4 Hour Strategy (MACD)

Quoting Phillip Nel

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I will wait for further direction indication and confirmation

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Quoting mike1349

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Hi Phillip,

As I see in your chart if the first break out doesn't pull back Do you redraw your trendline with new candle?

regards
Mike

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Quoting Palmer

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Take a look at how price reacted to the 365 here, the bold gold lines and the blue triangles. The 4 hour closed below the 21 and found support right at the 365 'area'....again.

Per the method: Price can come back to the 21 (up) before continuing in the new direction (down). Price was making its way back up to the 21, per the 1hr. The close of the long bull candle was my entry which was about an even R:R. I took one off at the 21 and still holding one.

It was a simple matter of price reacting to the 21 rules and the 365.

I will refrain from posting any more 1 hour entries.

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Quoting maxster

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I only trade the EUR & GBP now because before I was jumping around and was missing trades - those that are starting just stick to 2 pairs there really is no need for more.

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Quoting >Apocalypto<

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AUD/USD,


swissy looking good making a break I will look for a pull back to the 21ema or 89 with a TC on the MACD to get in. the swissy is now looking the good to the up side, see what comes of this.

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Quoting jren07

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very exprienced insight. From your past posts, you used Fib to filter bad 4h TC signals, and to enter order on better positions in 1 H, or to exit it. In your charts, you always have Intraday fibs and Swing fibs. How do you define their Highs and Lows? Did you use last swing in 4 H for intraday Fibs and previous day's High and Low for Swing fibs? It takes time to name two Fibs' levels, how do you do this so easy, by some indicator? Your practical guideline is very helpful. My understanding is to use Daily chart for direction , and to use fibs from 4 H last swing and 1 H previous day's swing to confirm Rhythm. Would you give some comments.

Thanks,

Jenny

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Quoting maxster

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I don't use fibs to filter macd but to simply follow price movement. By following this movement I know the MACD is going to give a TC signal before it happens.

You need to think about fibs as a visible tool to see S/R levels better - not an indicator where price will turn.

In terms of the 4H - if you look at the last GBP down swing on the 4H then look at that same swing on the 1H you will clearly see trending movement (some call it impulse moves) and corrective movement. The key to understanding price movement is seeing/realizing price moves from one S/R level to another S/R - or from one corrective cycle to another corrective cycle with a trending cycle in between. Once you see this movement drawing the fib becomes very obvious - you draw it across the last trending or impluse swing.

You need to understand this movement to correctly draw the fib because the fib levels will simply act as a visual guide for S/R levels for the upcoming corrective cycle.

After studying tons of charts I notice that many times price will resume or ending the previous 1H corrective cycle when it bounces from the last minor 1H swing. If you think about it more it makes perfect sense as price is simply fulfilling Phillip's pullback to 21 then move away trending rhythm but on a still lower timeframe than the 1H.

Then once you put all the timeframes together - the picture becomes clear. But please don't concentrate your effort on finding entries & exits - but at first on seeing and fully understanding this price trending and corrective movement which is the secret. By looking at Phillip's rhythm this way you not only understand the rhythm but also price movement. Once you clearly know this movement finding entries and exits is the easiest part and you will find entries that suit your personality and trading style.

Also I don't look to the daily for direction in terms of that is the only direction I trade because I follow what price is doing on the 1H - I keep an eye on the daily in terms of S/R levels because price again moves from one S/R to another - hard to explain but just remember to follow price right now. For example before the EUR jumped this morning I was very cautious because price is very near a major S/R of 4720 - it could go either way. But now it has clearly broken that level price will most likely test the extreme of that corrective daily cycle. There are so many ways to trade once you understand what is going on.

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Quoting aihua5

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maxster,
I think that what you said above is the essentials of the market. Thanks for the excellent observation.

Now I have a request: can you give an example about the S/R drawings, price move cycle, rhythm related with D1,H4,H1 together? If you can also give some snapshots, that is perfect.

I hope that I can understand and master your method easier. Thank you very much. Look forward to your detailed introduction about the market movement.

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Quoting Bag Lady

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...

Rhythm is the way price moves, or dances, around the MA's (bursts into song... rhythm is a dancer...). Look at the current GBP/USD chart; price crashes through the 200 sma on the 31st Jan, but, mindful of the rules, goes back to the 200 (rather as a young girl at a dance would go back to an elderly lady and her mother, just to be polite, before rushing off in the direction she was headed, arm-in-arm with the 8 ema). In this case, price goes back to the 200 and the 21 before continuing in a -2 bear rhythm until around the 7th Feb. This is rhythm.

Where the MA's get tangled up together and price straddles them, going first in one direction then the other, this is where there is no rhythm.

Market motion is the activity involved in creating price movement. Large candles create large pip movements and fast motion. Look at the candles just before the 31st Jan drop. The bear (red) candles are larger than the bull candles, showing more activity. The rhythm is still +2 bull rhythm, but the motion is not really upward any more.

The market motion now begins to show some emotion (still with me?). There are lots of tails down to the 21 in the period leading up to the drop on the 31st Jan. This would usually indicate that price wants to carry on pushing up. But there is resistance to the desire to go up, you get a couple of spinners off the 8ema, and price plummets. This is the emotion showing in the candlesticks.

.... so, the emotion of the dancers (traders) shows in their candlestick formations and leads the motion (speed and direction) of the dance. The dance (price action in bull / bear market) has certain steps or rules that prevents it turning into chaos, these rules create the rhythm that you see on the charts.

Basically, it doesn't matter so much what you call it, so long as you always do a proper analysis showing direction and speed of price, type of candlestick formations now occurring, and position of the MA's relative to each other and to price. Do this before you decide whether to go long or short and whether to trade at all.

...
Rebecca,x.

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