POST 17531 PAGE 1169 Right, a lot of people are asking about the market rhythm and it’s for me strange to see people actually trading and still don’t know where the market rhythm is written. If you go back to page 1 of this thread, the very first page, you will see there, there is a summary given of all the important stuff on this whole thread. There are some very good other posts as well but you will see there introduction for all newcomers. There is a page and a post number which gives you the whole system and there is 13 lessons and of them, you will see there is a lot of them, market emotion is one of them, market rhythm part 1. There is so much stuff there that I am surprised that someone is asking about the market rhythm and there is 2 websites, that’s one of Palmers : www.fxtradeblog .com, and marketrhythm.wik.is. You can go to page 1 (of this 4 hr MACD thread) and tackle everyone of those links or those references. The very first one is page1 post 1 and the very last one is gap trading on Sunday nights (page 1133 post 16988). If you don’t know where to get that, you will see that on the top (right) there is page number and next to the last page, if you click on the little down triangle there; if you click on that it opens up with “go to page” and you type in page number and you press go and it will take you to the page number and then you just scroll down to the post number and you will get to the post containing that specific topic. I hope you people asking questions around market rhythm will go there. OK, let’s go back to where you know the rhythm of the market. I have included a graph here that is the British Pound. Now I was not around today but that’s the one I would have traded on the short term trade. I am using the 5 minute system that I have also got on the thread. I will post you the link there and you can go there and read through it. That is a different strategy in terms of taking 10 or 12 or 15 pips at a time but you can use this also to stay longer in the trade. That’s what I do lately with these huge moves. You can see the left hand graph is a 4 hr graph of the British Pound. The market rhythm says that when price breaks through resistance level, in this case it broke through to the bottom, it tends to pull back and in this case, either the 8 EMA or the 21. It was on the way back to the 21, making three small candles there and that is a typically continuation pattern and that’s what I call market emotion. The market showed you those 3 little candles and that’s a Japanese Candlestick formation, 3 small candles and then the market is going to come down. And when it came down, I have encircled that area A. That is the area where you would like to get into the market on market rhythm because the rhythm shows you it pulled back and it is going to come down. If it went upwards then the rhythm is back towards the 21 or if it went past the 21 then it could go to the 89 , but in this case, these 3 small candles completely show that the price will most likely continue because it is a continuation pattern, those 3 little candles, the small red one and then the very next one coming down. If you switch to the 5 minutes, you can see those 2 vertical lines with those arrows indicating there the 8:00 to 12:00 candle. That’s the 4 hour time frame that that move occurred. And what you do is you wait for the price to come down, pull back into the zone as I call it, those 2 smaller moving averages the 10 EMA and the 21 EMA ; the upper one, the blue one is the 50 SMA and then price came down and pulled back into the zone again at point “C” that’s where you would have exit; 55 pips you could have made there. In fact, I would have closed it even earlier after that nice little head and shoulders on those 3 candles at the bottom there (on the 5 min chart). I would have closed there but you could have stayed longer to give it a chance should it go further down. In fact it did go down further but that was my trade for the day, on the short term, 55 pips in the pocket because the 4 hours did not give you a chance today, there was not nice signals to tell you to get into the market. That’s why I say get yourself a nice short term strategy that will be able to get you into the market when the market moves. You cannot just jump in. You have to have a certain place to get in. In this case the price started moving down , you can see it in the 5 minute chart then it pulled back and started coming down, that’s where you enter a stop loss just above the high of the previous that little bar there. Then you stay in the trade until it came back into the zone. That’s it. The main thing is to anticipate the market move that is going to come down according to the 4 hr MACD rhythm. That was the key point to know that the market is going to move down, the chances are very high that the market will move down because of that formation. It is not by chance that I have a system indicators up, down. I am watching the 4 hours and the 4 hours tells me in what direction I would like to trade according to the rhythm of the 4 hours. This is not part of the 4 hour system so I don’t want you people to think that I am changing the 4 hours. I am trying to help you people to get into the market on a shorter time frame basis. You must get yourself a time frame - 5 mins or 15 mins that you can get in, in the direction of the 4 hours and then you will make some pips.