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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

  • #32,701
  • Jun 8, 2009 11:07am Jun 8, 2009 11:07am
Quoting TiaForex
I like that chart Josh and have used it myself.

The only caveat I add with thes figures is that sometimes we plot our previous live trades, demo trades, backtested trades or whatever against this formula and we come up with very precise figures regarding expectancy and the percentage of a certain drawdown and the percentage of a losing streak.

It's an incredibly useful tool and I use it a lot but I think it can give us a reassurance that can be misleading.

We are discretionary traders here. We don't trade moving average crossover systems,...

Great post as always, I knew of 2 people that could chart better then anyone I have ever seen. They would spend like 2-3 hours with lines and all this good stuff but they never made money, I would trade the charts I had no idea what it was saying but I knew if it looked short or long and I did well. These people used to work for huge firms Merrell and the other was UBS and would give the charts to others to trade. They both quit and tried to do trade but they would freak out everytime they opened a trade and screw up all the rules... Funny thing is they both now run a large hedge fund and do well trading others money lol. Sorry for the long rant I just have seen 1st hand what happens when you think too hard and it seems the more time you spend telling yourself that "This is the one" the more you get attached to it and become emotionaly involved with the trade, then if it goes bad you think you failed.
Keep taking CT trades, I need more money
  • #32,702
  • Jun 8, 2009 11:09am Jun 8, 2009 11:09am
Quote
This is trading based off strong horizontal pivot levels/ppzs.
Won't go into the details cuz I don't want to digress from the main topic, but these are touch entries based on price hitting a ppz. The basic idea is to grab some pips off "The immediate bounce" which may or may not be sustained. rest is all trade/money/psychology management, where this initial idea can transform into a plan for 500 pips.
Good point made by ghous.

Another way of looking at/saying this is "following the profit-taking herd" as price gets near/hits a certain ppz or S/R. like ghous said, u go trade off the immediate bounce, wherein the "bounce" is caused by the profit-takers exiting (or even some small speculative traders who are just long) near/at the PPZ or S/R. most of the time, the bounce is small (let's say 10-30 pips). but there are times when the bounce snowballs into a much bigger-than-expected bounce ((let's say 30-50pips). sometimes , still, this snowball turns into a minor countertrend or retracement when participation (from more traders) increases ((let's say 50-100+ pip "bounce").
  • #32,703
  • Jun 8, 2009 11:11am Jun 8, 2009 11:11am
Quoting mmbmusa
Hi Fat_TOm,

I take it you are looking at the Cable(GBP/USD) daily chart? There is a very strong PPZ on the weekly that suggests we might see prices trade as low as 1.45 (if we are able to break this zone). There is also the weekly pin bar that should take us down to the 38.2 level, all things being equal...

I feel the market might just be pausing and might resume its next leg down soon.

MM
mmbmusa,

Yeah I think you might be right looking at the longer weekly chart. I will keep a eye on the pin for a possible long entry to a 50fib retrace (~1.6280) but looking at the weeklys I think it might be a longer term downtrend we're about to get into.

Thanks for your reply still getting used to this.. (Only 4 live trades in my career to date!!!)

thanks again

Fat Tom
  • #32,704
  • Jun 8, 2009 11:13am Jun 8, 2009 11:13am
Still short, To be honest playing this daily stuff is CAKE after doing the 5min lol, would be nice doing 7 trades a month not a day


Took one this AM at +250 a little better then 1:1, Killed the eur/jpy for +30 dumb trade. Waiting for the other 2 for the red lines...

Killed gbp/usd may go long @ close of day.
Attached Image (click to enlarge)
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Keep taking CT trades, I need more money
  • #32,705
  • Jun 8, 2009 11:53am Jun 8, 2009 11:53am
so how many trades do you do then usually per month.. 7 is less?
  • #32,706
  • Jun 8, 2009 12:05pm Jun 8, 2009 12:05pm
Quoting masont
so how many trades do you do then usually per month.. 7 is less?

If this is too me I am not sure, the good ones I hope. Only been doing the daily for 3 days so far. I guess as many good trades as I find.
Keep taking CT trades, I need more money
  • #32,707
  • Jun 8, 2009 12:08pm Jun 8, 2009 12:08pm
Quoting supremeChaos
Good point made by ghous.

Another way of looking at/saying this is "following the profit-taking herd" as price gets near/hits a certain ppz or S/R. like ghous said, u go trade off the immediate bounce, wherein the "bounce" is caused by the profit-takers...
Yes this is how we roll...

here is the Usd/Cad which started off with nothing but an initial stop of 30 pips and 50 pip first target. It's been a free trade since then, I added some at the first blue ppz which was taken off at 1.114,

The plan was to add some more Monday open when and if price tests this level again, but missed it altogether (early morning study for exams etc) but it just goes on to show the role of these levels on a chart. They DRIVE the markets. The sooner we realize this simple truth the sooner we're out of the hole.
Attached Image
I believe . . .
  • #32,708
  • Jun 8, 2009 12:13pm Jun 8, 2009 12:13pm
Quoting Ryanmcd
If this is too me I am not sure, the good ones I hope. Only been doing the daily for 3 days so far. I guess as many good trades as I find.
Good stuff Ryan,

Hope you're doing well on the "waiting part". lol!
I believe . . .
  • #32,709
  • Jun 8, 2009 12:13pm Jun 8, 2009 12:13pm
Quoting Ryanmcd
I have been doing this a while and I will never look at a chart to tell me what my losses will be, I have had over 40 winners in a row as well I dont see that chart Also how big are the losses, did you go tilt on the losses? Too much to take in to see what your "losses" will be. Just take good trades and dont think, Okay 6 losses I have to win the next one the chart says so!
You are right Ryan. The chart is only intended as a tool. Not as an end all. Sorry for confusion.

Josh
  • #32,710
  • Jun 8, 2009 12:13pm Jun 8, 2009 12:13pm
Quoting ghous
Yes this is how we roll...

here is the Usd/Cad which started off with nothing but an initial stop of 30 pips and 50 pip first target. It's been a free trade since then, I added some at the first blue ppz which was taken off at 1.114,

The plan was to add some more Monday open when and if price tests this level again, but missed it altogether (early morning study for exams etc) but it just goes on to show the role of these levels on a chart. They DRIVE the markets. The sooner we realize this simple truth the sooner we're out of the hole....
Looks like you are the windshield on this one guy...
  • #32,711
  • Jun 8, 2009 12:19pm Jun 8, 2009 12:19pm
AUDUSD

Here you pay attention to this area....with correct price action...and money will fall into your pockets
Sell if price goes up and buy if price goes down

Attached Image (click to enlarge)
Click to Enlarge Name: audusd.gif Size: 34 KB
  • #32,712
  • Jun 8, 2009 12:19pm Jun 8, 2009 12:19pm
Quoting HipsterPipster
Looks like you are the windshield on this one guy...
love it on this end
I believe . . .
  • #32,713
  • Jun 8, 2009 12:25pm Jun 8, 2009 12:25pm
Quoting TiaForex
I like that chart Josh and have used it myself.

The only caveat I add with thes figures is that sometimes we plot our previous live trades, demo trades, backtested trades or whatever against this formula and we come up with very precise figures regarding expectancy and the percentage of a certain drawdown and the percentage of a losing streak.

It's an incredibly useful tool and I use it a lot but I think it can give us a reassurance that can be misleading.

We are discretionary traders here. We don't trade moving average crossover systems, or...
Yep, in full agreement here Aaron. Chart should be used only to show theoretical values, and should not be tightly applied to a trading strategy. I should have said something like this in my post to avoid confusion/misapplication.

Josh
  • #32,714
  • Jun 8, 2009 12:26pm Jun 8, 2009 12:26pm
Quoting Ryanmcd
Great post as always, I knew of 2 people that could chart better then anyone I have ever seen. They would spend like 2-3 hours with lines and all this good stuff but they never made money, I would trade the charts I had no idea what it was saying but I knew if it looked short or long and I did well. These people used to work for huge firms Merrell and the other was UBS and would give the charts to others to trade. They both quit and tried to do trade but they would freak out everytime they opened a trade and screw up all the rules... Funny thing...
I agree Ryan. Looking for certainties in this game is a seductive but deadly trap.

One thing I remember Mike once saying: "I try to see every setup as just another trade that could go wrong".

In one of his recent PF webinars he also laughed at how many absolutely surefire setups he had seen that did exactly what they were NOT supposed to do.

This is why I imagine even someone like James would blanch at the thought of risking 10% on a trade, no matter if it was the best setup he had ever seen in 26 years of trading.
  • #32,715
  • Jun 8, 2009 12:32pm Jun 8, 2009 12:32pm
Quoting Jduester
Yep, in full agreement here Aaron. Chart should be used only to show theoretical values, and should not be tightly applied to a trading strategy. I should have said something like this in my post to avoid confusion/misapplication.

Josh
Don't get me wrong Josh, I am completely agreeing with you and didn't think you were making claims that the chart was gospel. And personally I think the correct road is to do the research and then take it with a pinch of salt, or large margin of error, just like you do. I didn't mean to take an opposing position, just to add a nuance to your argument.

In fact I think the danger is that someone could read our conversation and think "screw expectancy I don't need that". Far from it. It's the same when people make reservations about backtesting not reflecting real live conditions and then someone says, okay so I don't need to backtest. The truth is I'd rather backtest to build confidence and just not get too atached to the results. Much better to do all the work, then throw out what I don't need or has limited use, rather than avoid it all because of a couple of reservations.

And if anyone is observing the back and forth discussion, Josh and I are on the same page about most things, this included.
  • #32,716
  • Jun 8, 2009 12:33pm Jun 8, 2009 12:33pm
Quoting mbqb11
was out of town for my brothers graduation

Emails are going out fast now thanks to my iced coffee!

Aaron had some killer posts while I was gone
I was taught by the best....

Thanks dude.
  • #32,717
  • Jun 8, 2009 12:34pm Jun 8, 2009 12:34pm
Quoting TiaForex
I agree Ryan. Looking for certainties in this game is a seductive but deadly trap.

One thing I remember Mike once saying: "I try to see every setup as just another trade that could go wrong".

In one of his recent PF webinars he also laughed at how many absolutely surefire setups he had seen that did exactly what they were NOT supposed to do.

This is why I imagine even someone like James would blanch at the thought of risking 10% on a trade, no matter if it was the best setup he had ever seen in 26 years of trading.

It's like a 4 step program...


1) I can't win and lose over and over
2) I can win now how do I manage it
3) I keep winning but I am not making money
4) I keep winning now and know how to let a winner run
Keep taking CT trades, I need more money
  • #32,718
  • Jun 8, 2009 12:36pm Jun 8, 2009 12:36pm
Quoting Ryanmcd
Still short, To be honest playing this daily stuff is CAKE after doing the 5min lol, would be nice doing 7 trades a month not a day


Took one this AM at +250 a little better then 1:1, Killed the eur/jpy for +30 dumb trade. Waiting for the other 2 for the red lines...

Killed gbp/usd may go long @ close of day.
I would say one thing Ryan, from my observation of dailies.

It's been like Christmas this month, especially the last few days. But there are long dry patches too and sometimes that can really test the patience. I think this is an unusually juicy time because so many pairs are hitting these great big important levels and giving off bars too.

But then again, I'm talking to the guy who regularly watched the 5 minute chart for a whole week without taking a trade. That's superhuman levels of patience. Waiting weeks for a daily trade is going to be a walk in the park...
  • #32,719
  • Jun 8, 2009 12:36pm Jun 8, 2009 12:36pm
This is a keeper.

Quoting TiaForex
The truth is I'd rather backtest to build confidence and just not get too atached to the results.
Keep taking CT trades, I need more money
  • #32,720
  • Jun 8, 2009 12:37pm Jun 8, 2009 12:37pm
Quoting TiaForex
I would say one thing Ryan, from my observation of dailies.

It's been like Christmas this month, especially the last few days. But there are long dry patches too and sometimes that can really test the patience. I think this is an unusually juicy time because so many pairs are hitting these great big important levels and giving off bars too.

But then again, I'm talking to the guy who regularly watched the 5 minute chart for a whole week without taking a trade. That's superhuman levels of patience. Waiting weeks for a daily trade is going to be...

Yep I just find things to do with my time now, Like cooking lol
Keep taking CT trades, I need more money
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