Powerful Fib Based System - by DAZfx

Nice area to reload short positions, chart:



I think is Daz sys on 15 mins

I thought I would share my twist on DAZfx's fib system. Nothing fancy, just better suited to my shorter term nature. Ive attached several charts for reference.

Following our run up this morning, my 195 tick (roughly = 5min) Macd crossed as price sold off. The ensuing rally took us right into the .618/.786 retrace area. I approach entry here by dropping down a multiple of 5 (to 39 tick chart, roughly = 1min). I have the 5SMA on this chart, as well as a weighted 5,3,8 Sto. The 8 smoothing helps with delaying the %K cross, as well as helping me pick off some even lower TF scalps (not addressed here). As the first chart shows, my 39tick peaked nicely as price rallied to our fib area, and then it closed down below its 5SMA. While aggressive, I prefer this type entry as the risk is smaller vs the potential reward.

I exited just beyond the .618 MM which was also a retest of the prior low.
We didnt reach the 1.00MM before price rallied again. This set up my 2nd short (see chart 2 of 39tick only). Once again, you can see the peak reached and the Sto's position, and its 5SMA being breached. I actually exited this position around the 30 level as I ran out of time.

I included one last chart of a later long (I was not here to trade this). After seeing the Macd cross and price rally, we pulled back on the 195tick. We pulled back just slightly beyond the .786 area, but the 39tick chart helped to defiine our long entry. We had a nice up candle breaching the 5SMA accompanying our Sto cross to trigger us in.

Perhaps someone will find this helpful in trading these fib setups. Thanks to DAZfx for the original disclosure of this nice approach to the markets. I have simply tweaked the entry methodology to fit my nature. Great trading to you!

Ninja

As price rallied this morning, my Macd crossed, and I highlited the .618/.786 retracement area looking for a possible pullback. Dropping down to my lower TF, I was watching for the Sto to reach OS within this retr area. The initial white candle triggered me, and I bought as price pulled back slightly. We retested on the 39tick, and as such I sat thru a few pips of heat. The Sto showed nice divergence on the retest. One thing Ive found on these entries is that we want to see that 5SMA turn in our favor soon after entry if not right then. I did have one last brief retest, and then off it went. Partial out at the .618MM, and balance at retest of high. Had I had one more contract on, I would hold it for the shot at the confluent 1.00MM/1.272extension area.

Do you take into consideration the length in bars/candles of the retracement in relation with the length in bars/candles of the impulse wave?

Hi. I believe DAZfx counts the candles in the impulse wave (leg A of possible ABC) to estimate time duration of the C leg (move back in trend direction following correction) as a guideline to help with exits. To date, I have focused on using the .618MM, prior pivot point (high/low), and 1.00MM/1.272extension area for exits. To data, Ive not taken symmetry into acct so far for an exit guideline. It is certainly a valid concept (I learned it from Borodyn's fib work), and one I intend to monitor.

What about the correction wave length? If AB is the impulse, BC is the correction, is it important that the BC has more candles than AB?

If the correction has more candles than the impulse and it wasn't able to retrace more than 61.8% (or 50%, 32%, ...) this tells me that the momentum of the general trend is strong. Could this be a valid filter also?

hey, u could use anything to filter the trade but i will say just keep it simple, here is my advice, if daily trend is making HH consistently, come to 1hr TF and trade daz long and vice versa.

keep it simple

long?

Following the retest of the 9:30+ (eastern) high by the 10:30ish high, I highlited the .618/.786 retr area and waited to see if price pulled back here. On my entry chart, based upon the Sto crossing and positive candle, I got long on a small pullback following my trigger. This occurred around the top of the retr area. Price then moved down a bit more to reach (and briefly exceed) the .786 fib. During this time, note the %K on the 195 tick Sto. It was rising (diverging) and was crossing its %D. While I dont enter using this, it can provide insights to help with the smaller TF Sto timing. When I got the nice positive candle breaching the 5SMA on the 39 tick, I added on. At this point, I was less than 5 pips from B.E., and given the technical evidence, felt this was acceptable. While I dont recommend this to all, this is simply how I trade.

As I had to leave shortly, I exited as I hit the .618MM target (I tried to grab the chart right after I exited). I see price eventually reached the prior high as well.

This was certainly not a nice and neat "textbook" type setup, and this is why I wanted to post it. The size of the .618/.786 area dictates that we need to be flexible. And on this TF, its not nearly as large as a 1H or higher, and this is why I tend to stay on this lower TF. I can see more setups (albeit smaller targets), but with such a positive expectancy approach such as this, I want all the chances I can get! :-)

I hope you find something of value here. Ive found that only by personalizing an approach to specifically fit each trader can he/she reap its full benefits (imho). Enjoy

This is not dazfx but if u know how to trade it fine. such scenario happened on GY yesterday............. check GY

why not?

thanx.

Good day,

EU looks to rally more, attached is my chart, looks good to buy at 1.4700 level
convergence reason

1. good resistance turning support
2. possible bounce at Trendline intersection
3. daily TF is making HH and HL
4. might give head and shoulder: this will be trend continuation and not reversal

Woaaaa,
This thread is kicking again.
Keep it up guys.

Appreciate all the stuff here.

GU is at 50% fib ret.

it will only fit daz trade if divergence is spot on stoch

First off, I am really sorry for being inactive for so long on this thread. I really thank everyone for keeping this thread alive during my absence, especially Naijafx.

I have moved on to another business venture and only trade part time now (still the same system ). So, I still can't promise to post here on a regular basis. But I will try and post screenshots of trade setups from time to time and answer some of your questions.

Thanks

-Dazfx-

welcome back

thx for the system sharing and welcome back~~~ daz


jack.

Stop by more often Daz!

wot's happening here. too quiet!

Dazfx, have you tried to determined waves and trend with a zigzag ?