MasterBlaster

The 2 bar exit is a stop method originally intended for longer timeframes (4 hours). It was designed to make calculation of stopping points easy and to lock in profit as soon as possible without smothering the trade and ending up with a fraction of the pips available. The beauty of these exit methods (this one, the crossover, etc.) is that they eliminate subjectivity (an enemy to most traders) and still provide for a good exit point towards the end of a move. Once I've established an entry I'll put a stop in place on the 5 minute about 6 pips (GBPJPY spread) beyond the lowest/highest point of the previous two candles to the candle that is now forming on the 5 minute. (** Look at the current candle forming...count the 2 completed candles to the left of that one. Take the lowest/highest point between those two candles, add in an additional 6 pips cushion and that is where you set your stop). At this point if I need to go to the bathroom:beer::beer: or get a drink I have at least 5 minutes to do so. Every 5 - 10 minutes I observe price action and move the stop up accordingly. See the attached chart for a couple of examples. Disregard the entries as I just chose those arbitrarily as a starting point, not due to valid entry criteria discussed on this thread. Cheers

Hey Walter, Great stuff here! I followed you over from ForexFactory. Been following LinuxTroll and the Cyrox Rainbow for a while now. It's a great method and I really like the additions you've made here. I would like to suggest an alternative exit for study. The Two Bar exit consists of making your entry off of the 1 minute charts then going back to the 5 minute charts for your exit criteria. The way the two bar exit works is that your exit trails price by the greatest distance of the previous two bars plus spread. As with all exit criteria, this will perform better than the 1 min Xover criteria in some cases and worse in others. It's great for keeping you in steep moves with flat VMAR periods (consolidation). Hope this helps. Cheers