The SETUP and the Chuvashova Fork

Dragos I was looking at the LTF drawing my T E lines and never even noticed that. Shows that you see what you are looking for. Good eye.

Mario, I deliberately left off the E lines to make people look a little harder. I have added them on on the next chart and also zoomed in because you need to be zoomed in enough to see the smaller structure within the large structure and you need to be zoomed out to see the larger structure.

When you can see the T E Line in blue and the E line in Black label as much of your SETUP as you can.



Here we have one of the T E lines and a bearish SETUP. The Blue T E line goes through E and I want to draw your attention to the fractal that pokes below the T E Line. Draw a line form E through that fractal and you have an early entry. This is my C Fork. (Again if you had a bullish SETUP you would reverse the process. The next chart will show a couple of those.)

Here is the original T E line exercise chart with C Forks. Note that not every SETUP has a C Fork, The the last one on the bottom right is an example of one that doesn't.



Bearish C Forks are shown with a red line, Bullish C Forks are shown with a green line.

There is a lot to absorb here. Go try it on a few charts at random and see how you do.

Locate a T.
Draw a line through the next E.
Look for a fractal under the T E line at a top or above the T E line if at a bottom.
Draw a line from E through that fractal. (Green for bullish and Red for bearish.)

After you do a few dozen or a few hundred it gets easy.

I am going to take a break now and let you play with this stuff. See how you do.

Here are couple more on the H4 EURUSD.

I don't get it.
In the circle the forkline is on the right of TE, while in the rectangle the forkline is on the left of TE. Still both of them are bullish forks?..
If that's the case, then what do they say more than the SETUP itself?

Thanks,
Dragos

Wab, I would have a question regarding the last chart If I may.
Why you have taken the E there, and not at the lower high fractal?

Thanks,
Dragos

You are right dragos. My mistake.

Thanks for catching that. I am looking at too many charts.

I see a daily / 4h NZUSD setu.....made waiting for a pull back.

BLACK = Daily
Grey = 4Hr
Green= Cfork

Blue square was a trend continuation entry....?

ajs, your Daily S should be at the second bottom fractal from the left ... there is another LL LH that you missed if I am correct.

Thanks for posting.

There are two opposing SETUP patterns in the circle. The market reverses at a bullish SETUP and has a brief CT rally then forms a Bearish SETUP and continues the trend down.

Hope that clears it up a bit.

This stuff is complex at first. More examples to follow that may help it gel.

USDJPY getting in on a CT.

This one took a while, monitoring the M5. As the trade developed it became quite clear what was going on and nice that I could call the shots ahead of them happening.

I am showing the chart in M15, first so I can't fit it all in. The M15 view lets you see the T where the Counter Trend started.

I will start from the left.

First bit of strategy is to draw a T E line.

We start at T on the bottom left with a heavy blue line and extend it through each potential HL fractal that might be an E. At this point you can use the chin bars and you will get an alert when the T E line gets hit and adjust it accordingly.

We draw in our series of HH HL as the chart evolves. Each HL is a potential E and after a while the market breaks past a previous HL and heads towards its first LL LL. We put a E label at that last HL and draw in an E line. When the Market finds a down fractal and turns back up that point (our first LL ) is labeled as U.

The highest HH ( the one between E and U is T.) The previous HH to the left is S. At this point we have S E T and U of our SETUP.

All we need is our pullback to P to complete the SETUP pattern. We can place pending stop orders just below E and just below U and expect a good trade from each one.

However the market is going to go to P. We are sure of that but not sure where P will reveal itself. We begin to stalk P for an earlier entry. Since P is a reversal point somewhere in the future, how can we anticipate it?

Fist we construct a Fibonacci retracement from T to U. Zero at T and 100. We expect P to be somewhere near a Fibonacci level. Different pairs tend to favor particular Fib Retrace levels. The Sweet Spot level is often a good one to keep and eye on.

Meantime. keep a good eye on the extended heavy blue T E line. Note how the price follows it and moves from one side to the other.



Now let's go to the M5 chart which is the same chart as above, just zoomed in.



Let's start at E. Just above E on the M5 there was a down fractal. I drew a line from E through that fractal and that is the red Hook line.

Incidentally (and this often happens) it is also the Bill Williams Fractal entry level. It becomes a signal as soon as its level is below the Red Alligator line on its way to U. (More about it later.)

Next, I added a dotted trend line on the U P structure. I adjust this line just as we do the original T E line. It is labeled as the U P line, just to the right of the first HL. (That style of trend line is very powerful ... use it wherever you can. ) That trend line tells me the HL will be to its left and more important is reveals a smaller red E of the SETUP at larger P. It reveals that a reversal is being reached with a bearish SETUP in progress. I placed that on the chart with red lines and red labels. Now we know all about signals in a SETUP, this one is no different.

Let's look at all the available signals (all available with pending orders.) Red E line, Red U, Break of the red fork line, (also same as the BW fractal) Black E line and Black U. I'm showing off so I took four trades.

Remember the Bill Williams Fractal? There is another one, which this time happens to be the red E level . Talk about double confirmation of a signal.

So that was a lot of analysis. It looked goon on M15 a well so I am trading it on M15. My four positions are all locked in at the last fractal.

So what's ahead?

Back to the Fibs. Most likely target is 161.8. If you look left that si where he last big bullish rally started so maybe it will re-visit. At any rate I will tail fractal by fractal and let that take care of itself.

So there you have it a full blow by blow of an M5 Counter Trend entry.

Practice those T E lines. Draw them until E is confirmed with a LL or a HH and price builds a SETUP. Chase P if you want to prove a point like I have here, or just place orders at E and U and trail till the next E.

Master the T E line and the game is a lot better. At this point my smallest move on this trade (from U) is 24 pips and I am short four lots.

Over a hundred pips and counting on an M5 chart. LIVE.

I will add candle time and spread to the first post as it is a useful indicator.

The trade ended after forming a SETUP at the reversal and giving bullish signals. I got out at eh 161.8 level.

Looking out at the chart we could see that next SETUP was heading into a CT, so we wait for another bearish SETUP and there it is .

I have pending orders at E and U.

P goes higher than T so cancel the orders.

Last trade of the week. M1 USDJPY.

Since I was messing around in M5 and it was making a series of HH HL I decided to enter at a M5 LL and see if I could scalp a M1 rally to the new M5 HH.

As you can see, a nice little M1 Bullish SETUP arrived as the M5 HL formed and I took a trade at the U fractal.
The pullback to P did not give me a chance to get in at a second pass through the E Line.



Not a big trade in terms of pips but a big trade in terms of how this works. I took the exit at the Fib 100 level as it was getting closer to market close.

Maybe we will get to the forks next week if I have time. Posting live trades and doing all the explanations is time consuming.

Meantime, practice that HH HL LL LH and E line recognition until you master it. Pick a chart, any chart, any time frame and go for it.
Then do it over and over and over. M1 to Monthly, it works.

Very productive day you had, in terms of both pips and analysis Thanks for all your hard work!
Looking forward for more info on how to use the fork.


Have a nice weekend,
Dragos

Your SL, would that have been at the previous fractal low labelled P?

Wab,

This is super crazy. I'll need time for this to sink in. The lack of chat time is very frustrating for me.

Is great watching a live trade even if I'm two days behind, I'm still staggering with the S placements but even wobbly as my constracts are, this is doing me a siteid of good, thanks.

Stop is initial always at T but P once it gets going is fine. The I move it fractal by fractal or trail it on the green Alligator or just take a fib target.

I am off to a niece's graduation so I will be away for a day.

I have been busy today with my jewelry work. I just left my shop to have supper and checked the EURUSD. A short order that I left pending has been entered.



I will trail the price on the Green Alligator line, as the Alligator is opening up now and confirming a down trend.

The H4 EURUSD should now provide lots of entertainment.

 

1. We expect a down fractal to form at U. (I will get stopped out after that.)
2. Then a bullish pullback to P that we can trade on a LTF from U to P if so inclined.
3. Once U is established we will draw our Fib with 100 at T and 0 at U.
4. We will monitor the Fib Retracement levels with a good eye on the Sweet Spot
5. We can stalk the bearish SETUP that will form at P.
6. Re-enter short at E and U and any other nice signals like a BW Fractal or even a C Fork.
7. Plan our target based on the Fib pullback level at P.

This is H4, slow and steady, a big freighter full of pips for us. We are pretty certain what the market structure is going to look like.
Not exactly to the pip but we will recognize U and P in due course and be ready to play for real on the second pass through E if it happens and then U.

Here is another H1 SETUP that I entered at U.

I can't always be on my computer so sometimes I just take what I find as it happens. E adn U are not as good as P but that is ok

So far so good.



I will trail a stop with fractals. The161.8 target is likely.

The H4 EURUSD and the H1 EURCAD are live trades you can monitor and experiment with

Anyone watching this one?

Another H1 treat ... if you caught it. 156 pips from the E Line.



Entry is actually on the H4 E line, so you can still get on board.
Pending order, lower down, is at H4 U.

Got caught out on the EURCAD by not checking the big picture.

Always check the big picture and the HTF HH HL LL LH structure and reference it to the AO.

The wave was corrective so the SETUP did not go far before a new opposing SETUP arrives. at a likely HL.

U and P are waiting to be placed.



Watch this one for more opportunity in the dominant trend direction.

Okay let's jump in with the EURCAD and the Chuvashova Fork.

We have all of our tools at work:

SETUP with a pullback to P in progress.
Fib Retracement from T fractal to U fractal.
P label waiting for confirmation at a Fib level and with a LTF SETUP.

Enter the Chuvashova Fork. Currently telling us the market is going go down (to P hopefully) if the lower, red tine, of the fork is broken.



Now, I am still earning about the Chuvashova Fork so I do not claim to be an expert on it. I am hoping we can learn together. I will share what I (think) I know in future posts.

I have attached a Chuvashova Fork indicator for you to experiment with. (There are a variety of them which I will post later. Let's use this one for now, to keep things from getting complicated.)

Identify any SETUP and see how the fork sometimes helps.

You can refer back to the first post for a previous link to the Chuvashova Fork.