4 Hour Strategy (MACD)

Hi, Phillip,

Regarding to the entry after breakout, can we say: if the breakout is purely a technical one, we may need to wait for a pullback to entry, if it was activatied by a strong impacting news, we can ride on it without waiting for pulling back?

Macalmd

I allways wait for pullback. If it does not come within the first 20-30pips after the news(news have to be of such a nature that you must be quite sure the market will move) I walk away. It has to give me a chance within the first 20-30pips.

Euro;Some more research for those of you following me on this. I have a template here with 89sma pockets from 12 hr and daily, as well as the 200sma 12 hour and 89sma 12 hours. It sounds complex but visually its easy to grasp. On the template are the usual congestion areas in lavender, smoke white areas i was interested in. Also this morning i added in the yellow overlaid rectangles, those areas which i felt were similar to our current set up with the Euro, whereby the 21ema and 89sma from the daily are forming a kind of wedge, trapping the price and causing congestion there. Also i marked some red rectangles because i found it interesting that the price breaks out at three points where the 89 smas bisect...........You could make many other observations from this template, i havent been exhaustive by any means. Points of interest also are the number of times the price refers to each of these lines.

The congestion areas which concern us are when the price has got trapped in these pockets but with the 365 from the 4hr present as well. That seems to be when the congestion occurs.

I hope the template comes out ok and the indicators are the right ones.

I might put some charts and observations into a word doc. sometime, depending if i have time.

(Please note i have history distorted on my MIG platform from Aug. till Oct. 2004. I will look at another platform to cover this and fill in the blanks.I have checked the missing months and there is nothing else i want to add to them.)

This template includes both Euro and GBP, moving averages and observations.The second template is updated with USDJPY and other observations included.

I couldnt resist posting another one of these charts. This is a really nice one from the Euro Jan/Feb. 2007. Same set up, same result. Breakout of the corner where the two 89smas cross. (It remains to be seen if this pattern is the same for the Euro right now we shall see). In fact they could be the same chart, but one is the GBP and other the Euro, the similarities are uncanny. I have just drawn triangle shaped trendlines onto the top left of both charts as the price tapers before the breakout downwards, that too is the same for both charts........spooky!.(The GBP chart is actually Jan/Feb 2005).

Here is a pdf. of collected thoughts and charts for the 4hr 365ema issue we are presently dealing with in our charts.

In terms of current condition before entry it was very simple - we were in a triangle - I wanted to enter near the extreme of the lower range.

I used the following to pinpoint the price where the lower extreme may be.

1. The 138% Ext of the previous 1H upmove
2. The lower Trendline
3. The previous support price low first circle

I have said it many times when we are in a ranging market entry is at the extremes.

But in a bigger picture and why I went long:

1. If you look at my previuos daily chart posts - you can clearly see that price is in a daily correction of a longer term weekly move. The daily in currently in a large range between 1.5340 and the all time high of 1.6020. Price has previously bounced once at 1.5340 back in Mar 24.

2. In the nearer term price is in a small range with a triangle forming - this is a result of price getting trapped between the S/R levels 1.5550 & 1.5350 - they are clearly defined on the daily chart.

3. If you look at the 4H down swings of the last down move you can clearly see a rounding of price with down swings then sideways swings and now I am expecting upswings.

4. I am expecting price to break to the upside - look at my previous daily chart again at the purple S/R levels - I expect price to test 5600 then 5700 then finally the all time high. Price may need to fight to get above the S/R levels with more ranging, mini corrections, mini down moves, etc.

If you rely on MAs to tell you price is ranging you will always be at a disadvantage because a certain length MA will indicate ranging only if the swings price and time fall in sync with that MA length - and price in terms of time is dynamic. The foundation of the market is made of price and S/R levels everything else is calculated/skewed/changed/based from it.

Hi there is a tc coming up in 8 min on the euro... but it's right at the trendline coming down from 1.6000...
would you take this one?
I guess not...

best
colbru

this is the 1H chart.. 4H is almost there...

ok so no tc... but still I'd like to know from thr pros if they would have considered a trade if it would have closed higher at made a tc

No signals yet on 4H

Both EURUSD and GBPUSD have higher bars on 4H MACD with bullish TCs on 1H. But in both cases on 4H candles are like "hanging in the air" (too far from EMA8-broken resistance line on EURUSD or EMA21-EMA8 on GBPUSD) - I anticipate a bit deeper retracement (and on 1H it may give a lower high). Just my anticipations.

Euro. At least it broke out of the red trendline.

EURUSD
I analyzed 6 setups: 69, 70, 71, 73, 74 - passed either due to bad SL/R:R or "cons" in the price movement; 72 - a TC on 1H could bring about 12 pips / 1lot but decided to pass due to candles view, SMA89 too close. So 0 trades on EURUSD that week.


GBPUSD
7 setups (4 on 4H MACD, 3 TCs on 1H): 60 and 61 should have been taken by me and could have brought about 12+10=22 pips/1lot, but, what an irony , I wasn't at my PC at that time. The rest were not good due to misc. reasons. So 0 trades for the week.

I failed to position myself for the breakout up on Fri, but I really don't see an evident opportunity where it could have been done.

Im watching both pairs this morning.

EU has formed a green bar on the MACD but after only one red, I seem to remember seeing somewhere that this isn't considered a TC as it has really pulled back enough. Also the move didn't really come back to the 8 properly.

GU is also pushing up and this has done so after 2 red bars and a full pullback to the 8. It has now broken the 1H trend line and I suppose a pullback to the breakout could be a good place to long.

I've decided against the long on the pullback because the 4H has a fairly large spike but mainly because the 89 is in the way of my target price making the trade fairly high risk (45 pip stop) with nearest 1-1 target beyond the 89.

GBP; Behaving itself for once and stopping right on my target line.

EU is about to form a TC, but the long tail makes me feel uncomfortable. And should I enter GU's RT for its long tail?

The 8 is below giving support, and it's not really overbought. I personally am not going to.

Euro;Price memory line around 1.5635,also 200sma near and 89sma from 12 hr chart at the same place as the 200,15 points off the top of the high.

Me too, there is not much room.

Very quite today. There were a few pips on shorter timeframe.

The EurUsd we have moved between the 89sma and 200sma. Maybe another ranging period between those MA's. Trade shorter timeframes frome these Supp/Res areas.

GbpUsd have bounced off the 89sma. Might be heading towards the 21ema currently sitting at the 8ems.

Sold g/u because tail off 89 with rt and also because on the daily there is a bounce off 21.
First tp to 21ema 1.9530
second to bottom trendline 1.9480