When Price is UP, buy; when Price is Down, sell short...

Hello friends and traders,

looking at the title above, the natural question following it will ...How ???

that is what i intend to answer here in this thread by using words and images that in my opinion, i feel adequately and accurately convey my trading method that has produced consistent results.

Nothing to prove here, i know it works. will there be losses ? Yes. If you're looking for the holy grail, i found it...please do this when u are alone...stand in front of a mirror with your eyes closed, now open them...who do u see ? yourself ? it's not yourself, what u see is only a reflection of yourself...want to argue the point ? yes ? ...ok, move your left hand ...which hand in the mirror is moving ? your left hand or is it the right hand ? The point ...?...it's not your physical self in the mirror, only a reflection of you so the point i'm trying to get across is this...in almost all instances in trading, our success or lack of success is directly or indirectly related to the image we have of ourselves...that i can't help u with but i can give u the tools to be successful, how you are going to use it and whether you are believing in its longterm success, is entirely within your own believe system. so, sort yourself out before u want to sort the markets out. To incur a loss or string of losses are part of trading, accept that fact and we are on our way to trading maturity...enough of this philosophical rant. i wish everyone that is willing to give this method/s a go, the best of success, positive growth and contentment.

Pictures are an integral part of grasping the nuts and bolts of this method, so expect 100's of them...a picture speaks a thousand words...we dream in terms of images, if u recall something from memory, its an image or sound we recall, so without much ado, lets roll...

 

1. the method: trend following
2. the strategy: analyse the longer term time frame but enter on the lower time frame

o ! almost forgot, i shall attach a LIVE trade explorer to this thread...u talk your talk, now walk your talk cousin.

PS1: i wanted to open this thread in the Interactive Trading Forum section but one has to be a "medium impact" member in order to do so. the reason that i wanted it to be there is because we will be actively trading fx pairs as opposed to just discussing entry and exits, but i suppose this forum will do.
PS:2: this will be the longest verbal post, so don't get discouraged.

Gimme the nuts now

what participants and silent incognito readers can expect from this method:

 

1. as our title suggest, how to buy when price closed up..., and
2. how to sell when price closed down...it sounds real silly and simple but believe me, it's one of the hardest things to do, because generally...when the buy signal comes it will be emotionally hard to go long because everywhere u look will be red !!! we have all heard the saying..." buy when there's blood on the streets..." yes ?....well i will do my best to shadow and guide u when the time comes.
3. how to trade using the Monthly and Weekly time frames
4. how to enter using the Daily and 4hr time frames
5. when and where to enter Stop Loss {SL}...sometimes we will enter a trade without SL but place it later after trade has moved in our favour.
6. when and how to pyramid or stack
7. what trade size is recommend for this method
8. when to take profits or if more than one entry in same pair or commodity or index, how to bank some of our gains and let the others ride,
9. when to move our SL to lock-in profits
10. how and when to take a counter trade. eg. if we are short several weeks now in AUDUSD pair which we entered off the Monthly, but a buying opportunity presents itself in the Daily, we will now go long and ride that shorter term uptrend until our strategy rings the bell to close that shorter term trade. NOTE:: this is not hedging as understood in the conventional sense, but we are simply trading our method based on a lower time frame than the monthly. what i found in practice is that rather than sitting through a deep retrace that may last up to 3 weeks or more...we might as well profit off that retrace until the Long Term Trend resumes it's downward course.
11. how to trade the hot hand...in other words...when a currency pair is on a tear, we want to ride that trend with as many stacks as we can safely enter for as long as that momentum lasts.. that usually means that sometimes out of more than 20 pairs we will be heavily focused on only 2 ...which also means...these 2 pairs will be heavily stacked, almost exclusively so
12. how to setup our charts that is best for this method, i.e. how many periods is necessary for viewing and analysing.
13. the use of indicators or not
14. how to best use a Line Chart
15. how to determine a Trend Change on the LONG TERM charts

eish...looking at the above, im getting scared i may not deliver...

do u mean mine or yours ?

ok,here we go...

we have 2 strategies [actually 3 but for now, the 2 below is enough] that we trade simultaneously and there is no contradiction in these two strategies.

the 1st one::

{1}We look at the Monthly Chart to determine our trading bias for the next month,

1. if the Monthly is Up as in the example of the NZDCAD pair below,
2. we switch to the Daily Chart and only look for buy or long entries there.
3. i have marked the BUY Signals with green x's on the Daily chart

the 2nd one::

{2} We look at the Weekly chart to determine our trading bias for this coming week.

1. if the last Weekly Bar is Up,
2. we switch to the 4hr chart and only look for buy signals there.
3. i have marked the Buy Signals with Red x's
4. the +brb's {bullish reversal bars} marked yellow we will not take, i will explain later. God Willing.

i have 2 long positions in this pair that i entered on friday.

see the 4hr chart below for my entries based off the 4hr Buy Signals. you can see my SL on the chart.


Any questions thus far ?

how i use the Line Chart.

on the Monthly Long term chart i switch to the Line format to display price TREND. using the USDCAD as an example below

1. Looking at the Slope of the Monthly chart [about 22 to 30 periods] one can clearly see that the Long term trend is UP,
2. ​after we have established that fact, we now switch to the Daily Chart and look for long entries there, however, we don't just take every +brb as an entry signal...looking at the Daily Signal Chart in LINE format we notice several small horizontal lines, sandy brown in colour. these lines inform us whether to buy the last +brb or stay out.​
3. basically, as you know, a line chart shows the closing prices only. we are interested in where price closed the last time in relation to the last swing high for longs or last swing low for shorts.
4. in this case we are only interested in long signals, so looking at the Daily Line chart we notice 3 long signals as pointed out by the green x's i marked. the 1st signal results is a loss, the 2nd signal result is a gain and the 3rd signal, which was generated last friday, is currently in play.
5. thus...for next week, we will only entertain long entries on the Loonie.​
6. the 2nd Daily chart shows the long entries in candlestick format.

​

Interesting thread...Subscribed

thank you Inceptionist, may u find real value here.

so there u have it ! the gist ....nuts and bolts...of the way i trade. ...not finish yet...almost.

all that remains now is to fine tune the strategy but, if u take what i've presented thus far, then u can trade profitably consistently, being a trend following method...all we need now is to be in on a run of a few weeks and it will lift our gains exponentially as we will stack accordingly and increase our trade size will expand ad well.

it's a amazingly pleasing what a profit buffer can do to one's trading account and the number of trades and the psyche .

so, traders, u are most welcome to post your potential trades and trading direction here if its inline with what i'm showing here.. we will also trade Gold, Oil and the Dow amongst others.

Just pull up the Weekly Chart, 22 to 30 bars is enough...look at the Trend direction...drop down to the 4hrs and apply the Line chart...check the Daily Line Chart above as an example...and enter when u have your trading signal.
or, Pull up the Monthly chart...look for overall price direction over 20 to 30 periods... then drop down to the Daily and look for entries, pls check the Daily Line Chart above as an example.

you will notice from my posted trade size and my explorer when i link it that my trade size is minuscule...please do the same when testing my method...my trade size will increase as the account increase. God willing.

Hello,
how do you enter trades in lower timeframes ?
you place a pending above high/low, or wait for price to close above/below that line then enter ?

thanks in advance

excellent question bradu,

the answer to your question is:

...Yes, i make use of both... pending orders primarily, Buy Stop orders when looking for long entries and i'm anticipating a +brb
...at the time of placing the Buy Stop order, i also enter a SL. You may have noticed in the NZDCAD trade above, that the sl is based off the lower time frame entry chart, for example, on a Weekly+4hr trade; the SL is based on the 4hr chart,
...but the Profit Target is based on the larger Weekly time frame [tf]. i'm sure u can see the favourable reward to risk ratio here. similarly, for a Monthly+Daily trade...the SL is based on the Daily but the PT is attached to the monthly tf.
...mostly, i enter manually after the signal bar close
...Sell Stop orders are used when we looking for shorting trades.

...Limit orders, both Buy and Sell, are used but differently. i intend showing how we employ Buy Limit orders and Sell Limit orders as we progress. Please remind me should i forget.

i forgot to mention:

 

1. that in placing Buy Stop orders for longs, we put an entry price 2 pips plus spread above the last high.
2. when i'm present at my trading station, mt4, then i will wait to see if price forms a +brb and price should close above or at the last CLOSE {refer to a 4hr Line and Daily Line charts above}

here is another trade that entered on friday.
my short entry was a bit late because i noticed the signal only when i returned to my trading station, nevertheless, i took the trade.

the following short trade is of the GBPJPY, showing the Weekly+4hr charts. EDIT: the 4hr short entry may have been premature.

Note: the Monthly Trend is still up

Here are 3 trades that i'm waiting to stack. 2 shorts and a long when their respective time frames complete as desired

 

1. AUDNZD...will stack short on -brb
2. NZDCAD...will stack long on 4hr bar closing as a +brb
3. AUDUSD...same as AUDND...stack short on 1hr -brb complete

here they are again after the 1hr bar closed as anticipated and i entered 2 trades,

the NZDCAD 4hr bar closed as a Doji, meaning...its 4hr open and close is the same so i now have the following options:

1. enter long bcz Long term trend is UP, or
2. switch to the 1hr chart [see middle chart below] and wait until a +brb forms before buying, or
3. place a Buy Stop order above the just completed bearish bar and wait for the next hourly bar to form a Bullish Reversal Bar [+brb] and then enter long.

​i have chosen the 3rd option because i should be at my trading station

IMPORTANT: the 2 trades of the Ozzie pairs that was entered a few minutes ago was entered because the 1hr confirmed the bearish slide, therefore...their Stop Losses are off the same hourly Signal Bar. {i really meant to kept the hourly chart for a later as i do not wish to confuse...so much for noble intentions}

I think you have something interesting here. I have my own system, but I like to observe. I see potential it does make sense and can see good results.

thank you palabara,

u are most welcome to observe, however, i would really appreciate your active participation...doesn't matter if u agree or not...i have more losing trades than winning one's but as you can see my application of the different tf's skew the reward to risk heavily in my favour.

As my thread title suggest...if price is UP, BUY...if price is down...sell. i don't argue with price.

More importantly, coming back to the Reward:Risk ratio....in essence, this Method entails::

...Determine TREND on long term charts {WEEKLY and MONTHLY},
...drop down to the Lower timeframe {4hr and daily} and execute your trade there when a Trade Signal {TS} appears,
...enter SL above the high of this Lower timeframe TS,
...No Profit Target entered as we want the market to reward our trade direction.
...this is the HEART of our system,
...nothing new here, other traders have similar systems, but i'm only presenting to those that are interested in obtaining a winning method.
...so please, do participate, thank you

PS: there are much more to come...

Please pay attention: this is very important in catching a Long Term trend as it starts because as we all know, that's where the really big pips come from. Sometimes the trend starts straight away after the Trend Change Signal has activated, and at other times we may experience several whipsaws before the trend will submit to the will of price.

Please note:

 

1. it's a monthly chart,
2. price is hovering around the trend change boundary within a few tiny pips,
3. one more day before the current month completes,
4. what do we want to see now today and tomorrow ? we want to see a decisive break of that horizontal support line, or a decisive move up away from that Trend Change Line.
5. please checkout the chart and let me have your thoughts please.

​PS: i do use 2 ema's but since it's still early days, i will refrain for now to introduce their uses.

i forgot to mention that my Geppy short trade was stopped out for a loss at 177.56, maybe it was a combination of weekend increased spread and to close a SL. However, price didn't go up after it removed my SL but reversed to resume it's downward march. price is currently at 177.02