Well, I'm determined to make this system work for me, and I'm having moderate success with my back-paper-trading, but there just seems to be so much subjective analysis required... so many different ways to interpret the data - I'm far from sure what to do at any given potential opportunity.
Here's an example of something that just bugs me... Look at the chart of EU ca. 7/2004... I've indicated the signal (lower low after lower low) and the bar that created it. Since it's a counter-trend move, caution seems indicated. The SL needs to be above the dashed red SR line, which has been very well respected by price lately, so I have an SL of about 47 pips. For a target, I'm looking right at a confluence of 1. a price level, 2. a recent SR (solid red) which is ripe to turn from resistance to support, and 3. a longer term SR (dashed red) which has given consisten support for weeks. There's no reason I can think of why I should expect the price to break through this clog of roadblocks (yellow rectangle), so the TP sits at about 22 pips. 22/47 is an RR of < .5, so clearly I should sit this one out.
Then.... the price plummets nearly 200 pips!!
So what gives?? Is there something I missed which would have told me to take this trade? Or do we H4 MACD traders simply have to sit impotently while the best move in nearly 3 months slides past us untouched?
I'd appreciate any perspectives on this that would help me better understand how to make a good decision in a case like this...
Here's an example of something that just bugs me... Look at the chart of EU ca. 7/2004... I've indicated the signal (lower low after lower low) and the bar that created it. Since it's a counter-trend move, caution seems indicated. The SL needs to be above the dashed red SR line, which has been very well respected by price lately, so I have an SL of about 47 pips. For a target, I'm looking right at a confluence of 1. a price level, 2. a recent SR (solid red) which is ripe to turn from resistance to support, and 3. a longer term SR (dashed red) which has given consisten support for weeks. There's no reason I can think of why I should expect the price to break through this clog of roadblocks (yellow rectangle), so the TP sits at about 22 pips. 22/47 is an RR of < .5, so clearly I should sit this one out.
Then.... the price plummets nearly 200 pips!!
So what gives?? Is there something I missed which would have told me to take this trade? Or do we H4 MACD traders simply have to sit impotently while the best move in nearly 3 months slides past us untouched?
I'd appreciate any perspectives on this that would help me better understand how to make a good decision in a case like this...