Do you want to make some money??

Good morning guys...

Fibonacci and sentiment. What follows is only my opinion. The reason why the Fibs work is because people are using them on their screens nothing more. I mean is there really a bookie out there plotting fibs on his books? No he moves the market to where the most orders are. Why? This is how he makes money COMMISSIONS.

As far as longer time frames I can't help but think I ALREADY TYPED THIS. I am trying to move away from that.

I believe that the same mechanics that are active on a daily chart are active on a 5min chart even if it is riddled with noise. I honestly believe that these smaller time frames are like proving grounds which will very quickly show up system weaknesses. I am not trying to design anything that is artistic or relative to the operator. I am trying to design something that can be explained to the average Joe.

I am beginning to feel the cold reception that someone else was alluding to earlier which is what deterred me from posting before, I mean honestly I don't want this thread to get riddled with the usual dribble. In other words let's keep this informational to benefit the people that might read it.

I have had a look at No Brainer Trades and enjoyed it.

Anyone else have any ideas??
What about S&R? Are there any Rules, Filters, or ideas that are completely mechanical and indicator-less that have made the difference in your trading?

When price falls to a new Low and then rallies, buyers who missed out on the first trough will be inclined to buy if price returns to that level. Afraid of missing out for a second time, they may enter the market in sufficient numbers to take control from sellers. The result is a rally, and that price is unlikely to fall further and creating a support level.

When price makes a new High and then retreats, sellers who missed the previous peak will be inclined to sell when price returns to that level. Afraid of missing out a second time, they may enter the market in numbers sufficient to overwhelm buyers. The resulting correction is that price is unlikely to move higher and establish a resistance level.


Breakout from a range can be calculated by measuring the height of the trading range
and projecting this from the point of breakout http://www.incrediblecharts.com/imag...ng%20range.png

Forexflash I couldn't agree with you more, and this is the logic behind my thinking. Consequently its also why I rate each level so that if one holds while another doesn't I don't have to wonder why. I also do this because at a glance (multiple pairs) you can easily see the best setups which is not something that is as easily done with a single color. Think how naive we would be if we assumed that all S&R are of the same importance/strength.

Forexflash I was just looking at your last post and can tell that it has been edited/added to. That breakout explanation is just NICE..It's clean, organized, and straight to the point.

Ok guys the next post that I make will be about Signal bars. These are the bars that actually get me into trades. I will talk about what the best ones look like where they occur and when. How do you guys get into trades?

Hey Chad; Please understand that I am not your enemy. I have my method & I look forward to "Incorporating" yours into mine.

I only wanted to point out that if, as you admit by requesting input to yours, it will become sooo wide that it may not be Yours anymore.

Things that make you go 'Hmmm...'

Hey guys I apologize for not posting in a while but I am in the middle of a remodeling project, as soon as I get a free day I will make another post.

I agree with ForexFlash on the pic shown here... this is how i am currently setting my stoploss. I put it about 2-5 pips away from tips of the last candle in a higher time frame. So, if I am trading a 5 minute chart i would take a peek at the 15.... trade the 1min, look at the 5, etc... usually if it takes my stop then I have the overall trend incorrect to start with. Just my current thoughts.

As far as a good entry signal...I'm working on that myself.

Trendlines

The way that I draw trend lines is a bit like fractals in that I look for 2 price points that have remained un-challenged on both sides (left and right) for a certain amount of bars. This allows me to rate the importance of one trend line over another. When looking for price points I start looking right to left. Once I have 2 points picked out I rate the trendline using the weakest price point in the trendline. Typically I rate them like this:

Color Bars Unchallenged Strength
White 100 or more Strong
Orange-Red 50 - 100 Medium Strong
Blue 25-50 Medium Weak
Yellow 10-25 Weak

SIGNAL BARS

These are the basic bars that everyone agrees on. Pins, Inside Bars, Outside Bars. These 3 bars is what we will focus on for now. My filter for Pins is that the open and close must be contained within the top/bottom 1/3.

SIGNAL BAR CRITERIA

1) Must be touching defined S&R
2) Must make a 10 bar high/low
3) Breakout trades must show signs of a strengthening trend.
4) Reversal trades must show sign of a weakening trend.

THE TREND

You have heard it over and over "The trend is your friend until it's over."
What is the trend? To me it's simply the probable direction that price will move. The left to right method works but in my world the 10 bar high/low IS the trend. How much more complicated does it need to be?

REVERSALS AND BREAKOUTS

There are only 2 possible trades that I am ever interested in. What are they? Reversals and Breakouts. A reversal occurs when price suddenly stops and starts going in the opposite direction it was originally going.

STRENGTH/WEAKNESS

Whether a move is getting stronger or weaker will greatly affect how price reacts to S&R. This is where single bar analysis comes in. Look at the bar/s comprising the signal and determine whether the move is getting stronger which would indicate a breakout or weaker which would indicate that a reversal is more likely.

I love how you say in your first post that you shouldn't use indicators and then two posts later you talk about using support and resistance lines which are indicators.

The problem isn't so much in the use of indicators but in the user of the indicator. People spend thousands of dollars a year buying new golf clubs thinking that they will make them a better golfer when they never learned to use the clubs they already had in their bag.

magnumfreak, apparently your comprehension skills are a bit lacking. If you carefully read my first post, you will see my intentions behind this thread. If you had read, you would have noticed what the guidelines were. There is nothing original about your post. Furthermore, it has absolutely no value whatsoever.

Here is what a popular online dictionary defines a technical indicator as:
"A technical indicator is a type of analysis chart that indicates market direction. Some common indicators are Stochastics, MACD, Moving average, RSI and a host of others.
Indicators generally overlay on price chart data to indicate where the price is going, or whether the price is in an "overbought" condition or an "oversold" condition."


magnumfreak, realize what section this post is in, and realize what audience it is for. Most people are NOT going to challenge an accepted definition from a symantical standpoint with no other purpose than to draw attention to oneself, bash another, or rack up posts, but with over 1,000 posts it's not surprising.


As far as indicators are concerned, they ARE the problem. Advertisements, books, magazines, and all other forms of trading propaganda make mention of indicators, and how easily anyone can make money using them. Indicators give people a false sense of security, while promoting laziness. There is absolutely nothing of value that an indicator can show you or make you aware of that is not already noticeable in the chart. Any trader who has taken the appropriate steps in analysing any chart prior to making a trade, has no use for an indicator.




I respectfully ask that you remove your post (#30), at which point i will remove mine (#31).

using semantics to saying that S&R are indicators is a almost the same that says that your display is a indicator too and your eyes are indicators, or that even the pair you are trading itself is a indicator.

first time i read S&R as "indicators". Fibos are another story, altough even so in the trading word there is a clrearly differentiation normally "leading indicators" (Dinapoli). But simple S&R i never heard before.