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4 Hour Strategy (MACD)

  • #11,801
  • Feb 15, 2008 4:25pm Feb 15, 2008 4:25pm
Dear friends,

Thank you very much for all of your kind replies and comments regarding to my post#11789. I got the idea that I should pay attention to the movement of price and the configuration of previous bars, then judge if the MACD signal is effective or not . In today's case of UJ pair, the "signal" bar is not really a definite signal, it can be either a TC or the second shoulder of SHS, then it is clear I should stay away from it. I am learning from your helps. Thanks!

Macalmd
  • #11,802
  • Feb 15, 2008 5:39pm Feb 15, 2008 5:39pm
Quoting Bag Lady

the feeling wasn't there. It's not just about the MACD signal being green or red, it's about rhythm.
Agreed. The ability to use discretion only comes after experience.
  • #11,803
  • Feb 15, 2008 9:58pm Feb 15, 2008 9:58pm
Here is something that might be helpful to some of you in filtering trade signals. I applied it to the U/J chart to include the last failed signal. This is a "thread" of multiple period stochastics that was presented by Spudfyre in an old forum thread. I'm not sure the thread is still active, or how to access it. There is a .tpl within the thread or you can make it by overlaying stochastics in the same window beginning with a 6/3/3 all the way up to 24/3/3. Color 6 thru 13 blue, highlight the 14/3/3 with a bolder line and different color (according to Spufyre, the 14-period stochastic is the most significant for revealing price direction), and color 15 thru 24 red.

The basic premise is that you want to enter when the threads are "combed" or bunched together uniformly. Stay out when they are "tangled" or spread apart wildly. If you look at the Stoch's behavior in relation to price action it becomes rather intuitive in how to use it.
Attached Image
  • #11,804
  • Feb 16, 2008 12:59am Feb 16, 2008 12:59am
Quote
RandyG67

Here is something that might be helpful to some of you in filtering trade signals. I applied it to the U/J chart to include the last failed signal. This is a "thread" of multiple period stochastics that was presented by Spudfyre in an old forum thread. I'm not sure the thread is still active, or how to access it. There is a .tpl within the thread or you can make it by overlaying stochastics in the same window beginning with a 6/3/3 all the way up to 24/3/3. Color 6 thru 13 blue, highlight the 14/3/3 with a bolder line and different color (according to Spufyre, the 14-period stochastic is the most significant for revealing price direction), and color 15 thru 24 red.

The basic premise is that you want to enter when the threads are "combed" or bunched together uniformly. Stay out when they are "tangled" or spread apart wildly. If you look at the Stoch's behavior in relation to price action it becomes rather intuitive in how to use it.


Hi, Randy, Thanks a lot! It makes sense. I will try it by myself.

Macalmd
  • #11,805
  • Feb 16, 2008 7:56am Feb 16, 2008 7:56am
[quote=maxster;1854168]A month or so ago when I got my tail aha moment - I thought to myself why was this dame simple thing so hard to see before. I look for them in 1H, 4H & Daily - the uglier they are & the more # of bars - the more significant to a higher timeframe cycle. Look at the 1H EUR right now - those tails are telling me to no longer look for TC as it is indicating that the 4H cycle may be ending. Then once you start to see tails, double tops & ugly things on the 4H - it is hinting the daily cycle may be turning. I love seeing how these daily, 4H, 1H price movements unfold in sync - now if I can only trade what I can now see.


Hi. Maxter, this is a very insightful and useful observsation. I will definitely keep this in mind when planning a trade. Phillip does always mention TAILS in his reviews. sometimes we soemthing everyday. but there is a difference between seeing and realizing. thankyou for providing a shortcut to my realization moment . Always good to learn something new.

P.S . Everyone, i know it is my turn to do the 15th feb daily wrap up written copy, i will have it up in a few hours. please be patient. Thankyou.
Nadia,
TRADE WHAT YOU SEE... FOCUS ON SUCCESS
  • #11,806
  • Feb 16, 2008 8:43am Feb 16, 2008 8:43am
Quoting maxster
A month or so ago when I got my tail aha moment - I thought to myself why was this dame simple thing so hard to see before. I look for them in 1H, 4H & Daily - the uglier they are & the more # of bars - the more significant to a higher timeframe cycle. Look at the 1H EUR right now - those tails are telling me to no longer look for TC as it is indicating that the 4H cycle may be ending. Then once you start to see tails, double tops & ugly things on the 4H - it is hinting the daily cycle may be turning. I love seeing how these daily, 4H, 1H price movements unfold in sync - now if I can only trade what I can now see.

But the kicker is Phillip mentions tails in most audios. I think more than half of his trades the key pulling reason is the tail.

When one sees a tail with a large counter move like we had in the JPY and a couple of bars ago in GBP - it hints danger in terms of TC entry. I think I remember Phillip calling these "Phillip Stars".
It is very insightful findings.
The tails may be market's emotion building up.
Anyone can give one summary of the tails' observation and application?
Rhythm, Motion, Emotion and Risk Reward.
  • #11,807
  • Feb 16, 2008 9:30am Feb 16, 2008 9:30am
Quoting RandyG67
The basic premise is that you want to enter when the threads are "combed" or bunched together uniformly. Stay out when they are "tangled" or spread apart wildly. If you look at the Stoch's behavior in relation to price action it becomes rather intuitive in how to use it.
Yes, this is a very useful template. Spudfyre really went into great depth explaining the art of multiple stochs. Wonder whatever happened to him and his thread.
  • #11,808
  • Feb 16, 2008 9:34am Feb 16, 2008 9:34am
Hello, here it the written copy of feb 15th wrap up, please go to post 11800 for Charts and mp3. thankyou,
Nadia.
Attached File(s)
File Type: doc written copy of Feb 15th wrap up.doc   6 KB | 565 downloads
TRADE WHAT YOU SEE... FOCUS ON SUCCESS
  • #11,809
  • Edited 11:42pm Feb 16, 2008 11:20pm | Edited 11:42pm
Quoting EricthePip
Interesting. I looked on Intrabank and my 89/200 crossed back on 2/1.... I'm using simple MA's for the 89 and 200, plus zero shift, apply to close.... I wonder why they show different.
Hi EricthePip!

Checked my chart again and it seems I've mistakenly put in the 89 and 200 ExponentialMA. Apologies.
  • #11,810
  • Feb 16, 2008 11:58pm Feb 16, 2008 11:58pm
Quoting RandyG67
Here is something that might be helpful to some of you in filtering trade signals. I applied it to the U/J chart to include the last failed signal. This is a "thread" of multiple period stochastics that was presented by Spudfyre in an old forum thread. I'm not sure the thread is still active, or how to access it. There is a .tpl within the thread or you can make it by overlaying stochastics in the same window beginning with a 6/3/3 all the way up to 24/3/3. Color 6 thru 13 blue, highlight the 14/3/3 with a bolder line and different color (according to Spufyre, the 14-period stochastic is the most significant for revealing price direction), and color 15 thru 24 red.

The basic premise is that you want to enter when the threads are "combed" or bunched together uniformly. Stay out when they are "tangled" or spread apart wildly. If you look at the Stoch's behavior in relation to price action it becomes rather intuitive in how to use it.

This lags just like every other indicator. I see lots of people take a few thing here a few things there and think, Hey if I add the best of all this crap together I will make so much money! Well it does not work and it just cluters up your screen / trading. I have been down that path, now I keep it super easy, the last thing I need is to have a 10 line check list that has to be perfect before I can take a trade. You can do this as I did about 6-8 years ago when I started out but it all boils down to PRICE ACTION, all this other stuff just slows that down. Print charts, understand movement, control emotions, make money. Look at Phillip's trades he posts real time, 85% winners? Why change that, who else on here has posted that??? No one?? Don't change the charts change YOURSELF!
Keep taking CT trades, I need more money
  • #11,811
  • Feb 17, 2008 12:38am Feb 17, 2008 12:38am
Quoting Ryanmcd
This lags just like every other indicator. I see lots of people take a few thing here a few things there and think, Hey if I add the best of all this crap together I will make so much money! Well it does not work and it just cluters up your screen / trading. I have been down that path, now I keep it super easy, the last thing I need is to have a 10 line check list that has to be perfect before I can take a trade. You can do this as I did about 6-8 years ago when I started out but it all boils down to PRICE ACTION, all this other stuff just slows that down. Print charts, understand movement, control emotions, make money. Look at Phillip's trades he posts real time, 85% winners? Why change that, who else on here has posted that??? No one?? Don't change the charts change YOURSELF!
Ryanmcd,
I can not agree with you more.
Guys, please focus on the pairs' movement, rhythm, emotions and keep the screen clean. In present Macd indicator is enough for the 4h strategy.
Maybe macd will be used less and less in future 4h strategy. LOL.
Rhythm, Motion, Emotion and Risk Reward.
  • #11,812
  • Feb 17, 2008 1:42am Feb 17, 2008 1:42am
Hi Randy,

Very good insight. Can u send me a template file for adding the multi time frame stoch as per your settings. I'm finding it a bit difficult putting it up on my charts. Appreciate if you could help.
  • #11,813
  • Feb 17, 2008 2:48am Feb 17, 2008 2:48am
Quoting aihua5
It is very insightful findings.
The tails may be market's emotion building up.
Anyone can give one summary of the tails' observation and application?

These tails are simple price hints that you can incorporate into your trading plan.

For me since I am solely a pullback/TC trader after a clear significant price movement I use them by anticipating what the pullback will be like. If you go back and look at the 4H TC pullbacks there are really only two kinds - pullbacks that are short and simple, and pullbacks that are long and extended - most of the time these extended pullbacks will give false TC MACD signals.

On the current EUR when I see these tails on the 1H and also 4H is hitting the 62% fib of the daily cycle - I am anticipating an extended pullback & so will ignore MACD signals. I am however still anticipating it to go up because that is the current trend. I will look for a basing pattern on the 1H to enter a trade. This basing pattern is objectively defined in my plan. In my plan If a 1H bar closes below Friday's 62% fib level of 1.4660 I will no longer be long biased & will wait for another clear significant price movement then look for entry on pullback.

If you spend the time to study these pullbacks after a trending move you will fine tune your trading plan beyond simple TC MACD signals. If you also study daily, 4H & 1H price movement cycles and their S/R levels in relation to these pullbacks you will precisely understand the weak points of the 4H TC MACD signal and will naturally find better entry points based solely on price movement. A few weeks ago I got a sh*t my pants type AHA moment when I was studying the 1H pullback swings in relation to the 4H trend. :>))

Having said that if one can't tell a trending move from a ranging or corrective move nothing in the world will help. You need to be able to see Phillip's trending rhythm as price unfolds in real time because that is 90% - and need to realize the importance of the 8 & 21 EMAs when price is moving.
  • #11,814
  • Feb 17, 2008 3:06am Feb 17, 2008 3:06am
Hi Randy,

Very good insight. Can u send me a template file for adding the multi time frame stoch as per your settings. I'm finding it a bit difficult putting it up on my charts. BTW i been to Spudfyre's forums but could not find tpl for overlaying stochs with different settings in one single window. Appreciate if you could help.
  • #11,815
  • Edited 5:48am Feb 17, 2008 4:33am | Edited 5:48am
Quoting maxster
These tails are simple price hints that you can incorporate into your trading plan.

For me since I am solely a pullback/TC trader after a clear significant price movement I use them by anticipating what the pullback will be like. If you go back and look at the 4H TC pullbacks there are really only two kinds - pullbacks that are short and simple, and pullbacks that are long and extended - most of the time these extended pullbacks will give false TC MACD signals.

On the current EUR when I see these tails on the 1H and also 4H is hitting the 62% fib of the daily cycle - I am anticipating an extended pullback & so will ignore MACD signals. I am however still anticipating it to go up because that is the current trend. I will look for a basing pattern on the 1H to enter a trade. This basing pattern is objectively defined in my plan. In my plan If a 1H bar closes below Friday's 62% fib level of 1.4660 I will no longer be long biased & will wait for another clear significant price movement then look for entry on pullback.

If you spend the time to study these pullbacks after a trending move you will fine tune your trading plan beyond simple TC MACD signals. If you also study daily, 4H & 1H price movement cycles and their S/R levels in relation to these pullbacks you will precisely understand the weak points of the 4H TC MACD signal and will naturally find better entry points based solely on price movement. A few weeks ago I got a sh*t my pants type AHA moment when I was studying the 1H pullback swings in relation to the 4H trend. :>))

Having said that if one can't tell a trending move from a ranging or corrective move nothing in the world will help. You need to be able to see Phillip's trending rhythm as price unfolds in real time because that is 90% - and need to realize the importance of the 8 & 21 EMAs when price is moving.
maxster, thanks for your explanation.
It is very helpful for my studying telling the fake signals in the macd tc pattern.
I have read the market rhythm article of Phillip many times. And I think I should have understand the price trend movement in relation to 8, 21, 89 MA on H4 chart.
About the daily, 4H and 1H price movement cycle, could you give more details and add some snapshots based on your experience? I am more intertested in this. I think it will be one another excellent lesson in addition to the Phillip's 13 lessons. Thanks.
Rhythm, Motion, Emotion and Risk Reward.
  • #11,816
  • Feb 17, 2008 8:09am Feb 17, 2008 8:09am
Quote
This lags just like every other indicator.
I know. But I'm not using it in the more traditional way that people use Stochastic indicators. I'm only using it, as I presented it, as a quick visual to see if price is in a cooperative state.

Here is a template. Please PM me for any questions you may have regarding threads.
Attached File(s)
File Type: tpl 4-hr macd with threads.tpl   9 KB | 688 downloads
  • #11,817
  • Feb 17, 2008 9:27am Feb 17, 2008 9:27am
Quoting RandyG67
I know. But I'm not using it in the more traditional way that people use Stochastic indicators. I'm only using it, as I presented it, as a quick visual to see if price is in a cooperative state.

Here is a template. Please PM me for any questions you may have regarding threads.

What it really boils down to is having something you can trust and pull the trigger everytime you see a move, I can do that now lots of people need that extra to show them to take the trade. If you removed everything but MACD and price you can make money if you know the market movement.
Keep taking CT trades, I need more money
  • #11,818
  • Feb 17, 2008 11:01am Feb 17, 2008 11:01am
Quoting maxster
These tails are simple price hints that you can incorporate into your trading plan.

For me since I am solely a pullback/TC trader after a clear significant price movement I use them by anticipating what the pullback will be like. If you go back and look at the 4H TC pullbacks there are really only two kinds - pullbacks that are short and simple, and pullbacks that are long and extended - most of the time these extended pullbacks will give false TC MACD signals.

On the current EUR when I see these tails on the 1H and also 4H is hitting the 62% fib of the daily cycle - I am anticipating an extended pullback & so will ignore MACD signals. I am however still anticipating it to go up because that is the current trend. I will look for a basing pattern on the 1H to enter a trade. This basing pattern is objectively defined in my plan. In my plan If a 1H bar closes below Friday's 62% fib level of 1.4660 I will no longer be long biased & will wait for another clear significant price movement then look for entry on pullback.

If you spend the time to study these pullbacks after a trending move you will fine tune your trading plan beyond simple TC MACD signals. If you also study daily, 4H & 1H price movement cycles and their S/R levels in relation to these pullbacks you will precisely understand the weak points of the 4H TC MACD signal and will naturally find better entry points based solely on price movement. A few weeks ago I got a sh*t my pants type AHA moment when I was studying the 1H pullback swings in relation to the 4H trend. :>))

Having said that if one can't tell a trending move from a ranging or corrective move nothing in the world will help. You need to be able to see Phillip's trending rhythm as price unfolds in real time because that is 90% - and need to realize the importance of the 8 & 21 EMAs when price is moving.
Thanks maxster for posting this!
  • #11,819
  • Feb 17, 2008 11:09am Feb 17, 2008 11:09am
Ditto that, but I would add the 21ema.... It's helped me looking at charts after I made my 21 more prominent on my charts (used to be a faint dotted line).... Now it's the big/bold/red line... Highlights the motion for me visually... Plus it's an integral part of the rules (motion off the 21 relative to the 89)...

by the way..... for tomorrow (Monday)....

All Day USD http://www.forexfactory.com/images/m...act_medium.gif Holiday: President's Day (Euro session could be active, but could get some false moves in the US session)


Quoting Ryanmcd
What it really boils down to is having something you can trust and pull the trigger everytime you see a move, I can do that now lots of people need that extra to show them to take the trade. If you removed everything but MACD and price you can make money if you know the market movement.
  • #11,820
  • Feb 17, 2008 7:11pm Feb 17, 2008 7:11pm
Long USDJPY 107.86 Stop @ 107.63
Keep taking CT trades, I need more money
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