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4 Hour Strategy (MACD)

  • #6,901
  • Sep 14, 2007 9:17am Sep 14, 2007 9:17am
I agree with ashes maybe next week after FOMC meeting market will give us more clear signals.
This week I only tested 5 min intraday in Yen pairs and watched USD/CAD movement as reaction of petroleum price.
It was a week to learn.
Have nice pips everyone
  • #6,902
  • Sep 14, 2007 9:23am Sep 14, 2007 9:23am
Phillip

Hi I have read all your lessons. I noticed during the wrap up you mentioned that you were in the eur/dollar since Monday. My question is this.
It did not bounce off the 21 ema for an entry as your lessons talk about. It appears to have bounced off the 8ema. Are there times you will take the 8 ema bounce? And how do you determine when to do that? Thanks
  • #6,903
  • Sep 14, 2007 9:52am Sep 14, 2007 9:52am
Quoting JimTatum
Phillip

Hi I have read all your lessons. I noticed during the wrap up you mentioned that you were in the eur/dollar since Monday. My question is this.
It did not bounce off the 21 ema for an entry as your lessons talk about. It appears to have bounced off the 8ema. Are there times you will take the 8 ema bounce? And how do you determine when to do that? Thanks

Hi
I am glad you spotted it. I entered on market rhythm alone. Friday saw a huge up candle with Monday opening with small candles indicating trend continue. News was also bad for Eur lately so I expected a further up move. Risk was very little as candles was small so I took the odds on. MACD has not given signal but on rhythm I entered. Hope this answered you.
Phillip
  • #6,904
  • Sep 14, 2007 10:55am Sep 14, 2007 10:55am
Hello,
In the last daily wrap up (Sep 13) Phillip says:

At this stage I am still in the trade since 1.3780, Monday morning, I am looking for a close in the region of 21 EMA 1.3840. But if there is any SIGN that this thing is going to weaken I will bring up my stop loss somewhere around 1.3840

Does anybody know what is the "Sign of weakening" in this case?

Regards
Mike
Failure, is a wonderful teacher!
  • #6,905
  • Sep 14, 2007 11:48am Sep 14, 2007 11:48am
Quoting mike1349
Hello,
In the last daily wrap up (Sep 13) Phillip says:

At this stage I am still in the trade since 1.3780, Monday morning, I am looking for a close in the region of 21 EMA 1.3840. But if there is any SIGN that this thing is going to weaken I will bring up my stop loss somewhere around 1.3840

Does anybody know what is the "Sign of weakening" in this case?

Regards
Mike
Hi Mike,

In my opinion, we are seeing the signs...First sign...price closing below 8 EMA (the trend has been hugging)...second sign and more important (price below 21). We also had a retest of the .3892 area w/failure. MACD is also crossing 0 line. Third sign..more bearish candles appearing on chart..Fourth sign deals w/support... Haven't drawn any support lines (I lost my chart last week and haven't redrawn lines), so I'm not sure if uptrend line has been broken, but it looks like it might be (but support is still being provided by .3850 previous high, this is still bullish). (think traders may be unloading a bit b/c of US interest rate decision on 18th). What is a head scratcher though...why didn't it fall further already? Look how fast Cable fell? Makes me say hmmmm.....

Hope this was helpful,
Pips
  • #6,906
  • Sep 14, 2007 12:15pm Sep 14, 2007 12:15pm
Hi gustavo868!

You have made a great observation re: market rhythm! The rhythm follows on all time scales, but the shorter time frame you use, the riskier the trade! Why? Because it is very easy to confuse what you are doing, and start trading the shorter timeframe while thinking you are following the 4 hour chart. I've seen it frequently w/the 1 hour method...actually trading the 1 hour signal instead of the 4 hour while thinking the trade is a 4 hour one. Then you end up whipsawed and confused as to what happened and what to do.

But, I do agree if you have a plan and you are looking for a tight entry, using a shorter tf chart in conjunction & in harmony w/the longer tf can be profitable -- especially if the pair is trending nicely. Just make sure you understand and can trade the system well before adding on additional elements. Use smaller tf as an enhancement to what you have planned rather than trading what you see on it only when you are looking for a better entry price & tighter stop (this also takes more discipline not to overtrade).

Good work on your efforts to read the entire thread! There is a lot of incredible information on these 1000's of pages!

Wishing you all the best in your trading!
Pips

Quoting gustavo868
Hi everybody.

Im new here and im starting to read and listen to all those mp3 and pdf's,digest all the rules and starting to read the whole thread which i found more than interesting, especially how the rules get developed. You can write a book out of it!!. By the way thanks to everybody that made posible this thread. Unfortunely i m still at page 45, and plenty of dubts and questions. I asume that you use the system with the most data that you can get, i mean, not in a mechanical way.

Ok here is one thing about the 1 h chart supporting 4h chart.
Lets take the E-U that by now its in rythm 8 ema. To get a 1 h confirmation signal, we will wait for the pair to bounce out of the 21 ema ( at the 1 hour chart). But at the same time if we go to the 15 minute chart and you change the 89 sma to 89 ema we will get the same crosses.
The same example we can apply it to the cable wich is, or it was on a 21 ema rythm, we can get the equivalent + or - at the 200 ema . I see by this example that the technique seem to me reliable, i would like to confirm with you. Assuming that it would never work for the big support-resistance areas where the emotions are big, and you will get fake motion signals.

I belive that they re many shortcuts like this,, that helps to get a better R:R, just guessing.

gus
  • #6,907
  • Sep 14, 2007 1:12pm Sep 14, 2007 1:12pm
Quoting ashes
Hi,

except for Monday, which was a was a loser trade, I did not trade at all this
week. I was watching the eur/usd charts but I have been unable to determine the
uptrend to go long with it.
Actually eur/usd seems to be testing the resistance around 1.3880.
I'm cuious about the next week and I hope for some good opportunities.

A good weekend to all of you

Greetings
Hi ashes,i have had many frustrating weeks like you describe(and still do) and i think this week was hard because of the credit thing and all, but i took a few trades bouncing off the 8ema, not in the rules so much but using rhythem that Phillip so excellently taught us. Im definetely not the expert and i dont know which way it will go now, its now above the 21 , right at the 8ema and still bullish(16:00 candle). Lets see where it closes today, Best to you
  • #6,908
  • Sep 14, 2007 3:05pm Sep 14, 2007 3:05pm
This is from an mp3 by Phillip, dated 3March2007, page 114, post 1705.
Attached File(s)
File Type: doc Phillip Nel- Summary- 3Mar2007- Post 1705.doc   8 KB | 638 downloads
File Type: pdf Summary 3March2007 Page 114 Post 1705.pdf   34 KB | 724 downloads
  • #6,909
  • Sep 15, 2007 6:48am Sep 15, 2007 6:48am
still a newbaby. though i have been following this tread since february. Thanks to Philip and all the contributors to this great forum. I Must confess that there is no way one can be a good trader without the knowledge of MARKET RHYTHMS. I started a live trade the second week i saw this strategy cos it look great and promising without the knowledge of market rhythms then. I burned my account twice before I gave up and started following the tread and learn from great people of this community.

I had position myself for breakout in two direction.
I used pending order to take a short position from the top trendline @ 1.3925 and tight my stop loss. i also used a pending order to take a long position at the bottow trend which is about the previous high @ 1.3851 which had also trigger and gave me an entry point of 1.3853 with stop loss @ 1.3840. i still have the two position open. I want to see how i can manage these.
Attached Image (click to enlarge)
Click to Enlarge Name: eurusd.gif Size: 28 KB
THE DIFFERENCE BETWEEN GOOD AND EXCELLENT IS ATTENTION TO DETAILS.
  • #6,910
  • Sep 15, 2007 12:33pm Sep 15, 2007 12:33pm
Hey people...BAMA doesn't kick off until later this afternoon so I have a little time here. I noticed something on the website on the Market Rhythm page. On the chart examples there should be a light blue highlighted part of the chart that shows the rhythm strength. Can everyone see that when you go to the site? The reason I am asking is because on one of my laptops the blue highlight shows and on the other laptop it doesn't. It may have something to do with the actual color but I'm not sure why this is happening. It's important to actually 'see' the strength.

Looking back at the past week, the EURUSD was really strong and had a few good Tc entries. The USDJPY formed a Rb from the get go and had about a 200pip run. Hope everyone took some out of these two. Curious as to how Monday is going to play out with Bernanke speaking on Tuesday. Could he go .50 points lower or the .25 as expected???

Pips: Not sure why your post didn't post on the blog...It's a free forum deal so you basically get what you pay for if you know what I mean. I'm in touch with someone else about setting up the blog on a more reliable server so this may streamline things even more.

Still have a lot to do on the site. Still working on the chart examples entries/exits/standing aside...

Let me know if some of you can't see the highlighted part of the charts here http://www.fxtradeblog.com/rhythm.html
  • #6,911
  • Sep 15, 2007 12:36pm Sep 15, 2007 12:36pm
ejiexe:

Be sure to keep tabs on the interest rate statement on Tuesday. If there is surprise and you have a position open on both sides make sure you have stop loss on both sides because the gains on one side will negate the other side of profit. Also, look for the spread to be huge, 20 pips or so...
  • #6,912
  • Sep 15, 2007 3:47pm Sep 15, 2007 3:47pm
Hi
My laptop has dropped me so I had to buy a new one. Still configuring and setting it up. That is why I was so scares on FF this week. Thanks for the patience.
Phillip
  • #6,913
  • Sep 15, 2007 4:02pm Sep 15, 2007 4:02pm
Hey Phillip. Glad your back and all is well. Looking forward to your posts as usual...
  • #6,914
  • Sep 15, 2007 4:14pm Sep 15, 2007 4:14pm
Quoting Palmer
Hey Phillip. Glad your back and all is well. Looking forward to your posts as usual...
Thanks. Did not post on Tradeblog due to laptop failures. Will start this week the moment everything is setup. Stlll have to do my E-mail and sound software then I will be mobile again.
Hope you had a good week.
Phillip
  • #6,915
  • Sep 16, 2007 2:55am Sep 16, 2007 2:55am
Quoting Palmer
Hey people...BAMA doesn't kick off until later this afternoon so I have a little time here. I noticed something on the website on the Market Rhythm page. On the chart examples there should be a light blue highlighted part of the chart that shows the rhythm strength. Can everyone see that when you go to the site?
Hi, Palmer welcome back, we missed you and especially your U/J analysis !
I can see the blue part.

Best regards, Ira.
  • #6,916
  • Sep 16, 2007 3:21am Sep 16, 2007 3:21am
Quoting OldDog
This is from an mp3 by Phillip, dated 3March2007, page 114, post 1705.
OldDog, thanks for posting this!!! Amazing how the same info perceives differently after some time has passed. I understand why you posted it, it's very close to the situation we have now.
We had an up move to the 89MA, then a period of consolidation and a very strong up trend with touching only 8MA, +2 in Palmer's scale. And now the price for the first time has touched 21MA and then bounced of it. We are still in a strong up trend and I like the way it has tested strong resistance wich now has become a support 1.3850. I probably would have taken BOZ long with the trend, but with the big news on Tuesday, I think on Monday the price will be in consolidation waiting for news. Maybe it will go to the PL
1. 3900 to test it again, it can go further from it or bounce of it, and then we will have either TC or a kind of RB. But again with the big news coming, my strategy will be to wait for the market to show me what to do. If the price will be able to make new higher high than we will have up trend renewal, if it's gonna make lower high, then the trend is running out of steam - I've got the lesson!
Attached Image (click to enlarge)
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  • #6,917
  • Sep 16, 2007 3:52am Sep 16, 2007 3:52am
There is something else I would like to share. Thanks to the Pips and OldDog for inspiring me to review the rules. I have made a list of so called "allowed trades" or high probability trades as Phillip calles them. There is nothing new, it's just like a note for myself. Of course any comments are most welcome. So here it goes:
1. Market Rhythm - will show you what market is likely to do. Define is it a trend (it's direction) or range.

a) Up trend - only longs from 8 or 21 MA (may use 1H for early entry)
b) Down trend - only shorts from 8 or 21MA (may use 1H for early entry)
c) Counter trend trades - if the price couldn't go higher/lower than the previous top/bottom and already tested 21 MA, you may take a trade to the 21MA (IT/IB)
d) Price went through the 89MA you may take a trade to the 21MA
e) Candle closed above/below 21, tested it again, you may take to the 89MA
f) In range take trades only from channel lines

2. All trades must be confirmed with MACD signal (closed signal candle)

3. Consider candles - emotions of the people

4. Consider support/resistance, etc (all that was taught on the thread)

For the newcomers I would like to say that it's not a set of rules. it's just a note for high probability trades, if you want to understand it - work through the thread.

Phillip thank you again for putting so much time and work in teaching us!!!
  • #6,918
  • Sep 16, 2007 5:36am Sep 16, 2007 5:36am
Quoting ira
There is something else I would like to share. Thanks to the Pips and OldDog for inspiring me to review the rules. I have made a list of so called "allowed trades" or high probability trades as Phillip calles them. There is nothing new, it's just like a note for myself. Of course any comments are most welcome. So here it goes:
1. Market Rhythm - will show you what market is likely to do. Define is it a trend (it's direction) or range.

a) Up trend - only longs from 8 or 21 MA (may use 1H for early entry)
b) Down trend - only shorts from 8 or 21MA (may use 1H for early entry)
c) Counter trend trades - if the price couldn't go higher/lower than the previous top/bottom and already tested 21 MA, you may take a trade to the 21MA (IT/IB)
d) Price went through the 89MA you may take a trade to the 21MA
e) Candle closed above/below 21, tested it again, you may take to the 89MA
f) In range take trades only from channel lines

2. All trades must be confirmed with MACD signal (closed signal candle)

3. Consider candles - emotions of the people

4. Consider support/resistance, etc (all that was taught on the thread)

For the newcomers I would like to say that it's not a set of rules. it's just a note for high probability trades, if you want to understand it - work through the thread.

Phillip thank you again for putting so much time and work in teaching us!!!


Thanks Ira
This is the important rules of the system. If you stick to that on only 2-3 pairs you will be successfull. If the trade does not look right in terms of candles etc!!! don't take the trade. 6-8 Trades per currency per month should bring in +100 pips per currency mininmum.
  • #6,919
  • Sep 16, 2007 3:31pm Sep 16, 2007 3:31pm
EurUsd

Hi. Weekly is in a rising wedge. Top resistance tested. http://imagebin.org/10448
[08:02:19 PM] Phillip Nel says: EurUsd
[08:03:18 PM] Phillip Nel says: When it moves off 21 upwards just remember resistance of that wedge
[08:03:44 PM] Nadia says: yes rising wedge is an indicator of reversal?
[08:03:48 PM] Phillip Nel says: There is about 35-40 pips to that res
[08:03:51 PM] viu says: could it be a sign of reversal in a long run ... downwards in this case ?
[08:05:34 PM] Phillip Nel says: If it found resistance against that line I will position myself for a reversal. It might not go there all the way. Watch out for an Inside Top +- 1.3895 and double top in price as well.

GbpUsd

cable has gone thru all major MA so now a retracement is pretty much bound to happen
[08:10:55 PM] Phillip Nel says: Yes. i was amazed to see it go all that way
[08:11:34 PM] Phillip Nel says: It is sitting at 38% retracement of recent upmove
[08:11:41 PM] Phillip Nel says: Just below 38%
[08:14:23 PM] Nadia says: i have a trend line, a support line and 50% fid at 2.0009
[08:20:57 PM] Phillip Nel says: Just have alook at this weekly of the GbpUsd http://imagebin.org/10449
[08:25:50 PM] Nadia says: it has broken thru a trend line
[08:27:04 PM] Phillip Nel says: The wedge has been broken down. But watch that intermediate line that becomes support and resistance changing a few times. price might found some supprt there if it goes lower
[08:27:39 PM] Nadia says: in the big picture the bottom of cannel is at 1.9780
[08:29:49 PM] Phillip Nel says: i will watch 1.9800 closely for some sort of support
[08:30:00 PM] Phillip Nel says: If it goes down there
[08:30:29 PM] Phillip Nel says: We might see a pullback to the 200 as it broke it on Friday
[08:30:45 PM] Phillip Nel says: Then maybe a down move too TL
[08:31:17 PM] Phillip Nel says: 365 is also with 200
[08:32:08 PM] Nadia says: dont u think the pull back to 200 can happen before price moves to 1.9800
[08:32:27 PM] Nadia says: or is that what u mean in the first place, sorry i am a litle confuse
[08:32:44 PM] Phillip Nel says: Yes that is what I ment. Pullback to 200 and then TC down to TL
[08:33:10 PM] Nadia says: ok thankyou, that is what i was thinking too since a round bottom on macd might be seen too
[08:33:47 PM] Nadia says: and that supports market motion as well, i just hope price does not get stuck in a chammel .
[08:34:09 PM] Nadia says: channel it can go up or down as long as it is in rythem
[08:34:23 PM] Nadia says: pull back to 8/21 move away and so on
[08:35:59 PM] Phillip Nel says: Look at the 4H intermediate line that I have. http://imagebin.org/10451
[08:37:11 PM] Nadia says: yes a retrace at this point make sense
[08:38:53 PM] Phillip Nel says: I wont trade this retrace. For me it will be only a possible confirmation of a move away from the 200 with TC to go short as part of the market rhythm rules
  • #6,920
  • Sep 16, 2007 3:47pm Sep 16, 2007 3:47pm
As Imagebin stores images only for a limited time, here they are.
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File Type: pdf Week Ahead.pdf   92 KB | 957 downloads
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