Ratios & Harmonics: a Different Way to Trade | Page 1974 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

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

Learning to trade with harmonics 11 replies

Time for Change - Pivots & Harmonics to freedom 67 replies

180 reasons to trade Harmonics and Patterns 13 replies

Group Trading based on Elliott wave and Harmonics 0 replies

Attachments: Ratios & Harmonics: a Different Way to Trade
Exit Attachments

Ratios & Harmonics: a Different Way to Trade

  • #39,461
  • Apr 15, 2018 6:10am Apr 15, 2018 6:10am
Quoting PeteH
{quote} I am fairly new to Harmonic trading and try to keep my rules simple. For long trend trades I look at the main NSH/NSL and not the intermediate order flow or short-term order flow. I noted point A and E and the upswing to the high at F. As A has not been breached in the longer term I am looking for longs (i.e. 1:1 harmonic of either E to F or A to F). As price has retraced to the 78% of E to F (point Q) and this is also at an area of structure I am looking to see if price returns to this area on Monday for a Long trade. My stop is therefore...
Thanks PeteH , i could understand your long term trade approach but would like to hear more about how you look at these short term I drawn or you were looking for even shorter immediate order flow .

Maybe it was how the order flow that day and we should just accept it.
  • #39,462
  • Edited 9:48am Apr 15, 2018 6:54am | Edited 9:48am
Quoting 6288monkey
{quote} Thanks Parviz1953, that was a great answer. 1 . on which swing you would start to take entry. ( you mean your SL at beginning of long term swing = A ? ) 2 . , and 3. , that was a great insight for me . 4. how i know when i can start to trade again.
Hi: Let me start from beginning and explain how i would trade this chart
1) let say that we opened the chart and we are now somewhere below the L point, i mean we decided that what is our long term main swing, and that we are going to take a long position on short term order flow.
2) when do we decide to enter long..? , obviously the lowest possible price ...! but where is the lowest possible price to enter...? we don't know...!!, what we know is that we have a main swing up that is going to correct and, so first i try to determine the areas of support and resistance along the course of my main swing, (i draw these areas from higher time frames in bolder rectangle, to lower ones with finer lines, so that i emphasize for myself that these are more important than lower ones)
3) Then i draw the fib reteracement for my main swing to see how much correction has already happened.
4) then on the basis of first the supporting structure position and then its coincidence with common fib ratio, i decide to enter long.
5) I try to decide where is the most likely expectation for the correction to end, on the basis of the Damian's lessons of projection and momentum, if i expect a deep correction i don't enter at 38.2% correction or if i do ,i would with 1/3 of my allowable lot size(M and O point). and keep the rest of may lot size for possible deeper fib correction (and structural support , lets say 1/3 for golden zone ( 61.8% to 78.2) and the rest for 88.6% , don't forget if they only coincide with structure and reconfirm the area )
6) We never would like to trade with the price being in no man's land or taking long position near strong resistance or short near a support area (N, P, and R points).
7) And about my target, my first target always is at the nearest structure that is at the level of my swing end (before L point), at this point i exit 1/3 to 1/2 of my lot size and bring the SL to Break Even point ( above average open price of all the entries, plus few point) for the rest.
8) My second target would be the structural resistance around 127-138.2% of main swing fib extension.
9) Indeed i am trading the longer term main swing regarding the expectations, but my entry and exit point would be determined on the basis of the short term order flow structural support and resistance.

i hope that this would be of any help, and forgive me if i have discussed a very basic knowledge, that every body knows ...,this become a bad habit from years of being a teacher.
  • #39,463
  • Edited 8:02am Apr 15, 2018 7:34am | Edited 8:02am
Quoting parviz1953
{quote} Hi: Let me start from beginning and explain how i would trade this chart 1) let say that we opened the chart and we are now somewhere below the L point, i mean we decided that what is our long term main swing, and that we are going to take a long position on short term order flow. 2) when do we decide to enter long..? , obviously the lowest possible price ...! but where is the lowest possible price to enter...? we don't know...!!, what we know is that we have a main swing up that is going to correct and, so first i try to determine the areas...

Nice answer , we need to stick to the long term for this .

to be honest , i would like to hear someone who can trade the short term. example like swing A to B , C to D , K to L , P to Q , and would like to know where to put SL , so that i can know which swing you are trading.

i am trading forex currently and constantly facing such situation .

from the chart there were profitable expectation but it seem hard to catch the right swing .

still learning to master this skill .

i often have difficulty to define which swing were the right swing

example let say L to O was a NSL , at P should i consider it as a complete correction when Q were form or not yet completed correction. (. I often facing very swallow correction that sometime consider complete ,sometime not )

and shall i trade short at R , i should SL at P or L.

same to F,H,J should i consider them a NSH , or just a continuation of previous swing extending.

For me, a clear swing were A to B , C to D , and E was a expectation failure with NSL.

speaking of just what i can see from the chart and not considering previous order flow from the chart.

thanks

edited some grammar spelling
  • #39,464
  • Edited 9:08am Apr 15, 2018 8:37am | Edited 9:08am
Quoting 6288monkey
{quote} Nice answer , we need to stick to the long term for this . to be honest , i would like to hear someone who can trade the short term. example like swing A to B , C to D , K to L , P to Q , and would like to know where to put SL , so that i can know which swing you are trading. i am trading forex currently and constantly facing such situation . from the chart there were profitable expectation but it seem hard to catch the right swing . still learning to master this skill . i often have difficulty to define which swing were the right swing...
Just let me add one more point :
At D and E point you see NSH and at the same swing NSL , both with a very small projection , what would be your expectation then...?
a deep correction or reversal ( or may be a complex correction) isn't it so...?.(the same is true for H-I and J-K swing), I don't trade either of them without having the information from higher order flow and never trade a complex correction,(ranging price ) if the range is less than 20 pips wide or it does not provide enough space to move to BE or to protect the trade.
  • #39,465
  • Edited 12:27pm Apr 15, 2018 11:59am | Edited 12:27pm
Hi all:
On the continuation of my previous posts's subject,
i would like to share one of my experience with all who may be interested. The question for me was:
What is the best higher time frame to look for the order flow trend, when i want to take trades on shorter term order flow..?

My experience showed me ,that it should be at least 4 to 6 folds higher, no matter it be time chart ,or tick chart, so that for trading 144 tick chart the 233 is not a good choice, for 233 tick chart, 1597 would be a good one . the same is true for time based charts, E.g. :if you are trading on M15 then, M30 is bad choice,and like wise when trading M30 , H1 is not a good choice to see the longer term trend direction.
To clarify my point i post three chart from the same area of EURUSD , when i want to trade M15 chart order flow you can see that M30 higher time frame trend is not only a bad choice, but even misleading. and that H1 will be a good one.
M15:
Attached Image (click to enlarge)
Click to Enlarge Name: M15.PNG Size: 50 KB

M30:
Attached Image (click to enlarge)
Click to Enlarge Name: M30.PNG Size: 52 KB

H1:
Attached Image (click to enlarge)
Click to Enlarge Name: H1.PNG Size: 63 KB
  • #39,466
  • Apr 15, 2018 1:39pm Apr 15, 2018 1:39pm
[quote=6288monkey;10966365]{quote} For me, a clear swing were A to B , C to D , and E was a expectation failure with NSL.

Sorry to be so blunt with my response but this rule doesn't have any support in the literature of the technical analysis of financial markets. It's neither supported by Dow Theory nor Elliott Waves Principle nor Gann, Wycoff Theories and most of all not supported by Carney's harmonic patterns which you based your trading plan on. Study Gartley and bat patterns and compare them to this rule. According to your way of thinking you would disregard NSH after bullish Gartley or bat patterns or NSL after bearish Gartley or bat patterns and what about our bread and butter AB=CD pattern? Of course, you can include anything in your trading plan I just try to play devil's advocate and direct your attention to other option while you trade harmonic patterns. Good luck with your trading. As always I am in your corner.
Attached Image (click to enlarge)
Click to Enlarge Name: YM 06-18 (987 Tick) 4_13_2018.jpg Size: 116 KB
Always trade your own plan...I don't provide trading signals.
  • #39,467
  • Apr 15, 2018 3:30pm Apr 15, 2018 3:30pm
Hi :
IMO , the EURUSD general trend would still be bearish for this week with its first target at area between 1.2270 to 1.2235 and second target at 1.2170 to 1.2150 .
Attached Image (click to enlarge)
Click to Enlarge Name: H4 eurusd.PNG Size: 52 KB
  • #39,468
  • Apr 15, 2018 9:24pm Apr 15, 2018 9:24pm
Quoting Coreg2004
Quoting 6288monkey
{quote} For me, a clear swing were A to B , C to D , and E was a expectation failure with NSL. Sorry to be so blunt with my response but this rule doesn't have any support in the literature of the technical analysis of financial markets. It's neither supported by Dow Theory nor Elliott Waves Principle nor Gann, Wycoff Theories and most of all not supported by Carney's harmonic patterns which you based your trading plan on. Study Gartley and bat patterns and compare them to this rule. According to your way of thinking you
...

Thanks Coreg , i dint trade Bat and Gartley , dint really know how to use them accurately because never try before . i do use 1 to 1 .

ya your chart 2nd drawing was my "For me, a clear swing were A to B , C to D , and E was a expectation failure with NSL. " explanation.
in my eye , it has become A-D , E-F , where i always look at it as A-B,C-D,D-E .
i am defining the wrong swing and wrong expectation.

i know we need to be more dynamic , but cant catch the right point haha

your 1st drawing will be my hardest trade. - but the results if taken all trade will be normally near breakeven. depend on which swing i can get.
  • #39,469
  • Apr 15, 2018 10:33pm Apr 15, 2018 10:33pm
Quoting 6288monkey
{quote} Hi bmdenton23 , thanks for your posting of results , can you add in your initial SL on your chart , so that we can know which swing you are looking at .
Hi 6288monkey, my SL is the red line on that chart around 24430 but it's not a hard stop, rather a mental stop, I like to see what price does in that area as it often retraces at structure.
  • #39,470
  • Apr 15, 2018 11:23pm Apr 15, 2018 11:23pm
1. UsdJpy possible short trade - 5min
2. EurUsd short trade - 15min
3. EurCad short trade - 30min

i trade specific timeframe because lower timeframe look " crazy " , would not be going over 30min timeframe given the time needed to manage.

please point out to me if i looking at the wrong swing.

edit : all 3 pair has weak correction despite having weak projection , and strong correction despite having strong projection( except UJ ). < was this a sign that i am looking at the wrong swing?
Attached Image(s) (click to enlarge)
Click to Enlarge Name: Untitled2.png Size: 39 KB
Click to Enlarge Name: Untitled3.png Size: 40 KB
Click to Enlarge Name: Untitled4.png Size: 40 KB
  • #39,471
  • Apr 16, 2018 12:10am Apr 16, 2018 12:10am
Quoting 6288monkey
1. UsdJpy possible short trade - 5min 2. EurUsd short trade - 15min 3. EurCad short trade - 30min i trade specific timeframe because lower timeframe look " crazy " , would not be going over 30min timeframe given the time needed to manage. please point out to me if i looking at the wrong swing. edit : all 3 pair has weak correction despite having weak projection , and strong correction despite having strong projection( except UJ ). < was this a sign that i am looking at the wrong swing? {image} {image} {image}
Just let me give you an example of how i do see your chart on USDJPY M5 ,may be it would be helpful:
Attached Image (click to enlarge)
Click to Enlarge Name: usdjpy 5M.PNG Size: 25 KB

An AB=CD pattern retraced 61.8% to C point ,and completed at 127% fib extension of AB leg at a structure and 1:1 harmonic.
what would be the expectation now...?
a correction to the 61.8% of the entire length of ABCD ,or up to the whole length of CD leg and to the structure there.
Look at the red strong resistance on top and dark green support rectangle at the bottom of the chart
  • #39,472
  • Apr 16, 2018 12:30am Apr 16, 2018 12:30am
Quoting parviz1953
{quote} Just let me give you an example of how i do see your chart on USDJPY M5 ,may be it would be helpful: {image} An AB=CD pattern retraced 61.8% to C point ,and completed at 127% fib extension of AB leg at a structure and 1:1 harmonic. what would be the expectation now...? a correction to the 61.8% of the entire length of ABCD ,or up to the whole length of CD leg and to the structure there. Look at the red strong resistance on top and dark green support rectangle at the bottom of the chart

Parviz thanks for your sharing, my chart look different as the low of B at price 107.251 , and the next D dint reach 127.20.

not sure yours has 1 to 1 completed , but mine not yet .

the last candle at point B has longer wick .

and shall it was completed my 61.80 of whole swing was at 107.542 which also slight different.( dint pass above C point )

and the chart you show were 15min but dint matter much.

i am using mt5 with an automatic created account.

i think you were using ninja trader with futures broker. ( your price were more accurate )
Attached Image (click to enlarge)
Click to Enlarge Name: Untitled5.png Size: 36 KB
  • #39,473
  • Apr 16, 2018 12:39am Apr 16, 2018 12:39am
Quoting 6288monkey
{quote} Parviz thanks for your sharing, my chart look different as the low of B at price 107.251 , and the next D dint reach 127.20. not sure yours has 1 to 1 completed , but mine not yet . the last candle at point B has longer wick . and shall it was completed my 61.80 of whole swing was at 107.542 which also slight different.( dint pass above C point ) and the chart you show were 15min but dint matter much. i am using mt5 with an automatic created account. i think you were using ninja trader with futures broker. ( your price were more accurate...
No i am using MT4 platform , and yes i used the M15 chart because on my screen it was much better simulated and matched pattern on your chart, and yes i consider this nearly a 1:1 completion, because of the confluence in this area.
And my advice to you is that, don't be perfectionist in trading, price does not follow the rules so exact.
  • #39,474
  • Apr 16, 2018 12:42am Apr 16, 2018 12:42am
Quoting parviz1953
{quote} No i am using MT4 platform , and yes i used the M15 chart because on my screen it was much better simulated and matched pattern on your chart, and yes i consider this nearly a 1:1 completion, because of the confluence in this area. And my advice to you is that, don't be perfectionist in trading, price does not follow the rules so exact.

Yes , 1 to 1 wont be always pinpoint accurate , but this on my chart still abit far , maybe due to different point B price.

UJ now break down on small NSL after a 38.20 correction on my swing , i would see how it correct from there and post again

any opinion for my all 3 trade? the other 2 ok?
  • #39,475
  • Apr 16, 2018 1:06am Apr 16, 2018 1:06am
UsdJpy 5min short

please point out if i do it wrong
Attached Image (click to enlarge)
Click to Enlarge Name: Untitled6.png Size: 36 KB
  • #39,476
  • Apr 16, 2018 1:19am Apr 16, 2018 1:19am
Quoting parviz1953
{quote} No i am using MT4 platform , and yes i used the M15 chart because on my screen it was much better simulated and matched pattern on your chart, and yes i consider this nearly a 1:1 completion, because of the confluence in this area. And my advice to you is that, don't be perfectionist in trading, price does not follow the rules so exact.
Oh , one more point that i forget to mention is that: After the completion of AB=CD, price may go into a complex correction before, reversal.
on the basis of what i said , i already entered long with SL below the D point structure and TP around C point making R:R of 1:4.
Attached Image (click to enlarge)
Click to Enlarge Name: usdjpy15M.PNG Size: 37 KB
  • #39,477
  • Apr 16, 2018 1:29am Apr 16, 2018 1:29am
Quoting parviz1953
{quote} Oh , one more point that i forget to mention is that: After the completion of AB=CD, price may go into a complex correction before, reversal. on the basis of what i said , i already entered long with SL below the D point structure and TP around C point making R:R of 1:4. {image}
Let see what happen
Attached Image (click to enlarge)
Click to Enlarge Name: Untitled7.png Size: 38 KB
  • #39,478
  • Apr 16, 2018 1:30am Apr 16, 2018 1:30am
Quoting 6288monkey
UsdJpy 5min short please point out if i do it wrong {image}
Wrong...?
1) Most important one is that you are mixing different order flow and so get a wrong expectation look at size of your 3 trend lines and where you draw them.
2) you are not paying attention to the higher time frame order flow.
3) Even if your order flows was correct, have you heard that some expectation may fail. IMO this is where you are going to experience one .

Excuse me ,that was a joke, i am not going to be rude...
4) please watch Damian's video lesson on order flow again.
  • #39,479
  • Apr 16, 2018 1:43am Apr 16, 2018 1:43am
Quoting parviz1953
{quote} Wrong...? 1) Most important one is that you are mixing different order flow and so get a wrong expectation look at size of your 3 trend lines and where you draw them. 2) you are not paying attention to the higher time frame order flow. 3) Even if your order flows was correct, have you heard that some expectation may fail. IMO this is where you are going to experience one . Excuse me ,that was a joke, i am not going to be rude... 4) please watch Damian's video lesson on order flow again.
1. so how to correct it? ( i want to trade short term ) - that why i asking do i draw the wrong swing.
2. because i am trading short term , i do pay attention to them , but the price were weak ( bull ) when i enter short , after that they become strong
3. yes , i knew but it happen to often to me
4. i watch it i think all of them

Taken out , now i should look for NSH or keep looking for NSL? as the longer term were indicating NSL , and did i draw the wrong swing? shall i need to look for NSL which point should be my swing/SL at?

note : price still abit further from my 1 to 1 completion

and i am here to trade expectation , i dont take 1 to 1 completion correction trade , gartley , and bat. those were beyond my skill especially 1 to 1 completion.
Attached Image (click to enlarge)
Click to Enlarge Name: Untitled8.png Size: 38 KB
  • #39,480
  • Edited 2:36am Apr 16, 2018 2:19am | Edited 2:36am
Quoting 6288monkey
{quote} 1. so how to correct it? ( i want to trade short term ) - that why i asking do i draw the wrong swing. 2. because i am trading short term , i do pay attention to them , but the price were weak ( bull ) when i enter short , after that they become strong 3. yes , i knew but it happen to often to me 4. i watch it i think all of them Taken out , now i should look for NSH or keep looking for NSL? as the longer term were indicating NSL , and did i draw the wrong swing? shall i need to look for NSL which point should be my swing/SL at? note : price...
I believe this is the correct order flow that you should be following. Forming what is called an "AB=CD with extended CD leg" CD leg extended to it 161.8 zone ,the most usual fib for this pattern , to form the D point of lower order flow ab=cd.
Another confluence criteria , is completion of a higher order and lower order flow ABCD at the same region.
Attached Image (click to enlarge)
Click to Enlarge Name: extended CD leg.PNG Size: 33 KB
24 traders viewing now