Inside Bar Trading

We are getting tangled up in the 89 and the DTL here guys so we have to be carefull. The IB here does endup getting 62 pips but the DTL is only 7 pips away. Anything long here until the DTL is broken is tabu..

By the way, I have opened up the Stochastics and even though this is a lagging indicator, it can help us with direction thru divergence. That is what I am looking for. I use it only for direction.

We are patient traders

Jim

Anything thru here is risky, however most come thru. You just have to be ready to pull them quick. 25 here to a recent low.

717 +25 = 742 in 3 days

Jim

This IB we would not have taken since the 89 is only 7 pips away, however, if you got in yu would have been rewarded with 59 to the trendline.

In keeping it honest, we will not count these because we would not have taken this trade.

Still at 742

K

There is an IB here but we won't take it, why, because the trendline is in out face. Actually this can be taken short at the break of the trigger bottom, but there is the 89 again. Lets wait.

Still holding at 742

Jim

Ok, 89 is there but trend of the moment is down along with the major trend. The first Exa: 15 is ok, but risky. The 2nd Exa:16 is perfect as we break away from the 89 and the first red candle off the break is a flat bottom which means the next candle will almost always glow red. We get 72 with 2 minis and move stop to B/E. This time it comes back and we don't get stopped out at B/E and the pair moves down to the support it just formed at 116.95 where we exit with 72 times 2 equals 144 plus the garbage pips, 37 for a total of 181 on this trade. Thanks for being patient.

742 + 181 = 923 in 3 days

Jim

Guys and Gals, I will see you later and I will finish out the week. Remember, its amazing we have only been on 1 pair in 3 days and we have over 900 pips. It don't get any better than this.

Jim

Well guys and gals, my wife decided to stay home, hence I am back and will do this untill my eyes start hurting again. OK, we move on the the next example. We got a nice longlegged hammer to signal a possible move back up to the 89 and DTL. We get an IB but we are against so we are wary. We check to see if there is any resistance and we see the 13:00 candle and quickly we see we can get 27. If we hadn't seen the inverted hammer as the trigger bar, I would say pass, but with that we could have a chance to go all the way to the 89, ( Approx. 48 Pips ), or possibly the DTL, ( Approx. 64 pips ). It does neither and we take the 1/2 off and set to B/E at the low of the 13:00 candle. It gets rejected and stopped out immediately.

923 + 27 = 950 Pips

Here could be the first loser we have come across. Now, here is where you use your clues to keep you out of this trade. Notice the IB candle and what do you see. This is kind of a reversal candle that says beware, we could be reversing. We stay out although 18 pips is acuirable but there are no targets. We sit.

Jim

Here is a nice one, but the long candle is twice as long as the IB. I pass.

Jim

Back in business, we are catching a short one off the 89 and the DTL. We catch 38 pips with 2 minis but are stopped back out at BE. I will graciously take 38 here.

950 + 38 = 988 after 3 days

Jim

This trigger bar is also a reversal bar which in the position it is in it is called a shooting star. Lo and behold there is an IB in the mix. We got a target at the 89 in which we get 43 more pips and we are then stopped out at BE after we take 1/2 profit off. We will take 43.

988 + 43 = 1031 pips

Jim

Here we have another little one. See how targets shrink when around the 89. We will steel 27 here and be done with it. BE will be stopped out.


1031 + 27 = 1058 pips in 3 days

Jim

Jackpot, although we are just above the 89, a quick check and we see we can get a quick 26 time 2 equals 52 pips to the 89. We enter this trade thinking that we will only go to the 89 and get a bounce to be stopped out at B/E. But this is one of those equalizers that make it all worth while. After moving to the 89 we quickly move our stop to B/E, never to be hit. After taking off 1/2 at the 89 we leave the other half roll, and roll it does.Thinking it may go to the DTL or the low at 12/3 21:00 candle. We pull the trade after the Doji pulls back up. So we get 124 + 52 equals 176 pips. Are we having fun yet.

1058 + 176 = 1234 pips in 3 days

Jim

Here we see yet another, do we take this short. No, why not, because you got 3 reversal candles there to tell you not to. This is an easy no call, However, we can take this long if we can get thru the DTL and trade it to the 89. Boom, this one comes back, but since we did not hit our target our stop remained there. So price comes back as we ride it out. Trades like this you want to walk away from. It misses stopping us out by 2 pips and then goes on after a DTL bounce to hit our TP at 52 pips where we pull 1/2 off and pull our stop to BE. It misses our stop again and blows thru the 89 heading to the next major DTL. We pull profit at the Hammer which is a sign of reversal. No matter, we got 52 + 151 garbage pips = 203 pips.

1234 + 203 = 1437 pips in 3 days.

Jim

We will take 40 here to the 89 and the bounce does not get to our BE trade. We let it run on into NFP and pull it after the spike. So we got 40 times 2 equal 80 + 153 = 233 on down.

1437 + 233 = 1670 pips

Jim

No trade here, The stoploss would be to much for my account right now.
Theres the week in review. 1670 pips with very little effort.

Jim

Im sorry i cant keep up with you. i Do understand the IB bar and where you tak your trades but when you start talking about selecting IB bars because of other reversalbars and the support or resistance from the 89 ma it is there you lost me im comfused about the reversal bars and that ?


best regards

jgadefelth,

Maybe I can help a bit (Jim, if I am out of line here, just let me know - don't want to step on your toes)

OK, so you got the IB part down and you understand the setup and the trigger right? Good.

Now, what Jim is saying about reversal bars, S&R, & the 89 is basically that we don't just blindly take every single IB on a collar (long and short) and then 'hope' for it to break and go in a directon far enough for our fear and/or greed to either let us take profit or get stopped out. Instead, we use price action (reversal bars) and support and resistance (pivots, daily trend line, and the 89) to give us an indication as to what price is likey to do.

For example, if the daily trend is down and we have an inside bar form, but it is only 5 or 6 pips from the 89 - pass on it. More than likely it will hit the 89 and at least bounce off it - possibly far enough to stop us out. Instead, sit that one out and wait. Now if price drops below the 89 and the next area of support is a daily pivot 25 pips down - now we look for an IB. When we get one, place two short orders at the trigger line: The first one takes profit at the daily (first area of support), and the second one runs (with a stop at break even after the first order takes profit) to (1) the next area of support (2) till price indicates a reversal (pin bar, doji..etc) or (3) price reverses and hits our Break even stop.

Does that help any? If not, I will try to be a little clearer. Have to head out for a bit, but I will be back later to check in. Again, Jim...if I stepped on your toes here, I apologize. =)

V/R

Mario

I couldn't have said it better, they will understand more when trades are taken.

Jim[

quote=pizzamiglio;2401248]jgadefelth,

Maybe I can help a bit (Jim, if I am out of line here, just let me know - don't want to step on your toes)

OK, so you got the IB part down and you understand the setup and the trigger right? Good.

Now, what Jim is saying about reversal bars, S&R, & the 89 is basically that we don't just blindly take every single IB on a collar (long and short) and then 'hope' for it to break and go in a directon far enough for our fear and/or greed to either let us take profit or get stopped out. Instead, we use price action (reversal bars) and support and resistance (pivots, daily trend line, and the 89) to give us an indication as to what price is likey to do.

For example, if the daily trend is down and we have an inside bar form, but it is only 5 or 6 pips from the 89 - pass on it. More than likely it will hit the 89 and at least bounce off it - possibly far enough to stop us out. Instead, sit that one out and wait. Now if price drops below the 89 and the next area of support is a daily pivot 25 pips down - now we look for an IB. When we get one, place two short orders at the trigger line: The first one takes profit at the daily (first area of support), and the second one runs (with a stop at break even after the first order takes profit) to (1) the next area of support (2) till price indicates a reversal (pin bar, doji..etc) or (3) price reverses and hits our Break even stop.

Does that help any? If not, I will try to be a little clearer. Have to head out for a bit, but I will be back later to check in. Again, Jim...if I stepped on your toes here, I apologize. =)

V/R

Mario[/quote]

I'm so loving this thread! well done mate!