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Trading the Cable swings via averages

  • #8,041
  • Jul 7, 2022 6:54am Jul 7, 2022 6:54am
Thanks Mr. Alan,

1h Price still above ema, i saw it retraces 50% of D, now look at 5m, another ABC, i have plan like this, let's practice
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  • #8,042
  • Jul 7, 2022 7:48am Jul 7, 2022 7:48am
Dear Master, I am reading to post 2680, but I don't understand exactly where your entry.

If you have bearish divergence as picture, you short at (1) or you short at (2) ?

Thank you very much!
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  • #8,043
  • Jul 7, 2022 10:02am Jul 7, 2022 10:02am
Quoting ThanksDana
Dear Master, I am reading to post 2680, but I don't understand exactly where your entry. If you have bearish divergence as picture, you short at (1) or you short at (2) ? Thank you very much! {image}
Hi mate, if you don't mind so i would share my view for your question.

In the text book of Mr Alan, first we take inference in H1 then go deeper in lower time frame to take the entry.

- So if H1 ok as text book, then M5 show as picture --> short at (1) or (2) is ok, entry is the "acceptable range". Of course (1) is better than (2).
- If your inference is M5 (as picture), you go to M1 for finding the entry.

ps. today with second practice above, the market kicked me out 2 times with stop loss (5usd and 7 usd) but finally i took back 40 pip due to keep that plan as text book! Thanks Mr. Alan
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  • #8,044
  • Jul 7, 2022 8:57pm Jul 7, 2022 8:57pm
Quoting Nala66
{quote} I sure can clarify it. You have completely missed the ABCD which I have added to your chart for you. These are very important swings of measurable sentiment where the competing bulls and bears are both winning between A and B. The bulls made it to the 50% level of the D target but were in divergence and this stopped them dead. The bears were then able to overcome and and make the target D1. So for this type of trade your entry is the 50% level divergence with your stop at the 100% i.e. D. Your target is D1 and this is 3 x times the risk....
Hi Alan. can you share your indicator are using on MT4? (ex: daily pivot, swing line...), thank you so much!
  • #8,045
  • Jul 7, 2022 9:42pm Jul 7, 2022 9:42pm
Quoting sinhpham1219
{quote} Hi mate, if you don't mind so i would share my view for your question. In the text book of Mr Alan, first we take inference in H1 then go deeper in lower time frame to take the entry. - So if H1 ok as text book, then M5 show as picture --> short at (1) or (2) is ok, entry is the "acceptable range". Of course (1) is better than (2). - If your inference is M5 (as picture), you go to M1 for finding the entry. ps. today with second practice above, the market kicked me out 2 times with stop loss (5usd and 7 usd) but finally i took back 40 pip...
It is H1 I see a Zoo point, so I am finding an entry on M5 to short
- If I short at (1), it is open of the bar, but at that time market don't create bearish div clearly. So is this the risk of this entry that we must accept ?
- If I short at (2), it is close of the bar, at that time market created bearish div clearly.

- Or we short when market is runing down and we see a bearish div (3)

So you think (1), (2), (3) , all of them is OK. Thank you very much for your reply.
  • #8,046
  • Edited 10:43pm Jul 7, 2022 10:32pm | Edited 10:43pm
Quoting ThanksDana
{quote} It is H1 I see a Zoo point, so I am finding an entry on M5 to short - If I short at (1), it is open of the bar, but at that time market don't create bearish div clearly. So is this the risk of this entry that we must accept ? - If I short at (2), it is close of the bar, at that time market created bearish div clearly. - Or we short when market is running down and we see a bearish div (3) So you think (1), (2), (3) , all of them is OK. Thank you very much for your reply.
Morning, this is my point of view:

- If I short at (1), it is open of the bar, but at that time market don't create bearish div clearly. So is this the risk of this entry that we must accept ---> i always wait until bar close, when bar closed and this confirmed that bear div at entry time frame i will start at that point and set the stop loss at BE + Spread!
- If I short at (2), it is close of the bar, at that time market created bearish div clearly.--> yes, more safety

- Or we short when market is running down and we see a bearish div (3) --> yes, normally at support point, not too far.
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  • #8,047
  • Jul 7, 2022 10:37pm Jul 7, 2022 10:37pm
Today 4h i found Bi-Triangle, A and C now regular div. here is the plan. How is your plan today?
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  • #8,048
  • Jul 7, 2022 11:41pm Jul 7, 2022 11:41pm
Every time we take a trade we must consider what type of trade we are dealing with because we have to take the actions accordingly. Unfortunately I have covered so many types it has probably become confusing to many.

So let me break it down to the various types as they come up in the future.

Today I will deal with the ABCD because it is current.
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Here we have the 1 hour chart with an insert of the 5 min.

We can see we have an ABCD on the hour and need to determine which way to trade it. Kind of a 50 : 50 guess at this point.

We see price on the hour drop to the EMA and we regard this as a ZOO point where we expect something to happen. Checking the 5 min we see we are in a bull div and if we want we could also check the 1 min and do a two bar test on it for a more precise entry.

BUT finding this entry is not at all the end of it only the start. We have to consider the money we are trading. We have to ask what are we willing to risk for example $10. This trade is a 1:2 risk reward so we are hoping to make $20. So get out the calculator and work it out. The stop or risk is the 50% of D1 which I have marked on the chart. D1 is the opposite lower target of D.

We can see the risk is about 25 pips or so, we need to convert these pips to dollars to come out at $10 which is our max risk. The risk is the important factor not the profit. We always want a risk that doesn't affect us very mush at all.

We can see 3 hours later we got paid but look what happened if we held out for more, it took about 8 more hours to get back to the same level. This would happen if we don't stick to the plan we have developed.

We must have faith in our plan otherwise we are wasting our time as traders. Sure we can move our stop to BE so we have nothing to worry about other than the loss of a profit. I think people are really intimidated by loosing profits when it is loss of capital that should be paramount.

How many times have I said never add to losing trades, make the trade and accept the outcome. If you don't do this you get caught up in whirlwind of mental challenges and you don't need these at all. Better to make the trade and just walk away, come back and see if it panned out. Your account will show you either lost $10 or made $20.

If I lost the $10 I would be looking to factor this into my next trade for consideration so I would get it back plus a profit. This is why we should always risk a little so we have a good chance of recouping it.

Now you should note this type of trade is fixed, That is to say there is no multiple entries to compound the profits.

Another of these types happened a little later on the 5 min chart so we drop to the 1 min do the sums and enter there. We have to be pro active with our pencil and paper calculating what needs to be done when and why. It is a headache at times which is why it is dumb to overtrade making us suffer more than we should.

These types of trades are great, just set and forget. What could be nicer than that.
  • #8,049
  • Jul 7, 2022 11:44pm Jul 7, 2022 11:44pm
Quoting sinhpham1219
Today 4h i found Bi-Triangle, A and C now regular div. here is the plan. How is your plan today? {image}
I think H4 is continuation div, not regular div. Sorry if I am wrong
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  • #8,050
  • Jul 7, 2022 11:45pm Jul 7, 2022 11:45pm
Quoting sinhpham1219
Today 4h i found Bi-Triangle, A and C now regular div. here is the plan. How is your plan today? {image}
Be careful this is not an ABCD just a simple bear div and they only return price to the EMA!
  • #8,051
  • Jul 7, 2022 11:55pm Jul 7, 2022 11:55pm
Quoting Nala66
Every time we take a trade we must consider what type of trade we are dealing with because we have to take the actions accordingly. Unfortunately I have covered so many types it has probably become confusing to many. So let me break it down to the various types as they come up in the future. Today I will deal with the ABCD because it is current. {image} Here we have the 1 hour chart with an insert of the 5 min. We can see we have an ABCD on the hour and need to determine which way to trade it. Kind of a 50 : 50 guess at this point. We see price...
Hi Sir, long time no see. Are you still working on your new money management? Is that ok to share any update of your plan?
  • #8,052
  • Jul 7, 2022 11:58pm Jul 7, 2022 11:58pm
Quoting Nala66
{quote} I sure can clarify it. You have completely missed the ABCD which I have added to your chart for you. These are very important swings of measurable sentiment where the competing bulls and bears are both winning between A and B. The bulls made it to the 50% level of the D target but were in divergence and this stopped them dead. The bears were then able to overcome and and make the target D1. So for this type of trade your entry is the 50% level divergence with your stop at the 100% i.e. D. Your target is D1 and this is 3 x times the risk....
Thank you for the explain, I'm not use ABCD and AB=CD yet as i'm try focus on those basic element on the first 50 pages.
And please help me with the question about "If EMA make fail make HH, it make LL instead". From top X, "if EMA fail, it should make LL" mean it should breakthrough red circle to be call sucessful make LL, Or it should breakthrough green circle instead to be call as finish make LL and EMA can change/keep direction any time now?
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  • #8,053
  • Jul 8, 2022 12:10am Jul 8, 2022 12:10am
Quoting ThanksDana
{quote} I think H4 is continuation div, not regular div. Sorry if I am wrong {image} {image}
opp, you are right, my fault, its not regular div. SR
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  • #8,054
  • Jul 8, 2022 12:17am Jul 8, 2022 12:17am
Quoting Nala66
{quote} Be careful this is not an ABCD just a simple bear div and they only return price to the EMA!
Thanks Mr. Alan,

Check text book again, because A and C are the same side with EMA, price still above EMA so this is just Div to send the price back to EMA. --> We should not consider it ABCD right?
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  • #8,055
  • Jul 8, 2022 2:53am Jul 8, 2022 2:53am
Are there any one got this downtrend? I don't see Zoo on H1 for this short. Maybe market open below H1 EMA is Zoo? Picture below is what I see now
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  • #8,056
  • Jul 8, 2022 4:24am Jul 8, 2022 4:24am
Quoting ThanksDana
Are there any one got this downtrend? I don't see Zoo on H1 for this short. Maybe market open below H1 EMA is Zoo? Picture below is what I see now {image}
Sorry I have been out at a birthday party.

Yep your 1 hour ABCD was well spotted and if you had your stop at the 50% D it would have been a nice trade.
  • #8,057
  • Jul 8, 2022 5:06am Jul 8, 2022 5:06am
Quoting eliotjng
{quote} Thank you for the explain, I'm not use ABCD and AB=CD yet as i'm try focus on those basic element on the first 50 pages. And please help me with the question about "If EMA make fail make HH, it make LL instead". From top X, "if EMA fail, it should make LL" mean it should breakthrough red circle to be call sucessful make LL, Or it should breakthrough green circle instead to be call as finish make LL and EMA can change/keep direction any time now? {image}
In this type of trade we are looking for failures which are usually predicted by divergence stopping the EMA.

On your chart d is not a LL nor did the EMA make a HH so it is merely ranging.

Then at the appropriate time the market took off with the EMA targeting a, so price should make the next level down which it did. Your green circle is the EMA target not the price target.

I will explain how we play these types of trades later.
  • #8,058
  • Jul 8, 2022 5:19am Jul 8, 2022 5:19am
Now notice how the bull div kicks in once the ABCD is made and this should return the price to the EMA. The 5 min insert shows the entry of the bull div.

That is about another 50 pips or so, with a 25 pip stop you still have a 1:2 risk reward.
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Trailing the stop and adding more buys makes these great trades.
  • #8,059
  • Jul 8, 2022 5:22am Jul 8, 2022 5:22am
Quoting prohaha
{quote} Hi Sir, long time no see. Are you still working on your new money management? Is that ok to share any update of your plan?
Well as I have said just making 1% per day is not difficult and adds up to a substantial sum in time.
  • #8,060
  • Jul 8, 2022 5:22am Jul 8, 2022 5:22am
That div just made it to the EMA as I expected.
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