Ivob's channels, volume, and VWAP thread (EUR/USD)

Has the potential to go lower... No real point 3 down has been formed yet on the 5min, 15min... VWAP bending down nicely, being pulled by increasing volume. Volume good as well as the larger timeframes. Keeping a remainder of my short open and hoping for acceleration in the afternoon. A decent trend today makes sense after 5 days of chop.

Not easy during NFP.. up, down and up again. I quickly switched a few positions.
But if we follow the rules, everything is fine. A great opportunity that fails is usually a good opportunity in the other direction.
First price tries where it can go, after all possible roads are blocked it goes the only way it can go: The way of least resistance.
How far it goes there.. I have no clue, it's about seeing change. If there's no change it's continuation.

The rules are:
1. FBO (failed breakout) = reverse if position, else take position in other direction
2. BO (breakout) = hold when in a position
3. After BO: wait for a point 3 in direction of trend. Hold or add.

I closed the positions, we went up 9 bars straight and then 31 bars sideways.. taking too long, the sellers during NFP had plenty of time to cover. I doubt if we can make it to the high of yesterday or even 1.23 on a Friday afternoon...with volume dropping of quickly it will be even more choppy..

Ivo

In order for a trend to continue... volume must increase in the direction of the trend..

Here we have decreasing volume in a downtrend...

Ivo

Nice day with very nice moves even though the range was not that large. It was possible to extract several 30 pip legs and surpass the 60 pip range of the day.

I got a question if I use stops.
Yes I do, I use mental stops.
The reason I use mental stops is first because brokers play tricks. They suddenly widen the spread, or even trigger the stop outside the spread but the most important thing is that I like to take myself out of the market actively. I do not deviate from the stop I have in my mind, as soon as I see the price crossing the stop I am out and I actually feel good, it's an excellent training in discipline and pulling the trigger without emotions.

I generally do not use time stops.. actually I think impatience is a human trait/bias that the market uses to shake people out...so in order to balance this I decided that don't care how long it takes for my target to be hit. (more on targets later). When the opportunity is very good the market either goes too fast for the brain to assimilate or too slow for the brain to believe it... It's all tricks, smoke and mirrors..

Ivo

Hi all,

I have attached a good indicator, found it somewhere.
Many many many thnx to the creator of it.

Settings:
setAtDaysBack true
daysback 1.0
UseManualDrop false
PastDisplayClearanceBars 400
SetAtConstantBars true
ConstantBars 950
HistogramAmplitude 120
SD 1,SD2,SD3 true
Histogram if you like it
PVP is the point of control, i dont like it.
Show VWAP true

I use it on M1 and M5.
Be very very very carefull!

Price below VWAP = BUY!!
Price above VWAP is SELL!!

Buy low and sell high!!

VERY VERY VERY Aggressive institutional buying/selling often at SD 3. BE CAREFULL and dont sell in the SD2/3 area below VWAP, DONT. Dont buy viceversa..

After u use this indicator you will see why the price sometimes move as fast as it does... 40+ pips in a minute... It is often the SD3 area.

SD = standard deviation and you can calculate it, this indicator does the work for you. Really nice one.

Reprogram your brain... When retailers selling, the bigboys are buying...
Who makes the money in this world.. We as retailers or the bigboys
This is the weapon they use.. U will see.

Changing the SD colors (the lines) above VWAP to sell colors and the below VWAP to buy colors.. It will help.
In my trading i use two colors, crimson for sell and grey for buy... Easy to remember and easy for your brains

What works good is this.. Add a MACD, settings 34,55,9... If momentum changing, the MACD will change from grey to red. You place a SELL LIMIT on the other side of the VWAP, @ SD1/SD2 or SD3 so ABOVE!!!! the VWAP.
Look left... What do you see..? Often they will retest the last high..
Take profit.. Often the SD 3 below the VWAP!
For buying viceversa.

Yesterday on the e/u... M5... London was selling from the SD 1 above VWAP.. Retailers getting in, think they need to sell.. Sudden price shoots up and retested the last high/SD1 area.. The market activates a lot of sell limits orders at the SD1 and momentum changed nice from buying to selling.
Target.. SD3 below VWAP...
Activating a lot of buy orders again in the SD3 area below VWAP and price moved slow back to the SD1 above VWAP.
The samething happens there... Sell orders where activated and momentum changed to selling.. Again the target was the SD3 below VWAP!
The next day (Today).. London start buying.. Big money can be slow.. Price moved up and up and up and sudden in the New York afternoon near the VWAP there was a big selloff back to the SD3 below VWAP...60+ pips in a minute...
Really dangerous and this is the killing what they do... It is the shake out candle you often see when a new trend is started...

What was clever to do.. Being stupid and follow the MACD traders... "Momentum changed.. So whe gonne buyyyy.."? Or... Let the momentum change an you just WAIT as a sniper in the SD2/SD3 area BELOW VWAP, with a buy LIMIT order .. PATIENCE is the key.
In the SD3 area there where a lotttt of buy limits.. Price touched the SD3 and JUMPED right up to the SD1 above VWAP.. 70 pips in a few minutes!!!

THINK WISE, dont be stupid and play the game!

SD 3 is also often the 113/127 area where it is perfect to sell and buy because it is just above/below the last high or low where retailers think they need to buy/sell.
REPROGRAM YOUR BRAIN!

Have fun with it!! And remember.. Everything works but nothing works for 100%.. The example above was a day where the bigboys where accumulate there orders.. They call it a "D Profile"...

Damn people.. You're life will change!!
I traded the last days very aggressive ().. Fucked the 2% moneymanagement rule and monday an account was $250.. Now it is $1200..
Money is EASY!!

Enjoy!! And trade safe

itis hanging my mt4.. how to rectify this problem... really it is nice indiator

AMAZING EXPLANATION I HAD THIS INDICATOR BUT DID NOT UNDERSTAND HOW TO USE IT NOW I UNDERSTAND ITS TRULY AMAZING
THANK YOU from the bottom of my heart for you post MY YOU ALWAYS BE HAPPY , PROSPEROUS , HEALTHY AND GROW BY LEAPS & BOUNDS IN ANY AND EVERY VENTURE BE BLESSED & HAPPY ALWAYS
would like to ask you what time frame do you prefer to trade intraday 1 min or 5 mins and are you religiously still using this indicator because its really amazing and have to noticed any issues while trading with this strategy on this indicator please

Just heard about vwap. Trying to learn all i can

I might hold my last portion (long) for the rest of the day... We had a breakout of an important channel so we are waiting for a point 2 (retracement) and then a point 3 up which could take us far up. I have very very very rarely seen it NOT happen... (a point 3 after BO, in other words point 1 being taken out without price trying to make a point 3).

Also I notice volume dropping after BO indicating the wall (resistence) is gone. At the moment of snapshot it is 60% of previous bar. But ff course one never knows who is sidelining. Anything can always happen at anytime but for now I am very bullish.

Other timeframes are also lining up... such as a perfect sym pennant on 30 minute...

worked out very well and exactly as anticipated... +52 pips, simply got out when everyone got in.

At volume extremes change is near... that does not mean the bullish trend is over. Might re-enter long at the (red) trendline.
Happy with the profits, an amazing month so far.

Here's the 30min perfect sym pennant before the BO. Very bullish signal. Low volume at the border (next bar) means it's ready for a breakout, alternatively if volume at the border is high it needs to breakout quickly and I am usually looking for a failed breakout and price to fall back. (FBO) In this case they let it fall back to 1.17 before massively buying it.

Ideally at breakout I want volume to be normal or low... because that means that there's no resistance/wall... If price needs to struggle to continue then there are still sellers. If you observe carefully you always see volume picking up AFTER the breakout and not DURING. (in contrast to popular believe).

Of course my 52 pip profit could be much more but hey, I'm not perfect, at least the entry was very accurate.

It's always how we react to the things and not about the things themselves... That counts for market movements but also for our own emotions. The worst respons would be to be angry, re-enter, reverse, etc etc..and let a nice win turn into a loss (been there, done that...)... instead the best respons is gratitude ... thank the market, let it come to rest and only take a very good setup or else call it a day!

The mental capital is far more precious than one trade. Preserving it allows us to make all those future profits! :-)

Congestion, Convergence, Centering or CCC

it's basically a big triangle.. neither side is winning. Happens often after a big move..people expect another big move and set profit targets far away, however, they are never hit and if the stop is too close it is hit over and over again eating away all the profits from the earlier trend. (I think it is designed that way.. ;-) People are still conditioned to think in trend-mode... The recency bias is still bothering them, however, this is different.

The way to trade this is sell at upper 1/3 and buy at lower 1/3 providing the range is big enough. In this case it's about 15 pips.

The trick is to recognize quickly, not lose money or even make some and sit it out. For instance at this moment should be early enough to catch two more swings or so. Do not trust anything you see...it will try to make you think it's breaking out all the time and it fails over and over again.

The interesting thing is it ends in a perfect sym pennant.. on the 5 but preferably on the 15min... the Breakout of the pennant has to be traded of course differently from CCC and could be a substantial move, depending on several factors.

Something like this around or right after (European) opening should ALWAYS be taken...
It's high opportunity. (no guarantee though)

looks like an uptrend...

My take on FOMC and federal funds rate:

There where some pips to take but nothing happened to EURUSD.... up, down, up... etc..
Not going anywhere tonight.. I would not aim for breakouts anymore. Maybe a couple of fades.
So the news is that the news did not break the uptrend on the daily. Uptrend still intact.

Opportunities at Right TrendLine (FBO) are much easier to recognize than trying to catch the turn counter trend..

At the RTL in 90+% of the cases you know price will at least do something there.

The trick is to be either very early by placing the order as soon as price touches the trendline and then use a tight stop... or be late: wait for the bar at trendline to be taken out in the direction of the trend and place a wider stop and dito target.

Summarizing: At RTL there are 2 options...
1. price goes thru: if against position: get out, if with position: hold.. if no position just wait for a point 3 to form.
2. price bounces of: enter in direction of trend.

The clue for the move up was this bar. (circled in red)... a high volume bar was taken out on the 15min by a lower volume bar quite easily and steady and ending at the high. Same happened at the 5min which coincided with a breakout of a small channel... many things came together quickly. The key is concentration, paying attention, not doing other things...keep on drawing channels, even little ones so we can anticipate.

When I take countertrend trades my requirements are:
- bar should end at the high, right after or before entry, doesn't matter.
- I want a quick breakout..thru all trendline that are still there.

If I don't get this I get out very quickly.
In this case I was already short (lost 4 pips) and reversed for +23 pips. I do not reverse often but saw a clear reason.

Right now is tricky. I am not confident at all that we will make new highs... there's not much time left before volatility/volume goes down so there will be not many participants to sustain the move. People / potential buyers know this...

I will be watching for price to retrace to the right trendline on the 5min (drawn in black) to go long again, if this doesn't happen no more trades today.

The options...

I intend to go short around 1.15, at RTL

We get FBO = short or we get BO and the bias becomes long.

I use the 15min and the 5min. The best moment to take a trade is in the last 5 minutes of the 15 and then not around the hour.
So that would be between 10-15 minutes past the hour (my favorite), 25-30 past the hour or 40-45 past the hour... (55-0 is not good..)

I will explain later in a seperate post but if you think about the fractal nature of the market it would be understandable why...

Same as yesterday....

Indications:
1. perfect sym pennant on the news.. first bar is high volume
2. taken out easily by a lower volume bar
3. the 15min shows the same (2)
4. breakout bar ends at the high
5. we are now at the hour...get 2 pause bars... (market plays tricks around the hour..shake out weak hands)

The question is can the move be sustained... it might (there is time now). But if we close below the red line it may fall back.

The only option now is to do something at RTL... Right trendline.

bounce for a nice long
go thru for a short

typically after 5 bars down price will first make a 1-2-3 towards RTL.
If it does something else (no touch of RTL): no trades.