The System (Irony included)

I got a couple of pm's ..thanks for the compliments

I'll try to help the best I can. I just gave you a sneak-peak there's a lot more

I'll stick around as long as my health permits

The idea is for you guys to start looking at the market as it is...a big-ass auction where price is the only consideration invloved.

again thanks for the compliments

see you guys tomorrow

Hope you elaborate the above when you're more ready. Thank alot

ferfuxake, next you'll be telling them all about "Stop-Buys" & "Stop-Sells" and giving away the best kept secret, the "edge"

Doesn't matter I suppose, 'cos no matter how hard i try to convince people to give up a few pips by not trying to trade the exact reversal, all they can ever see is the pips they have "lost" by buying "too high" or selling "too low".

you can show them any number of stats showing the probablity (and actual results) of trend continuation using Stop-Buys/Sells versus getting stopped out on an unconfirmed reversal, but it seems like double-dutch to most people.

keep up the good work, best thread on the forum !

Great thread and simple to comprehend. This is the way to instruct - nice and easy - no rush. Thanks much.

I haven't forgot about you guys on the options stop-loss strategy

Please stick around. I don't want to confuse a lot of people jumping in and out

I promise I will get into that very soon.

Please notice that on the reversal candle on the last chart I posted. , there's a V shape formation going on I should say most of the time ( a side note: there's not a sure -fire thing in any market ok?)

could that be a change of sentiment??? maybe...

you job is to enter as soon as you see that V formation....and place your stops and trail them accordingly

Don't be a fool and get on board thinking that a correction has ended. Risky business in my opinion. Make sure the trend has resumed. Remember...always look for that V pattern

A word on lower time frames

4 hour charts are some sort of a " looking for a sale(bargain)" window

let me explain

let's say the higher high the day before was broken. Most likely ( you will never hear me say "always" or "definitely") the market is looking to resume the trend. Let's say the high was taken @ 1.4450..well I will get down on 4 hour charts looking for 1.4430 or better to go long...

Do you have to look for that discount all the time??? no

Just that for me (very subjective) I like to buy stuff on sale (or sell stuff for profit)...don't you??

Markets in a pure definition are nothing more than a big auction. Think about it

Consideration involved = price

Consideration = something of value

Most of the time, traders believe that price is cheap/expensive....Although I personally disagree with that concept, unfortunately we need to follow the crowd.

be right back (I wish I could live in a world with no phones....don't they sometimes bug???) LOL

I have read this with interest. I like the style, and as a member of James16 PF, I am familiar with your basic theory so far. (You two have similar thoughts.)

The one thing I would point out to these guys is that you are advocating taking very few trades. This goes against human nature. (This is what I believe you mean by saying trading is supposed to be boring.)

It is very hard for the new guy, or any of us for that matter, to take a trade on a pair every 25 days for example. (Although I firmly believe this is the road to riches.)

I think too many of us get into this with the thought of riches, because only 20 pips can mean $200. This is using too much leverage for most of us here, as we are still learning, and even fewer of us have $200,000 accounts.

Besides, it's much easier to risk say.....25 cents a pip, at 200 pip-stop loss, as opposed to $10 a pip at 20 s/l. (Assuming you have the amateur sized account.) Damn greed, will make you learn the hard way.

From a psychological point of view, this way is a little harder, because you might be down 40 pips, up 80, then b/e, and FINALLY - it takes off. I still see this as the way, and support what you are doing.

I'm just playing devil's advocate.

However, I really like your teaching so far. And I hate moving averages, so you already get my vote!

You have a new fervent reader.

Clockwork

Feb

Looking forward to your next posts. As said, I also like your style. Do you only trade EURUSD? I must say that I am not totally against moving averages, but I'm against how most people trade with them. Trading crossovers etc is not for me (might work for some people), but using 2 or 3 widely used moving averages (50, 100, 200) as support and resistance points (the same way you use trend lines) definitely works for me. It is like using Fibo, a lot of people use them so they sort of become self fulfilling. Anyway, just my two cents. Looking forward to the rest.

Thank you clockwork for your comments. I agree with you completely. I am like that movie very much and I am a huge fan of Pink Floyd (Atom heart mother theme at the opening is awesome)

The psychological standpoint is very important and it's one of the reasons I started this thread. I don't bash people using indicators and everything but they tend to build a whole religion out of indicators. Another reason I started this thread is to shake up this "new religion" build around this Cornelius system, which is nothing else but wash-out indicators used for years and years.

It's easy to say " buy when the light is green and sell when the light is red" and...you could get profitable, of course you do. But...

Then it happens that one day the market reach 1.30 or 1.40 or (dow) 12,000 etc and all of the sudden...the control panel doesn't work.....

Then you got frustrated....and you go with something like "this system is useless"...or , let me add x and x to make it more "efficient"

So, they spend their whole lives looking for a system that "works most often than not"""

If you can get an edge on the Big mac or RSI well more power to you.

But I learned thru the years that price is king. At the end, nothing else matters.

If anyone need a moving average to tell where the trend is.....I smell trouble

Take the market for what it is...a big auction Don't following a "system" to the core placing all your hopes like a Jim Jone's cult. All markets are nasty. The market won't care if you have a good system or not. It's a beast waiting to take you hard earned dollars.

Be smart. Buy on strength. Sell on weakness...after you confirmed the direction of the trend as I stated before. That way you will minimize the chances of getting burned on a correction.

Support and resistance - correction and continuation - will never go out of style as long as there's supply and demand.

Farimir

I like EUR-USD better than the others because is more gentle volatility speaking(most of the time) not as spiky as cable. I don't trade very often, unless I see a good offer. But that's me, my personal and unique biased opinion. I trade currency futures and some others like ag's , mini's etc

Actually as today 11-05-2007 I see a small pulback on the EUR-USD on the daily chart. Keep your heads on.

cheers

Clockwork

About timeframes, I started this thread because I trade off daily charts. O f course you can correlate any time frame you like. Just make sure "noise" won't give you false signals. I personally think anything less that 4 hours is noise, especially in forex. It's something you need to see for yourself.

I don't like to tell people "this doesn't work" I like for the to experience by themselves. Hopefully not in a live account.

Yes trading should be boring. Well, some traders have the necessity to pull the trigger all the time, because subconsciously they MUST be at the market constantly in order to make a living. They end up chasing the market and forgetting about their strategy.That's a recipe for disaster.

If you want to be in profitland, you need to be the predator.....like a cat moving the tail in front of a mouse. Wait for the right moment to jump in. It is sometimes boring to be the predator...very boring...but it works...just try it.

Here's a classic - futures - S&P 500 (E-MINI'S)

I place very strategically resting order with a small limit 2-4 ticks above below pivot points...why??? because the market reacts most of the time when it get to the pivots. There's plenty of stop orders to be hit and ...somebody has to be at the other side don't you think??? and even better, poor souls buying on breakouts...oh boy it becomes a carnage on the pits...

I call this a bread and butter strategy.....not to be confused with any other

That's a truly example of be a predator.

Thanks for sharing feb. this is truly incitefull!

I look forward to more.

EUS-USD is having an impasse between 1.4404 and 1.4522 -1.4527 area

keeps you heads up. Look for the upside

I haven't check the calendar to see if there's any news from the aussie tonight. But if does it might move the dollar.

Hey FEB,
thanks for all this info. The more I learn about Forex, the more I trade, the more I believe that pure PA is the way to go. It makes a lot of sense. At least to me, a self-made skeptic. So your thread is fesh air among the smog of indicators that tend to contaminate so many trading charts.

I am looking forward to your future posts - if your phone allows you to continue writing!!!

Thanks mate .

This method is a classic and still one of the best way to trade stocks, but in my opinion if you want to get more pips you'll need to get into the trenches and trade inside the consolidation zones; this is where the extra cash comes in. I mean, what do you do when there's a 6 weeks stalling period? I don't think I can afford to sit around that long. Just my 2 cents.

scalpt

Er... well, I'm VERY happy to start looking, but at what? Do I have to be a mathmatician to know what you're referring to...?

C'mon, a clue :-)

yeh you have to give some idea surely

I completely disagree. Getting into the trenches will get you killed more often than not. No offense buddy but you should read carefully the whole thread before posting.

I also remember something about Feb stating a preference on bigger time frames. I assume is just a personal preference.

This method is not just about waiting. The key element here is a confirmation of a fractal. Doesn't matter what market you're trading, it always work.

I've been watching this thread and I am implementing this strategy on 1 hour charts and the results are definitely impressive!!

Great thread Feb!!!!!

Hi People

As mentioned previously, I also like this thread as it brings something new (actually it is old) to the table. It seems easy enough, but I think the interpretation is the key to all of this. I'm not a newbie, but I also am unsure if I'm missing something. I would really like to see more people posting some charts, not only Feb (if he is ok with this), especially the people that think they have the concept. We can all learn from this and discuss a chart further. It doesn't have to be only the EURUSD as I'm sure this will work on anything. A picture is worth a thousand words.

Ok, I will go first. I hope a attach the chart correctly. This is a daily chart of EURCHF. The last bar is still forming. If I understand the thread correctly, I have to wait for a turn up of the correction currently happening. We might end up with a hammer candle at the end of today coming from the 38.2% fib level and previous support. If we get an up day taking out the high of this last candle we can look for entry on the 4 Hour chart. Am I on track or am I missing the point?

If you're using the 1 hr chart, to me, you are trading in the trench. This is the zone where I made most of my pips, and where most traders stay away from. I don't want to be in the way of this thread but if anyone seriously want to implement this method I'd suggest also to learn the chart using entry and exit from Dan Zanger at: http://www.chartpattern.com/cf/index.cfm

Good trading to all,

scalpt