Plan the Trade

Interesting place to park the Dow for the weekend;



The words; 'chisel' and 'falling' come to mind!)

Nq also closed at low of day -730 ticks today

Hello,
Some people know me on the TDI thread.
I liked this method, but I read / listen to the interventions of Divergence , The Cableguy and others ... about trading naked , with the pattern 123 ... offer demand etc
I agree that the indicators are always late. And I love your way of trading!
So I decided to stop with FULL the indicators!
I'm sorry my english is poor.
I looked on google to learn the pattern 123.
I also discover the pattern 2b Victor Sperandeo.


Do you use both?
I have a lot of difficults to loking his patterns on the chart forex.
I see you are trading on the NQ.
I think I have only one chart , and to know it well, it's enough to be a winner.
But I have never traded NQ and do not know it.
I do not understand, I use Lmax but I observe that the price NQ is not the same as you ...
Which broker do you use?
I am beginner ... what do you advise me to practice this pattern? Forex? A pair? Or that NQ?
Thank you very much to you ... I hope you understand me ^^

Yes, thank you for your comment Harold. I am leaving the range chart behind. I wasn't actually trading off of it, just using it to try to determine the strength of the moves. It is no better than just looking at the tick chart. I will move to the 400 tick chart, as I have been practicing with it this weekend. I need to keep it simple and continue to improve. I think the best way to do that is to stick with the plan, and keep plugging away.

[quote=fleurdelys;10740495]/quote]

If you are looking at nq on lmax you’re looking at a CFD, not the futures market. So prices will not be the same.

Hi Fleurdelys;

Firstly, no need to apologise for your language. It is perfectly understandable!)

Personally, i tried trading 123 triggers (break of point 2) for a long time, but there are many failures and you ideally need to place your stoploss below either point 3 (aggressively) or point 1 for invalidation. This usually means that PA has moved away from the prior supply/demand zone (point 3), so we want to get into the trade as close to that point as possible, therefore hoping for a retrace.

Ok, sometimes the price takes off and the train leaves the station without you, (there is a way of using Hooks instead to enter such trades, but that's for later...).

Don't forget, 'not having a position is a position itself'. If you can wait for those pullbacks you can really minimise your risk (in points terms).

Price moves because of a mismatch between buyers and sellers, so often when price moves, it leaves a clue. Not all orders get filled straight away, so, often the price is manipulated back up or down to the original order where upon it can be completed. That is the retest and exactly when we also want to join in. We only know these price levels after the event as PA itself leaves the clues.

I found an old chart from some time ago yesterday, showing PA reacting at a Fib retracement level. I had labelled it showing a 123 trigger entry;



Now, as it happens and being that i labelled the chart in hindsight, i highlighted a great trade. If i were to view the same action now, i would have traded it this way;



That shows the difference in entries and risk. It also means the likelihood of at least a reaction away from the point where we can visibly see Supply...

Now bear in mind how easy everything looks in hindsight. We all know that 'live' trading is very different. What comes next? well, that's the question we have to ask ourselves constantly when evaluating what we see.

Here is the same chart as above, but this time let's concentrate on the PA in the red circle to the left;



It looks like a valid 123. So, if you were to trade the break of point 2, you almost immediately go into a loss and just as it recovers and you think it will all work out fine, it then goes straight to stop out.

Now look what happens if you were to trade the pullback (to point 3) of the same set-up instead... You get enough of a reaction from that level to get your stoploss to BE. So when it turns, you lost nothing, compared to taking the 123 trigger which cost you a full lot.

In fact, the thing to do is not get too caught up in using a 123 to determine trend change. It is to use a small version to get yourself back into the main underlying trend. So (Ok, benefit of hindsight and all!), but here is the best way to view this trade;



So now you can see a small 123 that triggers and gets bought back up. The candles show miniature battles between buyers and sellers. We want our limit order at that level. Do we know for sure it will retrace there? No, but look at the benefit of the set-up when it does.

It is simply following logic. It is also fractal, so although what i have highlighted there is in miniature, it generally looks the same on all scales. A thrust away from point 2 of a 123, followed by a retrace to near point 3. Usually an order above/below the starting pinbar of the move away from the original point 3 is the position for the limit order.

I will generally always trade such retests as this;



When it works, price will usually only retest the break out level briefly and then drop like a stone. If it doesn't, your risk is small anyway. Even a 50% win ratio, will return points.

Dow sells off further...

Will we get some Positive Divergence, before any kind of retrace;

Current to above;



Standard retracement fib for the 4th wave after an extended 3rd wave is 23.6% (or back to the 76.4% fib upside down, as i like to show!) - as per chart and reaction.

There was a lovely flagline on the NQ earlier. I didn't trade it, but it looked nice;



Incidentally, the 5th wave was exactly 38.2% of waves 0-3, for the turn. I didn't trade that either!)

Now back to S/D...

Wow. it hit the weekly naked poc at 82.50 and headed long really fast.

Really impressed with the speed and function of sierra chart.
Back up to previous day low i see . . .

rough day today and turn of events market way down and then suddenly turned around 3 losing trades 1 win and a +5

No trades from me, having set up my single contract 20 tick range chart; may just observe all week, as it has a very different feel.

One nice entry (so easy after the fact ) :

526tick range in 1hr ? 682.25 or so to 813.75 round abouts, lol

again very quick. 2 trades +20 and -10. Not using the range chart anymore. It did not pan out for me. I apologize to all for all the talk about it. There was no collusion, all the emails have been released, the accusations are not accurate. Did I mention there was no collusion.

Things have been tough for me financially for the past few months. Had to clean out my trading account to take care of necessities. Hopefully, God willing, things will turn around soon. Keep at it guys. There is no better way to trade once you get the rhythm of this. I didn't get it quick enough to move to 2 or 3 contracts to make a living with it. I will keep following the thread though.

I pray for lots of ticks for all!

Maybe there was no collusion, dave - we'll just have to give you the benefit of the doubt - but I like those Mack-style channel lines on the 1200 tick chart .

Good job in rough market...I made 81 ticks with 2 contracts = 162 ticks. What I need to improve is to make less trades because I don't wanna pay so much commissions ($4.10 RT).

As you can see, we're trading the NQ futures contract here, which you cannot trade with a forex broker, so you need a futures account and platform... and also a larger account, as the NQ tick size (a tick is the futures term for pip, ie. the minimum move; it's 0.25 of a point in the NQ) is $5. ie. the equivalent of trading 5 minilots ($50,000 posiiton size) of a USD forex pair. One NQ contract requires $500 margin for day trading.

Personally, I wouldn't recommend attempting to trade the NQ with less than a $5k account for a beginner ($2k for an experienced trader), SO I would learn to trade this way either with Forex, EU or GU, or if you are in Europe, a CFD, in which case the Ger30 (DAX) has similar volatility to the NQ.

Don't trade real money till you are profitable at least 4 consecutive weeks, then start VERY small position size, say 10c / pip. It's a marathon, not a sprint etc etc.

Just my opinion, of course...