Price Action Scalping

As I continue on my journey to trade full time...I am testing a few things on live account but with pennies. I've blow up a few accounts and thankfully these recent one's have only been for a few dollars. I'd like to get reaction to a scalping method.

Lot's of systems here call themselves scalper systems, but what they really do is wait for a trend to establish and then trade with the trend and the firing of 2 to three indicators. So they are trend scalpers I guess. Many of these systems don't fire at times when the indicators don't line up just right when sometimes it's so obvious because the best indicator, price, is moving in an obvious direction. So I propose a simple price action scalping method that will work on any pair.

I use M1 and M5 with a gann hi-lo indicator with a setting of 10. I have two moving averages to help keep me on the right side of the trade....but it's primarily price action and moving above/below gann that sets the trade up.

Rules for entry:
M5 - wait for gann to reverse, end of candle
M1 - go to M1 and now look for the same, gann to reverse and price starting to move

I wait for the retrace and when price hits a new high I'm in with a stop at the low of the most recent pullback.

I'm thinking we don't need much else besides pivots, S&R and some trendlines which are drawn on a higher timeframe...and we go with the price action moves with tight stops.

Exit is another matter all together and there are so many ways to exit. We can discuss that.

What I'm looking for is to refine some entry criteria....keeping it really simple and minimal indicators. Any comments from others that use price action to scalp would be much appreciated.

Cheers
CanuckCT

Trend lines and horizontal S&R is fine

But get rid of the indies and just have a look at the chart

Using gann lines I think defeats the "price action" part of your system.

My suggestion is to look for a way to trade breakouts. Most scalping trades I take are generally a result of a breakout.

I'm trying hard to wean myself off the indicators and use price action. 1-2-3 breakouts, trendlines, S&R and pivots. The more I trade, the closer I move to those tools....but can't seem to go totally naked of indicators. Maybe this tread will help me to do that. I'm currently searching for similar threads...I see there are many.
Cheers
CanuckCT

Learn to trade fibs. If you are having trouble, use the trading simulator: http://www.forexfactory.com/images/attach/zip.gif Trading simulator.zip


The trick to trading fibs as I see it is knowing what to use as a point for drawing the high/low.

Thanks Ron...I'll do some more study with fibs. I guess I'm just seeing a lot of great trades based on price action. Waiting for indicators to trigger...well often they are late and sometimes get you in at precisely the wrong moment....you are watching the indicator and not the price. And yes, waiting for the trend is good and going with the trend....but there are a lot of breakout trades that could be traded for 10-20 pips....a lot.

I'm going to try a naked chart with pivots and fibs that I draw plus trendlines. Any suggestion what timeframe to use from drawing the fibs?

Cheers
CanuckCT

fibs are good for any timeframe. But remember that the shorter the timeframe, the more it is likely to be affected by news-generated whipsaw

So Ron...here is what I am now down to. I will leave the Gann only for now and begin to focus on price movement and other related matters.

Cheers
CanuckCT

+53 on GJ, small lots.
Done for now....back to work.

Hi CanuckCT

This is the same GJ that u have just trade.

Yes it is...that's a nice clean look on your chart...what moving averages r u using. Can u post the template?

Cheers
CanuckCT

Hi CanuckCT (and RR) (and others)

Thanks for starting this valuablel thread. It is important to learn trading from naked charts. I am getting tired of being to late entering the market. Just have to find trust in price movement only. Okay, fibo's pivot's are helpfull and trendlines are very important for trading breakouts or re-entry.

Let's learn this stuff!

I only use EMA.

Yellow - EMA 3, 5, 8, 11, 13
DeepSkyblue - EMA 30, 35, 40, 45, 50
Red - EMA 55

You know...the lines do create a nice pattern....but you tend to focus on the pattern and not price action.
Cheers
CanuckCT

You're right about that Canuck. I only look at this chart to support my main chart for trend strength n re-entry purposes. Im not trading it naked

I was thinking this was going to break to the downside and was ready for that. However, it never did....price started to go up and was above gann in M1 and M5....and I went with it.

I'm thinking to keep the charts a clean as possible....no more than one indicator and M1 and M5 timeframes. In and out in a couple of minutes.

And maybe try to wean off that last indicator.

Cheers
CanuckCT

nice afternoon scalp after a tough day for 105 pips

exit long at the 161.8 extension

GJ +40

price crossed below gann...waited for retrace, sold at 146.90 and target was 146.50.

EDIT: I'm seeing that if you apply fibs on M1 and there is a 50% retracement, there is often a good chance the 200 fib will be hit.

Cheers
canuckct

nice chart...GJ does seem to work very well with trendlines....often bounces off the line or shoots accross it. We need to study this some more.
Cheers
CanuckCT