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Psiholog's EUR/USD trading style

  • #21
  • Jan 30, 2009 6:38pm Jan 30, 2009 6:38pm
Quoting hafizal79
Hi.

How I can use the method of trendline break out on M5? could be other additional indicator needed? when I looked at the chart normally the pip movement is varying with same height or half and double. that why the trendline is very important and possible. But how to sure that the price will bounce or break out?

And u are entry on lower and higher price but you close at the middle?

Sometime it would not bounce and keep move higher and higher. if you entry when it reach the trend line possibility it would not bounce is higher. then the price...
Just brainstorming but the way to stray away from false entry is raising your time frame... the 5min TF is going to whipsaw you all over the place....
Going to make it big by age 21.
  • #22
  • Jan 30, 2009 11:01pm Jan 30, 2009 11:01pm
Quoting cobraforex
Congrats PSI, a good decision opening your own thread.

Already bookmarked it
Ditto to Cobra's words!
At least now I won't have to swim around the other thread looking for your analysis, which I value very much.
Way to go!
My best wishes for a prosperous and insightful journey, and many thanks for sharing your points of view and wisdom.
  • #23
  • Jan 31, 2009 9:07am Jan 31, 2009 9:07am
Quoting psiholog
As a conclusion for now, heres a chart incorporating all, supports/resistances/channels/patterns of the current situation of the eur/usd. Keep in mind i have been doing this for countless hours, this comes easy to me, for all of you interested, gotta do the work, put in the hours or walk away from this method if it does not suit you.


we have reached a double bottom. 1.2780 or so is the strong support. we are currently in a descending channel with pa sticking to the lower wall. The previous strong support has become resistance (1.2850). Conclusion,...
Your system is very good. i have some questions for you.

1. If the wall not extend but same level what its meanings?

2. what the minimum days to be consider for analysis the support and resistance of the days? Normally some say at least 3 day before.

3. Are scalp on TF 15 minute? Or u just set at 1 hour and wait for it reach the target. Can you show me the graph with those trade line and support and resistance at 15 minute?

thanks
  • #24
  • Jan 31, 2009 1:21pm Jan 31, 2009 1:21pm
Quoting psiholog
Hope that covers all, for any questions you can pm me or ask here. I am debating whether I will post my observations here from now on or in the main eur/usd thread....to be seen.


Have a nice weekend all, took me 3 hours to type all this...I am out haha!
Thank you for spending the time and effort to get this done. This method seems to really click with me, although "the proof is in the pudding" they say, hehe.

I think posting here is most appropriate, so that we do not have to filter through the unrelated posts (there will be many). But that is just speaking from my convenience. Do what you see fit. I suppose you could occasionally post on E/U, and when you do you could invite members to come here "for more info", sort of a "teaser" post. Just some thoughts.
  • #25
  • Jan 31, 2009 2:48pm Jan 31, 2009 2:48pm
Excellent Excellent Excellent, This is the way to go Excellent. Lets have your post on this thread.
LISTEN TO MR FUNDAMENTAL AND MR TECHNICAL
  • #26
  • Feb 1, 2009 12:04pm Feb 1, 2009 12:04pm
Excellent thread started. One of the few good threads on PA.
I would try it on Monday. I have been using trendlines for my system which is also from FF. I will learn to incorporated your method in the higher timeframes.
Pivot Boss in the making~
  • #27
  • Feb 1, 2009 12:22pm Feb 1, 2009 12:22pm
The channels i have drawn, hope i got it right.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: log26.gif Size: 33 KB
Click to Enlarge Name: log27.gif Size: 32 KB
Pivot Boss in the making~
  • #28
  • Feb 1, 2009 1:38pm Feb 1, 2009 1:38pm
Hey there Psiholog,

Excellent thread, I think you've nailed it all here. I'm a strong believer in KISS (keep it simple stupid) and you seem to have discovered the most obvious but overlooked method.

Please continue to post you thoughts/trades here. And thanks so much for taking the time to put all this together for us all.

Cheers
  • #29
  • Feb 1, 2009 2:00pm Feb 1, 2009 2:00pm
Quoting hafizal79
But how to sure that the price will bounce or break out?

And u are entry on lower and higher price but you close at the middle?

Sometime it would not bounce and keep move higher and higher.

thanks
1)keep in mind that all decisions are based on gut feeling. Gut feeling to me is judging the relative strength of bears and bulls based on price action. In other words, you have to think on the spot which is most likely to take control once your entry criteria has been reached. This is very similar to indicators like mas where once lines cross or w/e...you know whos taking control except I make the decision without relying on any indicator.

2) The smart way to play here is like this. If it is an uptrend and you buy at the lower wall, you keep that position open until the middle wall is reached, close half the position there and just leave the rest in play with stop loss at entry until either the channel gets broken where you should manually close right away or when the other wall of the channel gets reached as you know that is the most profit you can hope for out of that trade. If you are selling at the upper wall in an upwards channel (playing against the trend)...exit at the middle wall because trying to pick tops is extremely risky and you should be happy you made some profit.

3)If i understand your last question correctly, i think you refer to lets say in an uptrend where the upper wall is reached. Tapped and then lets say for several hours the price action sticks to that upper wall never moving down an inch. This is why I said when playing against the trend, I like to have 1/3 of a regular position size as you cant know for sure when a trend will end. However if this scenario occurs, you should expect a hard break down to the lower wall eventually (possibly even a break down out of the channel) because you know the bull power is diminishing (these scenarios is usually when market makers load up on short positions at the high slowly pushing price up until there is no one left to buy cheap dollars from and then the big move down follows). If at some point strong horizontal resistance is reached (based on the longer timeframes) and even reversal patterns develop, you may want to add to your position to match the regular size position. Again, based on gut feeling and what the eyes see, how you perceive the market will always be different from lets say, me. The risk your willing to take is different from the risk im willing to take and so on.
Different opinions highly valued, ignorant to slander.
  • #30
  • Feb 1, 2009 2:10pm Feb 1, 2009 2:10pm
Quoting hafizal79
1. If the wall not extend but same level what its meanings?

2. what the minimum days to be consider for analysis the support and resistance of the days? Normally some say at least 3 day before.

3. Are scalp on TF 15 minute? Or u just set at 1 hour and wait for it reach the target. Can you show me the graph with those trade line and support and resistance at 15 minute?

thanks
1) Im not sure i understand the first question correctly, I think you refer to whether an upper or lower wall is tapped and price action does not go outside the wall by 1pip. In that scenario you know the wall is strong and it will take a big move to go even that 1pip outside the channel wall.

2) There is no time limit. You just follow how price action develops. This is why taking a birds eye view of what has happened in the past, where levels of support and resistance were met is crucial in where you determine current strong support or resistance is. This is very similar to pivots which are calculated mathematically except your doing all the work in your head disregarding that data. That way you have no bias and just follow what the price action does

3)The reason I like the way i do things is because it is so liberal. Channels can develop on any time frame from the 1minute charts to the monthly charts. It is my personal preference though to see channels on the 15min and 1hour charts though because those tell me the bias for the day, the most likely direction for that particular day. This creates entries for me that have the potential for at least 50pips (any less is not worth my time). If you follow the 5min charts or 1min charts and channels that develop there....your looking for what will happen in the next few hours at the most which may not yield too many pips. THe only time that I look at the lower time frames like the 1min chart and the 5min chart is when the market is quite volatile. This is most often seen right before and after the open of the euro session or us session or before news releases and afterwards. Gut feeling and always adapting to what the price action is doing is key here.
Different opinions highly valued, ignorant to slander.
  • #31
  • Feb 1, 2009 2:14pm Feb 1, 2009 2:14pm
Quoting jurn_e
The channels i have drawn, hope i got it right.
good job....as accurate as accurate gets.

Note how price action is sticking to the lower wall of the current channel which makes me believe we will see a hard break up to the upper wall of the current downtrend, possibly even higher. Of course market open is more important then anything else at this time (which is why i never play the weekend gaps).
Different opinions highly valued, ignorant to slander.
  • #32
  • Feb 1, 2009 2:28pm Feb 1, 2009 2:28pm
Here is what I see on the weekly chart:

PA continues up the ascending trendline that slices across the channel. It has done so since the end of October, aside from the huge spike upwards that occurred in early December. Now that we are mid-channel, I can guess two things will happen: one is that PA will continue to be rangebound 1.28-1.3250, give or take, which will keep it mid-channel; or, a break down towards the bottom of the channel. I am leaning towards the range, but ready for anything. I don't anticipate a big break up again in the near future. Should that happen, and especially if it breaks the upper wall, I may have to reconsider the current channel I have drawn.

The blue rectangle is most likely range. The light blue line is mid-channel. Fibs are all-time fibs.
Attached Image (click to enlarge)
Click to Enlarge Name: weekly 2-1-09.gif Size: 17 KB
  • #33
  • Feb 1, 2009 2:50pm Feb 1, 2009 2:50pm
These channels are very similar to what i already trade but, i was a bit confused on entry and exit and you explained this part very well, I like your strategy looks very good. Looks like it would take longer to learn this but would be alot more accurate than those indicator strategies less false signals.


Sean
  • #34
  • Edited 5:35pm Feb 1, 2009 5:19pm | Edited 5:35pm
Interesting open this sunday , gap lower (according to ibfx open time 1hour after regular market open). it gapped so low, it hit the lower wall of the channel we were trapped in on friday. now because i missed a total of 2 hours of pa (friday close and market open today)...i dont know if that lower wall was broken or not. Methods of play currently, wait until further price action develops, the spread is too high and a buy at the lower wall here is too much of a gamble. Also note that sometimes when price action drops or goes up rapidly, especially in this situation, a channel within a channel may develop. If the inner channel walls gets broken..then the bigger channel comes back into play.

Attached Image (click to enlarge)
Click to Enlarge Name: current.gif Size: 34 KB
Different opinions highly valued, ignorant to slander.
  • #35
  • Feb 1, 2009 6:18pm Feb 1, 2009 6:18pm
Quoting psiholog
...now because i missed a total of 2 hours of pa (friday close and market open today)...i dont know if that lower wall was broken or not. ....
Attachment

My feed does not show the wall having been broken. However, about 4 hours ago, Doblece said price was a low of 1.2739. I don't know where that fits in relative to the channel though.
  • #36
  • Feb 1, 2009 6:37pm Feb 1, 2009 6:37pm
I see a triangle on the M5. This makes me think, as time goes along, and if the gap has not been closed, that the chance increases the triangle gets broken up. There will be pressure to close the gap. If it gets broken, would there be enough momentum to hit the channel top?
Attached Image (click to enlarge)
Click to Enlarge Name: triangle.gif Size: 13 KB
  • #37
  • Feb 1, 2009 6:51pm Feb 1, 2009 6:51pm
Here is a price action thread I will subscribe to!
  • #38
  • Feb 1, 2009 6:51pm Feb 1, 2009 6:51pm
Hello Psi,

Good to see you open your own thread.

Best of luck in everything.

Trade well.
  • #39
  • Feb 1, 2009 6:54pm Feb 1, 2009 6:54pm
Quoting TradeWell
I see a triangle on the M5. This makes me think, as time goes along, and if the gap has not been closed, that the chance increases the triangle gets broken up. There will be pressure to close the gap. If it gets broken, would there be enough momentum to hit the channel top?
if you draw a horizontal line where fridays low is, 1.2775 or so you will notice it is currently acting as strong resistance. We break that, the next strong resistance is 1.2850 which acted as strong resistance friday in the last few hours before the close which also coincides with the upper wall of this channel. We break that too, we could develop enough momentum to reach the upper wall of the bigger channel down which is around 1.2950 at the moment. One thing I have stopped trying to do is predict how high will we go or how low can we go. In other words, the only values i look at now is price action bouncing between current strong support and resistance. I do see a return to 1.2850 but any higher...to be seen. To the downside, if the current downwards trend gets broken, I have to look way back to november to see where the next strong support is. The smart move right now is wait until Euro session where the real direction will develop. The risky move now is place a buy since were hugging the lower wall but with no real strength to go higher yet.
Different opinions highly valued, ignorant to slander.
  • #40
  • Feb 1, 2009 7:02pm Feb 1, 2009 7:02pm
Quoting psiholog
1) Im not sure i understand the first question correctly, I think you refer to whether an upper or lower wall is tapped and price action does not go outside the wall by 1pip. In that scenario you know the wall is strong and it will take a big move to go even that 1pip outside the channel wall.

2) There is no time limit. You just follow how price action develops. This is why taking a birds eye view of what has happened in the past, where levels of support and resistance were met is crucial in where you determine current strong support or resistance...
thanks for your replay.

I am very happy all my question is answered.

Now on M5 the lower wall already being broken. it seem to be the price will move back to bigger channel. look and see m15.
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