# Kolachi Method of Trading - page 3

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Pyramiding in Kolachi Method:
Rules of Money Management in Kolachi Method say that Pyramiding is allowed in certain conditions.It means that in ordinary conditions it is not allowed.
Let us consider what is pyramiding.To understand it we will have to understand what pyramid is.We know that pyramid has a wide base and its sides are tilting toward axis which connects base to the tip of pyramid.
As we rise from the base the cross sectional area of pyramid perpendicular to axis starts decreasing and as we reach half way up, the cross sectional area is reduced to half.When we reach the tip, cross sectional area becomes zero.
In trading the cross sectional area is infact our risk reward ratio.When we locate a trade, we are at the base of a pyramid.There can be different risk reward ratios in trading.Similarly there are pyramids of hundreds of dimesnions.But here we are dicussing anyone such pyramid.
When we place a trade, we have maximum risk reward ratio available to us, which means we have hundred per cent cross sectional area of pyramid.When trade reaches 50% of the target then our risk reward ratio for a new trade at this point is reduced to half.And at the target itself there is no question of taking a new trade.
Kolachi Method has only motto:to preserve your capital from excessive exposure.
As per Kolachi Method when we place a trade we must have a risk reward ratio less than one to take a trade.We cannot use pyramiding on a trade with such risk reward ratio.
1)When we have a trade in which we have a ratio is 1/3 then we can pyramid it one time prior to or reaching at half way through.
2)The best place to pyramid is diplomatic channel if it satisfies above the above rule.
3)When price moves against your trade in Kolachi Diplomatic Channel and touches the ema and wmachanges slope place the pyramid trade.
4)When price has crossed the half way to target, pyramiding will be suicide.

In Kolachi Method only one pyramid trade is allowed in every 1/3 ratio.Kolachi Method does not cosider pyramiding technique as good one.It exposes you with more risk than you were exposed at the outset.
Now by opening a new trade you have averaged down the cross sectional area of pyramid and thus exposed yourself to an unnecessary risk in greed of few more pips.

kolachi

N.B.Kolachi Method and its Rules are copyrighted (2006) under law.

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Ravique:
Now we are talking, keep up the good work. Interesting material.

Thanks for encouraging.

kolachi

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Kolachi

You stated earlier that there appeared a lack of interest in your system . I applied on your website for access but you have never replied to me with conformation. my email address is dwalsh28@mchsi.com.

Pupil in waiting lol

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goldstock:
Kolachi You stated earlier that there appeared a lack of interest in your system . I applied on your website for access but you have never replied to me with conformation. my email address is dwalsh28@mchsi.com. Pupil in waiting lol

Hi goldstock,

Confiramtion and activation is automatic by the software and I have no control over it.some guys have complained about activation and I have solved their problem ASAP.

I will look into it in few minutes and solve it.

kolachi

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Dear goldstock,

kolachi

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Hi all,

I have posted free weekly analysis of euroyen and cable on KT(my website).

If intersted you can go through it.

kolachi

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Factors Affecting Kolachi Analysis:

There are various factors which affect the analysis which include but not limited to the following factors:

1)Higher charts profile

2)general slope of emas.

3)Angle between two emas.

4)distance from Median Lines

5)height of MACD histo lines.

6)previous lows and highs

7)BBs

8)Info about same currency form crosses like euro guessed form eurosterling and euroyen profile.

kolachi

N.B.Kolachi Method and its Rules are copyrighted (2006) under law.

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Name:This Method be called as "Kolachi Method 2"©

Method:Place wma5,ema21,ema100,ema200 on your chart based on median price.Place median fibo lines 72,116.5,188.5 around the axis.

Signals:When wma5 changes its slope beyond a median fibo line and returns for pull back, place entry.When wma5 changes slope beyond the median fibo line exit from trade.

Whipsaws:Unlike other crosses this method has very few possiblilites of whipsaws.The reason being the difference in the period of two MAs.Moreover our entry is not the cross itself but the change of slope of wma5.In case of whipsaw you will see the repulsion of wma5 from ema21 but you have already break even or locked few pips.

1)Median fibo lines are average of two fibo numbers.

2)Axis of the system and median fibo lines is 200 ema.

3)This method is designed for 30M and 1H charts.

4)Use of any indicator is not necessary.

5)It works both in Trending and Ranging markets.

6)Strategy in ranging market is to place entry as per method and exit as per method.

7)In trending market,place entry as per method but exit on 100ema or 200 ema as per situation.

8.)In trending market as soon as wma5 is repulsed by higher emas, place entry and exit as per method.

9)Highly trending market is recognized by steep slope of higher emas which are parallel to each other.

10)Ranging Market is recognized by frequent crosses of higher emas.

11)ema55 in not used in this Kolachi Method 2.

12)For volatile currencies 116.5 and 188.5 are mostly used.

13)For less volatile currencies 72,116.5 median fibo lines are used.

14)Proper Money Management and proper use of Kolachi Method 2 guarrantees success.

Legal Info:

1)I have used this system with live account and is very successful.I am not convincing anyone to use it.My intent is to share my knowledge and experience.Decisions in Trading are ones own responsibility.sometimes you need your discretion about deciding entry and exit.

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This Excerpt is taken from FF which shows the history of Kolachi Traders:

"In 1984, Richard Dennis taught a trend following method to a group of students who were called Turtle Tradres.This project was a joint work of Richard Dennis and his friend William Eckhardt.

It was thier greatness that they shared their system with these people and a new trading system was made public atleast to a group of people which later on reached the general public.

Here we are a new group of traders called Kolachi Traders.We are no match to the names I have written up just for example.But David Kolachi is the first Kolachi Trader.

I have tried my best to teach a group of people who feel themselves in difficulty in intial time of trading and lose money.I am a full time trader.I could have continued with my trading but rather decided to share it with those who really need it.Therefore here begins the story of kolachi Traders who will be among the successful traders in their time."

kolachi

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What is Kolachi Method?

Kolachi Method of Tading is a method designed by David Kolachi to trade forex markets, stocks, and commodities.It is a technical method which uses different moving averages of price, median lines drawn around axis and MACD histogram.

David Kolachi is the first Kolachi Trader who started it and was supported by Brendan who is the second Kolachi Trader. Later on, a third Kolachi Trader joined the circle and identified himself as Valerie. Thus a circle of Kolachi Traders emerged and is expanding day by day.

What is Purpose of Kolachi Traders?

The common point among the Kolachi Traders is frequent use of tools and techniques elaborated in Kolachi Method to enhance profitability and become successful traders.