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Andrews Pitchfork (Median Line)

  • #361
  • Jun 17, 2009 5:58am Jun 17, 2009 5:58am
Quoting Thomling
Hi guys and thanks all for sharing,

It sure isnīt easy, I drew one a few days ago (Green PF) and price has moved outside of it and donīt thinks itīs coming back in - price has past to far away. If I would have taken the long trade at 1.6292 I would have lost.

I now have enlarge the PF (Orange PF) so that price is inside and above the lower ML. Is this one still valid or should I draw a new one pointing down - thereīs a quite big retracement there and price has past the 200 MA?

Greatful for all your inputs
Have a great trading day...
I know other people have chimed in--I was not available to post for a time--but look at your pitchfork, just look at it.

Price had obviously changed behavior. Price was making higher highs and higher lows, crusing in a nice up trend. Then it flattened out and made a nice top, then it changed direction and behavior--and YOU have to recognize that and draw in the down sloping Median Line or pitchfork, which I think Surya did a few posts later.

Pitchforks get a bad reputation because people treat them like the lagging 200 moving average indicator hanging out on their chart: You don't have to redraw the 200 period moving average, it just squiggles over a bit. You HAVE to pay attention to price and draw a new fork in when price changes behavior. Lazy traders cannot use leading indicators because they don't see the change in the market structure and they then don't draw in the new pitchfork.

Price isn't going to be nice and 'DO' what you want at lower lines. If you have an up sloping pitchfork and price makes a clear turn lower and is heading for the lower Parallel, you can't just hold onto your position, thinking...the Lower Parallel is there, it will save me. Or god forbid, you can't just throw in a bid at the lower paralllel because the up sloping line is there. The lines have to fit market structure.

It isn't hard, but you have to pay attention and learn market structure. Then when the structure changes you have to add a new pitchfork. It really isn't rocket science.

Tim
  • #362
  • Jun 17, 2009 6:04am Jun 17, 2009 6:04am
Quoting TimMorge
GT3RS:

Ok, first, forget the standard Schiff. About 15 minutes after Dr. Andrews showed Jerome Shiff the modifications, even he stopped using for 99 pct of the charts they were looking at for evaluation at Andrews' house. You basically want to focus on the traditional Median Line and the Modified Schiff.

Modified Schiffs have 3 general uses: 1] coming out of veritcal moves--you'll know when a traditional median line doesn't 'catch price' because it is skewed by the verticality. 2] In a range, you can use Schiff Median Lines to help you know...
Many thanks Tim for the explanation. Much clearer now! I am just practising drawing forks all over the place!!!

[Just ordered your book by the way!].

Thanks once again,

Rob
  • #363
  • Jun 17, 2009 9:01am Jun 17, 2009 9:01am
Thanks Tim, this post is a real gem for anyone who appreciates the prowess of the Andrew's Lines; and your explanations are done in such clarity that one won't need to see a chart attachment to illustrate your point about the usage of the Andrew's Lines. Many thanks and be well.

Have a good one
Jeff


Quoting TimMorge
I know other people have chimed in--I was not available to post for a time--but look at your pitchfork, just look at it.

Price had obviously changed behavior. Price was making higher highs and higher lows, crusing in a nice up trend. Then it flattened out and made a nice top, then it changed direction and behavior--and YOU have to recognize that and draw in the down sloping Median Line or pitchfork, which I think Surya did a few posts later.

Pitchforks get a bad reputation because people treat them like the lagging 200 moving average indicator...
~*~You are only one trade away from humility~*~
  • #364
  • Jun 17, 2009 9:25am Jun 17, 2009 9:25am
Just wanna share my chart again...
It's Eur USD 4 H Chart.....
Any Comment?
Attached Image (click to enlarge)
Click to Enlarge Name: EurUSD4H.jpg Size: 80 KB
  • #365
  • Jun 17, 2009 9:37am Jun 17, 2009 9:37am
Slightly different than yours Surya but same diff. to me. Take care.

Have a good one
Jeff
Attached Image(s) (click to enlarge)
Click to Enlarge Name: Eur Median Lines 06172009(vi).gif Size: 36 KB
Click to Enlarge Name: Eur Median Lines 06172009(vii).gif Size: 52 KB
~*~You are only one trade away from humility~*~
  • #366
  • Jun 17, 2009 9:50am Jun 17, 2009 9:50am
Almost the same chart as yours.....
Same Chart eur usd 4h
Attached Image (click to enlarge)
Click to Enlarge Name: EurUSD4H=1.jpg Size: 81 KB
  • #367
  • Jun 17, 2009 9:56am Jun 17, 2009 9:56am
We obviously are at a juncture with a potential H&S for a downside break; but at the same time, the up sloping Andrew's Lines are holding well for the long side as well. We are at critical juncture. Best get some further price actions for confirmation before committing. For me, I just traded around those warning lines for scalps. Directional bias are both valid for both sides....for now.


Edit: One thing is for sure, if this turns out to be a failed H&S; the shorts are in for real big surprise and price actions may just go ballistic to the north.
Quoting surya97
Almost the same chart as yours.....
Same Chart eur usd 4h
~*~You are only one trade away from humility~*~
  • #368
  • Jun 17, 2009 1:07pm Jun 17, 2009 1:07pm
I certainly agree that we are at a juncture (aren't we always ). It looks to me as though there is an upward bias to the market with a nice energy point at the yellow circle. Wait and watch is what I will do.
Attached Image (click to enlarge)
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Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #369
  • Jun 17, 2009 1:22pm Jun 17, 2009 1:22pm
A closer look shows that previous hi has just been surpassed. A pullback (if it happens) into the energy point could be a good entry area. That would give us higher highs and higher lows. Patience, Grasshopper, patience.
Attached Image (click to enlarge)
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Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #370
  • Jun 17, 2009 2:06pm Jun 17, 2009 2:06pm
Just wondering if this would be a more approppriate area for a "heads up"? I think its a Schiff, if I did the dark green fork correctly. Anyone have thoughts on this?
Attached Image (click to enlarge)
Click to Enlarge Name: 12.gif Size: 16 KB
Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #371
  • Jun 17, 2009 2:39pm Jun 17, 2009 2:39pm
Nice observation, FXH. The whole I had been changing thoughts in respect to the issues of directional bias and also decided that price actions simply shown they weren't willing to come down and formaing a triangle at the Up Sloping lower median line.

Quoting fxhermit
I certainly agree that we are at a juncture (aren't we always ). It looks to me as though there is an upward bias to the market with a nice energy point at the yellow circle. Wait and watch is what I will do.
~*~You are only one trade away from humility~*~
  • #372
  • Jun 17, 2009 2:45pm Jun 17, 2009 2:45pm
This is Modified Schiff (50% of both price and time between P0 and P1); it looked very valid to me indeed. I certainly what you present on this post will materialize as oppose to the post which depicted a re-test AGAIN of the Up Sloping lower median line! (as I'm still have my longs running :*) All the same, I certainly don't mind it will come right down to the Up Sloping Lower Median for me to position my longs once again. Thanks and nice charts.

Have a good one
Jeff

Quoting fxhermit
Just wondering if this would be a more approppriate area for a "heads up"? I think its a Schiff, if I did the dark green fork correctly. Anyone have thoughts on this?
~*~You are only one trade away from humility~*~
  • #373
  • Jun 18, 2009 6:09am Jun 18, 2009 6:09am
Great posts, guys! Maybe we'll get an active thread going here yet!

Note the two attempts to claw above the 38.2 area.

The forks look good, the structure looks IFFY. I don't think price has played its big card yet--and is that big card a buy or sell?

More after my morning live session...I'll be back.

Tim
Attached Image (click to enlarge)
Click to Enlarge Name: eur061809am.gif Size: 44 KB
  • #374
  • Jun 18, 2009 9:37am Jun 18, 2009 9:37am
Thanks a lot Tim for the chart. I fully agree that we need more price actions in order to gauge for a long or short play. I was longed Eur/Usd last night and got myself out when this morning in Asian session, prices hit the warning line in the 20-min time frame. Right now, I think we got ourselves an expanding pattern to deal with.

I surely hope this thread will turn more active in the near future. I'm on the sidelines for now.

Have a good one
Jeff


Quoting TimMorge
Great posts, guys! Maybe we'll get an active thread going here yet!

Note the two attempts to claw above the 38.2 area.

The forks look good, the structure looks IFFY. I don't think price has played its big card yet--and is that big card a buy or sell?

More after my morning live session...I'll be back.

Tim
Attached Image (click to enlarge)
Click to Enlarge Name: Eur Median Lines 06182009(i).gif Size: 53 KB
~*~You are only one trade away from humility~*~
  • #375
  • Jun 18, 2009 10:03am Jun 18, 2009 10:03am
Thanks for the informative charts guys - we WILL keep this thread going!!! ;-)

I have just ordered Tim's book, and am eagerly awaiting delivery, so have LOTS to learn on Median Lines/Pitchforks.

My first question [for now!] is this:

You all seem to be using 4hr charts. I'm guessing you've found this to be the best timeframe for drawing median lines?

Many thanks,

Rob
  • #376
  • Jun 18, 2009 1:43pm Jun 18, 2009 1:43pm
Nice to see others posting their charts and comments, always adds insight to one's own analysis. Just messing around with some Schiff's, still trying to get the hang of drawing them. Here are a couple that seem to delineate market frequency. Comments are most welcome.
Attached Image(s) (click to enlarge)
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Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #377
  • Jun 18, 2009 1:59pm Jun 18, 2009 1:59pm
Don't know if these Schiff's make any sense or not. They do seem to outline this slightly downward biased ranging market though.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 21.gif Size: 14 KB
Click to Enlarge Name: 22.gif Size: 17 KB
Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #378
  • Edited 2:26pm Jun 18, 2009 2:13pm | Edited 2:26pm
And just for the fun of it, here is one more. Gee, I hope that as the saying goes, practice makes perfect. I do love how the forks clarify the landscape. The proof of the pudding, of course, is being able to make money off these puppies.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 23.gif Size: 14 KB
Click to Enlarge Name: 24.gif Size: 17 KB
Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #379
  • Jun 18, 2009 2:21pm Jun 18, 2009 2:21pm
Quoting Gt3rs
My first question [for now!] is this:

You all seem to be using 4hr charts. I'm guessing you've found this to be the best timeframe for drawing median lines?

Many thanks,

Rob
My personal preference is to work "top down" beginning with the daily timeframe. The 4hr, 1hr, 30 min then become my "trading" timeframes. I generally use the 1hr, 30 min to time entry and for early trade management. The forks do seem to work well to delineate the 4hr "channel". Channel surfing is one of my favourite approaches to trading.
Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #380
  • Jun 18, 2009 4:34pm Jun 18, 2009 4:34pm
Nothing magical here:

1st half NY time zone = 4 hours
2nd half NY time zone = 4 hours

1st half Japan time zone = 4 hours
2nd half Japan time zone = 4 hours

1st half Europe time zone = 4 hours
2nd half Europe time zone = 4 hours

This started out as a system trader's favorite timeframe in the early 1980's in Geneva and slowly has become the hedge fund world's most popular timeframe. But any equally divisible timeframe within works well.

And Schiffs just plain work well with currencies...always have. I think its because they trade in big vertical moves and then range trade and then take off again--that skews traditional Median Lines but Modified Schiffs are better suited to deal with these conditions.

Tim
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