Stop Hunting using Sentiment and Market Structure

Current Sentiment - Shifty Shifty

How's everyone surviving in this choppy market?

Hi Traders -

Last week was a busy week.

Bob has been working hard to get alerts and notifications implemented into the App and

I have been working hard to get a SentiFX Beginner course together for new members.

In the meantime - we took some easy trades on EU, UJ, and our biggest hit was UC - which the exact trade was given to members PRIOR to the trade happening which resulted in a +100 to +120 PIP move. CHA-CHING!

The seasonal AUDJPY trade that we talked about before OCT has now completed for a +125 PIP move.

Also - One of our members has been doing some analysis on price movements and Sentiment changes and has noticed a direct inverse correlation of price movement and sentiment. No surprise there! But it is good to see some quantitative evidence to back up the methodology. Granted, the results I've been showing here week after week speak for themselves. I digress.

Going forward - we're looking at AUDUSD for long opportunities and will let Sentiment and Market Structure guide the way.

And there are some really interesting Market Cycles taking place right now that does not look good for USD.

We will of course be monitoring any pairs going forward that show opportunities by Tues/Wed of the this week.

Short trap in AU, HTF order flow playing out as expected.

You can enter now or on slight pullback to structure

You talking about going short? that is the way the sentiment is indicating?

Long, see 2 posts ago. We were eyeing AU long before week began and had resting limit orders, those who like confirmation just got it.

Sellers trapped.

Hmm, I don't quite get that, the sentiment indicator is moving up into the sell zone.

I'm no expert and not affiliated with Sentifx, maybe he likes to comment . But this is how I see and trade it:
As stated above price and sentiment are mostly inversely correlated. If AU is a buy, sellers are in, nevertheless during a stop hunt buyers are joining, pushing more down until the point sentiments shifts. I guess this is why Sentifx introduced the axes to have some point for decision where the shifts takes place. Each counter trend moves leads to a slight sentiment shift. The deeper the retracement/stop hunt/liquidity grab is going the more of the wrong sentiment side is pulled in the more unlikely a continuation gets. This is why people have the impression that fib levels work. It's just a matter where you draw your line and what is tradeable for you. I think this case is even described on his side as free content. Worth a read
Just my ideas or how I see the market

AU isn't following thru. If structure breaks to downside here for AU then we would want to reverse and aim for the stops below.

EU breaking down

Current Sentiment Snapshot:

EU X Axis cross into the Weak Sell Area.

AU Y Axis cross into Sell Area.

That;s what i been following.

EU +290
AU +150 -54 = +96

Lets see what the next opportunity is

Hi SentiFX, I was waiting for the EURUSD to break down, buyers where exhausted, maybe later you could post a screen-shot to show here how you traded EU that time when you posted.

Also your losses on AUDUSD show that you are a good trader, your profits exceed the "bad" trades, congrats and thank you for posting.

P.S. USDJPY showed good strength

In our Analysis before the week began, we said we wanted to look for long Opportunities in AU as it looked promising.

When those opportunities presented themselves - those who were ready pounced on it.

Now - we have cleared stops to the upside as expected.

Good Day Traders -

Hope you all have been able to take the profitable signals that I have been sharing week after week.

Just wanted to give you an update as to where we are with SentiFX and where we are headed.

Today I released a SentiFX Beginner course to get new members up to speed quickly on Sentiment Trading and Market Structure Trading. We combine both types of trading to extract profit from the market week after week. EURUSD was a great example how Sentiment was a LEADING INDICATOR before Market Structure change and to date has been over a +200 PIP run.

The SentiFX Beginner course is designed to give all the basic ideas that you need to begin making money immediately trading Sentiment + Market Structure.

This course (and all future courses) will be free to active members who are early adopters. Once the next course is complete we will have to charge for the courses as the knowledge contained within alone is worth many...many.... times more than the small cost of membership. Again early adopters will always get current and future content at no additional cost. Early adoption ends when the next course is complete.

See attached curriculum in case you're interested in learning more. When you're ready - you can subscribe here: https://sentifx.com/subscribe/

Also - @sentibob will be adding Alerts at some point today to the Sentiment Analysis Tool. You'll get email notifications when signals occur! This is really powerful as you don't have to sit around and wait for signals to occur and you'll get the email update when they have occurred - giving you time to check the charts - look at Market Structure - define your entries and exits and then let the trade take shape.

Next- our focus will then be on adding deeper analysis to the Sentiment Analysis Tool. We are going to add Price Change vs Sentiment Change for the pairs you choose. This will allow day traders the ability to see patterns and make additional connections to maximize their profit potential.

There are so many ideas on our dream board that we are excited to make a reality as we believe it will give our traders even MORE profit.

And Last - the next set of Educational Material that I will be developing will be a Deep Dive on Market Structure. We will get in the weeds of all the mechanics that make up Market Structure - the Behavioral Patterns - Market Symmetry - Exhaustion Areas - Ranges and Expansions - Order Flow - Trapped Traders - Market Making like a Market Manipulator - Contrarian Trading MS like a Pro - Trend Trading MS like a Pro - etc. Members will have access to this content as it is developed as we believe in a fluid development environment.

As far as Trading for the week - I am looking towards the USD strengthening by Monday/Tuesday. Will have to keep an eye on it and the Sentiment with USD crosses and re-assess as it returns to structure. Order Flow for USD is a SELL - but stops have been cleared and maybe a few more first - then I expect a bounce in the short term to structure.

If I see a Sentiment Signal for a pair where USD gives a BUY signal - I'm in.

UJ Short Term = Downward Bias, Longer Term = Upward Bias.

Trade it like an MM.

UJ expectations.

You can play both sides of the fence... watch you dont get burned.

The bias is UP

If you are subscribed to the SentiFX Newsletter - be on the lookout for an email within the next day or two.

I'm going to send out a link to a blog post that covers a different type of sentiment - overall currency sell off.

It's happening now and we can position ourselves to make a LOT of MONEY. Although there can never be any guarantees in trading - there are some strong signs that this reading is correct.

Are you ready to make some money? Be sure to look for the email and be ready to act on the opportunity.

I thought I had a great recording ready and only the audio came thru for some reason. This was completely unexpected.

I dont think I'll have time to put together something meaningful now as the moves may happen before I get time to re record and put together a post.

There is HUGE value in Community as the community picks up on things differently or notices things we may not be paying attention to. Both @lordgbengs and @daveh noticed MS breaking out in pairs vs USD.

This coincided with I saw in pairs that I was focused on... so I then looked at ALL USD pairs and then DXY. Sure enough, the dollar was getting clobbered and structure breaking everywhere.

There is an intelligent way to trade the macro short term play - like a quant.

Here is the general idea:

There are various forms of Sentiment Trading and even though we have been focused on hunting retail... there is also Currency Sentiment (as well as Social Media Sentiment, Fundamental Sentiment etc)

USD is selling off. This is currency Sentiment as the overall current mood for the currency is a sell. However longer term the pair is in an uptrend.

What do we do?

I tell traders that we have to be cognizant of the orderflow that we are trading. If USD sells off to the bottom of the channel, then we are not interested at all until a clearer picture is painted. However, If price pulls back then we want to short at structure targeting high probability targets and the Bottom of the channel area for DXY.

To trade this like a quant, we use cross sectional momentum. We look at the strongest currencies and trade them against the weakest, expecting momentum to continue at least in the short term.

@sentibob created strength and weakness indicators using currency indexes and math that is beyond my understanding... but basically it measures relative currency strength against all other currencies and then ranks them as a relative basket. Basically we get true currency strength readings.

So the top two strongest pairs right now are GBP and EUR.

When its time to strike, we will go long these pairs VS USD... aiming at taking a chunk out of the sell side order flow using the best performers vs the clear under performer - USD.

Short term daily OF is on our side - sell side. Longer term we need to be ready to enter at wholesale and sell to retail at high end retail pricing.