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Attachments: "Bullish Engulfing Bar" and "Bearish Engulfing Bar" trade
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Quoting baxter01
We all know ..there was an investigation by an italian(?) trader on success rate of price action patterns...the results- as far as I remember -were lower than 50%. What does that tell?? As with every strategy the success depends more on a great risk management as on the strategy itself. We can be successful traders with engulfings when following strict rules.
Trading any strategies available and readily accessible on the internet without any touch of refinement to it calls for a well-deserving loss. Even, I myself had to trade with tools that reassert a hindsight of confirmation bias because without it, the odds and probabilities of my trade going the direction I'd anticipated were probably in the range of 3 to 12%. Even so, the thread starter kindly suggested not to trade solely on the pattern... I guess people love to skip to the end without reading the first few pages thoroughly.
  • Post #62
  • Quote
  • Edited at 12:35pm May 28, 2020 12:06pm | Edited at 12:35pm
Quoting peterhenders
Here is one from yesterdays Candle, we will see how this one goes {image}

I thought I'd put some capital where my pufferfish mouth is, and take a LONG on AUD/CAD today, fading yesterday's daily candle which you described as a bearish engulfing (it wasn't, because its open was the same as the prior candle's close, so it didn't engulf the real body or the whole body of the prior candle).

Conversely, I reckoned that candle is a bear trap, so I bought AUD/CAD this morning, soon after you mentioned it here as a potential short. I have to thank you for this , by the way, because I don't watch AUD/CAD and without your post I wouldn't have noticed this opportunity to go long AUD/CAD and make 68 pips.

Here's my trade on the hourly candle chart.
Attached Image (click to enlarge)
Click to Enlarge Name: AUDCAD long.jpg Size: 110 KB
By the way, Steve Nison, whose book you mentioned, did indeed have his own special definitions of the classic engulfing patterns.

I read his book about 16 or 17 years ago, and have long since gotten rid of it. I hope it has since been recycled into something more useful, like a roll of toilet paper, lol.

Steve wrote the book at a time when the so-called "Heisei" bubble was on its last legs in Japan, just before it crashed in spectacular fashion. That was a time when trading the Nikkei was "the" thing to do, and everything Japanese was considered magic, and the West thought that Japan had invented a secret way to take over the world, financially (those who grew up in the 80s will remember the huge number of Japanese references and money back in those days, all fuelled by said Japanese bubble). So old Steve tried to ride the wave of Japanese bull hysteria and published a book with supposed insights on candlestick patterns.

Well 30 years later, he was still selling books and "education seminars" for a living. Actually, the last few years it seems even those weren't really selling, so he was seemingly selling the mailing list of his newsletter to other sources. I doubt that a successful trader would still bother to run a newsletter and sell books and seminars in his 70s. Trading probably didn't exactly work for him.

Back in December 2015, when the Dow corrected for like 4-5%, poor Steve went public to say "he wasn't gonna touch stocks there" and that "the bull market was most likely over" as he marked some daily candles that he said were "bearish engulfing candles" on the indices.

Well, as we all know, Dec 2015 wasn't the end of the bull. It was a chance to JOIN the bulls. After a couple of weeks, the Dow continued to rise for another 5 YEARS IN A ROW, lol!

In fact he made it even funnier. He went on to say that he would only buy if the S&P index broke 2130 on the upside, after a retest of that level, and that then he would place a "hard stop" on that level and never re-buy, if he was taken out once.

You don't have to guess what happened next. Just pull up a chart of the S&P in 2016. The index broke above 2130 and then spent a few weeks whipsawing exactly through Steve's "hard" level, taking him out if he was indeed long, SEVERAL TIMES, before finally exploding higher for another 1000 pips

Poor old Steve...

Well I shall look forward to Yuya's and others' trades here using engulfers and wish them tons of green pips

Good luck to all
Margin call out?
Trump save you.
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  • | Joined Dec 2014 | Status: Merry Xmas and Happy New Year all! | 27 Posts
Quoting Yuya
{quote} Thanks for your comment. The filter I think of is a good volume. Forex results in tick volume, which is not an accurate turnover, but I think it represents people's impatience and excitement. Here is an example diagram. {image} This is 1H of JP225 Cash. Look at the tick volume of the bar from "Bullish Engulfing Bar". It is considerably larger than the surroundings. I draw a big shadow line of a big tick volume with the candle one before that, but a tick volume and "Bullish Engulfing Bar" appearing to cancel it. I think that such places where...
Can you tell me what's the volume indicator you are using there and what are its settings?

Thanks
Quoting tehnoob
By the way, Steve Nison, whose book you mentioned, did indeed have his own special definitions of the classic engulfing patterns. I read his book about 16 or 17 years ago, and have long since gotten rid of it. I hope it has since been recycled into something more useful, like a roll of toilet paper, lol. Steve wrote the book at a time when the so-called "Heisei" bubble was on its last legs in Japan, just before it crashed in spectacular fashion. That was a time when trading the Nikkei was "the" thing to do, and everything Japanese was considered...
I didn't take that engulfing trade because the low of that candle was not taken out- but I did take the 20ema bounce. And I didn't say how great Steve is or isn't as I simply described his view on an engulfing pattern.
Now for you as a tosser, looser or still feeding off your mother, I suggest you read what is written and not what you think is written because you cant f'n read.
Quoting peterhenders
{quote} I didn't take that engulfing trade because the low of that candle was not taken out- but I did take the 20ema bounce. And I didn't say how great Steve is or isn't as I simply described his view on an engulfing pattern. Now for you as a tosser, looser or still feeding off your mother, I suggest you read what is written and not what you think is written because you cant f'n read.
I did notice you were going to supposedly trade the short if it broke the low. That's why I didn't suggest that you did take the short. I did say that you pointed that candle as a bearish sign (suggesting you were ready to short and go against the MA slope and the trend, which you had previously said you didn't do).

Good that you as you claim, you traded the "bounce" , reversing your prior bearish inclinations.

By the way, earlier (in post #31) you were talking about providing "kindly thoughts" to this thread in order to help. Since then, and seemingly only because I happened to politely but specifically disagree with you on this thread, you and your friend Grim have called me :

- ignorant (post #44)
- idiot (post #52)
- "Mother F'kin" (post #56) (I think we can all guess what this means)
- knob (post #41)
- tosser ( post #67)
- looser (sic) (post #67)
- "still feeding of my mother" (post #67) (three in the same post, you seem to be getting angrier, for some reason?)

and a couple more cute expressions.

Whereas I have kept my comments impersonal, as I am sure everyone who cares enough to read will have noticed by now. At the same time, I the only one who has posted 2 successful engulfing failures, the last one live, as it happened.

I and other noobs look forward to more of your "kind thoughts" and I'm glad to hear that you don't necessarily endorse poor old Steve's approach to "engulfing candles" or to trading, because what didn't work for him is unlikely to work for anyone else
Quoting Yuya
Hello everyone. My name is Yuya. I'm Japanese and I'm not confident in English sentences, but I'm happy if you read them. I trade only when Engulfing Bar appears. Engulfing Bar means the following candlestick. The images refer to the following sites. https://forex-station.com/app.php/attach/file/3341976 {image} Write a simple trading strategy. ★ For long If "Bullish Engulfing Bar" appears near the support line, go long. Loss cut is done by updating the low price of "Bullish Engulfing Bar". Take profits near the resistance line....
Hi there,
does it somehow differ from
"Three Line Strike"?
I like what I trade, I trade what I like
For the time being, we have been using a different method than this method for verification, and losses have continued.

Currently, it starts from 100,000 yen including the bonus of the vendor.
I've been trying scalping for the past few weeks, but I can't get rid of it, and I'll try to trade again on the daily and 4-hour bars.
Ninja trader Return This Year: 89.5%
Quoting wng
{quote} Can you tell me what's the volume indicator you are using there and what are its settings? Thanks
The volume indicator I use is the one that comes with MT4 by default.
I have not changed the settings.
Ninja trader Return This Year: 89.5%
Quoting togr
{quote} Hi there, does it somehow differ from "Three Line Strike"?
I did not know that.
Thank you for teaching me.
It's almost similar to that.
However, I think it is important at what price range the pattern appears.
Ninja trader Return This Year: 89.5%
I think exits are several times more important than entry.
I don't want to win every trade.
I hope to be able to make 10 loss cuts 3 or 4 times, 3 cuts at the quoted price, 2 slight profits, and 1 big win.
Perhaps now, I think that the entry points are similar for people who are winning and who are losing in total.
However, it depends on how you respond after you enter, whether it is profit or loss.
We need to find a way to deal with it.
Due to changes in my living environment, I tried scalping, but it didn't match my daily rhythm.
From now on, it seems that we will seek how to increase funds in transactions that match the lifestyle rhythm.
Ninja trader Return This Year: 89.5%
Quoting Yuya
I think exits are several times more important than entry. I don't want to win every trade. I hope to be able to make 10 loss cuts 3 or 4 times, 3 cuts at the quoted price, 2 slight profits, and 1 big win. Perhaps now, I think that the entry points are similar for people who are winning and who are losing in total. However, it depends on how you respond after you enter, whether it is profit or loss. We need to find a way to deal with it. Due to changes in my living environment, I tried scalping, but it didn't match my daily rhythm. From now on,...

dear are you still trading with engulfing pattern with 4h chart ?
Quoting sam1967
{quote} dear are you still trading with engulfing pattern with 4h chart ?
we are but daily seems to be better, but unfortunately tehnoob is not trading anymore because he cant trade, so just carry on as normal.
Quoting peterhenders
{quote} we are but daily seems to be better, but unfortunately tehnoob is not trading anymore because he cant trade, so just carry on as normal.
sorry for that i am unable to understand what are you said
Quoting sam1967
{quote} sorry for that i am unable to understand what are you said
Sam, the engulfing pattern will workout on the 4hr chart but only if you understand when and how to trade the pattern. Like all patterns, it depends on the traders knowledge on how to trade these patterns and the only way that you will find confidence in your trading is to back test and see why patterns did or didn't work out. Look at the charts and allow the charts to tell you the story-a candle taking out the proceeding candles high/low is a way to identify that there is interruption in the current trend or a possible reversal- In short the chart is telling you its next move but many fail to understand the simplicity of what the chart is saying.
Quoting peterhenders
{quote} Sam, the engulfing pattern will workout on the 4hr chart but only if you understand when and how to trade the pattern. Like all patterns, it depends on the traders knowledge on how to trade these patterns and the only way that you will find confidence in your trading is to back test and see why patterns did or didn't work out. Look at the charts and allow the charts to tell you the story-a candle taking out the proceeding candles high/low is a way to identify that there is interruption in the current trend or a possible reversal- In short...

dear peter.. thanks a lot for details explanation.abut engulfing pertern.do you trade based on this method ? i think it's very simple trading system. also it's mostly perform in s& r
Quoting sam1967
{quote} dear peter.. thanks a lot for details explanation.abut engulfing pertern.do you trade based on this method ? i think it's very simple trading system. also it's mostly perform in s& r
No I don't trade from this method but I did a few years back and it worked very well especially from the daily charts. 4 hr is still good though
Quoting peterhenders
{quote} No I don't trade from this method but I did a few years back and it worked very well especially from the daily charts. 4 hr is still good though

thanks dear... i also did on dimo ac. not in live ac. in that period do you use any ma's or any other filter to identify the proper engulfing candle ?
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