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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

  • #41,761
  • Aug 22, 2009 12:14pm Aug 22, 2009 12:14pm
Quoting StoragePro
Man, it is good to hear from you again....
This is my favourite from the dailies and weeklies as well. The weekly pinbar on my feed adds a nice bit of confluence. I would have liked to see a further pullback to the trendline connecting those last few lows. But the 150EMA and 50fib show some nice confluence.

Personally it's a little too shallow a retrace for me to hold it beyond the 365 and the highs, because my instinct is that the bounce from there will put me in a drawdown that I would not be comfortable with.

Trade management allows a god bar to be played so many ways. Full bar stop and break even at the highs looking for a move beyond, full bar stop and not moving to break even hoping that the stop won't get taken out by the bounce from the highs and then move back and beyond (as per FXV's chart). Perhaps a reduced 50% stop looking for the hard break a la Jarroo, a riskier play because of a tighter stop so you'd want to protect yourself quick on that one. And so on and so on.

Joel mentioned last week that there might be lurkers who use this thread as a signal service. I hope the above paragraph illustrates how precarious that is. You can be told where to get in but there are literally a hundred ways to manage it beyond that. And that's not even considering the reason most followers of signal services lose money; when the decision to enter the market is not yours, you are unlikely to have confidence in it if it goes into drawdown and are more likely to mess with it.

No substitute for trusting your own analysis. And I'm as guilt of this as anyone else. One of the main areas I try and work on in my trading is to avoid "forum confluence"
  • #41,762
  • Aug 22, 2009 12:22pm Aug 22, 2009 12:22pm
Quoting mbqb11
Hope all is well FXV, always liked your charts and am in agreement with that outlook as well

Mike
Let's talk turkey.

Since the markets are not highly predictable - if they were, we'd all trade much differently, how do you two guys come to arrive at a bias? Unless you are talking lower time frame...

I'm very curious about people do that - especially in light of where we are on the chart.

Do you find it helps? I am personally trying to avoid a bias, which might be impossible, because I'd hate to close myself off to the other two potentials - continued flat or the other direction.

The last time we were at this place, the EJ ranged for 2 and a half years.
I'm pretty much done with all this ...
  • #41,763
  • Aug 22, 2009 12:26pm Aug 22, 2009 12:26pm
Quoting TiaForex

No substitute for trusting your own analysis. And I'm as guilt of this as anyone else. One of the main areas I try and work on in my trading is to avoid "forum confluence"
Hee hee - I find forum confluence to be an excellent indicator. Contra-indicator.
I'm pretty much done with all this ...
  • #41,764
  • Aug 22, 2009 12:40pm Aug 22, 2009 12:40pm
Quoting StoragePro
........133.00 round number. (Mike would be proud!)
Hey Mike,

Personally I play less attention to round numbers (every 100 pips) on daily and weekly simply because I have noticed they do not really have any dramatic effect on the price.
Most of the time weekly and daily pin bars will be working also without looking at location.
On the other hand, I can see ton of PA setups on the 1H which do not work.

IMO, it is simply because the weekly and daily contain much more information in them (info of a longer period). They are not effected from the noise in the market. When you look at them, you can understand where price is going and what happens in the market. On the other hand, those 1H bars are nothing really important. They can show a sudden movement that have no meaning for several of reasons like: trades took profit, SL trigger, news etc.

I think using the round numbers on the lower time frames like 1H is much more effective, simply because most of the order flow of the intraday traders, is based around them. Many times I see a pin on the 1H between round numbers and against the trend - they do not work. There is nothing to push them.
When price heads into a round number, many times it will hang around it for a few bars period - that is the time when all the orders trigger. I have talked to another trader yesterday that is trading for a few years already. What he does, is placing a buy stop above the round number and a sell stop below it. When price hangs around a round number for a while, and triggers all the order flow, it will eventually go in one way many times straight to the next round number.

I think that most of the trades aware of what I have said till now, but their problem is to predict the direction. By the price action setups James is teaching, we have the advantage to know which direction.

-So basically, to sum it up:
- on higher time frames, round numbers are not THAT important.
- A smart way to trade the lower time frames will be looking for a clear PA setup off big round number because then you have the orderflow pushing you (Am I right? ).

By the way, PPZs here are easy (on lower TFs), because most of the time those round numbers on the 1H are the PPZs already (the big round numbers, aka order flow, are creating those PPZs ), so if I see minor PPZs in the way, I can use them to manage the trades - But not to base a entry of a trade off them.

Ohh and by the way Mike, I think you once told me that you do not trail stops on lower time frames, but look for targets. Am I correct?


Sorry for the long post hope I got the things right.


Ben
  • #41,765
  • Aug 22, 2009 1:02pm Aug 22, 2009 1:02pm
Quoting benji533
Hey Mike,

Personally I play less attention to round numbers (every 100 pips) on daily and weekly simply because I have noticed they do not really have any dramatic effect on the price.
Most of the time weekly and daily pin bars will be working also without looking at location.
On the other hand, I can see ton of PA setups on the 1H which do not work.
Yes - until you have existing confluence as at these round numbers. Confluence is the key - right? Most round numbers don't mater - until they do... ;-) Getting above where we are will take a big and sustained cash infusion to get it to go - in my uneducated opinion. It may happen, but not cheaply.

Quote
IMO, it is simply because the weekly and daily contain much more information in them (info of a longer period). They are not effected from the noise in the market. When you look at them, you can understand where price is going and what happens in the market. On the other hand, those 1H bars are nothing really important. They can show a sudden movement that have no meaning for several of reasons like: trades took profit, SL trigger, news etc.

Yes.

Quote
I think using the round numbers on the lower time frames like 1H is much more effective, simply because most of the order flow of the intraday traders, is based around them. Many times I see a pin on the 1H between round numbers and against the trend - they do not work. There is nothing to push them.

Joelcf posted an explanation of what he sees going on inside of the bank he works at. pretty interesting and why round numbers matter.


Quote
When price heads into a round number, many times it will hang around it for a few bars period - that is the time when all the orders trigger. I have talked to another trader yesterday that is trading for a few years already. What he does, is placing a buy stop above the round number and a sell stop below it. When price hangs around a round number for a while, and triggers all the order flow, it will eventually go in one way many times straight to the next round number.

Not an approach I personally would have the stomach for, but I can see how it might work.




Quote
I think that most of the trades aware of what I have said till now, but their problem is to predict the direction. By the price action setups James is teaching, we have the advantage to know which direction.
-So basically, to sum it up:
- on higher time frames, round numbers are not THAT important.
- A smart way to trade the lower time frames will be looking for a clear PA setup off big round number because then you have the orderflow pushing you (Am I right? ).

Yes - and notice that the big PPZ's form around these round numbers.

On the lower TF's I am guilty of not taking notice of them. That makes no sense - speaking from experience. Since the light finally went on, I've been working to keep notice of them in the front of the mind, until the habit is ingrained. Part of creating a new habit is to talk about it and verbally (typing in this case) the expectation. So, you are sure to hear me babble more about them for another month... I am a 'learn one thing at a time' guy. Always have been.

Quote
By the way, PPZs here are easy (on lower TFs), because most of the time those round numbers on the 1H are the PPZs already (the big round numbers, aka order flow, are creating those PPZs ), so if I see minor PPZs in the way, I can use them to manage the trades - But not to base a entry of a trade off them.

Yes, and that is where discretion comes in. And a little experience to understand what is a minor PPZ and a Major one. Long live the Demo!

Quote
Ohh and by the way Mike, I think you once told me that you do not trail stops on lower time frames, but look for targets. Am I correct?

Yes - Targets on the lower TF's. I don't have years of experience on lower time frames, so a simple target helps my psych while I continue to acclimate to them.

Quote
Sorry for the long post hope I got the things right.

Nah- perfect! Very good input and reminders for me. I wish I had my ducks in a row like your are when I was 16!


Ben[/quote]
I'm pretty much done with all this ...
  • #41,766
  • Aug 22, 2009 1:04pm Aug 22, 2009 1:04pm
Quoting nuclear62
Hello all, have a great weekend!

I just had to post because i´m so with you benji, i started 15 years old and i´m now 17, fantastic

Hope you all have great coming week also, i love this thread!

Nuclear
15 is younger than me Good luck!

Quoting o990l6mh
I'll join in: 16!!!

I'm planning to trade my way to financial freedom within ten years, that is, before I'm 40.
I believe you can do it mac Thanks man.

Quoting Radsson
Just don't forget about girls and other stuff called real life
Me? ohh don't worry about me I'm fine...don't need to chase them anymore...at least for now

Ben
  • #41,767
  • Aug 22, 2009 1:19pm Aug 22, 2009 1:19pm
Quoting StoragePro
Let's talk turkey.

Since the markets are not highly predictable - if they were, we'd all trade much differently, how do you two guys come to arrive at a bias? Unless you are talking lower time frame...

I'm very curious about people do that - especially in light of where we are on the chart.

Do you find it helps?...
Hey SP

I had a recent question about this somewhere in the PF with these two charts

I formulate scenarios in my head, not neccersarily a bias. I don't like to be bias either, I think it cloud judgement. I just stare at a chart enough and I see what is the "likely" scenario. Now that doesn't even mean I will trade it, if things still don't line up to my method. Examples come on many recent pairs, I knew exactly what was going to take place(check my last like 7 webinars). I basically spelled it out on a few of them. And guess what? I didn't get a single one of them b/c nothing lined up to meet my criteria. It's simply something I can't help doing when looking at a chart. I could do it with any chart, but I still will look for the same things. Now when my criteria lines up with one of those formulated plans, it simply helps me react better from feeling caught off guard.

here are my two posts with the charts. I do the same thing on all timeframes really. Can't even help it

_________________

[QUOTE=mbqb11;33893]I could have put this in any one of my threads but just threw it in here. People have been asking me what my bias is. I try not to be bias with the markets. As they are always right. But I do formulate "ideas" of what I would prefer to see happen(yes I know that is a bias LOL). Hopefully that idea though doesn't cloud the possibility in my mind for something completely different to happen and allow me to react.

Here is gbp/jpy. Notice at the 160 level above it we have a BOX(block of consolidation). This means a pullback now to 160 is usually going to act as STRONG resistance. Great area now to watch for a pullback for me. Notice it happened again to the long side previously(the first box).

Mike QUOTE]


___________________________________________



[quote=mbqb11;34766]Here is an update to this chart. This is what should give you all the confidence that this stuff works, it happens time and time again if we are patient. QUOTE]
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  • #41,768
  • Aug 22, 2009 1:30pm Aug 22, 2009 1:30pm
I saw this post today in the group by Matiasfx and thought i would share it.

"Although the cheetah is the fastest animal in the
world and can catch any animal on the plains, it will wait until it is
absolutely sure it can catch its prey. It may hide in the bush for a
week, waiting for just the right moment. It will wait for a baby
antelope, and not just any baby antelope, preferably one that is sick
or lame. Only then, when there is no chance it can lose its prey, does
it attack. That, to me, is the epitome of professional trading".
Mark Weinstein from Market Wizards, Jack D Schwager.

I have said many times that the only thing i teach is experience.

In my opinion based on personal experience the above quote tells you why
so few make it in this business.

If you were literally starving would/could you sit and wait for not just a
fairly easy meal THAT MIGHT get away or would/could you wait for a sure
thing, a GUARUATEED MEAL.

The cheetah will probably starve if it does not focus on its best chance
for a meal.

Traders that do not follow the same thought process will fail.

I GUARUNTEE they will fail.

almost 30 years of personal experience tells me that.

If and when you reach a point where 2 or 3 guarunteed "meals" a month
provides you the dream of no boss and fnancial freedom you will also
patiently wait for the lame baby antelope to cross your path.

The problem for almost all of you is being that picky with a small
account.

What can i say?

I understand where your at. Ive been there.

What can i tell you?

All i can do is be honest.

If your going to chase every healthy baby antelope that gets within half a
mile your going to starve. ( ie - marginal 4 hour trades etc...etc...)

I guarantee it.

The solution?

Treat this as a business even with a small account and be ok that it might
take you 5 or 10 years to build a nice size account.

Let me say once again what i did many many years ago.

After 8 years of chasing the healthy baby antelope and starving i quit
chasing it.

I stopped trading for around 2 years and demoed while i saved my money
for an account size where those 2 or 3 guaranteed meals a month meant
enough to me to wait for the lame baby antelope


Jim
  • #41,769
  • Aug 22, 2009 1:31pm Aug 22, 2009 1:31pm
Quoting mbqb11
Hey SP

I had a recent question about this somewhere in the PF with these two charts

I formulate scenarios in my head, not neccersarily a bias. I don't like to be bias either, I think it cloud judgement. I just stare at a chart enough and I see what is the "likely" scenario.

>snip<
OK - I've seen you do that a lot. I do much the same.

When we get to areas like we are at now with the EJ on the daily or weekly, my sense is that I just gotta wait and see because anything is plausible on those time frames.

It is the 'bias' thing - I'm just very curious to crack open a skull and see what people are thinking and why. I drive my boss nuts.
I'm pretty much done with all this ...
  • #41,770
  • Aug 22, 2009 1:44pm Aug 22, 2009 1:44pm
Quoting StoragePro
OK - I've seen you do that a lot. I do much the same.

When we get to areas like we are at now with the EJ on the daily or weekly, my sense is that I just gotta wait and see because anything is plausible on those time frames.

It is the 'bias' thing - I'm just very curious to crack open a skull and see what people are thinking and why. I drive my boss nuts.
I think we are all biased, whether we like to or not.

The challenge is to not let it affect your analytical thinking and decision process, at least keeping it down to a minimum.

And that's hard! I continually struggle with it. Trade what the chart says, not what your bias tells you. Easy to write, hard to do.
  • #41,771
  • Aug 22, 2009 1:54pm Aug 22, 2009 1:54pm
i can testify to this.

your a lot like me.

i drive a lot of people nuts.

just recently i contacted a physics professor at cal berkley because of something he wrote about pulsars/ astrophysics. this is another one of my hobbies. ive had telescopes so big it required two people to set it up.

took me 3 weeks to get thru to him and he flat could not believe i was some 50 year old guy in texas reading an obscure paper he wrote 3 years ago.

ive called him 3 times now and i can tell by his voice he thinks im a stalker or something. lol.

i could care less if he likes me or not im trying to understand something im interested in.

its in his brain and damned if im going to give up until i get it out and understand it.

thought you might like that story sto.

jim









Quoting StoragePro
I'm just very curious to crack open a skull and see what people are thinking and why. I drive my boss nuts.
  • #41,772
  • Aug 22, 2009 2:01pm Aug 22, 2009 2:01pm
geez if this continues were going to have to hire barney and bone him up on pa and pivot zones.





Quoting benji533
15 is younger than me Good luck!



I believe you can do it mac Thanks man.



Me? ohh don't worry about me I'm fine...don't need to chase them anymore...at least for now

Ben
  • #41,773
  • Aug 22, 2009 2:11pm Aug 22, 2009 2:11pm
LOL!!

I found three errors in a very advanced book on Topology while going to school. I was a Discrete Math maven in college - for some odd reason it was 'intuitive' for me. Have not touched it since.

I looked him up to discuss it, he disagreed on two of them - until I called him back up with a written proof... I think he is still pissed.

Stalker indeed...

BTW - a friend of mine is a big telescope fan, and got me into it. We actually ground our own mirror by hand and had a guy we know at Eastman Kodak coat it. 16 inch Newtonian we made ourselves. We used to sit with bags over our heads for an hour as far away from the lights we could drive so that our eyes were sensitized to any light coming in the scope. I'd have packed them in dry ice if it would have blinded me..

Quoting james16
i can testify to this.

your a lot like me.

i drive a lot of people nuts.

just recently i contacted a physics professor at cal berkley because of something he wrote about pulsars/ astrophysics. this is another one of my hobbies. ive had telescopes so big it required two people to set it up.

took me 3 weeks to get thru to him and he flat could not believe i was some 50 year old guy in texas reading an obscure paper he wrote 3 years ago.

ive called him 3 times now and i can tell by his voice he thinks im a stalker or something....
I'm pretty much done with all this ...
  • #41,774
  • Aug 22, 2009 2:26pm Aug 22, 2009 2:26pm
Quoting james16
geez if this continues were going to have to hire barney and bone him up on pa and pivot zones.

That`s hilarious.
"Don't trade to trade . . . trade to win." - James16
  • #41,775
  • Aug 22, 2009 2:58pm Aug 22, 2009 2:58pm
Quoting StoragePro
Yes - and notice that the big PPZ's form around these round numbers.

On the lower TF's I am guilty of not taking notice of them. That makes no sense - speaking from experience....
Thanks SP for your reply
I have started demoing these setups off round numbers on the 1H, but I am very picky with them. Usually I will take a PA trade off a round number only if there are more confluence factors (I like clear divergence), space (so there won't be something to block me. I have no intentions to hold positions on this TF), and of caourse if the PA bar itself is a pitbull and not a chihuahua And by the way, if the next bar won't break the PA bar, I will cancel my order simply because the lack of momentum (that can be a sign of weakness or indecision of the market at that stage, especially at areas of heavy order flow - so I rather be out, be safe).
I don't get many trades even on the 1H, but I can say all of them that I did take were winners till now, so that is quite like Jim says about the sick antelope

I was just curios if Mike plays that much attention to round numbers on daily and weekly charts.

Ohh and this is something I found - it draws your round numbers automatically plus you can set alarms when price hits those lines it can help you on the lower TFs.

http://www.forexfactory.com/showthre...t=22217&page=1


Ben

PS - Till now I was trading only pin bars. Now that I feel very comfortable with them, I moving on to demo the outside bars.
  • #41,776
  • Aug 22, 2009 3:17pm Aug 22, 2009 3:17pm
Quoting benji533
Hey Mike,

Personally I play less attention to round numbers (every 100 pips) on daily and weekly simply because I have noticed they do not really have any dramatic effect on the price.
Most of the time weekly and daily pin bars will be working also without looking at location.
On the other hand, I can see ton of PA setups on the 1H which do not work.

IMO, it is simply because the weekly and daily contain much more information in them (info of a longer period)....
This is the EXACTLY same thing I was thinking this morning while I was in the shower! lol!
And I keep saying "hey, traders who work on smaller timeframes have to watch a ton. of crosses, stocks etc., so thay cannot monitor every stock, cross in the same time, so they are likely to use some limit or stop orders at some levels, but which levels? maybe round numbers (00, 50)..."
It's good to see someone who shares your opinion
  • #41,777
  • Aug 22, 2009 3:18pm Aug 22, 2009 3:18pm
Quoting benji533
Thanks SP for your reply
I have started demoing these setups off round numbers on the 1H, but I am very picky with them. Usually I will take a PA trade off a round number only if there are more confluence factors (I like clear divergence), space (so there won't be something to block me. I have no intentions to hold positions on this TF), and of caourse if the PA bar itself is a pitbull and not a chihuahua And by the way, if the next bar won't break the PA bar, I will cancel my order simply because the lack of momentum (that can be a sign...
Good for you that you manage to wait for the sick animals to limp by.

I think you are at an advantage not having to run with the herd in the corporate world. One lesson you learn fast - if you want the higher pay grades bigger bonuses and Option out the rear (real money) and a job you enjoy - is that you work hard to influence the process around you in a manner that pays off for the business.

You learn to grab the wheel and make things happen. Sometimes by skill and brains, sometimes by deft handling of personalities, and sometimes by fiat (my personal favorite ... )

These skills will positively kill you dead in trading, and it is very hard to unlearn - believe me!


Quote
I was just curios if Mike plays that much attention to round numbers on daily and weekly charts.

Yes - look a the PPZ's and see how they line up. Major round numbers. 1000's and 500's often.

Quote
Ohh and this is something I found - it draws your round numbers automatically plus you can set alarms when price hits those lines it can help you on the lower TFs.

http://www.forexfactory.com/showthre...t=22217&page=1

Thanks - I have a different one - no bells and whistles. I'll check this out.

Quote
PS - Till now I was trading only pin bars. Now that I feel very comfortable with them, I moving on to demo the outside bars.]

Step by step. It is the way we all learn.

Just don't make me feel bad too soon and get more in your account than what i have too soon...
I'm pretty much done with all this ...
  • #41,778
  • Aug 22, 2009 3:39pm Aug 22, 2009 3:39pm
You were talking about bias earlier...
I too have mine about the daily GY.
Currently, as I see the yen pairs, they are quite consolidating, so it will be hard to catch long moves. Last time price failed to form a higher high, so if price reaches 160.00 again with this bearish divergence, I'll be looking for bearish PA off the 163.000
Other option - if the price will manage to break the 163.000 level, I'll be looking for a breakout pattern. If price breaks through the double top and pulls back, I'll take any good bullish PA bar long. I'm sure Mike is looking at this too

Currently I prefer staying out of the daily with this pair


These are the options I would like to see:
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  • #41,779
  • Aug 22, 2009 4:04pm Aug 22, 2009 4:04pm
Quoting Eclipse
This is the EXACTLY same thing I was thinking this morning while I was in the shower! lol!
And I keep saying "hey, traders who work on smaller timeframes have to watch a ton. of crosses, stocks etc., so thay cannot monitor every stock, cross in the same time, so they are likely to use some limit or stop orders at some levels, but which levels? maybe round numbers (00, 50)..."
It's good to see someone who shares your opinion
Cool
Yea these levels are important for intraday traders cause it is where the order flow is based.


@SP - I have found that indicator only a few days ago..still didn't used the alarm. Try playing with it till you figure it out.

Thanks for your post
Ben
  • #41,780
  • Aug 22, 2009 6:39pm Aug 22, 2009 6:39pm
Quoting james16
geez if this continues were going to have to hire barney and bone him up on pa and pivot zones.

Hi Jim,

Are you still planning on posting those pictures of the thing you do that gives you six figures a year and is 80% passive? I've been wondering about that all week.

Pretty please?
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