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2 day price action

  • #1
  • First Post: Jun 27, 2008 9:15am Jun 27, 2008 9:15am
I have a question,

it is basically this.

Is it possible or wise. to observe price action on any time frame other than that which comes as standard on the metatrader Platform?

I say this because at present there is a nice pin bar forming on W1 with E./J.

If we could look at the 'D2' time frame, then there is a great bearish outside bar to compliment the weekly Pin.

Is price action, price action? Or is it only valid on certain time frames because that is what the majority of other traders use.

I think i have read of indicators On this forum that help change the time frame to a bespoke setting.

If this is a valid thing to do then the possibilities are endless as we could create custom time frames on any basis until we see price action as we know and require to trade.

Or does price action only work due to lots of people seeing it on the standard time frames and acting on it accordingly. The self fulfilling thing again like fibs.

I would enjoy hearing anyone's thoughts on this

Regards Paul
  • #2
  • Jun 27, 2008 9:36am Jun 27, 2008 9:36am
The most general answer to your question is to trade the timeframe that you take the signal.

That is to say, yes, you may see conflicting signals based on different timeframes, but the signals are usually appropriate to the timeframe from which the signals were taken from in the first place (assuming you have a trustworthy signal system).

So, for example, if you're seeing a bullish signal on the D1 but a bearish signal on the D2, then you might expect the market to be bullish in the shorter term but then bearish in the longer term. That's just a rough example, but that's the idea.

Some traders don't like mixed signals like that, and so stay out until most signals from multiple timeframes are in agreement. But, of course, you can miss out on some choice trades by waiting for MTF confirmation.
Dave
  • #3
  • Jun 28, 2008 9:04am Jun 28, 2008 9:04am
Markets are so complex that we must always analyze them in more than one timeframe. Alexander Elder prefers "The Factor of Five" (every timeframe is related to the next higher and the next lower by the factor of five). There are almost five (4.3 to be exact) weeks to a month, five days to a week, and close to five hours in many trading days. We can break an hour into 10-minute segments and those into 2-minute bars.
  • #4
  • Jun 28, 2008 11:13am Jun 28, 2008 11:13am
Quoting lesaurus
I have a question,

it is basically this.

Is it possible or wise. to observe price action on any time frame other than that which comes as standard on the metatrader Platform?

I say this because at present there is a nice pin bar forming on W1 with E./J.

If we could look at the 'D2' time frame, then there is a great bearish outside bar to compliment the weekly Pin.

Is price action, price action? Or is it only valid on certain time frames because that is what the majority of other traders use.

I think i have read of indicators On this forum that help change the time frame to a bespoke setting.

If this is a valid thing to do then the possibilities are endless as we could create custom time frames on any basis until we see price action as we know and require to trade.

Or does price action only work due to lots of people seeing it on the standard time frames and acting on it accordingly. The self fulfilling thing again like fibs.

I would enjoy hearing anyone's thoughts on this

Regards Paul
I think of the same thing sometimes. And I think price action on traditional time frames is more significant than any random time frame. for eg. a pin bar on 1H would be more significant than a pin bar on 2H, 3H, 7H etc. Reason would be same as you mention that a lot of traders are watching their charts on these traditional time frames. But still the movement of price is significant at any time frame.

A pin bar/ outside bar etc. is nothing but reversal of price within a certain time frame. A reversal may or may not form a good looking price pattern/ candlestick formation on the chart coz it may not occur in synchronization with the clock hours. But still it would be a reversal of price and should have some significance.

And if you think about it almost all famous reversal price patterns are just price changing its direction viewed in different ways. A head and shoulder on 5 min chart could be a pin bar on higher time frame and an outside bar on 1 hour could be a pin bar on 2H chart.
  • #5
  • Jul 4, 2008 4:19pm Jul 4, 2008 4:19pm
Thanks for your reply,

This would suggest then that there is a 'sheep mentality' thing going on.

Every one buys/sells because there is a price action pattern, in turn causing the price to go up/down.

So if we know what most traders look for and trade, and the timeframe that they do it on, perhaps trading is as simple as jumping on the bus at one of these 'bus stops' (Pin Bars etc.)

After all the only thing that causes price to move is when there is a majority all doing the same thing.

The more obvious the price action, on the most significant TF = Highest probability for success - Wow what a revelation! - all i need now is a wooley jumper!

Everyone says keep it simple

Regards Paul
  • #6
  • Jul 4, 2008 5:40pm Jul 4, 2008 5:40pm
Isn't forex is a game of psychology?

Like the Fib retractment, why is it holds for many trades.

If everyone believes it works, it will work.
If everyone believes it, it will work.
  • #7
  • Jul 4, 2008 7:37pm Jul 4, 2008 7:37pm
Quoting lesaurus
I have a question,

it is basically this.

Is it possible or wise. to observe price action on any time frame other than that which comes as standard on the metatrader Platform?

I say this because at present there is a nice pin bar forming on W1 with E./J.

If we could look at the 'D2' time frame, then there is a great bearish outside bar to compliment the weekly Pin.

Is price action, price action? Or is it only valid on certain time frames because that is what the majority of other traders use.

I think i have read of indicators On this forum that help change the time frame to a bespoke setting.

If this is a valid thing to do then the possibilities are endless as we could create custom time frames on any basis until we see price action as we know and require to trade.

Or does price action only work due to lots of people seeing it on the standard time frames and acting on it accordingly. The self fulfilling thing again like fibs.

I would enjoy hearing anyone's thoughts on this

Regards Paul
Yes, Price Action is Price Action no matter the time frames.

Combining Bars (candles) especially on higher times frames can give you a look at Price Action that others (the market) may not see.

More importantly, the rules (guidelines) still apply when looking for tradable Price Action set-ups on combination Bars.

Is this two week Pin Bar (chart 1) in a good location? Well not really. It's in traffic. It has no 'space" due to the previous bars but it is off new highs.
How about the nose. Looks pretty good. It's 2/3 nose. Good. Open and Close within previous Bar. Good.

Uptrend is real strong. Look at the 2 week Pin Bar in the green area. Great looking PB with space and everything and it did fall 200 pips. Yet it fail to deliver out of all it's splender.
How about the BEVOB in the blue area, talk about good looking. Yet it broke the bottom just a little and failed to deliver.

So this 2wk PB in mid traffic is not looking good. But Price Action is a powerful thing and this could prove worthy. Maybe this 2 wk PB with the 2 wk BEVOB will provide the strength it needs to cause the fall. Hard to say.

Or maybe we should wait until the 3 week BEVOB breaks (chart 2).
http://www.forexfactory.com/showpost...ostcount=11021
Attached Images
Indicators show the past. Price Action "Indicates" the future.
  • #8
  • Jul 5, 2008 2:03am Jul 5, 2008 2:03am
Jaroo, how do you get those custom TF's?

What do you think about what i said regarding the sheep mentaility. Do you think it's wise to stick to traditional TF's for this reason?

Regards Paul
  • #9
  • Last Post: Jul 5, 2008 3:55am Jul 5, 2008 3:55am
Quoting lesaurus
Jaroo, how do you get those custom TF's?

What do you think about what i said regarding the sheep mentaility. Do you think it's wise to stick to traditional TF's for this reason?

Regards Paul
I think the sheep mentality may be there. I don't care, I just follow Price.
Attached File(s)
File Type: mq4 periodcon.mq4   16 KB | 578 downloads
File Type: ex4 periodcon.ex4   10 KB | 525 downloads
Indicators show the past. Price Action "Indicates" the future.
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