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Where can I learn more about Price Action like those in James16 charts? 9 replies

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james16 Chart Thread

  • #3,141
  • Apr 2, 2007 3:37pm Apr 2, 2007 3:37pm
Quoting Swami S
Hi folks, it's a dlhc off trendline breakout i'm looking for a bit of a retrace to enter prob to 6ema (green line).

EDIT: entered on break
Hi Swami,

Yes, that was a great one! I took some off at around 36 pips and am still riding that one, with the big difference of course that it is free trade now!

Take care,

Your brother of OM (although I changed my image).
  • #3,142
  • Apr 2, 2007 10:53pm Apr 2, 2007 10:53pm
Correction.... now up 67 and took some more off, still riding it.
  • #3,143
  • Apr 3, 2007 3:22am Apr 3, 2007 3:22am
Quoting SeekingLight
But here's a possible EJ mini-setup at the low of the current mini-range we're thrashing around in
Update on that setup - ended up going 120+ pips already. Got in at / near range breakout myself.
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Trust price. Know yourself.
  • #3,144
  • Apr 3, 2007 3:25am Apr 3, 2007 3:25am
Quoting SeekingLight
USDJPY - Matrix reloaded

We're STILL waiting for some sort of decision - above 118.30? Below 116.50?
What's up / or down, USDJPY?
We got another clue as that highlighted blue area held and we got another PB.

Broke out for around 60-80+ pips depending on your entry, also broke a daily IB with the move. Now going to be tested for real strength and valor at 118.50.
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Trust price. Know yourself.
  • #3,145
  • Apr 3, 2007 5:01am Apr 3, 2007 5:01am
google.
last 8 months.
looking at this chart really makes a key point to me and i'm posting it here so i don't forget it.
wait in the bushes with a rifle as james would say.
i reckon you could have taken these following two trades in 8 months and done nothing else and still come out ahead of everyone else and made yourself a nice living in the process.
want to do the math? these 2 trades made 4,666 points.
8 months is 32 weeks.
32 weeks of 5 trading days is 160 days total.
4,666 / 160 is 29 pips a day or 145 pips for each week. nice.

now there's a conundrum. 2 trades in 8 months. and i feel like i need to place a trade every other day or i'm not a proper "trader". just starting to realise why i've never been able to make any money in this game...
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  • #3,146
  • Apr 3, 2007 5:05am Apr 3, 2007 5:05am
can you hear the pin drop?
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  • #3,147
  • Edited 5:53am Apr 3, 2007 5:21am | Edited 5:53am
Quoting the_wizard
i reckon you could have taken these following two trades in 8 months and done nothing else and still come out ahead of everyone else and made yourself a nice living in the process.
want to do the math? these 2 trades made 4,666 points.
8 months is 32 weeks.
32 weeks of 5 trading days is 160 days total.
4,666 / 160 is 29 pips a day or 145 pips for each week. nice.

now there's a conundrum. 2 trades in 8 months. and i feel like i need to place a trade every other day or i'm not a proper "trader". just starting to realise why i've never been able to make any money in this game...

All true and well. Also how I used to view this, when I realized the magic of pins at first.

But keep in mind - just looking at the charts, the size of the pins and the way traveled afterwards is roughly 1:3-5. I mean by this that price moved about 3-5 times the size of the pin. Well, at least from what I can see on the zoomed charts by eye. Rough estimate.
Assuming your position size is 2%, you will make 6-10% on 3-5 times the pips moved as risked. If you take profit along the way, less.
That pretty much makes the insanely large pip figures less impressive.

However if you manage to find a spot to get in a big mover like GJ with only 50 pips stop, and you have a daily range of 300, you will make 2% for every 50 pips it moves in your favor. It's a question of by how much you will outlever the market.
Let me point out there is NOTHING WRONG trading off the same timeframe. Actually, you should, in order to avoid confusion. I'm just saying that 4500 pips moved for example with a stop of 500 originally is still only a factor of 7 -> at 2% risk that makes you 14%.
Don't know the Google sizes, just speaking generally.

An example I do know would be an oil weekly PB. Size was 320 pips.
It moved 1400. 1400 pips, a lot, right?
Still only a bit over 4 x 2% = 8% in 11 weeks. This is VERY good performance still, it's just not as much as 1400 pips would have you believe, is my point.

Don't let the pips fool you, it's all about the sizing/leveraging


The thing you mentioned that you SHOULD however in any case keep from this -

YES it pays not to overtrade.
YES it pays to wait.
YES, taking only the best setups is the way to go.
YES, holding positions for longer than 30 minutes pays off
Trust price. Know yourself.
  • #3,148
  • Apr 3, 2007 5:44am Apr 3, 2007 5:44am
seeking i love your posts. just when i think i am getting somewhere, there you are.
might change my name from the wizard soon. don't feel too magical right now. lol.
no, seriously, thanks for not letting me get complacent. i've lost so much money thinking i've found the "answer" and then jumping on anything that looks vaguely good. i am reading through this forum...you and mike and james are doing a very good job of helping us all...and all the others too. thank you.
  • #3,149
  • Apr 3, 2007 7:07am Apr 3, 2007 7:07am
Hi All,

Excellent thread, thanks to all.

I read this whole thread the other day, and although exhausted reading it, I have advanced in my understanding of what trading is all about. Most of the basic skills I learnt in my unsuccessful 2 year trading career early on, has become lost under a ton of technical marketeering bull$hit.

So I am going back to basics: PRICE ACTION.

If somebody can provide me with information about where I can find more information on the psychology of the market, in relation to price action, patterns etc, I would be very grateful. Its all very well knowing about patterns but knowing how and why they occur will bring me a step closer to knowing the market and the dynamics of trading per se.

James, I hope you come across my message: could you provide me with a detailed list of the content of the information you provide in your Private Forum and provide a date of when your new website will be up and running? Appologies if it is listed elsewhere in the forum or FF.

You all probably know the site below. The Joe Ross trading manual touches upon similar price action discussed in this forum, such as the pin bar: http://www.trading-naked.com/Articles_and_Reprints.htm

Thanks in advance. I hope to be contributing to the forum once I wipe my slate clean of BS :-)
  • #3,150
  • Apr 3, 2007 7:29am Apr 3, 2007 7:29am
Quoting Porkpie
Hi All,

Excellent thread, thanks to all.

I read this whole thread the other day, and although exhausted reading it, I have advanced in my understanding of what trading is all about. Most of the basic skills I learnt in my unsuccessful 2 year trading career early on, has become lost under a ton of technical marketeering bull$hit.

So I am going back to basics: PRICE ACTION.

If somebody can provide me with information about where I can find more information on the psychology of the market, in relation to price action, patterns etc, I would be very grateful. Its all very well knowing about patterns but knowing how and why they occur will bring me a step closer to knowing the market and the dynamics of trading per se.

James, I hope you come across my message: could you provide me with a detailed list of the content of the information you provide in your Private Forum and provide a date of when your new website will be up and running? Appologies if it is listed elsewhere in the forum or FF.

You all probably know the site below. The Joe Ross trading manual touches upon similar price action discussed in this forum, such as the pin bar: http://www.trading-naked.com/Articles_and_Reprints.htm

Thanks in advance. I hope to be contributing to the forum once I wipe my slate clean of BS :-)
glad you are enjoying this thread, thought I would let youknow whats in the PF. This is off the website thejames16group.com, i amjust expanding it a bit,although it could be even more detailed

Here is a breakdown of the private forum:
The James16 Group

1. Welcome - How to use this forum
This section is an introduction to the entire forum

2. James16 trading education
 This section is where we will learn the art of price action analysis and confluence. After mastering this material
your trading will forever be improved. I have many students that after mastering price action no longer use
any indicators on thier charts. It really is that good but like anything worth knowing it takes practice and dedication

this is where James teaches his price action bars and setups in a clear and concise manner, this section also has valuable links for other technical chart patters. This section is also where James explains confluence and goes into depth on that topic. Other stuff located here such as charting/broker options.


3. James16 system trading

In this section I will teach several systems using a trailing entry approach. This section is large and its
main focus is following all the markets and inplementing what we are learning. Forex, Futures and options
on futures

- This section contains threads on New Strategies, System Example Forums, James Teaches some of his personal crossover systems, Then he has threads of currency pairs where we can all follow the price action in to forms, a read-only where only James can post, and then a discussion section for the pair where people can discuss and james can post.

4. Sundial systems - Charles' section

This is where charles will teach and follow his knife system and its variations. Its a pip monster when
mastered and can be used in all markets.
- This section is dedicated to the Knife, where Dialist teaches a complete trading methodology. Split in to place Dialist Tutorials(all the different components) and then Dialist Discussions with knife and other goodies) Too large to go into detail of eveyrthing here.

5. Fijitrader - Trading Psychology and Money Management with Douglas

Words cannot describe the importance of these subjects to your trading success. Words also cannot
describe the brilliance of Mr. Bamlett in these two areas. After reading through his sections and
interacting one on one with him you will begin to see the importance of mastering these two critical areas.

Money mgmt, psychology, and other ways to make m oney, need I say more on that

Then thereis the new video section where james fiji and dialist are posting videos with voiceover work so you can see this stuff from there eyes.

and a general discussion, with a lot of misc, and all the other stuff.

Hope that helps a bit could be more detailed but that should give you a good idea,
Mike
  • #3,151
  • Apr 3, 2007 8:50am Apr 3, 2007 8:50am
Thanks Mike. Sounds like what I need right now.

I am sure you mentioned a book on chart patterns in an earlier post which I failed to write down and now can't find?? Or was that someone else??

Pete
  • #3,152
  • Apr 3, 2007 8:58am Apr 3, 2007 8:58am
Hi guys,

This is my first post on this thread, and although i haven't read through all the pages yet, i like what i see. I have been trading price action for about 18 months on a demo account but this was really more on the shorter timeframes and to be honest i haven't really managed anything much better than break even. I was basically looking for 123 formations etc at confluence zones but i always ended up looking at too many timeframes, which led to confusion. I tried to draw up trading plans and rules, but because they were discretionary and couldn't really be backtested, i suppose i was never confident with them. When i did take trades, i was always scaling out too quickly which can dramatically decrease your bottom line. I would then end up taking some trades from the smaller timeframes, which would often end up with me wiping out my profits on any previous trades.
I strongly believe in trading price action as price is king. I think the problem with using too many timeframes is that you end up with too many support/resistance zones and this can hinder you from taking trades, as well as the obvious, "which way is this going" problem.
I have traded pin bars before and have come across them on other sites but i have not really specialised in them. I have been trying to come up with a mechanical system based on price action, but to no avail. After weeks at staring at charts, i am coming to the conclusion that i am not sure if i can ever find one, although i know it is possible. I really need to train in one specific setup, and master it and this could possibly be the one i need to concentrate on. I think looking at the longer timeframes but utilising more instruments is definitely the way forward.
The only thing i see lacking on what i have read so far is how people are exiting from these setups. This is by far the most difficult part of trading and one that we should all be focusing on and helping each other with. I have seen many trades posted here but very few show how and why people have exited the trade, or shown where people take partial profits etc.
I know that it is essential to take some profits as the markets allows, which can help you stay in a trade longer by taking away the emotion of losing. However, there is a fine line here and taking profits too soon and moving stops to break even can damage your bottom line. If you consistently take profits too soon then this may not recover the losses on other trades.
I would just like to know people views on exiting. As this is the hardest part of trading it is usually a good idea to have some sort of profit target. Do you guys measure your risk/reward before a trade? Do you have a certain risk/reward criteria that you need to satisfy before entering a trade?
It would be good to get some information on this side of the trade execution, maybe it would spark off some interest??
Some of the stops can be quite large on the longer timeframes, so scaling out after 20 pips would be pointless.
  • #3,153
  • Apr 3, 2007 10:18am Apr 3, 2007 10:18am
Hi there, i am really not updated since i am reading this whole thread from the very begining of it so i have no idea whether james still runs it or not - whether he managed to carry out his course - anyways - i noticed in the first 20 pages i have read so far, that all of you guys deal with stuff that are not forex- oil, mini dow, s&p - and some other cherries , so i am asking you to explain what are the main of those - what are you trading there, just for general info, and the reason i am posting this reply is to ask which broker provides those stuff (oil minidow etc.) with metatrader - i love this platform, and i need also a mini account - i preffer..


thank you guys and hope thats not too messy - i didnt quite see what i was writing down so it might look cut and weird..

cheers

M
  • #3,154
  • Apr 3, 2007 11:25am Apr 3, 2007 11:25am
Quoting steveshutts
The only thing i see lacking on what i have read so far is how people are exiting from these setups. This is by far the most difficult part of trading and one that we should all be focusing on and helping each other with.
Hi Steve(?).
This is one of the most discussed topics, obviously. Mike has a good thread on this I believe. StevieT also has a nice way of going about it(he trails daily bars by 10 pips afaik. check his journal).

In essence -

-you should use the same timeframe to exit that caused you to enter, UNLESS you "zoomed in" to enter a higher TF trade on a lower TF, then I'd use the higher one as reference, obviously

-you should realize whether you are trading with or against the main trend or hoping for a trend change to come from this setup (that would have to be BIG then. and I mean really B I G)

-unless you're sitting right in front of gigantic s/r and fib clusters, give it a chance to grow. I've got a 2 day trade on from Sunday's open that has by now grown over 350 pips, and I am cursing myself for closing HALF at 80 pips already

Viable methods would/could be: trail the daily bar with a set amount of pips, StevieT likes 10 for example, or trail behind the last price formation that you find means big s/r or similiar. Or you could allow yourself to feel free to close once you have at the very least three times as many pips as you risked, etc. If of course you're doing a 1H based trade, expecting 500 pips out of that can be tricky unless it is from a spot you expect to become a kickoff for a daily setup. Basically - give your trades a chance!
Oh and as for r/r before entering - needs a balance of not being too skeptic about s/r being impenetrable but also not so silly as to expect 20 years of s/r to go if you're sitting only 20 pips away and entering right in front of it...basically, as James always says - try to only take the very best setups.

I've also found that scaling out is basically great for that "hah, phew, took something, banked it, yay" etc feeling, but it TOTALLY messes up your bottom line. As you said yourself.

Just posted this to my journal:

"Say, if you've closed half at +100 and were aiming for +200.
The remaining half position would need to go to +300 (150 "real pips" from the second half + 50 "real pips" from closing the first half after one hundred =200 "real pips") to achieve the same result as simply closing the full position at +200.
It's a drastic reduction of efficiency, even if it ensures that the "visible" profit turns into banked profit.
I guess it's a tradeoff between making sure there's money made and allowing MORE money to be made vs the risk of also losing it faster again. As obviously bigger stake also means a faster decrease if it turns again as well."

Hope this helps a bit to give some ideas. Basically, give it a chance to grow, don't chop down fragile plants before they grow to be ancient barks and voluminous trees. How else are you going to get enough material to print all the paper(read: cash) you want?

Check out Mike's thread as well

Take care,

SeekingLight
Trust price. Know yourself.
  • #3,155
  • Apr 3, 2007 2:40pm Apr 3, 2007 2:40pm
well, i lost 166 points on that weak pin bar i posted on oil a few days back.
shame i didn't take james' advice and stay on demo...
disappointing...especially when patience brings rewards like this...
i4b...the last three doji's all pull back sharply from the 50 fib and close above the 38...and all the while getting smaller ranges...a wind up tight and then we're off.
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  • #3,156
  • Apr 3, 2007 2:43pm Apr 3, 2007 2:43pm
Quoting Porkpie
Thanks Mike. Sounds like what I need right now.

I am sure you mentioned a book on chart patterns in an earlier post which I failed to write down and now can't find?? Or was that someone else??

Pete
The book Mike mentioned was Pring on Price Patterns by Martin Pring.
Some very good stuff in there.


Tom
  • #3,157
  • Apr 3, 2007 3:47pm Apr 3, 2007 3:47pm
right, i'm going to join the rest of you brave lot and make a live call rather than post setups that would have worked in hindsight.
how does this look: usd/dkk.

advantages:
a) DBLHC
b) break of IB4
--- so two pa setups in one bar --
c) current bar takes us so we are currently trading above daily and weekly pivot level (not on chart otherwise it would be too crowded)
d) the DBLHC takes place directly off the 76.4% retracement level of the lowest low on the chart you can see to the high a few sessions later

disadvantages:
a) price is, lets face it, trending down. infact, we are only slightly higher than the lowest point this reached in the last 8 years (which is as far back as my data goes)
b) setup comes in "traffic"
c) price is trading under all short term ema's that i like to use

any thoughts from anyone?

also - what about this DBHLC on eur/usd daily? i only looked briefly but couldn't find too much to support going short...

tom
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  • #3,158
  • Apr 3, 2007 4:18pm Apr 3, 2007 4:18pm
Quoting the_wizard
how does this look: usd/dkk.

advantages:
a) DBLHC
b) break of IB4
--- so two pa setups in one bar --
c) current bar takes us so we are currently trading above daily and weekly pivot level (not on chart otherwise it would be too crowded)
d) the DBLHC takes place directly off the 76.4% retracement level of the lowest low on the chart you can see to the high a few sessions later
Also if you look to the left, there are 2 bars that together would form a PB like formation. This retrace could be akin to a PB retrace at .618/.786
An entry at I4B break woulda been a nice attempt with a small stop.

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disadvantages:
a) price is, lets face it, trending down. infact, we are only slightly higher than the lowest point this reached in the last 8 years (which is as far back as my data goes)
How is this bad? I'd say the opposite. You're looking to go long and you're at an all time low. Great, there's tons of room to go AND folks will realize these are bargain levels, no? Where better to attempt a small long from? (keep in mind I haven't looked at this chart myself, I'm just taking your word for this here and going by your post) So if it moves off, there's a good chance it could go somewhere and if it only moves a bit and comes back to slaughter you, you at least know what's up
Risk will always be inherent to trading. I, too, still struggle with inside bars for this very reason of them being prone to whiplashes quite a few times. So if you have more reasons to think long, all the better.

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b) setup comes in "traffic"
This I also don't understand. An inside bar will always be inside another bar per definition.

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c) price is trading under all short term ema's that i like to use
This is a problem I know. I always think "Uh oh, it will hit one of the EMAs and slaughter my trade". Well, it can. And it may not. The point is - you aren't trading the EMAs here. If you have a setup that signals a possible reversal at a good s/r spot, then the EMAs WILL be passed. How else would they ever re-cross again? Always remember - the market always has TWO directions
This is where you get your emotions and faith in your trading tested. Don't close something out manually which you have set a predetermined stop for just because you see an EMA hit and a reaction. The stop is there for a reason. The trade is there for a reason. Give it the shot that made you enter in the first place. (speaking out of painful personal experience here, too)


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also - what about this DBHLC on eur/usd daily? i only looked briefly but couldn't find too much to support going short...
tom
Yea, we had quite a bullish reaction Friday, so this is all very iffy stuff right here. Would rather see us move below that weekly PB level again before "trusting" any descent. EURUSD has been tricky, the xxxCHF and xxxJPY have been MUCH more rewarding in these newsfree days. Or the other yielders like AUDUSD / NZDUSD.

Don't be discouraged if it seems like I'm constantly throwing sticks between your legs, I'm still seeking the light as well and could totally be off with anything I write. We're all just trying to give our best guess at any point in time and even Pro's are constantly wrong. They just allow themselves to be right longer when they do hit it off to compensate
Also - it's YOUR opinion on any trade that's most important, don't let others EVER talk you into or out of trades.

One of the biggest dangers of idea exchange and forums imho.

Take care out there,

SeekingLight
Trust price. Know yourself.
  • #3,159
  • Apr 3, 2007 4:31pm Apr 3, 2007 4:31pm
Quoting SeekingLight
Don't be discouraged if it seems like I'm constantly throwing sticks between your legs
on the contrary, i appreciate it.
i sometmes think that finding reasons not to take trades is the key to success in this business!
it's also a challenge because i will try to find that setup where you say - i can't find anything wrong with that" - then i really know to maximise the leverage
tom
incidentally, does anyone on here use msn? working from home is lonely...
  • #3,160
  • Apr 3, 2007 10:24pm Apr 3, 2007 10:24pm
From the weekly USDJPY, we can see that price has moved to some significant resistance area. I am watching PA signal here. My bias is short.

Ken
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