Fitz Confluence Discretionary System

I am starting this thread for the purpose of publishing my trading techniques. I am not looking for responses to any of my posts. This is the technical aspect of my trading. I will lay out the parameters of my indicators and try to prioritize their value.

So to start off another week of scalping, while in deep mediation, I had the thought to explain EMAs. I use 5 lines of EMAs on my charts.

5 close -1 horizontal exp.
8 open exp
20 close exp
50 close simple
200 close simple

We need tight entries and whatever you want to do after you get your stop break even.

I ofter use the 5&8 as an exit. if price is going with the trend, but reverses and closes counter trend outside the 8, thats all she wrote.

Other than those two. EMAs are moving S&R. Because I only use them for support/resistance, and never for the two line cross entry exit.
They are almost like moving fibs. You have 20 periods of 5 minutes or 15 minutes or whatever. The moving average is taking the 20 or 50 or 200 periods and averaging price action out of that length of time and giving you the average or halfway point or 50% Fib, for whatever TF you are using.

This is the only reason that they can be used effectively. This is also NOT to say that you cant use any others.

All EMAs are moving S&R and in a sense 50% fibs, Not from any high and low but from the last however many periods.

No matter where price is there is a EMA engaging it!!! Doesnt matter. The point is to get as many confluences in YOUR system as possible.


I also Use an important function of the 50 EMA as you might have seen on some of my examples. I use it for trend.
But not just above/below. I look for the ANGLE of the 50EMA. This is because I do not trade consolidation. Let me say it again. I DO NOT TRADE CONSOLIDATION!!

You want to? more power to ya. I just want to boost the probability rate of my trades by only trading trending markets.


That is all for now.
put it in the bank
Piitb

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I use Stochastic and MACD. MACD is always standard inputs for me. Stochastic is 10-5-3. Some people use 14-3-3 or 10-3-3. I find that this smooths the bands as much as possible. I also use RSI on the 5 min chart only. MACD on 15 minute and higher. Stochastic on everything.

By the way. I look at 6 time frames simultaneously as well as looking at multiple currencies.

This is what my charts usually look like when I trade. I will go further into the breakdown of confluence that I look for when I trade.

In the previous chart there are SEVERAL confluencing indicators happening.

 

1. First I would say that we are in a short term up trend. 15 minute chart is making new highs. I do not exactly remember what the higher timeframes are doing but I usually try to trade in line with them as well.
2. Second: we have price engaging a short term double bottom. When price makes swing highs or lows price usually will react to them at some point in the future.
3. Third: we have oscillator lows on the 5 and 15 minute chart. When stochastic peaks on the 5 and 15 minute chart at the same time it can be a good indicator to look for a bounce off of support and resistance.
4. Fourth: Price is engaging a fibonacci extension from the directly previous trading range, as well as engaging the 50 ema on the 15 min. Which also work as a moving fib.

Here is another short term trade. This is a little more risky because there is no clear support or resistance to play off of. But I do have some good indicators of a long run here.

As you can see I have stoch troughing low on the 5 and 15. That is a good indicator that the bears have done all that they can. RSI troughing on the 5 min as well says it should be a good entry. We do not have a support but what we do have is clear MACD divergence.

Here is a chart of a trending market. Notice the way that price engages the 50 and 200. They are good in co ordinance with stochastic. Trading in the direction of the trend in a high volume market is hands down the best way to trade!!!

This trade is a classic confluence of indicators. I had two previous highs that price came back to on the 15 minute chart and bounced off of.

Market flow is up on 60 minute chart. Stochastics oversold on 5 minute chart. and And I have a clear Fibonacci retracement level. There were two close fibs within 5 pips of price.

I made a quick 20 pips on this trade. It will probably go further because market flow is up on higher timeframes.