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Silent Service Method

  • #2,401
  • Jun 29, 2009 4:09pm Jun 29, 2009 4:09pm
CW just wanted your input on this trade. Got in on the hanging man two candles back expecting it to tank because of the falling TL and the huge bearish engulfing candle on previous run to the TL.
Attached Image (click to enlarge)
Click to Enlarge Name: pound_major_resistance_6_29_09.png Size: 48 KB
  • #2,402
  • Jun 29, 2009 4:32pm Jun 29, 2009 4:32pm
http://i39.tinypic.com/2poppit.png
  • #2,403
  • Jun 29, 2009 4:53pm Jun 29, 2009 4:53pm
Quoting kodflakes
CW just wanted your input on this trade. Got in on the hanging man two candles back expecting it to tank because of the falling TL and the huge bearish engulfing candle on previous run to the TL.
I personally don't trade "hanging man" unless prices breaks below the bottom of the bar. I'm not say that you aren't alright - just that you are doing it the risky way.

CW
  • #2,404
  • Jun 29, 2009 5:01pm Jun 29, 2009 5:01pm
Thanks CW that basically answers what I was asking. Low if you were replying to me on the in doubt part I wasnt until now Im trying to figure out if I need to get out with a small loss or let it go. Im just tossed up the price hasnt been able to break this level in a long time but it hasnt given in to the bears either so Im in no mans land at the moment

Quoting clockwork71
I personally don't trade "hanging man" unless prices breaks below the bottom of the bar. I'm not say that you aren't alright - just that you are doing it the risky way.

CW
  • #2,405
  • Jun 29, 2009 5:31pm Jun 29, 2009 5:31pm
Quoting kodflakes
Low if you were replying to me ....

My reply wasn't to suggest that you should be doubtful, in fact I really appreciate your contributions and they help me a lot. I brought up the chart because I just finished reading Jacko's thread in its entirety a few weeks back, and when the EUR/USD fell off of a cliff, a lot of traders got bit hard by the ending (or correction?)of a five year bull run.

Since this is not a trend following method, we would be much better prepared for such an event, and better able to capitalize upon it, but I just wanted to remind everybody that the same consolidations took place last year (maybe this happens every year, I'm new) at this time, and a lot of people lost money on their expectations.

I am very reluctant to acquire any expectations right now.

And to demonstrate my trading prowess and credentials, I took the silver long play, and price is about a third of the way to my SL already. Oh well.

Cheers
  • #2,406
  • Jun 29, 2009 8:51pm Jun 29, 2009 8:51pm
Quoting tazzam72
Hi CW
I took this trade today NZD JPY what do you think? Bought 60.85 TP @62.86
JUST HIT Tp
Attached Image (click to enlarge)
Click to Enlarge Name: nj240 6 29 09 6.png Size: 116 KB
  • #2,407
  • Jun 29, 2009 11:33pm Jun 29, 2009 11:33pm
Quoting tazzam72
JUST HIT Tp
congrats!
  • #2,408
  • Jun 30, 2009 12:47am Jun 30, 2009 12:47am
clockwork71 Excellent thread. I certainly appreciate it.
As an fnb and late arrival I’m just getting to pg 20. As I see it, you have laid out within 20 pages a mythology that rivals Warren Buffet himself..

One of the advantages a fnb has, is his book of dumb and stupid questions if filled with nothing but blank pages.

In your AUDUSD weekly chart you have on pg 20 r/s at 0.7996 and 0.6270. I understood the ending numbers should be 50 or 00. I believe I understand the reasoning.
(uniform pips= easier management?)

On my chart I have the same area s/r at 0.79500 and 0.62500.
http://img.photobucket.com/albums/v1...usd_weekly.gif
Q: Is it acceptable to fudge the ending numbers for a more precise s/r?

off topic: Where can I go to learn how to post pictures here?
  • #2,409
  • Jun 30, 2009 1:49am Jun 30, 2009 1:49am
http://i41.tinypic.com/aovqk4.png
  • #2,410
  • Jun 30, 2009 1:50am Jun 30, 2009 1:50am
Quoting SaepeExertus
off topic: Where can I go to learn how to post pictures here?

google "jing", free screenshot software. it rocks.
  • #2,411
  • Jun 30, 2009 2:14am Jun 30, 2009 2:14am
Quoting SaepeExertus
Q: Is it acceptable to fudge the ending numbers for a more precise s/r?

off topic: Where can I go to learn how to post pictures here?

http://www.forexfactory.com/showpost...ostcount=16184
  • #2,412
  • Jun 30, 2009 2:48am Jun 30, 2009 2:48am
My thought on how far you should look back on charts to look for s/r lines or zones is that s/r tends to occur at or very near to round numbers. These round numbers acted as s/r in the past due to the pyschological effect on traders of price reaching those levels. Once these levels have been touched the first time as price approaches them the second or subsequent times they will tend to be even stronger levels.

A good example is the 1.30 level on usdcad. Zoom a weekly chart right out and you can see it react to this level in 1992, 1993 and 2003. Is it any wonder that traders were watching that level in 2009?

Firstly it's the round number that counts. Round numbers at certain levels will always act as pyscological barriers where PA occurs due to buyers and sellers taking profits and/or reversing trades. Secondly, if it's a round number that has been significant before (and you can bet that there are more people than the followers of this thread watching those past levels) then it will be even more significant this time around.

This is what I think this method hinges on, it's the basic truth behind it. Find significant s/r levels on a zoomed out weekly chart and wait to see if price is going to react at that level. Also I wouldn't exactly say that this is not a trend following method. Of course you can use it to trade countertrend but I'm guessing a lot of us don't. If it's with the trend you're much more likely to make money.

Thoughts?
  • #2,413
  • Jun 30, 2009 3:00am Jun 30, 2009 3:00am
This could already be obvious to everyone or I may have just stumbled upon something useful, bear with me...

I'm short eurgbp at the moment, I sold it not much below 86 as it seems to be holding below that.

Eurgbp is calculated directly from gbpusd and eurusd. So, if gbpusd goes up more than eurusd or if one goes down in relation to the other then eurgbp will change in accordance with that. So far quite clear.

Now then, if you were just concentrating on eurgbp for your technical analysis you would be fine. 86 has acted as support on the way down and resistance a couple of times recently. But, would analysing the technicals on gbpusd and eurusd add anything to your trade?

Take a look at the 2 screenshots below. Gbpusd has broken above 1.65 and held and is showing signs of carrying on, next resistance 1.7. Eurusd is struggling around 1.41, could well be that 1.41 is going to hold it back for a while, long enough to give a nice bearish candle on eurgbp.

I think putting the 2 together gives me an extra insight into what may be happening with the pair I am actually trading.

Does anybody think this is a valid idea? There must be better examples too. My gbpaud long is going ok but audusd is going to hit resistance way before gbpusd, does this bode well for gbpaud?

Like I said, this may already be obvious to everyone and I'm a mile behind?
Attached Image(s) (click to enlarge)
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Click to Enlarge Name: gbpusd1.GIF Size: 13 KB
  • #2,414
  • Edited 3:39am Jun 30, 2009 3:28am | Edited 3:39am
Also watching longs on eurjpy. Nothing else interesting...
Id be all over ej only eurusd is at the top of its range and looks to be pinning on daily, definitely not enough to trade, but enough to cause a little retrace. So ej will go lower yet before it bounces. It will bounce, it broke free from its little box yesterday
Attached Image (click to enlarge)
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  • #2,415
  • Jun 30, 2009 3:46am Jun 30, 2009 3:46am
Pound chart, possible Pin Bar on the 4 hour.
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  • #2,416
  • Jun 30, 2009 3:49am Jun 30, 2009 3:49am
Quoting Low
http://i41.tinypic.com/aovqk4.png
Nice chart Low, ill look it up ^_^
  • #2,417
  • Jun 30, 2009 3:51am Jun 30, 2009 3:51am
Ahhh...my broker doesnt offer me that pair sadly =(
  • #2,418
  • Jun 30, 2009 4:06am Jun 30, 2009 4:06am
Quoting split_unit
Pound chart, possible Pin Bar on the 4 hour.
fxpro has a whopper of a 4hour GU pin, closed and everything. 100 pip long nose. Perfect.
Normally i dont touch pins at the top of a range in an uptrend. Too dodgy against the trend.
This is very tempting though

What do you think Chris?
  • #2,419
  • Jun 30, 2009 4:28am Jun 30, 2009 4:28am
Quoting hel13rock
This could already be obvious to everyone or I may have just stumbled upon something useful, bear with me...

I'm short eurgbp at the moment, I sold it not much below 86 as it seems to be holding below that.

Eurgbp is calculated directly from gbpusd and eurusd. So, if gbpusd goes up more than eurusd or if one goes down in relation to the other then eurgbp will change in accordance with that. So far quite clear.

Now then, if you were just concentrating on eurgbp for your technical analysis you would be fine. 86 has acted as support on the way...
I try to stay away from looking at other pairs (related pairs) when I am making a decision whether to trade a certain pair or not. I find that the more I add to my analysis, the poorer and more muddy the analysis becomes.
Simply put, I trade what I see on the chart. Good PA setup at a good location...

Just my 2,

Josh
  • #2,420
  • Jun 30, 2009 5:14am Jun 30, 2009 5:14am
Quoting Jduester
I try to stay away from looking at other pairs (related pairs) when I am making a decision whether to trade a certain pair or not. I find that the more I add to my analysis, the poorer and more muddy the analysis becomes.
Simply put, I trade what I see on the chart. Good PA setup at a good location...

Just my 2,

Josh
Yes, I can see your point. It just seems that it might add a useful extra aspect. If gbpusd was about to meet a strong resistance level and eurusd had a clear run for 3 or 400 pips I might feel differently about shorting eurgbp even if that itself looked like a good trade.

I'm thinking it's the majors that count the most and the crosses follow (as they are directly calculated from them) so PA and s/r on the majors should be taken into account when trading their crosses.
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