually pretty high or low against you. If the NZD got to 100 level then I would consider this as a good opportunity. WAIT for the market sigh I describe in part of my tread before you enter - you will see the scalping histogram take a sharp turn in the opposition direction, so for your example you would see a sharp curve downward with the NZD, this usually happens first, then the Day Trader bars and the PBT bars tend to make the move at the same time - this is the market sigh I mentioned - once you trade this enough you will notice this, you will see all or alot of the bars on the Scalping Matrix Dashboard retreat from their hi's or low's all at once - even ones not necessarily related to your trade - this is your signal to place the trade. Sometimes you will see a quick 6 or 8 pips, take them! Other times the trade will go in your favor then retreat a bit, but usually not too much in the negative, and then back to your target area - this is where you need to practice - wait for the market sigh before you enter! Literally it looks like you let the air out of a balloon. Otherwise you may get stopped out - as once the Day Trader matrix is high or lower, the market has momentum, so it's critical that you wait for the market sigh or the balloon to lose it's air before you jump on them. NOW if the global trend value is really low, like 1 or -1, or even better when the global trend value is in the opposite direction of the PBT - then revert to the trading method in the manual and go for more pips, as these are reversals back in the trend direction, they don't happen as much, but they make you more cash!
Wolfepack,
That is very helpful of an explanation. I appreciate it as it is helpful.

And yes, I know what you are referring to on the market sigh. I always considered that as too late to enter. So now that you added a new perspective, I will keep watch on PA when the sigh happens.

You stated in this example, your take profit is 6-10 pips (quick counter trend scalp). Is your stop loss still 2.7 of M5 ATR?

Stearno
 

stearno

Member
Wolfepack,
What is your view in situations when you would not consider to take the trade, even though the setup is there as you have described? For example, yesterday the JPY's all went crazy (attached screenshot). What kind of situations around the signals should be avoided?

I understand one avoidance is around news. But in this example, there was no news.

I look forward to hear your insights.

Stearno
 

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dan.campbell

Administrator
Staff member
Wolfepack,
What is your view in situations when you would not consider to take the trade, even though the setup is there as you have described? For example, yesterday the JPY's all went crazy (attached screenshot). What kind of situations around the signals should be avoided?

I understand one avoidance is around news. But in this example, there was no news.

I look forward to hear your insights.

Stearno
I'll let Wolfepack reply as well, but there's always "news" when markets move like this. For the JPY: whenever the US equity markets take a hit, the JPY gains value (there's a long-winded fundamental reason), but whenever US markets are tanking, expect JPY strength. These moves are very tradeable. I prefer Bloomberg for my news source. Bloomberg is usually pretty quick to respond to news that impact financial markets. They have a free browser TV option if you don't have cable access.
 

stearno

Member
I'll let Wolfepack reply as well, but there's always "news" when markets move like this. For the JPY: whenever the US equity markets take a hit, the JPY gains value (there's a long-winded fundamental reason), but whenever US markets are tanking, expect JPY strength. These moves are very tradeable. I prefer Bloomberg for my news source. Bloomberg is usually pretty quick to respond to news that impact financial markets. They have a free browser TV option if you don't have cable access.
Okay, that explains JPY, which is the most frequent I have seen to freak out. If you say is tradable, then I will watch during these times to figure out how. Because I have always entered at the wrong time in the past. But you give me hope enough to watch this sitatuation and learn it.
 
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