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The Price Action 'Anomaly'

  • #1
  • Quote
  • First Post: Edited Dec 30, 2009 4:18pm Aug 30, 2009 5:58pm | Edited Dec 30, 2009 4:18pm
Hello folks,
I decided to start this thread for one simple reason. I would like nothing more than an honest to goodness explanation,the 'why' if you will.
Having spent the past several months live trading this 'anomaly' with varying techniques on various time frames, all have been successful, some more than others.
The majority of my trading time and earned pips with this indi. were in the higher volatility pairs including gbp and gbp crosses.

Over the course of the past several months I've made some refinements to my own personal R:R scheme before entering the spot FX market. If anyone chooses to incorporate this indi. into their trading, a good R:R scheme should be your cornerstone.
I do not want to propose any type of stern trading technique here.
Just an outline of how I use this indicator in general and hopefully get a solid answer as to the 'why' question.

The price action indicator was originally coded by Victor M.(thank you),
to help identify 'market structure'.
The Scalper candle signals was originally coded by SwingMan(thank you), to help identify cycle.


Trading the VM Price Action anomaly.

1)BuOVB( Bullish outside vertical bar)
BeOVB (Bearish Outside vertical Bar)
The original indicator marks them as 'red stars'.

2)Along with Swingman's Scalper Signals to identify general direction.

Very simple, Mark the un-filled vertical bars(gaps) and target them with SMC4 Scalper Signals, off anytime time frame.



Regards to all and happy trading!
Attached File(s)
File Type: ex4 smC4Scalper Signals_v1.ex4   12 KB | 2,777 downloads
File Type: mq4 Price Action.mq4   22 KB | 4,041 downloads
  • #2
  • Quote
  • Aug 30, 2009 7:39pm Aug 30, 2009 7:39pm
Quoting jacson101
Hello folks,
I decided to start this thread for one simple reason. I would like nothing more than an honest to goodness explanation,the 'why' if you will.
Having spent that past several months live trading this 'anomaly' with varying techniques on various time frames, all have been successful, some more than others.
The majority of my trading time and earned pips with this indi. were in the higher volatility pairs including gbp and gbp crosses.

Over the course of the past several months I've made some refinements to my own personal R:R scheme...
About time jacson101,
You know I've been waiting for this thread for a while now. lol
Thanks again.
  • #3
  • Quote
  • Edited 8:25pm Aug 30, 2009 8:13pm | Edited 8:25pm
Hello Jacson101:

Don't mean to intrude or anything, simply to provide a perspective (on DAILY charts) that perhaps you have already seen before.

The persistent ranging price action around the 23.6 FIB level in the pictures below, has been a GREAT battle between buyers/sellers. But, the USD INDEX is about to breakout and go up, that may help break the stall we have in the SWISSY, and finally help USD to go up....(and stocks down, unfortunately)

What I see is an almost completed move down that started back in mid FEB or so. Once the price action gives an indication that the move down is completed, I will expect price to go retrace up to 76.4 FIB.

Once price reaches the 0 FIB area, and bounces off of it a couple of times, I will be LONG on the USD (in this pair anyway)...all the way up to 1.14 or so...

Thanks for sharing your indis and perspective.

Best regards,

PAPION
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 30 aug 2009 line.jpg Size: 97 KB
Click to Enlarge Name: 30 aug 2009 candle.jpg Size: 104 KB
An ocean of boundlesness......
  • #4
  • Quote
  • Aug 30, 2009 8:25pm Aug 30, 2009 8:25pm
Hello Again...

A continuation on my previous post, which had the DAILY charts for SWISSY.

Here are my 4 H charts.

FWIW,

PATION
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 30 aug 2009 line 4h.jpg Size: 103 KB
Click to Enlarge Name: 30 aug 2009 candle 4h.jpg Size: 106 KB
An ocean of boundlesness......
  • #5
  • Quote
  • Aug 30, 2009 8:32pm Aug 30, 2009 8:32pm
The dollar index, in my humble opinion, is about to break up....

That will help the dollar "crosses", and may force the stock markets to have a "little" retracement....

Notice how HIGH the dollar got during the last two mayor stock market bottoms in NOV and MARCH.....

Take a look...


PAPION
Attached Image(s) (click to enlarge)
Click to Enlarge Name: dollar index daily 30 aug 2009 line.jpg Size: 217 KB
Click to Enlarge Name: dollar index daily 30 aug 2009 candle.jpg Size: 223 KB
An ocean of boundlesness......
  • #6
  • Quote
  • Aug 30, 2009 9:19pm Aug 30, 2009 9:19pm
Quoting 45Fxguy
About time jacson101,
You know I've been waiting for this thread for a while now. lol
Thanks again.
Now all we need is an audience

YELL-O - HELL-O
Keys to the Kingdom over here.


Have a great week ahead
  • #7
  • Quote
  • Aug 30, 2009 9:24pm Aug 30, 2009 9:24pm
Quoting Papion
Hello Again...

A continuation on my previous post, which had the DAILY charts for SWISSY.

Here are my 4 H charts.

FWIW,

PATION
Hey Pap,

Definitely 'feel' the Swissy trade.
Am also watching Usd/jpy closely, countdown for lift-off should commence shortly...should culminate in our DX 'popping'.
Have very similar views at this point.

Have a great week ahead sir!
  • #8
  • Quote
  • Aug 30, 2009 9:36pm Aug 30, 2009 9:36pm
Quoting jacson101
Now all we need is an audience

YELL-O - HELL-O
Keys to the Kingdom over here.


Have a great week ahead
shush up......
  • #9
  • Quote
  • Aug 30, 2009 11:29pm Aug 30, 2009 11:29pm
Thanks for starting this thread. I was approached a few weeks ago about starting one, but the timing was not right. Have been a follower and contributor to the C4 and other threads. I think that these price action signals can enhance almost any strategy. To start with, for my risk:reward, I will try to use this using C4 like plans and a 10 pip SL, and a 5 pip TP with the first part of the trade, and letting the rest run until a price action reversal signal develops.

I have used the scalper candles in the past , and have chosen not to use them at the moment to better get a feel of pure price action. I will give a summary of my methods with my future posts.

Best wishes,

Cat Preacher

Price action is good at showing reversals, and when prices should continue.

Quoting jacson101
Hello folks,
I decided to start this thread for one simple reason. I would like nothing more than an honest to goodness explanation,the 'why' if you will.
Having spent that past several months live trading this 'anomaly' with varying techniques on various time frames, all have been successful, some more than others.

The majority of my trading time and earned pips with this indi. were in the higher volatility pairs including gbp and gbp crosses...

2)Along with Swingman's Scalper Signals to identify general direction.


Regards to all and happy...
  • #10
  • Quote
  • Edited 8:15am Aug 31, 2009 8:04am | Edited 8:15am
Quoting thecatpreach
Thanks for starting this thread. I was approached a few weeks ago about starting one, but the timing was not right. Have been a follower and contributor to the C4 and other threads. I think that these price action signals can enhance almost any strategy. To start with, for my risk:reward, I will try to use this using C4 like plans and a 10 pip SL, and a 5 pip TP with the first part of the trade, and letting the rest run until a price action reversal signal develops.

I have used the scalper candles in the past , and have chosen not to use them at...
Hey C,
My house is your house, as the saying goes.
In fact, I'm pleading for you to post more!


I've dealt with semi auto. order flow aggregation in the past. I guess that was what led me to the C4 thread, just thought I would scatter some idea's around that thread.
R:R is critical, have a look a papion's charts, I'm a big fan, just love the 'monster' calls.

Have a great week.
  • #11
  • Quote
  • Aug 31, 2009 1:14pm Aug 31, 2009 1:14pm
Quoting jacson101
Hello folks,

Very simple, Mark the un-filled vertical bars(gaps) and target them with SMC4 Scalper Signals, off anytime time frame.
Looking forward to the thread jacson! I don't really understand the target (gaps). Could you please give a bit more explanation?
Thanks
Q
The Only Constant Is Change!
  • #12
  • Quote
  • Aug 31, 2009 1:50pm Aug 31, 2009 1:50pm
Quoting JazzmanQ2
Looking forward to the thread jacson! I don't really understand the target (gaps). Could you please give a bit more explanation?
Thanks
Q

Hey Q,
Welcome and here you go.

A naked AUD/JPY 4hr chart.
Here are two immediate vertical bars that I've marker'd.
Notice how price has only closed to one side of them( I've been calling these 'gaps').
As a percentile I'm 98.67% confident price will close these gaps during my lifetime.

The neat part is you could trade them anyway you like.

Hope the beach is treating you well
My best,
Attached Image (click to enlarge)
Click to Enlarge Name: audjpy acc.gif Size: 16 KB
  • #13
  • Quote
  • Aug 31, 2009 8:32pm Aug 31, 2009 8:32pm
jacson101,

I still feel dumb as a rock looking at these PA stars.
That's why I wanted you guys to start this thread.

Can you maybe explain in terms of FrankenPips train analogy?

http://www.forexfactory.com/showthread.php?t=188248

Which I can relate to better, simple north/south Blueline/Redline stuff.
  • #14
  • Quote
  • Aug 31, 2009 8:50pm Aug 31, 2009 8:50pm
Quoting 45Fxguy
jacson101,

I still feel dumb as a rock looking at these PA stars.
That's why I wanted you guys to start this thread.

Can you maybe explain in terms of FrankenPips train analogy?

http://www.forexfactory.com/showthread.php?t=188248

Which I can relate to better, simple north/south Blueline/Redline stuff.
Let's try it this way.

The 'red stars' are train stations.
The train(Price) needs to travel both above and below our stations( to pick up as many passengers as possible).
Coming close to the station is not good enough. The train needs to get to every station(red star),stop(close) and move on.
Otherwise we've got stranded passengers which happens 1.3% of the time
  • #15
  • Quote
  • Aug 31, 2009 8:56pm Aug 31, 2009 8:56pm
Still a little unclear how this indi works. when and why do you enter a trade....or exit. Are you just saying that at some point the gaps will get filled so you should place an order that will eventually catch it? Please explain the use of your indicator.
  • #16
  • Quote
  • Aug 31, 2009 8:58pm Aug 31, 2009 8:58pm
Quoting jacson101
Let's try it this way.

The 'red stars' are train stations.
The train(Price) needs to travel both above and below our stations( to pick up as many passengers as possible).
Coming close to the station is not good enough. The train needs to get to every station(red star),stop(close) and move on.
Otherwise we've got stranded passengers which happens 1.3% of the time
Ok, thank you.

So doesn't really matter if you have a red star, form on top or bottom of a candle, it's just someplace the price needs to return to in the near future?
Is that correct?

What's the difference in the color of the stars, yellow, red, blue?
  • #17
  • Quote
  • Aug 31, 2009 9:09pm Aug 31, 2009 9:09pm
Quoting 45Fxguy
Ok, thank you.

So doesn't really matter if you have a red star, form on top or bottom of a candle, it's just someplace the price needs to return to in the near future?
Is that correct?

What's the difference in the color of the stars, yellow, red, blue?
Nope doesn't matter, price will travel to that point on any time frame.
Weird stuff!
The 'anomaly' is the 'red stars'.
Yellow stars are Pinnochio Bars(Pin Bars)
Blue stars are Double Bars high/low (DBHL)
  • #18
  • Quote
  • Aug 31, 2009 9:21pm Aug 31, 2009 9:21pm
Usually when you see a yellow star on top of a candle there will be a very big down move, if yellow star formed below a candle get ready for a big up move?
At least that's the way I think it looks on ey on 5 min charts history.
This maybe the perfect filter for Frank's trains.
May go a long way in helping me to decide which way to trade for the day, if used on 1hr & 4h charts, then, move back down to 1 or 5 for scalping.
  • #19
  • Quote
  • Aug 31, 2009 9:24pm Aug 31, 2009 9:24pm
Quoting 45Fxguy
Usually when you see a yellow star on top of a candle there will be a very big down move, if yellow star formed below a candle get ready for a big up move?
At least that's the way I think it looks on ey on 5 min charts history.
This maybe the perfect filter for Frank's trains.
May go a long way in helping me to decide which way to trade for the day, if used on 1hr & 4h charts, then, move back down to 1 or 5 for scalping.

  • #20
  • Quote
  • Aug 31, 2009 10:33pm Aug 31, 2009 10:33pm
Quoting 45Fxguy
jacson101,

I still feel dumb as a rock looking at these PA stars.
That's why I wanted you guys to start this thread.

Can you maybe explain in terms of FrankenPips train analogy?

http://www.forexfactory.com/showthread.php?t=188248

Which I can relate to better, simple north/south Blueline/Redline stuff.
Here is a visual description that may help, from Verb Theory. I will be inviting him to drop by and contribute as he has time. As you can see, all of these are reversal signals. You can view his site here: http://www.manualforextrader.com/for...c.php?f=3&t=30, and he has a section on pin bars and links here: http://www.manualforextrader.com/for...c.php?f=3&t=72

The only thing he really doesn't cover on the indicator is Market Structure High and Low. Here is a good source to learn about that: http://www.enthios.com/Primer_buildingblocks.htm, and here is another one: http://www.linnsoft.com/qa/a/45.htm

You will see on future posts that I use Average True Range (ATR) as an indicator of recent price movement. VerbTheory also has a good description on his site, which I am also attaching. I use the ATR Stops program to determine when a reversal is confirmed (on close), and ATR in pips to determine if I will have at least a chance of getting 5 pips in one 5 minute bar. If not, I generally pass.

I am a firm believer in fractals as a price action indicator, and have made many profitable trades from these alone. The one I use is the pipholic_sr (attached). This can show you many things, ascending, descending, and symmetrical triangles, trading ranges, and break outs.

That's enough for now.

Best wishes,

Cat Preacher
Attached Image(s) (click to enlarge)
Click to Enlarge Name: r22tjo.jpg Size: 60 KB
Click to Enlarge Name: u7lat.jpg Size: 89 KB
Attached File(s)
File Type: ex4 Pipholic_SR.ex4   2 KB | 932 downloads
File Type: mq4 ATRStops_v11.1.mq4   3 KB | 870 downloads
File Type: mq4 ATR in Pips.mq4   3 KB | 875 downloads
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