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"Ratios & Harmonics: a Different Way to Trade." Summary 37 replies

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Ratios & Harmonics: a Different Way to Trade

  • #31,601
  • Sep 18, 2017 9:11am Sep 18, 2017 9:11am
Quoting Mr. Pip
Lets shoot for the 29 of Sept
Locking it in into my calender.
  • #31,602
  • Sep 18, 2017 9:17am Sep 18, 2017 9:17am
Strength of the bulls looks like it is weakening on the immediate order flow but no good structure and it has gone beyond the 76.8. Would probably had shorted it earlier if PA had rejected this current area aggressively.
Attached Image (click to enlarge)
Click to Enlarge Name: YM 12-17 (233 Tick) 2017_09_18 10.12pm.png Size: 77 KB
  • #31,603
  • Sep 18, 2017 9:24am Sep 18, 2017 9:24am
Quoting Milfortra
Strength of the bulls looks like it is weakening on the immediate order flow but no good structure and it has gone beyond the 76.8. Would probably had shorted it earlier if PA had rejected this current area aggressively. {image}
These are market highs and price will slow down. This is because longs are likely to take profit and hesitate to keep buying and shorts are also scared in getting short in light of the strong bull market. Hopefully this will give us a deeper correction and give us a nice RR long. The expectation is clear for a NSH.
If you fail to plan, you plan to fail.
  • #31,604
  • Sep 18, 2017 9:34am Sep 18, 2017 9:34am
OK so we will do the live stream on the 29 same as usual.
If you fail to plan, you plan to fail.
  • #31,605
  • Sep 18, 2017 9:42am Sep 18, 2017 9:42am
Slow moving day so far. Might have to be more aggressive. I have adjusted my area of interest to 283-269 there abouts
Attached Image (click to enlarge)
Click to Enlarge Name: YM 12-17 (233 Tick) 2017_09_18.png Size: 36 KB
If you fail to plan, you plan to fail.
  • #31,606
  • Sep 18, 2017 9:51am Sep 18, 2017 9:51am
Quoting Mr. Pip
Slow moving day so far. Might have to be more aggressive. I have adjusted my area of interest to 283-269 there abouts {image}
i would only consider a long in the 270 region for a better RR but its gonna have a hard time getting there with all the structure to the left
  • #31,607
  • Sep 18, 2017 9:54am Sep 18, 2017 9:54am
Quoting civo
{quote} i would only consider a long in the 270 region for a better RR but its gonna have a hard time getting there with all the structure to the left
I would have to agree with you.
If you fail to plan, you plan to fail.
  • #31,608
  • Sep 18, 2017 10:14am Sep 18, 2017 10:14am
Morning Damian,

Would like to seek your advice.

With FX, I'm typically using 1H charts. It's predictable that every swing is about 150 pips. So it's easy to set TP and SL.


-------------



Recently Ive tried demo trading YM. Because YM is only actively traded during US Market Open hours, (which is 12H behind my time, 9:30pm), it's a wonderful trading time for me.

But because trading time is only 2 hours, have to use smaller timeframes, i.e. now using 233 ticks as what you are using.

Problem im facing is... there are too many swings, big swings that could be hundred of pips, medium swings thats 60 pips, and small swings of 15 pips.

How to set stop loss in this scenario?

In the example below, the main swing is 88 pips... surely we cannot set a stop loss thats so far away.

And because there are so many little swings, normally i can only trade those little swings due to limited trading time.

But setting stop loss becomes problematic. I've set stop loss based on the "small swings", only to see stop filled, and price quickly reverse because it's a retracement of the bigger swing.

I'm facing the issue of entering many trades (to trade the small price swings, making about 8 pips per trade), and getting one huge stop loss (say 30 pips).

Attached Image (click to enlarge)
Click to Enlarge Name: YM.JPG Size: 69 KB
  • #31,609
  • Sep 18, 2017 10:47am Sep 18, 2017 10:47am
Quoting kelvinyun
Morning Damian, Would like to seek your advice. With FX, I'm typically using 1H charts. It's predictable that every swing is about 150 pips. So it's easy to set TP and SL. ------------- Recently Ive tried demo trading YM. Because YM is only actively traded during US Market Open hours, (which is 12H behind my time, 9:30pm), it's a wonderful trading time for me. But because trading time is only 2 hours, have to use smaller timeframes, i.e. now using 233 ticks as what you are using. Problem im facing is... there are too many swings, big swings that...
I understand what you are saying the issue is that on the 1H you filter out all of the short term OF and you are left with a clearer framework. The issue is that the 1H is not for day trading and more for swing traders. We are swing traders as well but on the intra day OF.

On the 233 you can see the long term OF and intermediate OF and the immediate as well and this can sometimes have us getting mixed up in the OF. You need to identify which order flow you are trading and be able to identify the main swing of that order flow. Once you can do that effectively your stops and targets will be properly placed. This will increase your frequency which also means you will take on more wins and losses but it will not adversely affect your expectancy unless you start flipping coins on which trades you will take and which ones you will pass on.

It's ok not to take a trade because you have strong technical reasons to not take it but the bottom line is you are trading the expectation which plays out over 70% and if you only take 3 out of 10 for whatever reason then you have killed your expectancy and are no longer trading at a sustainable rate.
If you fail to plan, you plan to fail.
  • #31,610
  • Sep 18, 2017 11:43am Sep 18, 2017 11:43am
Quoting Mr. Pip
OK so we will do the live stream on the 29 same as usual.
Unfortunately, I will not be able to attend. I will organise a party for my daugther on that day.
My best day would be the 20th Sept.
  • #31,611
  • Sep 18, 2017 12:51pm Sep 18, 2017 12:51pm
Picked up 11. Finally came back into an AOI that was reasonable. Moving slow so took profit. Doesn't seem like we would get a new high today at all, but could be wrong. Not enough conviction to keep risk on.
Attached Image (click to enlarge)
Click to Enlarge Name: YM 12-17 (233 Tick) 2017_09_18.png Size: 49 KB
  • #31,612
  • Sep 18, 2017 1:03pm Sep 18, 2017 1:03pm
Quoting PeterT
{quote} I'm in a similar short on USDJPY. Let's cheer for the bears Go bears!
Closed the trade out with 2,5% return, so not too bad hehe.
Longed EURJPY and USDJPY
USDJPY:
expectation of a deeper correction because project was decreasing and Depth was increasing, momentum roughly the same..

EURJPY:
ABCD completion + structure + deeper correction due to weakening trend movement ( read: worse projection / a little deeper correction and worse momentum, as partly shown on the chart ).. Trading the immediate OF.. Seem to be learning new things every day.. But I guess everyone has there own rules of engagement and everyone should backtest their own rules to get the most out of the system.. Will share my trades every so often, when I have the time

EURJPY:
loser: traded outside of my trading hours and didn't quite get to my area.. Little short of it.. So could be avoided..

(red arrows where the candles where I took the trades ( opening of them )).

Have a good week everyone!
Attached Image(s) (click to enlarge)
Click to Enlarge Name: USDJPYM5 18-09.png Size: 38 KB
Click to Enlarge Name: EURJPYM518-09.png Size: 43 KB
Click to Enlarge Name: EURJPYM5 18-09 loser.png Size: 41 KB
"Luck is when opportunity meets preparation"
  • #31,613
  • Sep 18, 2017 1:14pm Sep 18, 2017 1:14pm
Quoting Mr. Pip
{quote} I understand what you are saying the issue is that on the 1H you filter out all of the short term OF and you are left with a clearer framework. The issue is that the 1H is not for day trading and more for swing traders. We are swing traders as well but on the intra day OF. On the 233 you can see the long term OF and intermediate OF and the immediate as well and this can sometimes have us getting mixed up in the OF. You need to identify which order flow you are trading and be able to identify the main swing of that order flow. Once you can...
Mr pip,

I backtested your system with (my own?) rules and got a result of 67-72% win rate with at least or almost at least 1:1 r:r, and sometimes even more, but on average at least more than 1:1 R;R so that is good.. Backtested 'manually' 2 MONTHS of 5 min charts lol, pain in the ass but really worth it, should advise everyone to do it! Really gave me an idea of what to expect such as losing and winning streaks and a 'rough' estimate on what you can expect as return.. Really thanks for the system, once you get the hang of it, it is really amazing! Will you post the livestream on youtube, find them REALLY REALLY useful, please keep doing them! We are all learning from them!
"Luck is when opportunity meets preparation"
  • #31,614
  • Sep 18, 2017 1:42pm Sep 18, 2017 1:42pm
This is from me today ...
NQ +7.75 points
Long in the AOI for the long term expectation of a NSH which in hindsight failed. Initial stop was right below rotation (pin bar and the following engulfing candle).
Attached Image (click to enlarge)
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  • #31,615
  • Sep 18, 2017 10:10pm Sep 18, 2017 10:10pm
Quoting Mr. Pip
{quote} I understand what you are saying the issue is that on the 1H you filter out all of the short term OF and you are left with a clearer framework. The issue is that the 1H is not for day trading and more for swing traders. We are swing traders as well but on the intra day OF. On the 233 you can see the long term OF and intermediate OF and the immediate as well and this can sometimes have us getting mixed up in the OF. You need to identify which order flow you are trading and be able to identify the main swing of that order flow. Once you can...
Yes. Exactly. With 1H, all the short term OF is filtered out, leaving a beautiful chart.

But with YM 233 ticks, its hard to figure out where to place the SL / or where to enter the trade.

For example is the chart below:

1) Main swing is UP.

2) But when US Market opens, the intra day could be DOWN.

3) Entering Long, then stop loss must be placed very far away, below the main swing.
- Side Effect: Large infrequent losses.

4) Entering Short, then stop loss is placed closely, just above the intra day swing.
- Side Effect: Small frequent losses.
Attached Image (click to enlarge)
Click to Enlarge Name: OF.jpg Size: 32 KB
  • #31,616
  • Sep 18, 2017 10:28pm Sep 18, 2017 10:28pm
Quoting Mr. Pip
{quote} I understand what you are saying the issue is that on the 1H you filter out all of the short term OF and you are left with a clearer framework. The issue is that the 1H is not for day trading and more for swing traders. We are swing traders as well but on the intra day OF. On the 233 you can see the long term OF and intermediate OF and the immediate as well and this can sometimes have us getting mixed up in the OF. You need to identify which order flow you are trading and be able to identify the main swing of that order flow. Once you can...
Trading short term, there's a lot of profits to be made.

But the problem is the frequent small dips that breaks short term expectations, but not the long term ones.

These small dips could easily be 40 pips to 60 pips.

Setting SL based on LTOF
- a) Holding on to such dips is very - very painful.
- b) And if the long term trend reverses, then its easily 100 - 200 pips of losses.


Setting SL based on STOF
- a) If stop loss is set for the Short Term OF, then it tends to hit stop loss all the time.
Attached Image (click to enlarge)
Click to Enlarge Name: OF2.jpg Size: 53 KB
  • #31,617
  • Sep 18, 2017 11:16pm Sep 18, 2017 11:16pm
Quoting kelvinyun
{quote} Trading short term, there's a lot of profits to be made. But the problem is the frequent small dips that breaks short term expectations, but not the long term ones. These small dips could easily be 40 pips to 60 pips. Setting SL based on LTOF - a) Holding on to such dips is very - very painful. - b) And if the long term trend reverses, then its easily 100 - 200 pips of losses. Setting SL based on STOF - a) If stop loss is set for the Short Term OF, then it tends to hit stop loss all the time. {image}
It sounds to me that you are just trying to avoid losing which is inevitable.
Choose the orderflow you are going to trade and put your stop in the appropriate place for that orderflow. Also by using the tools Damian has presented- depth, projection, momentum, structure and bar by bar ..you will be better at understanding where price wants to go and you will avoid the situations described in the picture in your post.
  • #31,618
  • Sep 19, 2017 2:13am Sep 19, 2017 2:13am
If anyone enjoys deep house, a really chillout set

https://www.youtube.com/watch?v=orWFnPIThxQ&t=36s
  • #31,619
  • Sep 19, 2017 3:15am Sep 19, 2017 3:15am
USDJPY Analysis

Intraday: NSH

- Price made a NSH at 6am GMT
- Small harmonics completed before market open

Expectation: would expect price to come to that structure, however, will be careful since large harmonics did complete there as well. But the expectation is still the same until it goes to the tier 2 structure as shown in 5m chart

Long term: NSH

- Large harmonics completed there
- Long term is in confluence with intraday as well so will go with the intraday expectations
Attached Image(s) (click to enlarge)
Click to Enlarge Name: usdjpy 190917 5m.JPG Size: 111 KB
Click to Enlarge Name: usdjpy 190917 15m.JPG Size: 107 KB
  • #31,620
  • Sep 19, 2017 8:38am Sep 19, 2017 8:38am
Quoting Sheeep44
{quote} Mr pip, I backtested your system with (my own?) rules and got a result of 67-72% win rate with at least or almost at least 1:1 r:r, and sometimes even more, but on average at least more than 1:1 R;R so that is good.. Backtested 'manually' 2 MONTHS of 5 min charts lol, pain in the ass but really worth it, should advise everyone to do it! Really gave me an idea of what to expect such as losing and winning streaks and a 'rough' estimate on what you can expect as return.. Really thanks for the system, once you get the hang of it, it is really...
Yes it will be via YOUTUBE.
If you fail to plan, you plan to fail.
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