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Indicator Free Trading - Skunny

  • #1,001
  • Jan 3, 2008 8:07am Jan 3, 2008 8:07am
Quoting dennycrane
please excuse my bad grammer, as english is my primary language.

I agree with mr ruby that fib real time placement is crucial.... a few previous chart examples shows a fib pulled where price retraces/corrects not even to an "eyeball of 23" let alone 38. then price hangs on zero line (support) i presume then blasts thru to 38 tp. Now obviously it worked out great who jumped in for ride of the breakout... Somewhere I had this misconception(??) that until retrace/correction happens, then you pull fibs from swings....then prepare for entry on 0/100 break for 38 ext tp...

of course it could be the mad cow....

"all we need is just a little patience" axel rose

denny crane
Hi Denny, welcome to FF and to the thread! Skunny is offering some guidelines and hints, but I think everyone on the thread is pretty much developing their own method of using fibs.
  • #1,002
  • Jan 3, 2008 8:17am Jan 3, 2008 8:17am
Quoting blueruby
Hi Denny, welcome to FF and to the thread! Skunny is offering some guidelines and hints, but I think everyone on the thread is pretty much developing their own method of using fibs.
exactly , he gives us the ingredients n most of us making our own cookies , im making chocolate brownie btw ...
To Live is the rarest thing in the world , Most people exist , that is all
  • #1,003
  • Jan 3, 2008 8:18am Jan 3, 2008 8:18am
Anybody watching the E/U developing right now? I see a nice long setup, waiting for a little more confirmation.

The 0 has been broken, closed above, and two more candle bodies above (I'm lookin at 1H). And that 0 is good no matter where you put your fib.

Price has pulled back to the 23 retrace on my chart. There is good support there -- 23 retrace, lotttttts of consolidation there today, and the 1H trendline is also there.

OK, I'm long, and 4 pips in the money. Going for 20 and I'm done for today.
  • #1,004
  • Jan 3, 2008 8:23am Jan 3, 2008 8:23am
Man, we got Sizzler, and now DennyCrane here on this thread, wow! I'd hang around if for no other reason than that!
  • #1,005
  • Jan 3, 2008 8:43am Jan 3, 2008 8:43am
We also have a 0 line break on the G/U. Again, it doesn't matter where you put your fib, or if you placed no fib at all, price did pierce support / 0 line.

1H candle closed below, and the next body was entirely under the line. Pullback, long wick, (1H pinbar?) and heading down....?

The fib rules say it will. My question is always, "what's it going to do between now and then?" That's why I wait.

I don't like the R:R on this trade, I'll pass. If it closes below 9850 - 9800, then we should see a good move, next support is a ways down.
  • #1,006
  • Jan 3, 2008 9:31am Jan 3, 2008 9:31am
WOW check this out everyone! Daily GBP/JPY chart. Yen cross freefall seems to have finally stopped for awhile, and look where the dragon decided to stop--dead on the 138.2%!

Does this mean a cycle has been completed? So where to begin our new cycle...?
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  • #1,007
  • Edited 10:44am Jan 3, 2008 9:36am | Edited 10:44am
Well, I'm very happy with my first few demo trades using PASR and fib targets, but I'm certainly well aware that I need more pieces to this puzzle. Skunny has given us some very good building blocks, but he's already said this is only a small fraction of what is really there.

I'm still digging for more clues to this and trying to let it all sink in, but wanted to toss out a few of my thoughts regarding cycles. There seems to me to be smaller cycles within larger cycles. This is ALL just my opinion, but I think where one cycle starts is where any two S/R points form to create it. Where it ends is when the 138 fib level for that cycle has been reached by PA. Once that happens, it would seem that particular cycle is no longer valid and the fib needs to be "walked" on up/down to the next cycle. The difficult part is that sometimes the next cycle may end at or originate from one of the expired S/R points, or the new cycle may just engulf both of the expired S/R points.

I also think that whenever we are plotting any given cycle between two S/R points, we have to be aware of the other smaller and larger cycles still in play that may affect the one we're currently focusing on. I think this is mainly why price doesn't seem to do what we expect it to within a given cycle. Just a few of my musings on all this.
  • #1,008
  • Jan 3, 2008 9:37am Jan 3, 2008 9:37am
For what its worth............
Here's my take.
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  • #1,009
  • Jan 3, 2008 10:30am Jan 3, 2008 10:30am
Quoting Pipskateer
.......................
I'm still digging for more clues to this and trying to let it all sink in, but wanted to toss out a few of my thoughts regarding cycles. If There seems to me to be smaller cycles within larger cycles. This is ALL just my opinion, but I think where one cycle starts is where any two S/R points form to create it. Where it ends is when the 138 fib level for that cycle has been reached by PA. Once that happens, it would seem that particular cycle is no longer valid and the fib needs to be "walked" on up/down to the next cycle. The difficult part is that sometimes the next cycle may end at or originate from one of the expired S/R points, or the new cycle may just engulf both of the expired S/R points.

I also think that whenever we are plotting any given cycle between two S/R points, we have to be aware of the other smaller and larger cycles still in play that may affect the one we're currently focusing on. I think this is mainly why price doesn't seem to do what we expect it to within a given cycle. Just a few of my musings on all this.
I agree, that is what makes it so difficult to get a handle on.I think that the really crucial ting is being able to determine the next (i.e. current) Fib range when the 138 or -38 is hit on the current (now old) one.
  • #1,010
  • Jan 3, 2008 11:15am Jan 3, 2008 11:15am
Quoting SA_Node
A perfect trade. thanks skunny.

do you mind posting your fib tool?
  • #1,011
  • Jan 3, 2008 11:21am Jan 3, 2008 11:21am
Does anyone have any thoughts on where is the correct place to put a stop so you "never get stopped out" when properly placed?

With the concept of buying or selling dips to the 61.8% level, including the minor violation spikes beyond that level, that doesn't seem like the "proper" place for it. So apart from using some other key S/R levels, if it's just fib related, it must be either 100% or 138% retracement. But I'm guessing.
"Support and Resistance either holds or it doesn't." -Anonymous hillbilly
  • #1,012
  • Edited 10:54pm Jan 3, 2008 11:27am | Edited 10:54pm
Quoting ianf0ster
I agree, that is what makes it so difficult to get a handle on.I think that the really crucial ting is being able to determine the next (i.e. current) Fib range when the 138 or -38 is hit on the current (now old) one.
Well, I don't think its something that is beyond us. It's just part of the learning process I think. I'm encouraged, yet still challenged by what I've seen thus far.
  • #1,013
  • Jan 3, 2008 11:56am Jan 3, 2008 11:56am
Quoting Pipskateer
Well, I don't think its something that is beyond us. It's just part of the learning process I think. I'm encouraged, yet still challenged by what I've seen thus far. I had one losing trade last night. I haven't fibbed it out yet (which I will do) to see where I failed, but I already know it was mainly because the trade was taken on a short term break to the upside on a "micro" S/R range while the GU has been currently headed more to the downside. I knew that when I placed it, but wanted to test price action for the learning value. I'm not good enough to do things as "stupid" as Skunny yet and have it turn out positive!

I have another trade still on, EU, which is currently in a small drawdown (-15) after being positive about 30 pips. I could have taken profit on it earlier this morning when I closed out the GU trade, but I want to see if that upper fib level (1.4815) is gonna get taken out.

My GJ trade had a primary target of 214.29 which was nailed, but there was also another target of 213.59 from a larger cycle. If I had used that one, I would have netted another 70 pips. I think that illustrates the "cycle within a cycle" point nicely. Very cool...

I'll post some pics of my trades from last nite:

EUR/USD: Open -15
GBP/JPY: Closed +211
EUR/JPY: Closed +102
GBP/USD: Closed -67 (will post that later after more study)
USD/CAD: Open -3 (just opened)

on your usd/cad trade i noticed that the fib was penetrated but not broken.... this is significant.... in my observations, IMO.... in this situation you may want to consider waiting for price to actually break (wait for next candle) and if it doesnt break.... then placeing a parent and contingent order or a stop sell order 1 pip below the line so when it does come back through(as you expect it will) you are there waiting for it like a genius.... helps to prevent drawdown for sure) but i use higher timeframes so... may not work as well for scalping...but anyone else see what i mean on vhands when price penetrates but doesnt break) (remember skunny told us to look for that!)_ good luck e1 keep up the good work
  • #1,014
  • Jan 3, 2008 12:51pm Jan 3, 2008 12:51pm
Quoting dagoods
on your usd/cad trade i noticed that the fib was penetrated but not broken.... this is significant.... in my observations, IMO.... in this situation you may want to consider waiting for price to actually break (wait for next candle) and if it doesnt break.... then placeing a parent and contingent order or a stop sell order 1 pip below the line so when it does come back through(as you expect it will) you are there waiting for it like a genius.... helps to prevent drawdown for sure) but i use higher timeframes so... may not work as well for scalping...but anyone else see what i mean on vhands when price penetrates but doesnt break) (remember skunny told us to look for that!)_ good luck e1 keep up the good work
You're exactly right...and I was wondering if anyone would comment on this. I'm not unaware of the break vs. penetration aspect, I'm just trying to experiment with what we've been learning on Vhands in real time. There are times when price seems to penetrate, retrace, and then break the level on its way to the -38.2/138.2 targets. Yet other times, it just slams on through, so there isn't a hard and fast rule we can apply (that I know of?). But, good call on your part!

Also, these were "set 'em and forget 'em trades". I wasn't going to be there to watch price action to see if there was a true break (candle close) or just penetration and retrace.
  • #1,015
  • Jan 3, 2008 1:02pm Jan 3, 2008 1:02pm
Quoting Thexder
Does anyone have any thoughts on where is the correct place to put a stop so you "never get stopped out" when properly placed?

With the concept of buying or selling dips to the 61.8% level, including the minor violation spikes beyond that level, that doesn't seem like the "proper" place for it. So apart from using some other key S/R levels, if it's just fib related, it must be either 100% or 138% retracement. But I'm guessing.
I think that Skunny has only ever said to put the sL at the postion where you would open a trade in the oposite direction. So if you expect the FX pair to respect the Fib to the pip, then you would enter (or would take an entry direction signal - if waiting for a retrace to improve the RR) on the 0% with SL at the 100% or vice versa.
  • #1,016
  • Jan 3, 2008 2:13pm Jan 3, 2008 2:13pm
This chart that Skunny posted a long time ago is what has really helped me identify price cycle flow and after tons of data analysis of a few pairs, it's really coming together.

I think a key mistake I made early in using Fibs was only using the latest bars to draw a conclusion on price action. Instead, now I go back at least a few months and re-fib each weekly/daily set of bars and make sure that the price cycles were complete before I erase that Fib and move on to the next one. More times than not, I end up with a hanging cycle somewhere a month or two back that I can use in the present time frame to make trading decisions on.

I'm still waiting for Skunny's advice on cycles, but I think I've found a good method to the madness. The best trades I've had were using weekly multi-bar Fibs along with weekly, daily, and 1hr last bar Fibs... it's AMAZING the way that price attacks the 138 extension on the 1hr bars if there is no superior S/R in it's path.


http://www.forexfactory.com/attachme...0&d=1197659075
  • #1,017
  • Jan 3, 2008 2:46pm Jan 3, 2008 2:46pm
Quoting youalreadykn
This chart that Skunny posted a long time ago is what has really helped me identify price cycle flow
And in looking at that image there is a 138 target from both a short and eventually a long break of the same original fib. Could a "cycle" imply a complete target of both sides of a "correct" fib before moving on? Or else why was that one drawn that way and not an updated fib for the long break?
"Support and Resistance either holds or it doesn't." -Anonymous hillbilly
  • #1,018
  • Edited 4:01pm Jan 3, 2008 3:40pm | Edited 4:01pm
Quoting Thexder
And in looking at that image there is a 138 target from both a short and eventually a long break of the same original fib. Could a "cycle" imply a complete target of both sides of a "correct" fib before moving on? Or else why was that one drawn that way and not an updated fib for the long break?
What I've used (and I'm sure Skunny has his own method, so take his word far above mine in this thread) are the following rules:

1. Hitting 138 targets one of two outcomes... either a continuation to 162 or a reversal to the opposite 138 Fib.

2. The price cycle is not complete until a 162 line is broken. At least I don't delete the Fib lines until 162 is broken on one side.

3. If a 162 line is broken, the next Fib cycle goes from the last valley to the last peak (or vice versa) and the same analysis is done.

4. The reason there should always be a cycle in place is that there are still mini cycles drawn from other peaks/valleys within the larger cycle that may or may not have been completed. It's amazing whats found going back over a year into some pairs and seeing how long some cycles last.

Here's an example of one that I found after the fact (GBP/JPY) that was posted throughout this thread, but always from the small cycle standpoint instead of the larger cycle (at least it's a cycle by my definition). Too bad I didn't draw this out a couple of weeks ago, but the long-term target to the downside would be 210.50 to end the cycle.

edit: I posted the wrong picture... corrected now.

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  • #1,019
  • Jan 3, 2008 3:48pm Jan 3, 2008 3:48pm
Quoting youalreadykn
2. The price cycle is not complete until a 162 line is broken.

3. If a 162 line is broken, the next Fib cycle goes from the last valley to the last peak (or vice versa) and the same analysis is done.
Based on 162 theory, the short I took this morning has completed and a new cycle might start on the swing that hit the 162 level as I've drawn now with the blue fib on GU, and it looks to me like it wants to break down again, it's taken 3 tries at 1.9700 today.
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"Support and Resistance either holds or it doesn't." -Anonymous hillbilly
  • #1,020
  • Jan 3, 2008 3:52pm Jan 3, 2008 3:52pm
Quoting youalreadykn
This chart that Skunny posted a long time ago is what has really helped me identify price cycle flow and after tons of data analysis of a few pairs, it's really coming together.

I think a key mistake I made early in using Fibs was only using the latest bars to draw a conclusion on price action. Instead, now I go back at least a few months and re-fib each weekly/daily set of bars and make sure that the price cycles were complete before I erase that Fib and move on to the next one. More times than not, I end up with a hanging cycle somewhere a month or two back that I can use in the present time frame to make trading decisions on.

I'm still waiting for Skunny's advice on cycles, but I think I've found a good method to the madness. The best trades I've had were using weekly multi-bar Fibs along with weekly, daily, and 1hr last bar Fibs... it's AMAZING the way that price attacks the 138 extension on the 1hr bars if there is no superior S/R in it's path.
Totally agree...this one was a big eye-opener for sure. Doing a top-down analysis of the S/R ranges has GOT to be a key function in the whole process. Failing to do this is, I'm sure, why certain trades just don't work out like we anticipate and why price seems to blow by some fib targets like they weren't even there. Price fulfilled two fib targets in one huge move on my GJ chart last night, but I didn't trade the larger one.

Thexder, I think you are correct on this because the chart posted by Skunny in response to 4X4EVER's EUR/USD question showed exactly that...price reaching two opposite 138 targets in one huge move. This is what puzzles me and makes it difficult to come up with solid "rules"... I've seen times where price only "touches" the 0/100 mark, then retreats completely to the other side to hit the opposite target....times where it penetrates and retreats, yet comes back to break the level and hit THAT target....and other times where it just barrels on through like there was no level at all like GJ did last night. So, I see these reactions, but am at a loss to define how we should trade it or predict which one will occur...

Skunny's EUR/USD Chart:
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