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New Mouteki Method...

  • #1,161
  • Sep 27, 2008 7:50am Sep 27, 2008 7:50am
Quoting Jared
Picked a random spot in the market on USD/JPY, happened to be june 07. Started to map out and trade on vhands. Mapped out a 1000+ pip move successfully on the first try! Check out the respect.

(I don't use the same extentions as mouteki btw).
Very nice chart BTW
  • #1,162
  • Sep 27, 2008 9:44am Sep 27, 2008 9:44am
Dave,

Thank you very much...your contributions are greatly appreciated!

With indicator trading, the entries are usually obvious (line 1 crosses line 2, etc), but the exits can be rather challenging.

With Fib and "Mouteki Fib" trading, the targets (exits) are usually rather evident (Fib Expansions, Fib Zones, etc). However, as Barak's Pip has described, determining the true direction and best entry point are the biggest challenges, especially for new traders. This is obviously where fundies and PA take over.

I agree with Barak's Pip and continue to learn more about when to enter every day. The good news is you can take some chances with your entries because we are usually dealing with 4:1, 6:1, even 10:1 Reward:Risk ratios. Getting stopped out at -40 pips when you are targeting +400 (10:1) does not "hurt" nearly as bad as getting stopped out at -40 pips when you are targeting +20 (1:2).

zznbrm

Quoting ozziedave
Ok...some of you are still a bit confused about pulling fibs in both directions. I've attached a 4hr GPBUSD chart so we can get an over view of waht we did in the other lessons.
  • #1,163
  • Sep 27, 2008 10:25am Sep 27, 2008 10:25am
yup, i agree that is the greatest strength of the system. the risk to reward ratio is excellent.

Suppsoe your trades only work 50% of the time, that is 1 out 2, and any guess is as good as that.. You would still be very profitable with your trades.

Add to that the consideration of fib harmony and news, that makes a very sound trading system.
  • #1,164
  • Sep 27, 2008 11:03am Sep 27, 2008 11:03am
Quoting soyabean
yup, i agree that is the greatest strength of the system. the risk to reward ratio is excellent.

Suppsoe your trades only work 50% of the time, that is 1 out 2, and any guess is as good as that.. You would still be very profitable with your trades.

Add to that the consideration of fib harmony and news, that makes a very sound trading system.
I agree , it is really good in terms of r\r , it will be interesting to see the outcome after a year trading this system , or to back test it a year backwards , and see ...

I guess that the most challenging thing will be to decide when to enter a trade practiclly -
one way- is to enter a trade each time u think that price respected a fib level\zone .
second way - is to wait that price will done respecting the and join in with the first large candle.

the disadvantage in the first way is that you be in the trade a long time before price will start moving to your direction , and you'll just watch it respecting over and over again , or even create a higher\lower respects while it takes your stop , the advatage is that your stop loss is relativelly small.

any way , I guess that patience is the key here while u are deceided entering a trade ....

Barak.
  • #1,165
  • Sep 27, 2008 11:14am Sep 27, 2008 11:14am
Quoting Barak's pip
I agree , it is really good in terms of r\r , it will be interesting to see the outcome after a year trading this system , or to back test it a year backwards , and see ...

I guess that the most challenging thing will be to decide when to enter a trade practiclly -
one way- is to enter a trade each time u think that price respected a fib level\zone .
second way - is to wait that price will done respecting the and join in with the first large candle.

the disadvantage in the first way is that you be in the trade a long time before price will start moving to your direction , and you'll just watch it respecting over and over again , or even create a higher\lower respects while it takes your stop , the advatage is that your stop loss is relativelly small.

any way , I guess that patience is the key here while u are deceided entering a trade ....

Barak.
Yup, I am trying to find the right entry method too. Currently still trying out candle reversal patterns and awesome oscillator as confirmation for entry.

Mouteki has shown us a few examples through his vids. Cant wait for more vids from him!
  • #1,166
  • Sep 27, 2008 1:14pm Sep 27, 2008 1:14pm
Quoting soyabean
Yup, I am trying to find the right entry method too. Currently still trying out candle reversal patterns and awesome oscillator as confirmation for entry.

Mouteki has shown us a few examples through his vids. Cant wait for more vids from him!
I'll be thankful if u can reffer me to the vids that he's showing his entry strategy , all I have seen by now is the last usd\chf vid when he said that he entered in that big bearish candle ...

I think this is the next very important issue , entry \ exit \ trade management strategey that go best with the stuff we've been watching by now .... if we'll have that part of the puzzle - it's a winner !!!
after all , maping the price action is great , but the key of making actual money out of all that is in the entry\exit\management strategy ....and that I couldn't figure by now , I wish he will be talking about that in his next videos.
  • #1,167
  • Sep 27, 2008 3:44pm Sep 27, 2008 3:44pm
Quoting grAgol4
Lastly and probably most importantly, trading is about probabilities and consistency.
Good point! I mentioned before that Mouteki Fibo is a MAP, not a trading system. Some of you pay too much attention to analysing every small move which may look like a retracement etc.

Fibo's just tell you where the market MAY (or is likely to) go next. Exits/entries should not be relied on the Fibo (alone). Price Action is the key to success when it comes to entry/exit.

E.g. on this chart posted by Barak's Pip, he question possible entry points (based on his interpretation of Fibo level), but the market there was consolidating. After consolidation it could have retraced more or continued major move. PA could tell you that. 2nd arrow on the chart points to a great Pinbar. You could go short there irrespective of Fibos (PBs is a separate subject - have a look at James16 thread). But, that pinbar (at that point) clearly showed market did not want too/could not to go higher. 3rd arrow is also PB (not as good as the one at the 2nd arrow., though), and it's high is lower then the previous PB's high. That indicates market's inability to go higher (not to say it will NOT happen). So, PA tells you that for now the retracement is over. But you don't just jump in, you wait for the price to break the "consolidation channel", i.e. around 8370, to breakout the trendline (marked on the chart).

So, Fibo tells you where you are, PA tells when to start moving.
Attached Image
One Chart is Worth Ten Thousand Words.
  • #1,168
  • Sep 27, 2008 4:50pm Sep 27, 2008 4:50pm
Quoting Forex007
Good point! I mentioned before that Mouteki Fibo is a MAP, not a trading system. Some of you pay too much attention to analysing every small move which may look like a retracement etc.

Fibo's just tell you where the market MAY (or is likely to) go next. Exits/entries should not be relied on the Fibo (alone). Price Action is the key to success when it comes to entry/exit.

E.g. on this chart posted by Barak's Pip, he question possible entry points (based on his interpretation of Fibo level), but the market there was consolidating. After consolidation it could have retraced more or continued major move. PA could tell you that. 2nd arrow on the chart points to a great Pinbar. You could go short there irrespective of Fibos (PBs is a separate subject - have a look at James16 thread). But, that pinbar (at that point) clearly showed market did not want too/could not to go higher. 3rd arrow is also PB (not as good as the one at the 2nd arrow., though), and it's high is lower then the previous PB's high. That indicates market's inability to go higher (not to say it will NOT happen). So, PA tells you that for now the retracement is over. But you don't just jump in, you wait for the price to break the "consolidation channel", i.e. around 8370, to breakout the trendline (marked on the chart).

So, Fibo tells you where you are, PA tells when to start moving.
these r good points , and I thank u for bringing it to our attention ,
I am trying to use everything I can in order to success in this market , candles formations , support & resistant levels , Phill Nell's Macd sys. , divergences and shortly every edge I can get to win in this market .

if I understood u correctlly , you suggested to use other knowledge in order to decide when a price had done retracing and it is ready to move back to it original direction , and by using the map offered by Mouteki you we are able to determine what the price is doing at a time and where is doing it (levels) , and in order to decide when to get into a trade we have to use some other tools .... is it correct?

and if it is , let me add one more chart of the cad\jpy and this time I found that yellow trend line that looks like resisting the price ... and to me looks like another aprroval for short - what do u think guys?

Barak
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  • #1,169
  • Sep 27, 2008 5:23pm Sep 27, 2008 5:23pm
I see many of you asking about entries. If you listen to Mouteki's videos he states several times that he wants us to develop our own entry and exit strategies and as far as I can see you could have countless ways to get into and out of the market. The Fib Zones are a map to the market and the trend direction. Mouteki has kindly provided us with clues through his videos of how he trades the moves so I will review the trade that he went over in his GBP video so people can follow it in the forum.

The GBP is in a up move according to the Fib Zones. We pull Fib A and the Fib A expansion. Price goes up from point A to point B and takes out the 610 Fib Zone and the 61% Fib Expansion Level of Fib A. The 610 Fib Zone is a very important level because the next move should be from 610 to 987 which is a about a 370 pip spread...and let's be honest...most of us would love to trade for 300 pips + in one go.

Ok..so we're at point B and we start to see a retracement so we pull our next fib which is Fib B. We see at point C there is respect of the 38% retracement level of Fib B. Now here is where we need to watch price action closely. Take a look at the 2 candles in the gray circle. See how they are both rather long candles and shoot up from the 38% level. That is what Mouteki is talking about when he is talking volume. From here the entry is rather straight forward. When price goes through the 61% Fib Expansion level of Fib A..boom...you enter. When price hits the level the second time it just confirms that it will continue and take out the 100% Fib Expansion of Fib A and the 987 Fib Zone. You can also pull the Fib Expansion of Fib B since we've had respect of Fib B. This gives us new profit targets above the 987 Fib Zone.

So now we've taken out the 987 Fib Zone...based on this analysis of price taking out the 610 Fib Zone what do you think should be happening with price at this time...take a look at your chart...what direction is price moving in the past few days???
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  • #1,170
  • Sep 27, 2008 7:50pm Sep 27, 2008 7:50pm
Quoting Barak's pip
these r good points , and I thank u for bringing it to our attention ,
I am trying to use everything I can in order to success in this market , candles formations , support & resistant levels , Phill Nell's Macd sys. , divergences and shortly every edge I can get to win in this market .

if I understood u correctlly , you suggested to use other knowledge in order to decide when a price had done retracing and it is ready to move back to it original direction , and by using the map offered by Mouteki you we are able to determine what the price is doing at a time and where is doing it (levels) , and in order to decide when to get into a trade we have to use some other tools .... is it correct?

and if it is , let me add one more chart of the cad\jpy and this time I found that yellow trend line that looks like resisting the price ... and to me looks like another aprroval for short - what do u think guys?

Barak
i would only enter on a evening star, bearish engulfing or tweezer top formation... with confirmation of AO turning down
  • #1,171
  • Edited Sep 28, 2008 4:37pm Sep 27, 2008 9:41pm | Edited Sep 28, 2008 4:37pm
I haven't seen much written about the USDCHF pair lately so I thought I'd go through my take on where we are.

Pull up a daily chart and follow along. As you can see price has broken the 1597 Fib Zone and is retracing (points A to B). We have Fib A which is still in play because it has the 161% Fib Expansion above current price levels. Ok, now draw Fib B up to the last swing high (point A) and we see that price has retraced down to the 38% Fib Retracement level of Fib B (point B). Now Fib B becomes a validated Fib and the Fib Expansions of Fib B become part of our price projections.

Ok..so take at look at the current price level and ask yourself where might price go next week? Well..the answer is either up or down (point C or D). Now ask yourself based on the data we've collected what are the probabilities of price moving down and what are the probabilities of price moving up?

So let's take a look at what might happen. If price starts to move down here's what I would do. I would go to my 1 hr chart and start to map out the down move from point A using the Fib Zones and Fibs. Take a look at the down move ...do we have any harmony? I've already done this and you might want to do it to so if the dollar gets weaker you'll be prepared for the down side move. This will help you determine where price might go if the down move continues...try it on your own to get a feel for how the Fib Zones might work in both directions.

Ok..let's look at the up move. We know that price has retraced to the 38% retracement level of Fib B which has validated Fib B and we can pull our Fib Expansions for Fib B now. What is a little concerning about this pair is we've already passed the 1597 Fib Zone and a move to the 2584 Fib Zone is a massive move from where we started from. The thing you have to keep in mind is to follow your analysis and don't second guess yourself on direction just because you don't think price can go any higher. Now if you watched Mouteki's videos where he placed trades and picked up on the methodology you will see that we have the same type of set up just at a different Fib Zone. So ask yourself..if price moves to the up side when can I join the party??? Folloing what Mouteki did I think you would stack the probabilities in your favour if you get in when price breaks the 61% Fib Expansion level of Fib B. Between the 61% Fib Expansion of Fib B and the 2584 Fib Zone there's about 800 pips.

Now, taking into consideration the current banking crisis in the USA there may be a good possibility that the dollar will get weaker over the next few weeks and if that happens...well...just keep this chart in mind. If you are a more experienced trader or you have a system that you have alot of confidence in, you may want to pick and choose your entries and take out chucks of profit along the way.

No one knows for sure which way price will go, all we can do is be prepared to trade in either direction once it makes up its mind.

I am not making any trading recommendations here, this chart is for education purposes only. Trade at your own risk.
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  • #1,172
  • Sep 27, 2008 10:15pm Sep 27, 2008 10:15pm
Hello felloew traders,
This is off subject but I came accross this blog from a member here at the factory.He breaks it all down,he explains the reality side of this market.Not the fantasy side most of us new traders thought forex was about.
http://blog.forexfantasies.com/categories/General.aspx

Start with the introduction audio file,good stuff!
  • #1,173
  • Sep 27, 2008 10:50pm Sep 27, 2008 10:50pm
Quoting Hwd


I think so.

Reasons:

1. Total respect for the 233 FZ

2. Takes out FE 61.8 with total respect then rebounds.

3. Good Respects at FZ 377

4. Rebounds at FZ 377 and respects FZ 233 again.

Indicates that FZ 610 should be taken out.

This pair's setup is very similar to the EUR/CAD, which I have asked the members of the forum to give feedback but I guess people are more interested in the majors, though Mouteki has said in his videos not to get stuck on the majors.

However, some more input on the AUD/CAD would be appreciated.


Thanks for recommending this pair.


TO THE FORUM:

I asked for responses on the pair AUD/CAD 3 days ago. I asked that people take a look at it after it was brought up by soartosky (not sure of spelling) but no one responded. Now Mouteki has the setup posted on his website as PERFECT setup and I guess now people will look at it, which is good.

However, I am asking the forum to take a look at setups and do not underestimate any member here. We are all learning, though some traders are more experienced, we must all look out for each other, just as Mouteki has done.

I also asked for responses on the EUR/CAD setup, which I still think is gonna go north to hit the 610 (it has a similar setup) and no one responded.

I take this forum seriously and this method as a means where people can achieve financial freedom, so I hope to see a little better responses.
  • #1,174
  • Sep 28, 2008 12:56am Sep 28, 2008 12:56am
Hi OzzieDave,

Just a sincere thank you for your lessons and present analyses. Keep up the good work.

Herty
  • #1,175
  • Sep 28, 2008 1:16am Sep 28, 2008 1:16am
Quoting Hwd
TO THE FORUM:

I asked for responses on the pair AUD/CAD 3 days ago. I asked that people take a look at it after it was brought up by soartosky (not sure of spelling) but no one responded. Now Mouteki has the setup posted on his website as PERFECT setup and I guess now people will look at it, which is good.

However, I am asking the forum to take a look at setups and do not underestimate any member here. We are all learning, though some traders are more experienced, we must all look out for each other, just as Mouteki has done.

I also asked for responses on the EUR/CAD setup, which I still think is gonna go north to hit the 610 (it has a similar setup) and no one responded.

I take this forum seriously and this method as a means where people can achieve financial freedom, so I hope to see a little better responses.
hey man,

there's some several posts of mine and some other people concerning those two pairs in earllier posts , u just have to look back in the thread , I don't believe anyone intentially did not replyed to your posts .

there r many posts that I've asked about and in beginning I got angry that no one had reply to , but sometimes when I've looked backwards in the thread I saw they were discussed before .

good luck.
  • #1,176
  • Sep 28, 2008 1:53am Sep 28, 2008 1:53am
Quoting Barak's pip
hey man,

there's some several posts of mine and some other people concerning those two pairs in earllier posts , u just have to look back in the thread , I don't believe anyone intentially did not replyed to your posts .

there r many posts that I've asked about and in beginning I got angry that no one had reply to , but sometimes when I've looked backwards in the thread I saw they were discussed before .

good luck.
Thanks for the advice, I guess u could be right.
  • #1,177
  • Sep 28, 2008 1:58am Sep 28, 2008 1:58am
but mouteki doesn't plot correctly the retracements! looks 4:09
  • #1,178
  • Sep 28, 2008 2:40am Sep 28, 2008 2:40am
Quoting Potax
but mouteki doesn't plot correctly the retracements! looks 4:09
The retracement didn't even get to 38.2. There were still 10 pips to go. So I couldn't say that this retracement level was respected....
Maybe Mouteki can explain how we must view this.
  • #1,179
  • Sep 28, 2008 2:56am Sep 28, 2008 2:56am
after whatched that vid of aud\cad , and my posts on the cad\jpy , I want to add the usd\cad - in the weekly chart you'll see a trend line that was a resistant line , until price break it - and now looks like that it turned into support , it's to early to determine that cad is about to get bit up during this coming week\s ?!

in the 4 hr chart you'll see that price left tails on that trend line , and if it won't break it - my vision is that we will see the usd going to higher prices .

best of luck.
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  • #1,180
  • Sep 28, 2008 4:06am Sep 28, 2008 4:06am
Apologies if this question has been answered before.

On the fib expansion tool, we have a line drawn from point "A" to "B". I've noticed that there is a second line that froms a point "C" which appears to be set at an arbitary 50% of A->B.

In Mouteki's videos, he doesnt appear to move point "C" whereas I would have thought that "C" should be dragged to a price retracement.

Can anyone help?

Thanks

Simon
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