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  • #541
  • Mar 17, 2009 4:44am Mar 17, 2009 4:44am
Quoting strat
Dan,

Have you got a girlfriend in Switzerland or something? What is the fascination with USDCHF?

There are other pairs with far better set ups than USDCHF

Rock n Roll,
Strat
Hi Strat,

Could you tell which pairs you see with good set ups with no reasoning, and I’ll look and come back with why I think they’re tradeable, because at the moment (and I am trying to learn to very picky about my entries) I cannot see any ‘clear’ opportunities or PA.

You seem bullish on E/J, but I’m seeing resistance at a PPZ around 128.65 – if I was looking at this independently, I’d be looking to short it from this level. Can you explain what I’m missing?

Cheers
Dan
  • #542
  • Mar 17, 2009 4:51am Mar 17, 2009 4:51am
What are you business intrests in China? Do you have a factory there?


Quoting strat
I did it on purpose to confuse the hell out of you!

No, I'm in China right now checking up on my business interests so I am 18 hours ahead of EST

Wait a minute - doesn't that mean I should be able to tell you what happened so that you can trade it? If only!

Rock n Roll,
Strat
  • #543
  • Edited 5:39am Mar 17, 2009 5:35am | Edited 5:39am
Everything is not always as it seems!

With the recent posts and some of the PMs I am getting, it’s time I posted the true story of my mate, Bond.

Bond was down in Tijuana, just over the US-Mexican border from San Diego and met a girl in a bar (as is his want!). He said she was a cracker, drop dead gorgeous and gave her a 9 out of 10 and that was before he had a beer. As he usually does, he got her into his room and while he was “checking out” the real estate of his catch to line her up for the “kill”, his hand came across……………………………………………………the meat and two potatoes!

Yes, it was a guy dressed up as a girl! He couldn’t believe it as everything else checked out great! He was devastated! He had never been tricked like this before. It took him ages to get over this, well the rest of the week anyway. He has never forgotten this and it has forever changed the way he approaches women.

Instead of drowning them with charm as he used to do, the first thing he asks when he meets a woman now is “ Are you really a woman – are you 100% female?”

What has this to do with trading? Absolutely everything!

As can be seen from some of the recent posts, we are learning price action specifically hammers. Notice I did not say “learned” – we are all learning and we never stop learning.

For some people, the very fact that they have “learned” certain candles can indicate price reversals, seems to make them feel as if they have found the Holy Grail and can walk on water. (This is NOT the Holy Grail, but I do know what it is). They then look at charts and see these candles everywhere! This happens every time. Worse still, they trade on them and then when they lose on it, go around bad mouthing price action!

So, as I learned this the hard way, and Baba G too and I’m sure many others, (loss of money), let’s see if we can stop it happening again.

With regard to shooting stars at the end of an uptrend and hammers at the end of a downtrend, they will jump out at you if they are the real thing. What is happening now is that you are “searching” for them and trying to make every bar look like one.

Now that you have dipped your toes in the water, go back and re- read all about them again. It is a known and proven fact that our subconscious learns from repetition so the more times you read it, the more you will learn and understand. Pay special attention to position or location. These type of candles mean different things in different positions in a chart and sometimes mean nothing at all.

While you are doing that, think about what the market is doing when it produces a “real” hammer or shooting star. Think about what it is trying to tell you. I’m not going to tell you that yet as I want you to study and work it out for yourself.

Then, when you see what looks like a hammer or shooting star, remember Bond. Ask yourself if it meets ALL the criteria, “is it really a hammer/shooting star?”.

Before anyone posts that they took trades and were successful on what appeared to be these type of bars but were not really (look a likes), then yes, it does happen. They also fail, and fail pretty bad as well. It all comes down to your risk tolerance. I want to encourage you to only trade “classic” price reversal bars as these are the safest ones with the lowest risk.

Are they perfect? No, nothing in trading is perfect. There have been classic reversal bars which have failed also but not with the same frequency as “look a likes”. Why do they fail? There are many reasons I suppose but what I always think is that after the classic reversal bar closed and gave us our set up bar, something in the market changed between the close of our set up bar and the new bar printing making price continue with the prior trend.

There are also several ways to trade the price reversal bar but I’m only going to discuss the safest and lowest risk (for me). After you see the price reversal bar and thought of Bond, this then becomes your “set up” bar. If it really is a hammer (don’t get fooled like Bond did!), enter a buy stop order about 10 pips above the high of the hammer. The amount of pips above the high will depend not only on the pair but on the current volatility of price action. (Below the low on a shooting star). If it is not a reversal, your stop order should be far enough away so that you are not filled. However, it will not stop you getting filled if the brokers and MMs go on a Stop Run.

Another thing is not to worry or beat yourself up if you miss one. There is always another one being set up somewhere.

So, think like Bond from now on and remember that everything is not always as it seems.

Rock n Roll,
Strat
15 YEARS OF PASR ON FOREX FACTORY!
  • #544
  • Mar 17, 2009 5:45am Mar 17, 2009 5:45am
Quoting Pirabuji
Hello Strat,

If your MA have crossed and prices is above them do you just wait for price to close well above a S/R area and then enter long on the high of the candle with your SL below S/R area?
Or do you wait for candlestick confirmation (hammer, bullish engulfing, any others?) before you enter on trade?

Thanks,
So now I'm suspicious why you have obviously copied this from somewhere and not written it yourself. Are you taking a proxy vote from all the threads?

Yes and more. The ones listed are only parts of the method. The key is what price does at support and resistance.

Rock n Roll,
Strat
15 YEARS OF PASR ON FOREX FACTORY!
  • #545
  • Mar 17, 2009 5:50am Mar 17, 2009 5:50am
Quoting strat
So now I'm suspicious why you have obviously copied this from somewhere and not written it yourself. Are you taking a proxy vote from all the threads?

Yes and more. The ones listed are only parts of the method. The key is what price does at support and resistance.

Rock n Roll,
Strat
He wrote it a few posts ago, and you missed it. So I'm guessing rather than write it all out again, he just quoted it to make it easier.
  • #546
  • Mar 17, 2009 6:05am Mar 17, 2009 6:05am
Quoting AstonDan
Hi Strat,...
I listed several pairs and then I re-read your request and deleted them. "Good Set Ups" completely threw me! Are you meaning right now with a set up bar to trade off of or "Opportunities"?.

What scale of chart are you looking at Dan? Are you looking at the big picture? Are you starting with what the BOSS is telling you? If you are zoomed in too close, you might not see the forest for the trees.

There are several pairs that are "setting up" for trades - pairs that have moved into bullish are or will be profit taking soon creating retraces from which we can buy off again (all things still being equal). Pairs that are close to topping are opportunities WHEN we get ALL the information.

EURJPY - Dan, you have the new trader mentality - you are thinking that once something goes up it must come down. Yes it will, BUT not at every small bar or red candle. We will know when the time is right to go short when price action shows us. I lost $tens of thousands on the Yen in 1994/5 thinking it can't go on like it is and must turn around soon.

Remember Dr. Joe - IT KEEPS ON GOING UP 'TIL IT STOPS GOING UP

When a pair is in a strong trend, prices blow through S&R like a knife through butter. Don't always think that resistance will stop it - look at HOW price reacts at that level.

So now I have said that, watch for the EURJPY to tank tomorrow.

Remember you are only 5 months into trading, Dan, you still have a long, long way to go, but you're getting there. Hang in there, me old Geordie mate!

Rock n Roll,
Strat
15 YEARS OF PASR ON FOREX FACTORY!
  • #547
  • Mar 17, 2009 6:06am Mar 17, 2009 6:06am
I haven't copied it from anywhere - well anyone. I was typing it in Microsoft Outlook and then copied and pasted.


Quoting strat
So now I'm suspicious why you have obviously copied this from somewhere and not written it yourself. Are you taking a proxy vote from all the threads?

Yes and more. The ones listed are only parts of the method. The key is what price does at support and resistance.

Rock n Roll,
Strat
  • #548
  • Mar 17, 2009 6:07am Mar 17, 2009 6:07am
Quoting Pirabuji
What are you business intrests in China? Do you have a factory there?
This is not the subject of this thread

Rock n Roll,
Strat
15 YEARS OF PASR ON FOREX FACTORY!
  • #549
  • Mar 17, 2009 6:11am Mar 17, 2009 6:11am
MEAT AND 2 VEG......ahahahahahahahah
  • #550
  • Mar 17, 2009 6:15am Mar 17, 2009 6:15am
Quoting b-rock
He wrote it a few posts ago, and you missed it. So I'm guessing rather than write it all out again, he just quoted it to make it easier.
Now that makes me feel bad, real bad - please accept my apologies, Pirabuji. My intention when I started this thread was to answer each post within 24 hours so I'm annoyed with myself.

Rock n Roll,
Strat
15 YEARS OF PASR ON FOREX FACTORY!
  • #551
  • Mar 17, 2009 6:21am Mar 17, 2009 6:21am
I had set S/L tight for E/J at break even..... no sign of resistance breaking out, so better be safe than sorry.

Will wait some more hour and probably close this one if it developed into full stagnation

Regarding G/J, i'm seeing resistances blocking the way @ 139.30, 140.... not a good sign so far.
There's a POT of GOLD at the END of the RAINBOW!!
  • #552
  • Mar 17, 2009 6:30am Mar 17, 2009 6:30am
There is currently a make or break situation on U/J, the couple of hours or days PA will be the decider of it's fate .... what can you say Strat?
There's a POT of GOLD at the END of the RAINBOW!!
  • #553
  • Mar 17, 2009 6:38am Mar 17, 2009 6:38am
Quoting strat
I listed several pairs and then I re-read your request and deleted them. "Good Set Ups" completely threw me! Are you meaning right now with a set up bar to trade off of or "Opportunities"?.

Rock n Roll,
Strat
Hi Strat, thanks for the reply.

No I’m not looking at ‘right now’, I’m looking through the pairs thinking of what is being set up.

So with EUR/JPY, I can see that its moving up to resistance so over the next couple of days, I’ll be looking for indication that its going to fall back down or break through. If it breaks through, I will/would wait for it to retrace back to what would now be a support level and look for PA to give me an opportunity for a long.

If it fails to break through its current resistance level, I would expect it to fall back to support at which point I would look for PA to give me an opportunity to go long on a retest of resistance.

That is how I am reading this pair – and it seems clear as day (although it might be wrong!), but looking across the other pairs, I’m struggling to read their situation in the same way.

I only look at the daily and I am learning to look at the weekly for overall direction. For instance, I shorted USD/CAD yesterday based on a BEOB last week. I won’t list the pips I made, but suffice to say it made my week on a Monday morning. However, I then go and look at USD/CHF last night on the daily and pitch in with an idea for a short, without looking at the weekly which had a BUOB! I test my own patience sometimes!

I probably start to look at a Daily chart with three/four months of bars on it, draw my PPZ lines, then zoom into about the level of the charts I have posted to see what they are trying to tell me.

Thanks for your time.

Cheers
Dan
  • #554
  • Edited 7:08am Mar 17, 2009 7:03am | Edited 7:08am
Quoting AstonDan
Hi Strat, thanks for the reply....
Dan, I thought it was obvious from my posts of "End of Week Analysis" how to use the different time frames. I can see now that I need to post something on time frames, trouble is I can't think of a good analogy to go with it!

Briefly, when you go looking for opportunities, ALWAYS start with the BOSS. Look at what it is telling you. Then knowing that, move over to it's slave - the Daily and look at what that is telling you.

As I said before, your thought process is correct just try and think about trend strength and longer trades.

Attached are my charts for EURUSD which I have side by side. One is zoomed super close so that I can see REAL CLEAR, the immediate action and that of the last few weeks. The other is the big picture which I ALWAYS look at before deciding on a trade.

Also notice on the big picture that you don't really need to draw trend lines - the 20 does that for you! Look at where price topped out on the BOSS 50 and now, look at where price is

Hope this helps,

Rock n Roll,
Strat
Attached Image(s) (click to enlarge)
Click to Enlarge Name: eurusdcloseup.gif Size: 27 KB
Click to Enlarge Name: eurusdbigpicture.gif Size: 28 KB
15 YEARS OF PASR ON FOREX FACTORY!
  • #555
  • Mar 17, 2009 7:40am Mar 17, 2009 7:40am
I have almost completed the index page for the thread, so if anyone has recently started the endeavor save the time and spend it studying PA.
Thanks
  • #556
  • Mar 17, 2009 7:56am Mar 17, 2009 7:56am
Sup folks,

Well I got in on a EUR/USD long position early Monday morning. I will say that the daily bar yesterday has scared me and it may have been wise to just take the small amount of profits I had at that point and re-evaluate PA over the coming days. But I decided to let it ride for at least today and see where it ends up.

Still in my AUD/USD long position despite it stagnating around 6600.

GBP/USD is lining up to go back south as I have been anticipating with the PA that's occured the last few days. If today's bar closes lower than yesterday, I'll sell below that low.

USD/JPY is on the tipping point. Can it finally break above 99.00 or will it drop again? And if it does drop again, is it going to fall further or will it bounce between 97 and 99 for a few weeks like we've seen some of the other pairs range lately?

This is why I love trading. In some ways, it is a game. You're seeing all these clues and signs that point this way and that and you have to decipher them all in order to "beat" the system and win.
  • #557
  • Mar 17, 2009 8:02am Mar 17, 2009 8:02am
Quoting thegunslinger
Sup folks,

This is why I love trading. In some ways, it is a game. You're seeing all these clues and signs that point this way and that and you have to decipher them all in order to "beat" the system and win.

yup, but just like CHESS, you need to be passive as well to WIN,
sometimes the only winning play is doing no play at all...
There's a POT of GOLD at the END of the RAINBOW!!
  • #558
  • Mar 17, 2009 8:03am Mar 17, 2009 8:03am
That's Ok, don't beat yourself up about it, I forgive you. just kidding

Quoting strat
Now that makes me feel bad, real bad - please accept my apologies, Pirabuji. My intention when I started this thread was to answer each post within 24 hours so I'm annoyed with myself.

Rock n Roll,
Strat
  • #559
  • Mar 17, 2009 8:05am Mar 17, 2009 8:05am
Time frames

Time frames are probably more important than most people give them credit for. First, it is the time frame that determines our “comfort zone” in trading. Second, it is our “workspace” that we base all our trading decisions off.

Many new traders don’t understand the “higher order” of time frames and forever suffer frustration not knowing why. Each time frame is governed or “controlled” by the next higher time frame. Since we trade the Daily, which is our workspace, we will start there.

The Daily is governed or controlled by the Weekly, which I call the BOSS. As long as we only trade from the Daily, then these two are all we really need. We can look at the Monthly for a longer, further out view, but as regards our trading decisions on the Daily, since the Monthly is two time frames higher (and controls the Weekly), we can disregard this.

Each time frame consists of waves or cycles or whatever name you want to give them and WITHIN those waves or cycles are smaller waves or cycles – these are our smaller time frames. So when you look at a BOSS chart you can see the large, major swings. Within those large, major swings are smaller swings – these are our Daily swings. From this, you should now understand that the BOSS controls EVERYTHING the Daily does. (Within the Daily swings are smaller swings which are your H4 swings).

This means that a BOSS swing controls several Daily swings.

If you have understood everything so far, you should realise that the BOSS support and resistance levels are those which the Daily moves up and down against. These then are MY major support and resistance levels. I qualify it as “MY” because they may not be the same as another trader’s major levels.

A BOSS bar consists of 5 Daily bars if the penny has still not dropped.

Hopefully this will help you understand why you cannot use information from a lower time frame to trade the higher time frame. For example, you cannot use support and resistance levels from H4 to trade the Daily since there are 6 H4 bars in a Daily and as many swings meaning that eventually you will be stopped out mid – bar. It is OK to find an entry on a lower time frame AFTER first identifying the opportunity on the Daily, PROVIDING you go back to trading the Daily.

If you want to find really strong, powerful levels of resistance and support, then pull up a Monthly chart and where the Monthly levels coincide with the Weekly levels is where you will find super powerful major, major support and resistance. If you do this, do not draw other lines in as you will end up with more horizontal lines than price bars!

The higher order of time frames also tells us that the higher the time frame, the more reliable, accurate are price action and technical analysis. So, a hammer on a BOSS chart is very meaningful and if you look back on your charts, you will see that many huge moves have come off these bars.

The higher time frames are easier to trade because there is less “noise” and trends are longer BUT you need very large accounts to handle the Stop Loss levels.

The one area which is not black and white (to me) is during a trend change. I struggle all the time with inter – time frame trend changes as I sometimes think the Daily has to change before it’s BOSS does. However, when I look in detail, it can be seen that the BOSS has changed first. The trick is to know what the immediate trend is or the momentum of the last couple of bars.

There is much more to time frames than this but this should be sufficient to help you along your way.

Rock n Roll,
Strat
15 YEARS OF PASR ON FOREX FACTORY!
  • #560
  • Mar 17, 2009 8:24am Mar 17, 2009 8:24am
Quoting rogueforex
I have almost completed the index page for the thread, so if anyone has recently started the endeavor save the time and spend it studying PA.
Thanks
Thank you ever so much, rogueforex!

Rock n Roll,
Strat
15 YEARS OF PASR ON FOREX FACTORY!
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