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-   -   But... Naked Trading!? The Elegant Charts Thread (http://www.forexfactory.com/showthread.php?t=432776)

g_j_hook@yah Jun 16, 2013 6:38am | Post# 1

But... Naked Trading!? The Elegant Charts Thread
 

But.......Naked Trading!!??

The Elegant Charts Thread

I’ve started this thread due to how my Simple Setups To Trade thread developed into me showing how I trade (at least one method).

It has been getting a little interest so I thought it would be beneficial, to me certainly, and maybe a few others, if I started a thread in which I explained fully my methodology. This is not a thread intended to teach people how to trade, it is a thread where I can show what I am doing and discuss it with other traders. (hopefully)

Remember when we all first started to learn about trading? I bet the first thing you did, like me, was to fill your charts with the many and varied indicators now available. And devise a hundred weight of systems that used them? You know MAs, EMAs, Alligator this, Fractal that, right down to the damn Ichimoku voodoo cloud rain dance system!! Yeah you did....I know!? I've seen charts so full of cr#p I couldn’t even see the price!! you only have to visit the Charts on Drugs or Works of Art thread to see that. Now I know indicators can have their place, some more than others imho, but as time goes by the more I learn about actual PRICE ACTION (if that is the right phrase) the less I find I need them. I might still use the odd one if only to find a bit of confluence, which I will come back to. What has become important to me now is SUPPORT (S) and RESISTANCE (R) and more so PRICE PIVOT ZONES (PPZs)

So what is a level of support or resistance? It is simply a price where the stack of waiting limit orders is large enough to stop price in its tracks and even change the direction of its movement, them and the market orders that follow. Simply put they are places of perceived value in the market. PPZs are simply areas where price has flipped around an area of support which then becomes an area of resistance, or visa-versa. These often occur around the round numbers, (RNs) 1.21, 1.22 etc and more so at big round numbers (BRN), 1.2000, 1.3000 etc. but this happens all over the charts in every time frame.

If these ideas are new to you I would highly recommend the James16 Chart Thread. It is run by profitable traders who go out of their way to help newbie’s. That thread taught me much. (Thanks to you all).

The other element important to me is trying to identify the general market sentiment from the candle sticks, and the general way in which price is moving. Or as a mbqb11 would say "the story". I am not going to go into that here, i am still learning and there are better places to learn about that than here. It basically comes down to chart time.

The first thing I will try to do is outline how I identify my PPZs

After a bit of chart time it will take you literally moments to notice them. A little later you will begin to see how to identify the more important (stronger) ones.

Firstly I start on the higher time frames (TFs) daily or above and draw in a line where I can see price has reacted to multiple times, preferably from both sides of the line, always taking note if the price is a RN or a BRN. Check out the vid to see what I mean. You might want to take a little more care than I did on the vid! It is for e.g. purposes only.


http://www.screencast.com/users/Jonnyfx

EUGBfindingPPZs


Then I move down to the 4H TF and firstly check if I need to refine the ones I drew on the 1D TF, then draw in any lesser PPZs I can see on that TF. I draw these lesser levels in a different way so I can see easily their relevant importance. You can see how price flips around these levels giving us lots of opportunity for trades. I will post a chart or two to try and demonstrate.

I keep on moving down from TF to TF right down to the 15min chart, (which is what I mostly use for the retrace breakout method on this thread)Each peak and trough can have value as a PPZ, on all TFs. A good tip so that you don’t end up with levels all over the place is to just let them run out when drawn on the smaller TFs. When price moves away from them just leave the level to go away as time goes by, this is one of the reasons why I use the rectangle tool and not horizontal lines. The small TF PPZs are usually only relevant to that TF and don’t carry too much weight on the higher TFs, BUT the PPZs drawn from the higher TFs WILL have an affect on price on all TFs. What you will see is just how closely price flips around the levels found on the higher TFs.

Check out the second video for a basic look at how I draw in the intraday levels and how price reacts to them. If you notice some are also RNs though not marked on the chart. It also shows the basic idea of the breakout and retest setup I am currently trying to master.


http://www.screencast.com/users/Jonnyfx

usd/jpy 1 hour


Using these ideas to get an angle on price movement the first set up I use has been shown in the original thread.


http://www.forexfactory.com/showthre...22#post6755922


The Second set up I am currently trying to master is a simple breakthrough and retest touch trade, out lined in the second video. I like the fact that we can often get high probability trades with small stops, (notice how little price moves through the breakout price when it does retest it!)When price breaks through PPZs or SUP/RES it very often swings back to the breakout price or a close PPZ (the retest) before continuing on its way. Sometimes the level might not hold price and it ploughs right through giving us a looser , or it there might be too much momentum for it to even reach and so we have no setup , but it does hold up enough times for it to be a high probability set up . This is nothing new and is used in many ways by many traders. Wizards thread Fail Better shows a great method pretty similar, and a lot better researched.


jon


g_j_hook@yah Jun 16, 2013 6:44am | Post# 2

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An Elegant Chart....RN PPZs....
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g_j_hook@yah Jun 16, 2013 6:51am | Post# 3

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Price flips and intraday PPZs in action.......
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g_j_hook@yah Jun 16, 2013 6:53am | Post# 4

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Elegant price action.....
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g_j_hook@yah Jun 16, 2013 6:58am | Post# 5

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It doesnt stop......
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g_j_hook@yah Jun 16, 2013 6:59am | Post# 6

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And we might even get lucky....6:1 RR in 1H candle.....
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g_j_hook@yah Jun 16, 2013 7:07am | Post# 7

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Stepping Stones...
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g_j_hook@yah Jun 16, 2013 7:12am | Post# 8

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Okay you get the idea.
i work hard so i wont be here as often as i would like, but i will open a demo account of e10,000 and see if this can make money. i will post the decent setups when i can and show my demo ac. results....Not only But Naked But Transparent also!
hope you feel like contributing..


jon
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jasakreatif Jun 16, 2013 8:00am | Post# 9

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i'm the first contribute

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g_j_hook@yah Jun 16, 2013 8:06am | Post# 10

i'm the first contribute {image}

nice...price has a better memory than me!

cheers

jon

jasakreatif Jun 16, 2013 8:11am | Post# 11

But ... why when the price down we think up , and up we think down

frsthr Jun 16, 2013 11:52am | Post# 12

Dear g_j_hook@yah,

Thanks for your thread.

I think you are very close to the nature of the price dynamics in the forex market.

I recommend a link:http://en.wikipedia.org/wiki/Foreign_exchange_market
Here everyone can see that the top 10 trader in the market are all banks and they have almost 78% of all the market share. In addition the top 5 banks have nearly 58% of the market share.

It means that every action of the banks will stop the price moving. Then we can see the zones where banks buy and sell. The good news is banks always take action in same zone. That is "price memory" as you mentioned.

Please keep the word "zone" in mind, not "line"

The ordinary trader cannot stop the price, neither ordinary banks.

What we should do is remember the price zones which banks like and follow the bank.

Hope the above can help.

If I am wrong, forget it.

g_j_hook@yah Jun 17, 2013 7:39am | Post# 13

Dear g_j_hook@yah, Thanks for your thread. I think you are very close to the nature of the price dynamics in the forex market. I recommend a link:http://en.wikipedia.org/wiki/Foreign_exchange_market Here everyone can see that the top 10 trader in the market are all banks and they have almost 78% of all the market share. In addition the top 5 banks have nearly 58% of the market share. It means that every action of the banks will stop the price moving. Then we can see the zones where banks buy and sell. The good news is banks always take...
, its all good....

jon

Xela Jun 17, 2013 8:55am | Post# 14

"A thing of beauty" is correct. Elegant charts, indeed: many thanks indeed for starting this thread, Jon, and good wishes.

jasakreatif Jun 17, 2013 11:44am | Post# 15

i'm the first contribute {image}
but... they copy us ?

http://www.forexfactory.com/news.php?do=news&id=432920
http://www.fxtimes.com/technical-upd...ottom-attempt/

g_j_hook@yah Jun 17, 2013 1:45pm | Post# 16

2 Attachment(s)
nz/cad limit sell.
4h strong TL break after price couldnt stay above .8200. low TF H+S
looking to sell the retrace to the neck line/ break price. SL protected by .8200 RN PPZ as well as those minor PPZs. targeting .8100
??????


jon
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sandovaljr Jun 17, 2013 2:11pm | Post# 17

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Very good topic .. I also deal with price action and has given me much success in negotiations. Also use standards for harmonic tendency of prices to maximize my earnings ... Success with your topic!
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sandovaljr Jun 17, 2013 2:32pm | Post# 18

Watch the video as I deal in FOREX ...



LINK:
- https://plus.google.com/u/0/10937875...ts/DQM2WNBpAVw

g_j_hook@yah Jun 17, 2013 6:02pm | Post# 19

nz/cad limit sell. 4h strong TL break after price couldnt stay above .8200. low TF H+S looking to sell the retrace to the neck line/ break price. SL protected by .8200 RN PPZ as well as those minor PPZs. targeting .8100 ?????? jon {image} {image}
Slightly concerned by the pa atm, would like a more direct retest....
will dicide what to do later..its been a quiet day.

jon

g_j_hook@yah Jun 17, 2013 6:07pm | Post# 20

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eu/us breakout - retest set up...

limit buy @ 1.3350
SL 1.3320, under last low of wedgey type pattern and the lower TL
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