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The View DownRiver

  • #181
  • Mar 1, 2007 5:21am Mar 1, 2007 5:21am
I am going to say something that will give you a clue to my thinking. There is nothing else for me to develop on the topic. You will need to take it and run with it. When looking at a trading time frame, many traders look at the close of a given period. I would suggest you look at the open of the period you are analyzing and not worry about the close. Particularly on the longer time frames.

Now with that said....

First I look a monthly charts going back several years and look for classic S&R zones. Once identified, I go to the weekly levels and look at price action, then further refine s&r in these areas, lastly I use the daily chart and do the same thing. . It is very time consuming. I print out charts, draw lines, etc. But it works. It is old fashioned, that is why it works. There is no magic. Once you do it for many months, you get better and better.

In the currency markets, you always have.....

movement, consolidation, movement, consolidation.

Currencies are much differenet than a stock, or stock index. Think about what implication fair value has if the EURUSD moves 100 pips for central bank, Airbus, etc. Much different implications that if IBM or Big China Utility runs up to new levels. Equilibrium returns for currencies because it almost has to.

There you have it. Clear as mud.

Quoting Tradeit
not complicating but graduakky trying to become Master Trader.

When you are looking to define those SR levels what particular method you are utilizing to locate them? consolidations, fibos, your own? how does this play part in defining those yellow lines?

thanks
  • #182
  • Mar 1, 2007 6:09am Mar 1, 2007 6:09am
Thanks For the Clue DRT. Good info

However you did not answer tradeit's very good question of "How" you determine these S/R areas. I understand you draw lines and print copies etc. But like tradeit asked I too have been wondering "How" and what do you use to define your support and resistence zones?

Also could you clarify the significance of the open of a candle/bar as opposed to the close?

THanks

TY


I am going to say something that will give you a clue to my thinking. There is nothing else for me to develop on the topic. You will need to take it and run with it. When looking at a trading time frame, many traders look at the close of a given period. I would suggest you look at the open of the period you are analyzing and not worry about the close. Particularly on the longer time frames.

Now with that said....

First I look a monthly charts going back several years and look for classic S&R zones. Once identified, I go to the weekly levels and look at price action, then further refine s&r in these areas, lastly I use the daily chart and do the same thing. . It is very time consuming. I print out charts, draw lines, etc. But it works. It is old fashioned, that is why it works. There is no magic. Once you do it for many months, you get better and better.

In the currency markets, you always have.....

movement, consolidation, movement, consolidation.

Currencies are much differenet than a stock, or stock index. Think about what implication fair value has if the EURUSD moves 100 pips for central bank, Airbus, etc. Much different implications that if IBM or Big China Utility runs up to new levels. Equilibrium returns for currencies because it almost has to.

There you have it. Clear as mud.

Quote:
Originally Posted by Tradeit http://www.forexfactory.com/images/buttons/viewpost.gif
not complicating but graduakky trying to become Master Trader.

When you are looking to define those SR levels what particular method you are utilizing to locate them? consolidations, fibos, your own? how does this play part in defining those yellow lines?

thanks


__________________
"Like a River, always flowing, realizing there is a vast Ocean awaiting."

DRT
  • #183
  • Mar 1, 2007 7:42am Mar 1, 2007 7:42am
I think DRT opened his own board.
  • #184
  • Mar 1, 2007 8:52am Mar 1, 2007 8:52am
I am still here. Not going anywhere. I am also still updating all the charts daily if possible.

I like to give people time to figure things out. It is the secret of learning responsibly. It is amazing what the human brain can accomplish when it needs to or should I say wants to.
  • #185
  • Mar 1, 2007 10:32am Mar 1, 2007 10:32am
Thank you!

However your answer brings more questions... I read your recent post about learning responsability and letting brain figuring out. I want to say that I am not lazy and want to learn how you are approaching SR calculations on longer term charts so I can improve creating those levels intraday.

The only method I saw that focused on Opening Price is Market Profile for Intraday Trading. In Forex in particular, there are not much difference what you are looking for Opening and Closing prices since we are dealing in 24 hour markets. Correct? So if I am looking at the opening prices, am I looking for the same consolidation areas most people locate in close prices or am I looking for bar ranges and Price Patterns in relation to the Open Price. You already stated that you are not using MP and Opening Balance.

In addition, when you do calculate those levels for spot do you also correlate that with futures, bonds, gold, oil charts?

My brain is trying to figure it out. Please point me in the appropriate direction


Quoting DownRiverTrader
I am going to say something that will give you a clue to my thinking. There is nothing else for me to develop on the topic. You will need to take it and run with it. When looking at a trading time frame, many traders look at the close of a given period. I would suggest you look at the open of the period you are analyzing and not worry about the close. Particularly on the longer time frames.

Now with that said....

First I look a monthly charts going back several years and look for classic S&R zones. Once identified, I go to the weekly levels and look at price action, then further refine s&r in these areas, lastly I use the daily chart and do the same thing. . It is very time consuming. I print out charts, draw lines, etc. But it works. It is old fashioned, that is why it works. There is no magic. Once you do it for many months, you get better and better.

In the currency markets, you always have.....

movement, consolidation, movement, consolidation.

Currencies are much differenet than a stock, or stock index. Think about what implication fair value has if the EURUSD moves 100 pips for central bank, Airbus, etc. Much different implications that if IBM or Big China Utility runs up to new levels. Equilibrium returns for currencies because it almost has to.

There you have it. Clear as mud.
  • #186
  • Mar 1, 2007 11:18am Mar 1, 2007 11:18am
I was not implying that you were lazy. Sorry if you got that impression. The exact way to calculate s&r is beyond the scope of a short post but basically it is looking for areas where price consolidates. Look for very narrow range bars or candles. Places where price is rejected over and over. Once a level is broken it often acts to support or resist when price comes back the other way. You might try some material on technical analysis. It is a standard concept. Be sure to look at the monthly charts.

Quoting Tradeit
Thank you!

However your answer brings more questions... I read your recent post about learning responsability and letting brain figuring out. I want to say that I am not lazy and want to learn how you are approaching SR calculations on longer term charts so I can improve creating those levels intraday.

The only method I saw that focused on Opening Price is Market Profile for Intraday Trading. In Forex in particular, there are not much difference what you are looking for Opening and Closing prices since we are dealing in 24 hour markets. Correct? So if I am looking at the opening prices, am I looking for the same consolidation areas most people locate in close prices or am I looking for bar ranges and Price Patterns in relation to the Open Price. You already stated that you are not using MP and Opening Balance.

In addition, when you do calculate those levels for spot do you also correlate that with futures, bonds, gold, oil charts?

My brain is trying to figure it out. Please point me in the appropriate direction
  • #187
  • Mar 1, 2007 11:24am Mar 1, 2007 11:24am
Also I had another thought. Did you see the information I typed up about "How to Set Up Your Charts". Have you done this? If so, you can see print out a long term chart and see where my lines are drawn. This should help point out the areas that I am seeing. Granted they are evolving, but start doing this on a day to day basis and maybe it will help you.
  • #188
  • Mar 1, 2007 11:38am Mar 1, 2007 11:38am
Super! Thank You
  • #189
  • Mar 1, 2007 11:38am Mar 1, 2007 11:38am
Quoting DownRiverTrader
I was not implying that you were lazy. Sorry if you got that impression. The exact way to calculate s&r is beyond the scope of a short post but basically it is looking for areas where price consolidates. Look for very narrow range bars or candles. Places where price is rejected over and over. Once a level is broken it often acts to support or resist when price comes back the other way. You might try some material on technical analysis. It is a standard concept. Be sure to look at the monthly charts.
Thank you again!

I did not say that you had imlied that I was lazy. Sorry. I was stating that I was not lazy.

In any case, I do use your yellow lines on my charts. I have also read few books on SR methods and have used trendline and pivots to calculate mine. I just was looking to see how you do yours. I am sure it will come some day.

But here are more specific questions. Since you mentioned Open Price, what does this do for you? The consolidation and bar formation are independent from open price, I imagine.

Another questions, your possible targets especially if you are projecting to the price levels for new highs/lows, something that there has not been any historical data.

I hope you do not mind me being so persistent with my questions. I am just learning from you and I appreciate all your help as I am sure many others do.
  • #190
  • Mar 1, 2007 12:57pm Mar 1, 2007 12:57pm
Hi DRT,

What are those thin dark voilet lines? Are these new levels?
I noticed that you referred to them mostly in your 3-1 chatrs.

Anyway I decided to establish a new long on AUDUSD at 7852.
  • #191
  • Mar 1, 2007 5:46pm Mar 1, 2007 5:46pm
Ok, now I got it. These are new levels.
Another question: How do you handle risk on close?
That is, it often happens that you only will close position if a daily close below or above a certain level. But one can't know eaxactly where that might be thus making risk undefined. In other words how far would you let position go on a day before deciding that that's enough?

Here it is, clear as mud.
I hope I make myself clear.
  • #192
  • Mar 1, 2007 6:11pm Mar 1, 2007 6:11pm
Quoting irusoh
Anyway I decided to establish a new long on AUDUSD at 7852.
I got in long too at 7850.
Is your SL my TP?
  • #193
  • Mar 2, 2007 7:47am Mar 2, 2007 7:47am
Any comments on your daily adjustments to the support and resistance levels? GBPUSD moved 150 pips away from the River. Is it a good buy? Or do we recalculate the value based on the hourly level and consider the shorts past 9400?

Not looking for trading ideas. Looking to see how you are adopting your strategy when the conditions are changing.

I remmeber in one of your latest updates you were looking for longs in the River area

Thanks
  • #194
  • Mar 2, 2007 7:51am Mar 2, 2007 7:51am
I exited on the move down today for a loss and I bought at 9418. The push through the yellow line at zone -1 in the charts. My targets are 9518, then 9584.

If the session were end now, the new daily river level would come in around 9500.
  • #195
  • Mar 2, 2007 7:55am Mar 2, 2007 7:55am
I will post the hourly chart for you once 11:00 AM passes so it is more accurate. Standby.
  • #196
  • Mar 2, 2007 8:02am Mar 2, 2007 8:02am
Here it is

http://home.comcast.net/~downrivertr...p_3-2-2007.PNG
  • #197
  • Mar 2, 2007 8:07am Mar 2, 2007 8:07am
Quoting DownRiverTrader
I exited on the move down today for a loss and I bought at 9418. The push through the yellow line at zone -1 in the charts. My targets are 9518, then 9584.

If the session were end now, the new daily river level would come in around 9500.
Excelent call!!!! Gutsy too

When did you cover the long? Over night? It stopped me out for 35 pips loss over night.
  • #198
  • Mar 2, 2007 8:10am Mar 2, 2007 8:10am
You are a great help! Really appreciate it.

I have been struggling to adopt your longer term levels for shorter time frames that I have been trading.

I wish I could have an access to the calculation of value on the shorter terms such as 30 minutes and 1 hour.

Will get there some day, I hope

Quoting DownRiverTrader
Here it is

http://home.comcast.net/~downrivertr...p_3-2-2007.PNG
  • #199
  • Mar 2, 2007 8:10am Mar 2, 2007 8:10am
I exited around 9540 if I recall.
  • #200
  • Mar 2, 2007 8:16am Mar 2, 2007 8:16am
Quoting DownRiverTrader
I exited around 9540 if I recall.
You must not be sleeping much these days.

Let me ask you about these yellow lines. I was under impression that they inly change once a months. Why is then the hourly and daily showing different yellow lines?
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