Based on the picture the attempt at support was already taken ...you missed trade already....I place limit orders at the main levels...this is amazing system with very high hit rate....if anything your probably building up sell stops below this level
- #6,204
- Nov 19, 2008 6:23pm Nov 19, 2008 6:23pm
- Joined Jan 2008 | Status: Trader | 2,996 Posts
Earlier in the day I took a long when it touched .8340 for 50 pips.
Do you mind talking about your system more? How do you find major levels?
Alright in the eurgbp....this are the only 2 levels I would conside anyting from ...in other words I see the red line as a major support levels that can be a point price might completly reverse if in fact price makes it to that point....and my yellow line is a place I only view as a poing price can be scalped at...when I see a clear spot like this I place limit orders to the pip of the level...
Now second you have a 38.2 fibb that comes from the daily chart that creates a huge amount of buyers at that moment enough for a scalp....the trade was missed already
Now in this second and third picture you also whant to look at the fact price is coming down by making a serties of lower lows and lower highs ...meaning the direction of the market at the moment is down as well as trend....every timeframe has its own trend...when they align trades simply get easier....and this simply meands any trade taken down has higher odds untill we start making higher highs and higher lows...
( I only like high probabilty traders)
Now on this last picture the reason why I like the levels thats red is because when price gets to it theirs going to be tons of attention around it because of fibb abnd build up limit orders...
Thanks for that explaination. I wonder if you could look at chart. I have 50 percent fib at 6507 on 4 hr chart. I also have confluence, diagonal trand line crossing horizontal. I think it looks like an up for a while. Wouldnt be hard call because it has certainly come down a way. Would like to use fib with confidence as all others here do so thanks again 
- #6,217
- Edited 6:11am Nov 20, 2008 5:58am | Edited 6:11am
- Joined Jan 2008 | Status: Trader | 2,996 Posts
shermenator, firstly its nice to have your perspective in this thread. you offer some fresh ideas that normally don't get talked about here. I'm kind of mixed if I agree with you on this one. I know the concept you are talking about which is all very well for scalping and risk management. However, its my opinion a traders job is take almost all the favorable risk reward scenarios the market offers.
This trade probably can't be played with a 25 pip stop but with a larger stop it can. It can also offer a very lucrative risk reward ratio. One could...
Yep I do agree with you in the fact of different timeframes...
Every time the market moves its reacting to a fibb of such...I trade many timeframes but something must occur in the smaller timeframes to confirm the movement ...for example I will show an example of how I trade....
USDJPY...
This is currently a currency I have a sell limit waiting to get triggered....
Alright if you look at my daily chart I have the last majort market move measuring a key high and low in the market being the red fibb...this levels show me the main levels of resistance that I can shorts from the daily chart as well as levels to be aware of if I am intraday trading as a one hour chart trader that I trade ( I dont touch charts smaller then 1 hour)
That red fibb only has 3 levels drawn on it 38.2 , 50., 61.8....my fibb have names in this case the short for the red fibb is the 38.2 and the pivot is 50 percent and the long is 61.8 ....simply what the name mean is if price is below the 38.2 of the red fibb I have a short condition in the market and so on.... Now what the purple fibb is a retracement fibb to the down fibb its a counter fibb to the down move and this is the place the countertrendtraders will trade against the trend as well as I take scalps and such from smaller timeframes....the purple fibb has names as well and they are backwards in use long in this case is 38.2 and so on....what I look at the daily chart as most important is highs and lows taking place in the market and that shows me momentum as well as strenght in direction....and as you can see in my picture we are still in a serie of selling pressure dominating until price surpasses 100.50 area in the usdjpy....
This is the information I recept from the daily chart...I use more fibs and such but I will attempt to clear my charts as clean as I can...
Now I drop to the 4 hour chart and I ask the same question to myself and that is what is the market doing as in market direction such as hgihs and lows and as you can see price is making lower highs and lower lows....you see if price brakes 97.04 with a close above it would put is in a long condition in the market shifting moemntum and giving me an early indication that the countertrendtraders whant to go and retest my daily fibb from the daily chart....and this would mean I have a long condition and might be shifting my style of trading depending on what trades I am taking as well as how I treat my longerterm trades...
Now I go to the 1 hour chart and look for the movemtn the intraday traders are being aware of and thats the intraday fibb from yesterdays movement ....this fibb simply shows me how the market is being traded for the current day as well as its own conditions...
In my picture you can see the location I have my sell limit and the reason is because we have the 50 percent fibb of the markets movement as well as the resistance to the left and we just mention the condition of all the fibb I have are short .....this is the way I trade and how I judge my entries ...I put the market under condtions and such...I use more fibbs as well but I dont whant to clutter with other stuf in the thread....
And on news I dont really care about it unless it changes the way big boy traders trade.....the market is about a constant battle between support and resistance
