Powerful Fib Based System - by DAZfx

I also took this trade short, got in a little later at 1.8668



Noel.

USD/CHF - Long 4h

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No.... I was trading off the 1hr chart but referring to the 4hr before entry.

(1)Thanks again. To beat the horse -- actually just to try and clarify, so you do not subscribe to Mike's idea that an impulse wave over 10-12 candles requires moving to the 4H to take a trade? (On that CAD trade, the impulse wave was 15 candles + on the 1H). Thats a variance in modern DAZ interpretation between you two?



(2) I dont know if my post above (954) was too lame or too difficult to generate a response. I am suprised this question hasnt come up before, but maybe every software package out there has this fib expansion tool but mine? (if so, that stinks) Anyway, I ran a quick test using one of the recent charts posted here and tried out my idea of a way to create a proxy for the fib ext tool.


I used Mike's 8/15 EurJpy chart posted above to capture the Target 1 and Target 2 produced by his fib exp tool. Then performed the steps on my own charts to see if the numbers matched. Results attached. As expected, since AB=CD, they do (or within 1 pip). I guess I just had to prove it to myself to be sure. It's alittle cumbersome but it works to produce the correct targets that will allow you use the DAZ Sytem. So if anyone else out there has this same issue, here is your solution.

Thanks guys.

Here is one I took this afternoon on the Swissy.
I think it matches your guys' interpretation of DAZ.
Bounce off the 618, stochs confirming, divergence and an IB.

The only issue I had was whether you consider this form of IB
consistent with the method here, i.e., an IB body to body, but
not an IB wick to wick. If anyone could clarify for me, I would
appreciate. Thanks. Also any other issues spotted on the chart
you care to point out would also be appreciated (like the # of
candles in the impulse wave?)

It was nice to get an afternoon trade since I couldnt trade this
morning. Not a whopper, but good for this time of day. I just took
1st target at 10991, and moved the stop up. (the upward sloping
lines are a trend channel, which was another reason for entry for me).

The AUD and AUDJPY are both currently producing
potential trades with similiar patterns.

sorry about the late reply PLz download any MT3 demo platform and do ur analysis therein whereby ur trade is taken on ur preffered broker

yeah, that was a contemporary bullish inside vertical bar.
its ok

A lot of us at times have difficulty recognizing the direction of a trend. I have posted 2 charts and maybe my explanation might help some people with this difficult concept. If you look at the 1st chart where I have zoomed in and indicated a possible entry point you can see it might have returned a 1:1 profit and maybe more if you hung on long enough. I see it as risky because I think the trend is undecided by virtue of the red (25) and green (50) ema's closing up and flattening out along with the price ranging. If you look at the second chart the profit potential is far greater, the trend is more defined. They are the same chart a few days apart. The second one clearly has the ema's down and I think is a much lower risk option.
I only illustrate this for the purpose of saying that by zooming out and getting a bigger picture, you may get a better perspective, not to suggest it is a perfect setup for a trade. It is purely to demonstrate the bigger picture.
I think we need to learn to be patient and wait for established trends. There are enough currencies to choose from to be patient.
I welcome any comments.

GBP USD 4 Hour Daz trade 1st target hit +84 pips

2nd target hit +116 pips.

let see how this one goes.

Hi guys:

re: CHF and AUD trades.
CHF worked, hit all targets
AUD did not (I never entered). This pair can give some very nice impulse moves. So if you are looking to expand your pair universe, give Mathilda a spin on the foor. But be warned, she can turn on a dime, as seen. So R:R, money management and appropriate stops will be a key.

-------------------------------

Also, in response to questions about identifying trends, I toss the simple idea of Trend Channels into the hat. I find it easy to use, and gives a handy visual representation of the trend on your time frame, whether you expand or contract your chart. Plus it has the added bonus of identifying possible trade set-ups/exits at the outer lines (or possibly the middle lines as well), which are just trend lines after all.

Here is an example. The first chart is a scrunched up 60m AUD to show the required swing points. It is suggesting a bottom might be rounding into form over the past 5 trading sessions. See the series of higher lows. The second is the same chart expanded. It shows how easy it is to see the trend in the background even once the detail is blown up. The second chart also shows how a TC can help identify a potential trade set-up. I dont know if this trade will be a good one (do we ever?) as it is a countertrend to the major downtrend of the last 6 weeks in this pair. However, the method is solid and repeats itself over and over, whenever you have swing highs and lows. You will find the same is true on suggesting exit or reversal points. If you already employ trend lines in your analysis, this is a helpful adjunct.

Anways, just a humble suggestion of one simple way to sometimes manage the issue of identifying trend that also has the added benefit of alerting you to possible entry and exit spots.

edit: i later noticed i neglected to add the fibs to this chart on the right. Hopefully its not too difficult to visualize where they would be. Entry near the 78% level. Sorry about that. The trade is still going after a downside challenge to the 8650 levels.

Here is one more example of a trend channel
recent EUR chart

You can see how the upper line held price, before a 200+ pip move south.

You can trade either direction with a TC. But obviously a short will always offer more pips with a downtrending channel while a long will offer more with an uptrending TC.

Can work very well with the DAZ method.

Updates from GBP/USD and USD/CHF trades taken yesterday:

One more comment on using a trend channel with this method.

Using the same AUD chart from 8/18, a TC might had helped you fine tune the targets by showing where to look for strong support -- at the lower leg of the upsloping trend channel.

Had you been looking short at the 50 fib near the 00 level (which would not have been completely unreasonable given the strong intermediate term downtrend), the TC was suggesting possible stop levels and/or adjustments that could be made to the normal DAZ targets. Here the 1H candle was an OB not an IB, but the overall idea is still valid either way. Or perhaps kept you out of the trade all together as entering a short into strong support is not always a great strategy. Still, there were some short-term pips there for the taking. Maybe moving to a lower TF would have been the thing to do?

Anyways, just an idea to throw out for considerartion.

Nice thread. I'm not seeing the trend lines on these charts. They will do well with this system. You guys can try drawing TLs on 4H then switch to 1H for entries or enter trades on 4H.

Thanks for visiting!

Hello evryone. This is my first post here at FF
Thanks for sharing this powerful system.
Is this EURJPY a valid trade?
Trend is down. Price reach 78% and turn around. Stoch is ready to tun down. Now I am waiting for price to go up to 78 level to short.
Thanks for any comments.

Happy pipping to everyone.

here is EUR 60 chart with possible setup

the pros are: fib + IB + stoch hook + divergence + approaching 5sma + top of trend channel

the cons are: not an upper fib level -- has broken 60 sma to the upside -- slower time of day -- too many candles?

am going to watch to see if it rises to the 50 fib / 4800 level

comments from the experts?


ps to DRA: Do you mean the colors are too faint to see?

Good spot but the candle involes are too many,
when u see such setup, don't rush at the setup, look at wot 4hr is saying,
I love to see 4-12(max) candle for valid setup on 1hr.

Look at my 4hr chart and see if the trade is valid
Thanks for alerting us