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  • #3,141
  • Edited 4:26pm Mar 14, 2008 4:04pm | Edited 4:26pm
Harold,

Very nice trades. Great set ups on the yen crosses. I was looking at the move down on the GBP and where the S&R lines where and I decided to try an experiment and traded against the long term trend. Well you can see how that turned out. My first loss but I know that I didn't follow the rules so that's on me. The good news is I realised that a 123 long set up was happening (same set up you took) and jumped in long on the GBP and recouped my loss right away.

NaijaFx....nice trading man...keep it up.

I hope everyone is starting to see how good this method really is. Thanks to Harold for sharing it with us.
  • #3,142
  • Mar 14, 2008 4:16pm Mar 14, 2008 4:16pm
I just wanted to show why you need to be aware of what's happening on the longer time frames. You don't want to enter a trade on the 15m chart only to find that your at a support or resistance line on a higher TF.

Look at the 1hr GBP chart. Price has retraced to a major area of support (pink rectangle). See the 3 peaks marked with green arrows that entire area is support and price is sitting right on the edge of it. Also, take a look at the fib level from the last move up.We're sitting right on the pivot which is the 50% retracement line. The way I see it the GBP is in a major up trend and the USA economy is still shaky so there's no reason to take any short trades at this time. Now if the price action clears the pink rectangle and the 200EMA I would start thinking trend change.

Just my 2 cents but I could be wrong.
Attached Image (click to enlarge)
Click to Enlarge Name: 150308 gbp 1hr analysis t5.gif Size: 40 KB
  • #3,143
  • Edited 5:22pm Mar 14, 2008 5:00pm | Edited 5:22pm
After taking a look at the EurYen trade set up a little closer I thought this is a classic half signal as defined by Martin Pring. If you haven't read Pring's writings on trends you really need too.

Ok..look at the 15m euryen chart. You see down trend, H, L, LH, LL then all of the sudden bam...price action takes out the previous highs and goes to point 1. What's the first thing most people think? Looks like a trend change is happening. Now iin your mind your all set for a sell trade to the down side and all of the sudden the highs are broken. You think..damn..there goes that great short set up and you move on to the next pair or next trade.

So the next thing that happens is price action proceeds to come back down and breaks the previous lows. So the move to 1 is a false signal long and when price comes back down breaks the lows goes back up to the green resistance line (point3) and starts back down confirming the resumption of the down trend that is a half signal. Notice after price hits point 2 it goes back up tests the resistance line 2 times, this also happens to be the 50% retrace line from the previous day's high and low and the 50% retrace from points 1 to 2. Could you have drawn this up any better? If your an aggressive trader you could have entered a short position on the close of the long bearish candle at point 3. If you are more conservative you wait for the break of point 2. The sad fact is I missed all of the yen cross trades.

As many of you can see I'm very excited about this methodology. I've spent alot of money on Forex training and systems and I have all of these bits and pieces of info in my head but I could never put them all into a methodology that I could trade with consistently. For some unknown reason when I read Harold's post with what he had discovered things started to make sense to me. Again, thank you Harold.

Sorry for such a long post....
Attached Image (click to enlarge)
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  • #3,144
  • Mar 14, 2008 9:12pm Mar 14, 2008 9:12pm
Here is a 123 set up that happened earlier in Friday's session before the trade Harold took. I wanted to point this one out because it demonstrates the reason why you only use the zig zag indicator as a visual guide. The zig zag indicator is in black and here you see if you weren't paying attention the indicator gives no signals. Now if you look a bit closer you can clearly see a H, L , LH. Trend on daily was down so you can enter at the break of L-2 point. Now if you missed that one another set up forms right after that one. Can you see the yellow lines that are the ABC swing (used ABC instead of 123 so I don't confuse anyone). The best thing about the ABC set up is point C comes up and hits the bottom of..you guessed it..a support turned resistance line (green line) ...does this surprise you? Take a look at all of the tests to the SBR line (red arrows). Again an aggressive trader could get in at the close of the long bearish candle at point C a more conservative trader would wait for the break of point B.

I know I been posting like mad...I have the day to myself so I'm studying the charts for 123 set ups. I hope these post are helping people to understand the 123 set ups?
Attached Image (click to enlarge)
Click to Enlarge Name: 150308 euryen zig zag t6.gif Size: 36 KB
  • #3,145
  • Edited 9:31pm Mar 14, 2008 9:16pm | Edited 9:31pm
ozzie i dont see a chart ok i see it i have been telling everyone its just a visual and to look inside to make sure something isnt happening hey anyone want to go over to tradingroom?
  • #3,146
  • Mar 14, 2008 9:33pm Mar 14, 2008 9:33pm
anyone want to go over to the room
  • #3,147
  • Mar 14, 2008 10:13pm Mar 14, 2008 10:13pm
Quoting harold4x
ozzie i dont see a chart ok i see it i have been telling everyone its just a visual and to look inside to make sure something isnt happening hey anyone want to go over to tradingroom?
Hi Harold,

I know you've been telling everyone that..just helping to drive the point home.
  • #3,148
  • Mar 14, 2008 10:34pm Mar 14, 2008 10:34pm
Is there anyway to make the zig zag indicator more sensitive to smaller 123 moves within the zig zag? Anyone?
  • #3,149
  • Edited 11:20pm Mar 14, 2008 11:10pm | Edited 11:20pm
ozziedave, That was a sweet trade on the euryen. trade well and have a great weekend. PS, you post some good charts Dave. Bob
Hej.
  • #3,150
  • Mar 15, 2008 5:54am Mar 15, 2008 5:54am
Great trading system Harold, many thanks.

To help spot 123 setups I have attached a Metatrader indicator that followers of this thread might find useful.

Noel.
Attached File(s)
File Type: zip BPS 1-2-3 Pattern.zip   22 KB | 719 downloads
  • #3,151
  • Mar 15, 2008 9:35am Mar 15, 2008 9:35am
Hi All,

I have no patience to trade in demo anymore, i don't want to loose all the winning trades with this system. After having unsuccess with forex.com, i am planning to go live in fxdd mini account. Pls give some suggestions about this broker, anyone had any good experience with them?.


Thanks
  • #3,152
  • Mar 15, 2008 9:50am Mar 15, 2008 9:50am
Harold,

Had to post this trade because it illustrates that the 123 can even happen during a Friday afternoon when you would normaly expect the market to be very quiet. A whopping 149 pips! I got into this trade and I wish I could say I rode it out. Got out with +50, and was very content. As you said in the tradingroom 123's can occur in any time frame.
Attached Image
  • #3,153
  • Mar 15, 2008 9:55am Mar 15, 2008 9:55am
What I meant to say in my previous post is that 123's can occur during any time of the day.
  • #3,154
  • Mar 15, 2008 5:45pm Mar 15, 2008 5:45pm
Quoting fxpivots
What I meant to say in my previous post is that 123's can occur during any time of the day.
Hi fxpivots,

123 set ups can and do happen any time of the day. The thing is you want to trade when there is more of a chance that the market might move a bit. For most people that time is during the London and USA sessions. Due to where I live and my time restrictions I personally trade during the London and early USA sessions. Hope that answers your question.
  • #3,155
  • Mar 15, 2008 7:45pm Mar 15, 2008 7:45pm
Hi guys..

I couldn't resist posting this 4hr analysis of the AUD seeing I'm from Australia.

Pull up a 4 hr chart and take a look at this. We have a very long term 123 formation (auqa lines) Notice how point 3 has not broken point 1. If you take a look at the daily chart you will notice that we are in a long term up trend. On the current upswing we have another 123 set up (ABC in yellow). Now the real interesting thing is that the B-C down swing is at a major resistance turned support line (RBS green line). To me that is a key area and if the price action starts to move up from that area I will be taking all of the 123 buy signals I can. Price may continue to go down but as long as it's above point A it's a valid 123 set up. If the price action goes below point A then I would sit back and wait. This is a high probability set up due to the RBS line and the strong up trend on the daily. Now knowing this what can you do to take advantage of the information? I know what I'm doing...monitoring the SBR line and if it starts to move up watch the 15 min chart for 123 set ups.
Attached Image (click to enlarge)
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  • #3,156
  • Mar 15, 2008 7:51pm Mar 15, 2008 7:51pm
Quoting ozziedave
Hi guys..

I couldn't resist posting this 4hr analysis of the AUD seeing I'm from Australia.

Pull up a 4 hr chart and take a look at this. We have a very long term 123 formation (auqa lines) Notice how point 3 has not broken point 1. If you take a look at the daily chart you will notice that we are in a long term up trend. On the current upswing we have another 123 set up (ABC in yellow). Now the real interesting thing is that the B-C down swing is at a major resistance turned support line (RBS green line). To me that is a key area and if the price action starts to move up from that area I wil be taking all of the 123 buy signals I can. Price may continue to go down but as long as it's above point A it's a valid 123 set up. If the price action goes below point A then I would sit back and wait. This is a high probability set up ue to the RBS line and the strong up trend on the daily. Now knowing this what can you do to take advantage of the information? I know what I'm doing...monitoring the SBR line and if it starts to move up watch the 15 min chart for 123 set ups.
The Aud/Usd will break parity on this up trend from 9146 so take a small lot and let it ride to the top and buy it on the dips as it goes, there is some good pips to be had in this pair in the coming weeks. I have 2 lots L from 9148 riding it and have bought the dips along the way.
Don't chase the market, Let the market come to you
  • #3,157
  • Mar 15, 2008 10:13pm Mar 15, 2008 10:13pm
Here Is Possible Senario On Daily Chart We Are Wave 5 It Might Take Out Last High And Wave 5 Will Be Under Way Or It Might Unfold With An Couple More Waves Before It Takes Out High
Attached Image (click to enlarge)
Click to Enlarge Name: 1.GIF Size: 41 KB
  • #3,158
  • Mar 15, 2008 10:21pm Mar 15, 2008 10:21pm
Quoting ozziedave
Hi guys..

I couldn't resist posting this 4hr analysis of the AUD seeing I'm from Australia.

Pull up a 4 hr chart and take a look at this. We have a very long term 123 formation (auqa lines) Notice how point 3 has not broken point 1. If you take a look at the daily chart you will notice that we are in a long term up trend. On the current upswing we have another 123 set up (ABC in yellow). Now the real interesting thing is that the B-C down swing is at a major resistance turned support line (RBS green line). To me that is a key area and if the price action starts to move up from that area I will be taking all of the 123 buy signals I can. Price may continue to go down but as long as it's above point A it's a valid 123 set up. If the price action goes below point A then I would sit back and wait. This is a high probability set up due to the RBS line and the strong up trend on the daily. Now knowing this what can you do to take advantage of the information? I know what I'm doing...monitoring the SBR line and if it starts to move up watch the 15 min chart for 123 set ups.
Dave,
Good work, keep posting ur analysis, it helps me to improve my analysis.
  • #3,159
  • Mar 15, 2008 10:23pm Mar 15, 2008 10:23pm
Quoting harold4x
Here Is Possible Senario On Daily Chart We Are Wave 5 It Might Take Out Last High And Wave 5 Will Be Under Way Or It Might Unfold With An Couple More Waves Before It Takes Out High
Hi Harold, nice system you have here

It has room down right now before heading back up but LT it is going to break parity and end somewhere 1000 pips higher in the coming weeks/months. Like I said I am long and riding it from 9148 all the way up.
Don't chase the market, Let the market come to you
  • #3,160
  • Mar 15, 2008 10:27pm Mar 15, 2008 10:27pm
Actually I Did A Fib Expantion From The 1 2 3 That Started It And The 1.27 Area Is 9611 161 Area Is 9812 I Think Thats The Resistence Then It Goes Down From There For Awhile
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