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Trading the Cable swings via averages

  • #61
  • Nov 20, 2018 8:51pm Nov 20, 2018 8:51pm
That should take a little digesting but remember there are the other charts to consider in conjunction with this 5 minute one.

For example look at the picture from a 15 minute perspective.. as below.

Pip perfect and heaps of profit made, well over 100 pips in the bank.
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  • #62
  • Nov 20, 2018 8:55pm Nov 20, 2018 8:55pm
And from a 1 hour perspective
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  • #63
  • Nov 20, 2018 9:16pm Nov 20, 2018 9:16pm
So we have looked at the relationships of the EMA, RSI and price signals such as divergence.

There are more but this alone is plenty to make your pips per day.

There is something I call the two bar test, for entries. You don't need to have whacking great lines going back to the dawn of time to get an entry a simple two bar test will do it.

Here on the 1 hour I have an example..

See how the fast RSI was below the slow one in the circle area. It then crosses from below to form a valley where I have put test here. This tells us the bulls have found a bit of energy and are able to hold onto it by not allowing the bears to take them back across. So at this point we place a two bar test line on the price, it closes above so we are good to go long with the stop placed as shown. Remember we are dealing with a divergence here so we should at least make it back across the EMA and as it turned out went a nice 100 pips or so, far more than we need.
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  • #64
  • Nov 20, 2018 9:39pm Nov 20, 2018 9:39pm
All the time we are looking for the Average swings and where they fail to make HH's or LL's.

Look at that last 1 hour chart and the two pushes the fast RSI made above the 80 level. It has no chance to pull the EMA up to make a HH so of course it is always going to be a short at these points. If the average was going to make the HH then the price would have made a huge impulse bar to get up there dragging the average behind it. The word huge is always relative to the level it has to make.

We could study theory until the cows come home, patterns, waves, harmonics or whatever which I have done but wasted a great deal of my time doing so because the reality of the situation is always there in front of you.

Notice how when the EMA is trying for one level the price itself makes it to additional levels. We look for which level it is failing at and decide whether or not to take action.
  • #65
  • Nov 20, 2018 9:42pm Nov 20, 2018 9:42pm
Ok I think I have done enough for today.

Tomorrow I will tackle the juicy bit of money management because I don't see any reason why I should be the only one with a headache.

Any questions...…………...
  • #66
  • Nov 20, 2018 10:03pm Nov 20, 2018 10:03pm
Well spotted there, I have been privately informed that I have made an error.

Referring to the 5 period RSI. It seems I omitted to Apply it to the Previous Indicators Data which it should be.

So on that two bar test it would have been tested a tad lower.

It doesn't make much difference but enough to cause errors.

Sorry about that.
  • #67
  • Nov 21, 2018 12:47am Nov 21, 2018 12:47am
Thx for sharing......
Never Ever Give Up!
  • #68
  • Nov 21, 2018 12:55am Nov 21, 2018 12:55am
[quote = Nala66; 11718366] Ok, myslνm, že som dnes urobil dosť. Zajtra sa budem zaoberať šťavnatύm riadenνm peňazν, pretože nevidνm žiadny dτvod, prečo by som mal byť jedinύ s bolesťou hlavy. Akιkoľvek otαzky ... ............ ... [/ quote]
I have no idea when to enter, where to go, where to put PT and SL.
Please excuse the bad English via Google Translate.
  • #69
  • Nov 21, 2018 1:04am Nov 21, 2018 1:04am
Quoting dokopy
[quote = Nala66; 11718366] Ok, myslνm, že som dnes urobil dosť. Zajtra sa budem zaoberať šťavnatύm riadenνm peňazν, pretože nevidνm žiadny dτvod, prečo by som mal byť jedinύ s bolesťou hlavy. Akιkoľvek otαzky ... ............ ... [/ quote] I have no idea when to enter, where to go, where to put PT and SL.
That is because I haven't told you yet
  • #70
  • Nov 21, 2018 1:06am Nov 21, 2018 1:06am
Thanks Alan, busy reading through a few times to grasp the concept. Would you consider this a valid 2 bar test trade although it is a late entry I still took it because it hadn't moved too far yet? or is the fast RSI valley criteria not sufficient?
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  • #71
  • Nov 21, 2018 1:11am Nov 21, 2018 1:11am
Nala

In your divergence example in post 60 the fast RSI is at the extremes.

Is this divergence only valid when the fast RSI is above the slow RSI ( for potential down movement) and below the slow Rsi for a potential up movement?
Would you consider the fast RSI convergence as a valid one in the picture below as it formed below the slow RSI? ( For a potential downward trade)
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Never Ever Give Up!
  • #72
  • Nov 21, 2018 1:18am Nov 21, 2018 1:18am
Don't get to hung up on the trades yet guys. Just study the relationships with the chart times and the elements I have shown you so far.

Look what happens round the time (vertical line).

Look at the relationships on the RSI and how they behave
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  • #73
  • Nov 21, 2018 1:23am Nov 21, 2018 1:23am
See how in the above chart that on the 1 hour price is at the EMA when on the 5 min we have a divergence on the RSI. The divergence tells us price is going to get back across the EMA on the 5 min..
  • #74
  • Nov 21, 2018 1:26am Nov 21, 2018 1:26am
Quoting Nala66
Don't get to hung up on the trades yet guys. Just study the relationships with the chart times and the elements I have shown you so far. Look what happens round the time (vertical line). Look at the relationships on the RSI and how they behave {image}
In my view, from 1HR chart, fast RSI is oversold. In 5Min chart, RSI show divergence and going to opposite site to test EMA low. Is that right ?
  • #75
  • Nov 21, 2018 1:35am Nov 21, 2018 1:35am
Quoting KyBakka
{quote} In my view, from 1HR chart, fast RSI is oversold. In 5Min chart, RSI show divergence and going to opposite site to test EMA low. Is that right ?
I think you mean 1 hr is overbought, so what do you think the chances are of the average making the HH from here and what would confirm it is going to do it or not.

To do this look at the 1 min and 5 min
  • #76
  • Nov 21, 2018 1:53am Nov 21, 2018 1:53am
Quoting Nala66
Well spotted there, I have been privately informed that I have made an error. Referring to the 5 period RSI. It seems I omitted to Apply it to the Previous Indicators Data which it should be. So on that two bar test it would have been tested a tad lower. It doesn't make much difference but enough to cause errors. Sorry about that.
Hi,

Very interesting method, looking forward to digest it.

As for the error we should apply it to your night template? I've done so as shown in the attached image. plz correct me if i'm wrong.

Thanks,
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  • #77
  • Nov 21, 2018 2:18am Nov 21, 2018 2:18am
Quoting Cobra
Nala In your divergence example in post 60 the fast RSI is at the extremes. Is this divergence only valid when the fast RSI is above the slow RSI ( for potential down movement) and below the slow Rsi for a potential up movement? Would you consider the fast RSI convergence as a valid one in the picture below as it formed below the slow RSI? ( For a potential downward trade) {image}
Very good thinking outside the box and yes.

The fast RSI is already showing weakness because of not crossing the slow and to be in divergence like that adds to the weakness of the bulls. For now I will just refer to them all as divergences.

We want to see these signals on the higher 1 hour chart so we can drop to the lower time frames to look for entries.

There are a couple more things you may observe going on. The more you study these simple little things the better your trading becomes.

Well done...great question
  • #78
  • Nov 21, 2018 2:20am Nov 21, 2018 2:20am
Quoting DreamwalkeR
{quote} Hi, Very interesting method, looking forward to digest it. As for the error we should apply it to your night template? I've done so as shown in the attached image. plz correct me if i'm wrong. Thanks, {image}
Yes just the night template was wrong.
  • #79
  • Nov 21, 2018 2:29am Nov 21, 2018 2:29am
GM! When looking at Cable at this moment. 3x divergences has formed in last 2.5hrs om M5. Price ranging in about 25pips. Are the signs there for a downward move once it can break 1.2800? Round number? Only if you have time!
  • #80
  • Nov 21, 2018 2:52am Nov 21, 2018 2:52am
Nala, I've marked the swing highs/lows for today, if you don't mind commenting on it if it's missing anything, and how far would you go on the M5 to spot your swing H/L if for example we didn't have the last two swing lows on Nov 15th ?

Thank you.
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