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Fibonacci Trading with Bobokus

  • #5,681
  • Sep 5, 2008 3:39pm Sep 5, 2008 3:39pm
Quoting alex12
Hi Bob.
I used to trade patterns with fiboacci ratios ( Gartly- Butterfly -Three Drives-HS) but the problem was that you do not get the signals so often but since I have studied and applied your system I get signals much more often .I still trade the patterns only when the it is confirmed by your system otherwise I consider the pattern invalid.
I am going through the whole thread slowly in order to get the feel for the system .As your system is spread all over the thread and I missed the tradingroom session I try to read and have a "written trading plan of your system".
On page 345 post 5167 one of the members ( Jren07) has written a very systhematic trading plan of your system.
I would appreciate if you let us know if you agree with that trading plan or you would like to add or modify that system.
Thanks for sharing your system and knowledge so generously with all of us.
It can be a little more simplified by this:

If the Intraday movement is bullish your looking for a retracement to bounce from the Intraday inner levels 38.2, 50, 61.8 (Short,Pivot,Long)
If the Intraday movement is bearish your looking for a retracement to be rejected from the Intraday's inner levels.

If the Intraday movement is bullish and the retracement breaks through all 3 Inner support levels your looking to scalp a short position since price has not shown to be a rejection yet from resistance levels, a rejection from resistance levels on the next waveform is a reversal signal.
If the Intraday movement is bearish and the retracement breaks all 3 inner resistance levels you looking to scalp long until price is shown to bounce from support levels on the next waveform and it has reversed.

When applying this logic, check for the major support and resistance levels from the larger timeframes that may interfere with the direction your trading.
  • #5,682
  • Sep 5, 2008 3:50pm Sep 5, 2008 3:50pm
Quoting Bobokus
It can be a little more simplified by this:

If the Intraday movement is bullish your looking for a retracement to bounce from the Intraday inner levels 38.2, 50, 61.8 (Short,Pivot,Long)
If the Intraday movement is bearish your looking for a retracement to be rejected from the Intraday's inner levels.

If the Intraday movement is bullish and the retracement breaks through all 3 Inner support levels your looking to scalp a short position since price has not shown to be a rejection yet from resistance levels, a rejection from resistance levels on the next waveform is a reversal signal.
If the Intraday movement is bearish and the retracement breaks all 3 inner resistance levels you looking to scalp long until price is shown to bounce from support levels on the next waveform and it has reversed.

When applying this logic, check for the major support and resistance levels from the larger timeframes that may interfere with the direction your trading.
Fantastic.Thanks Bob. What a gift for weekend!! I will try to read it a few times and practice on it so that it becomes a second nature.
  • #5,683
  • Sep 5, 2008 3:55pm Sep 5, 2008 3:55pm
Bo, when we make trades do the market makers really try to push the stop losses we set to trip them or is it simply supply and demand at work? Do they have comuter software that track all the stops accumulating at price points so they know which way to push the market to them? I've set a few trades in the past ( multi contracts ) that as soon as I set the stop loss it seemed that price made a bee line to it, then price resumed the direction of my trade all withen seconds of my stop loss being set. I don't like flying without a net, but sometimes I wonder what really goes on with the market makers. I am just getting paranoid? You've seen a lot of trades. Did you ever see that as soon as you set a stop loss? By the way, what are non- ECN brokers?
  • #5,684
  • Sep 5, 2008 4:56pm Sep 5, 2008 4:56pm
Quoting kpt1956
Bo, when we make trades do the market makers really try to push the stop losses we set to trip them or is it simply supply and demand at work? Do they have comuter software that track all the stops accumulating at price points so they know which way to push the market to them? I've set a few trades in the past ( multi contracts ) that as soon as I set the stop loss it seemed that price made a bee line to it, then price resumed the direction of my trade all withen seconds of my stop loss being set. I don't like flying without a net, but sometimes I wonder what really goes on with the market makers. I am just getting paranoid? You've seen a lot of trades. Did you ever see that as soon as you set a stop loss? By the way, what are non- ECN brokers?
I feel the same way sometimes about maybe the brokers or better yet their banks might go after folks stop losses but your order must be very huge I would think in order for them to even care about it (probably would need to be in tens of millions).

As Bo stated earlier one can set a hard/mental stop loss at places where if the market goes there it would mean a possible trend reversal. By doing this the chances of getting your stop loss hit become less likely. But Bo did not specifically say where to place it as he uses a mental stop loss I believe.

Perhaps one can put a stop loss at a certain amount of pips beyond the Intraday long/short or Intraday high/low, or simply look for areas of strong S/R, and or swing highs/lows.

My biggest concern though is that sometimes this might mean having a huge stop loss and I'm not sure I'd go for that, I'd rather have a small loss than a big loss and try the setup again if price is being rejected at a certain fib inner level...
  • #5,685
  • Sep 5, 2008 5:02pm Sep 5, 2008 5:02pm
Quoting kpt1956
Bo, when we make trades do the market makers really try to push the stop losses we set to trip them or is it simply supply and demand at work? Do they have comuter software that track all the stops accumulating at price points so they know which way to push the market to them? I've set a few trades in the past ( multi contracts ) that as soon as I set the stop loss it seemed that price made a bee line to it, then price resumed the direction of my trade all withen seconds of my stop loss being set. I don't like flying without a net, but sometimes I wonder what really goes on with the market makers. I am just getting paranoid? You've seen a lot of trades. Did you ever see that as soon as you set a stop loss? By the way, what are non- ECN brokers?
Here is a link to a thread here on FF that can explaign the ins and outs of an ECN and Non ECN type broker
http://forexfactory.com/showthread.php?t=8046

Your stop getting hit is just a combination of the 2. Most traders have a set number they use for stops and if they are entered in your trade contract when you open a trade or even after if you enter it after being in the trade your transmitting that information throughout your brokers trading world.
I do at times use stops but they will be placed beyond a previous support or resistance level in which the market would have to show signs of an obvious reversal in order to hit me. Most traders dont have the stomach to place their stop very far away from their entry and almost always use set numbers because they are bound to a set risk/reward ratio. To me the risk/reward is constantly changing during each trade as the are moves and counter moves in the action over the coarse of the day.The other reason I use stops is to simply protect profits or let the market force me out of a trade.
Hope that helps and read the thread I posted.

I honestly dont think that brokers are out to get you, If you show consistancy I think its actually the opposite.
  • #5,686
  • Sep 5, 2008 11:39pm Sep 5, 2008 11:39pm
Quote:
Originally Posted by kpt1956 http://www.forexfactory.com/images/buttons/viewpost.gif
Bo, in your ever evolving thread I want to be sure I'm up to date. Daily and / or Weekly time frames fibs pull uptrend, downtrend, retracements as needed for confirming uptrend, downtrend, or retracing market. 1 hour time frame fibs pull intraday encompassing 24 hours plus or minus hours in previous day or present if new or past intraday highs and lows are valid. Pull support and resistance fibs for direction and testing of levels for entries and exits off intraday fib. In adjusting uptrend and downtrend fibs move highs and lows if price making higher highs or lower lows. Move intraday from day to day if 1) intraday targets hit or 2) significant retracements occur in intraday pricing, ( Both as intraday highs and lows are made). Use retracement fib for direction on Daily or Weekly time frames and once pricing is retricted to retracing price levels and not trending up or down. Base entries in the direction of the trend on breaking support or resistance. Base entries counter to the direction of the trend on test failures of key fib levels not necessarily just the testing of highs or lows, but pivot points and other levels. Moves are stronger if tested or confirmed by both the higher and lower time frame fibs. Watch envelope for confirmation of trends or retracements. After entering trades adust stop loss to break even and target area points if possible. Let market take trade out. Be aware of daily events not so much to trade off as to evaluate market effect on trades. Anything else I have forgotten. Thanks Bo


Quoting Bobokus
Actually thats pretty good !
That was a pretty darn good Readers Digest version. Good One!!!
trading naked.......
  • #5,687
  • Sep 6, 2008 8:19pm Sep 6, 2008 8:19pm
hey bo could you explain to me something...it about the swing fib...when you pull a swing fib.. and when price reaches the levels of long, pivot and short... how do you decide to go long or short...do you go long or short according to the intraday levels...what i normally do is if i pull the swing fib for a bear movement i would be bias to short with respect to the intraday levels but what i notice is that there are times price went up and t1 of that current long movement and i would be in currently short... so bo how do you decide to go long or short at the swing fib.... sometimes if i were to take the break of the swing fib would be too late...
  • #5,688
  • Sep 7, 2008 1:40am Sep 7, 2008 1:40am
Quoting xscamx
hey bo could you explain to me something...it about the swing fib...when you pull a swing fib.. and when price reaches the levels of long, pivot and short... how do you decide to go long or short...do you go long or short according to the intraday levels...what i normally do is if i pull the swing fib for a bear movement i would be bias to short with respect to the intraday levels but what i notice is that there are times price went up and t1 of that current long movement and i would be in currently short... so bo how do you decide to go long or short at the swing fib.... sometimes if i were to take the break of the swing fib would be too late...
I base my entry's from the Intraday not the Swing fib.
  • #5,689
  • Sep 7, 2008 4:57am Sep 7, 2008 4:57am
Bobokus

If you base your trades on Intraday, do you plot the FIBs on the current day's chart or do you use the prior day's FIBs?

Another question: as we all see, the EURJPY has been on a strong downtrend, but has retraced quite a bit on Friday on the hourly candle of over 160 PIPs, would you still consider going short or maintain any existing short positions?
  • #5,690
  • Sep 7, 2008 6:16am Sep 7, 2008 6:16am
Quoting et_phonehome_2
Bobokus

If you base your trades on Intraday, do you plot the FIBs on the current day's chart or do you use the prior day's FIBs?

Another question: as we all see, the EURJPY has been on a strong downtrend, but has retraced quite a bit on Friday on the hourly candle of over 160 PIPs, would you still consider going short or maintain any existing short positions?
You want to look for entry's based off the previous days movement. An example is Fridays entry would be based off the movement and retracement of Thursday, Thursdays from the movement of Wednesday...etc etc...
I dont normally trade any cross pairs, to me its what will the USD/Yen do In releation to what the Euro/USD is doing, but looking technically at a E/Y 1 hour chart it looks to have formed a double bottom from Thursday and Friday's movements, which would lead us to believe we should see some deeper retracement into this downtrending here recently. 1st clue is the current movement will show support holding if it retraces back down any, a break of that support and stay away unless the previous low breaks to prevent yourself from getting caught short at the bottom of a ranging market.
  • #5,691
  • Sep 7, 2008 2:23pm Sep 7, 2008 2:23pm
hello bobokus,
i have gone through your thread again.you sis a great job. as a matter of fact i have asked lots of questions earlier and galaxymom has really helped answering all of my questions plus the one you also answered..but please i want to ask...i went through your thread and became a little more confused about fibonacci

what is the major concept behind fibonacci trading? is it just retracement?and at what levels do you watch out for retracements to place trades?

more so do you consider news while trading?

hope to hear from you and happy pips taking..
  • #5,692
  • Sep 7, 2008 3:16pm Sep 7, 2008 3:16pm
Quoting bjpumping
hello bobokus,
i have gone through your thread again.you sis a great job. as a matter of fact i have asked lots of questions earlier and galaxymom has really helped answering all of my questions plus the one you also answered..but please i want to ask...i went through your thread and became a little more confused about fibonacci

what is the major concept behind fibonacci trading? is it just retracement?and at what levels do you watch out for retracements to place trades?

more so do you consider news while trading?

hope to hear from you and happy pips taking..
The fibonacci tool , is just that a tool to measure price movement. Some traders will use them to measure price over set time periods like Monthly high to monthly low, weekly high to weekly low, daily high to daily low etc..etc..
Me personally I like using it to measure actual price movement from price waveforms high and lows. Its a matter of personal preference and what you find works best for you.
The tool measures how much price will retrace (to inner levels of 38.2, 50, 61.8) from the amount of movement your measuring, under the general rule of....the less it retraces the more likely it is to continue in the original direction...the more it retraces the more likely it is to reverse.
The extensions from the tool just give an approximate range that price can travel in reference to the amount of price being measured and used as targets.
Its a very simple logic, it is we who complicate it. There is alot of online crap that propose fibs having a magical or mystical reasoning as to why they work or are used but that is far from the truth and it gives traders the wrong impression. Ive used this analagy before and its they work more on the ole 35%/65% wholesale /retail type logic. In that buying dips in an uptrend gets a wholesale price(inner levels) you close it once it reaches retail price(extensions). The reverse when trading in a short market or selling rally's.
The news events or economic indicators just help speed up the process. The Support and Resistance levels either hold or they dont , the news events only matter when they have the enough of a chance to change the market sentiment and convince enough traders to reverse the way they view or have a bias to each pair.
  • #5,693
  • Sep 7, 2008 3:50pm Sep 7, 2008 3:50pm
I just love the way you explain sensible logic in a very easy to understand way.

Gotta love fibs the way Master Bo is teaching them to us!!

The more you explain it, the easier it becomes....

Happy Pippin' all
KC

Quoting Bobokus
The fibonacci tool , is just that a tool to measure price movement. Some traders will use them to measure price over set time periods like Monthly high to monthly low, weekly high to weekly low, daily high to daily low etc..etc..
Me personally I like using it to measure actual price movement from price waveforms high and lows. Its a matter of personal preference and what you find works best for you.
The tool measures how much price will retrace (to inner levels of 38.2, 50, 61.8) from the amount of movement your measuring, under the general rule of....the less it retraces the more likely it is to continue in the original direction...the more it retraces the more likely it is to reverse.
The extensions from the tool just give an approximate range that price can travel in reference to the amount of price being measured and used as targets.
Its a very simple logic, it is we who complicate it. There is alot of online crap that propose fibs having a magical or mystical reasoning as to why they work or are used but that is far from the truth and it gives traders the wrong impression. Ive used this analagy before and its they work more on the ole 35%/65% wholesale /retail type logic. In that buying dips in an uptrend gets a wholesale price(inner levels) you close it once it reaches retail price(extensions). The reverse when trading in a short market or selling rally's.
The news events or economic indicators just help speed up the process. The Support and Resistance levels either hold or they dont , the news events only matter when they have the enough of a chance to change the market sentiment and convince enough traders to reverse the way they view or have a bias to each pair.
  • #5,694
  • Sep 7, 2008 3:52pm Sep 7, 2008 3:52pm
Bo, aside from the case that GU usually covers it's gaps, is there any rational basis for trading what you see right now ? I have adjust intraday to new high and, honestly, did take the opp to scalp some pips during the frenzy but would like your thinking on this.
  • #5,695
  • Sep 7, 2008 4:11pm Sep 7, 2008 4:11pm
how can you base entry off previous days range if you plan on being in the trade for the next few hrs to days?....isnt the longer term picture more important, than what happened just 24hrs ago?
  • #5,696
  • Sep 7, 2008 4:46pm Sep 7, 2008 4:46pm
Quoting kc8flq
I just love the way you explain sensible logic in a very easy to understand way.

Gotta love fibs the way Master Bo is teaching them to us!!

The more you explain it, the easier it becomes....

Happy Pippin' all
KC
Just tryin to help make it easier to understand what they really are vs the magical mystical crap you always see.
  • #5,697
  • Sep 7, 2008 4:47pm Sep 7, 2008 4:47pm
Quoting prov1813
Bo, aside from the case that GU usually covers it's gaps, is there any rational basis for trading what you see right now ? I have adjust intraday to new high and, honestly, did take the opp to scalp some pips during the frenzy but would like your thinking on this.
Dont sweat it the best thing to do right now is wait it out and see whats inplay, opportunity's will present themselves later.
  • #5,698
  • Sep 7, 2008 4:49pm Sep 7, 2008 4:49pm
Quoting big_pipin
how can you base entry off previous days range if you plan on being in the trade for the next few hrs to days?....isnt the longer term picture more important, than what happened just 24hrs ago?

We'll if you want to trade Intraday your trading these daily movements as price makes its way to the higher timeframe levels.
  • #5,699
  • Sep 7, 2008 5:25pm Sep 7, 2008 5:25pm
Quoting Bobokus
The Support and Resistance levels either hold or they dont
That sounds strangely familiar....but where have I heard it?
"Support and Resistance either holds or it doesn't." -Anonymous hillbilly
  • #5,700
  • Sep 7, 2008 5:39pm Sep 7, 2008 5:39pm
Quoting Thexder
That sounds strangely familiar....but where have I heard it?
Hehe. Thexder, Bo had to get it from somewhere, so obviously he got it from you.

Only teasing. Go guys, go.

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