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  • #6,141
  • Oct 7, 2009 10:53am Oct 7, 2009 10:53am
Quoting strat
With this "short cut" attitude you are doomed in this business. My recommendation is to forget trading and find something you don't have to study and can therefore get to the end before you start at the beginning.

Snakes and ladders or tiddlywinks are both very good options but don't try Monopoly as you may have to study a little to find the best properties.
I think few here are newbies and that's a big problem. Personally, I wished to find Strat's thread earlier. That way I had not adquired the bunch of bad habits I have and that is so difficult to get rid of them.

Still in the path of learning curve, but my bad habits betray me very often. So, reading and understanding the thread is a must, coz confidence grows with time and practice.

I feel under pressure to trade coz trading is an important part of my income now. But I dont have the confidence and the knowledge (yet) to fully apply Strat's teachings to my live trades. Slowly learning.

Undestanding few concepts here had lead me to improve a lot, but my fear to change dont allow me (yet) to get rid of indies (Sorry. Too many years using them.) So, for my mental confort I have tried to put together some, using what I have learned so far in this thread.

Studing charts, this show me a gain of at least 1.000 pips almost every month in the pair I trade, with little drawdown. Maybe this will cause a big laugh to Strat, but is a good improvment for me, for I am very grateful.

I think thats the real purpose of reading the thread: have time to get rid of bad habits, gain confidence and mentally accept the change.

Strat: I will really love to hear how you do your money management.

Since I have mention indies, here is the chart ( with a little embarassment)
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  • #6,142
  • Oct 7, 2009 11:18am Oct 7, 2009 11:18am
Quoting chanak
Most of you misunderstood me. I am not a newbie. I have been studying for over 15 years, trading on & off over that period. I studied, put it in practice, blew a few accounts, or life gets in the way and I have to put it on the back burner. For the past 15 months or so I have focussed on trading fx and started live trading again, on a small scale.
As I said in my introductory post I have read all the books, tried many EAs and 'Systems', but nothing seemed to sync with my instinctive feeling that price action, support, resistance, trends are the...
“”I don't really need to read every post.””

Pandu, this is true IF you know everything. The message that you are giving and the image you are portraying is that “”you DO know everything””. This is ego gone wild.

Of all the Professional traders I know, or have known, I cannot recall one who thought he “knew it all” and as such, stopped reading and learning.

I suppose you think your statement “”I have been studying for over 15 years, trading on & off over that period.”” entitles you to take short cuts and makes you “above the rest of the readers on this thread””. What you have stated there is just flyshit in a pepper pot compared to some of us. If I include when I “first” started studying then I could post around 45 years but it doesn’t achieve anything.

There are very experienced traders following this thread in addition to Professional traders, Fund managers and Hedge Fund managers and I can tell you that each one of them has read this thread in its entirety, some maybe more than once. I can also tell you that “they” know they don’t know everything and are constantly reading and studying as much as they can about trading.

I will also tell you that the content I do not know about trading is FAR GREATER than that I do know about. I am constantly reading, researching and studying ANYTHING I can find about any type of trading.

Also, this thread is not the “be all and end all” in trading. Far from it – this is just teaching the basics of PASR trading – it probably constitutes about 10% to 15% of my total knowledge in trading. This thread is in its infancy BUT you cannot progress to the next 85% to 90% UNTIL you have mastered the basics.

Now, just as I can lead a horse to water, I can’t make him drink, I can’t force you to read the whole thread. That is entirely up to you.

What I can tell you, though, is that if you are going to join the ranks of Professional traders, you need to relieve yourself of that HUGE log on your shoulder, take lessons in humility and dump your inflated ego.

You have inspired me to come up with a new phrase, thank you.

The traders that know everything only know that they don’t know
15 YEARS OF PASR ON FOREX FACTORY!
  • #6,143
  • Oct 7, 2009 12:46pm Oct 7, 2009 12:46pm
It looks I was stopped out on CADJPY. It was nice BEOB with the trend so Im not very happy.
alter
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  • #6,144
  • Oct 7, 2009 12:56pm Oct 7, 2009 12:56pm
Below is a CAD/JPY setup that I'm looking at the moment. Comments and advise are welcomed

3 more hours before the daily candle closes in my broker's platform. Price does not seem to close above the wedge/coil. Am waiting to see later if the candle will close as a BEOB. It is also on a 38.2% fibo line. On weekly, 83.00 seems a strong SR for this pair. I WILL WAIT AND SEE if this candle close as BEOB, then set a stop sell order at 82.90. 1st TP at 82.00ish and SL at the top of the BEOB. IF THERE'S no BEOB, then I will pass this 1.
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Discipline is PRIMARY, Method is Secondary.....
  • #6,145
  • Oct 7, 2009 1:01pm Oct 7, 2009 1:01pm
Quoting alter
It looks I was stopped out on CADJPY. It was nice BEOB with the trend so Im not very happy.
alter
Alter, you had a Short position got stopped out? One just happened to me ....

If this current candle closes as a beob, I'm looking to re-enter the market again. Now, waiting aside for it to show me the path
Discipline is PRIMARY, Method is Secondary.....
  • #6,146
  • Oct 7, 2009 1:37pm Oct 7, 2009 1:37pm
Quoting bigboss
I think few here are newbies and that's a big problem. Personally, I wished to find Strat's thread earlier. That way I had not adquired the bunch of bad habits I have and that is so difficult to get rid of them.

Still in the path of learning curve, but my bad habits betray me very often. So, reading and understanding the thread is a must, coz confidence grows with time and practice.

I feel under pressure to trade coz trading is an important part of my income now. But I dont have the confidence and the knowledge (yet) to fully apply Strat's teachings...
Thank you for your very inspiring post.

“”Studying charts, this show me a gain of at least 1.000 pips almost every month in the pair I trade, with little drawdown. Maybe this will cause a big laugh to Strat, but is a good improvement for me, for I am very grateful.””

Laugh? No way my friend. This gives me enormous satisfaction and pleasure far beyond what pips can give me, to know that, in some small way, I have been able to help someone improve their trading. Thank YOU!

“”Understanding few concepts here had lead me to improve a lot, but my fear to change don’t allow me (yet) to get rid of indies (Sorry. Too many years using them.) So, for my mental comfort I have tried to put together some, using what I have learned so far in this thread.

Since I have mention indies, here is the chart ( with a little embarrassment)””

First of all, thank you for being honest and open. I suspect there are many others in your situation.

As I have told many who came here from Indicator Land, until you get them off your charts, you will forever rely on them and use them as a crutch. What you perhaps don’t realise is that this is causing you not to trust PASR. They are stopping you from truly understanding PASR. I strongly recommend you bite the bullet, take the indicators off your charts and go through the pain barrier. Once you have your indicators off and learn PASR, you will never, ever take up valuable chart space with them again.

Since you showed us your indicators, I take that as an invitation to pull them in pieces, so not one to turn down such an invitation, let’s do it:

From your chart, you are showing the following indicators:

PROFITLINE
HULL MA or variant
Zig Zag
Stochastics

PROFITLINE:
This is something you have running in the background so I cannot comment on this, save to say, what does it tell you that you cannot learn from PASR?

HULL MA or variant:
Quote from Alan Hull “”The Hull Moving Average solves the age old dilemma of making a moving average more responsive to current price activity whilst maintaining curve smoothness. In fact the HMA almost eliminates lag altogether and manages to improve smoothing at the same time.””

Please note “”making a moving average more responsive to current price activity”” . In other words, he accepts that PRICE ACTIVITY is LEVEL 1 and his indicator is LEVEL 2.

PRICE ACTIVITY is the GOSPEL, it is the be all and end all in trading BUT if you don’t understand it, he can make an indicator which he believes is second best.

Why would you want to follow a line that is second best to PRICE ACTIVITY when you can get ALL the information AND MORE from PRICE ACTIVITY itself?

As for “”almost eliminates lag altogether”” – this is sales hype, tripe and ego. There is NO INDICATOR which is derived from a formula taking the price of “x” days ago and then taking a running (moving) average that does not LAG. Think about it logically, you are comparing today’s price with a price from last week, taking an AVERAGE price of the two and then drawing a line – what help is that line to you when you can see with your OWN EYES where price is today relative to where it was last week?

If you look at your example, your magic line does not bottom or top with PRICE – it lags any where from 2 to 4 bars behind PRICE! We can see, by reading PRICE ACTION, within 2 bars when a price is exceeded or decreased.

“”Ah BUT””, you say, “”This one has a matching colour scheme, blue for up (long) and magenta for down (short).””

Well, all this is doing is changing colour when the slope of the MA changes from negative to positive and vice versa – that’s all!

And, don’t be fooled thinking that it happens on the bar where it is shown. This thing, like most indicators of this type, REPAINTS. In other words, if you go back in history, back – test, it always looks perfect. In REAL TIME, yes, even on the Daily time frame, it changes colour AT LEAST ONE DAY LATER. By this I mean that the PRICE has to change (go up or down) for several bars BEFORE there is a slope change. So, in real time, PRICE may have gone down for 3 or 4 bars from a high BEFORE there is a slope change to trigger the colour change. The indicator then recognizes the slope change and GOES BACK 3 or 4 bars and changes the colours. So, the best thing this useless piece of shit can do is tell you that 3 or 4 bars ago, you should have sold!

I, and the rest of us who understand PASR, usually know to sell within 1 bar!!!!!!!!

Here is the formula for the HULL MA:

Integer(SquareRoot(Period)) WMA [2 x Integer(Period/2) WMA(Price)
- Period WMA(Price)]

So, there are THREE moving averages (WMA) being used – read and UNDERSTAND that – THREE MOVING AVERAGES

It does not matter what type of mathematical formula you use to “decrease” or “smooth” a number (Integer and Square Root), the basic premise is that an average will ALWAYS LAG behind the prime number.

Right, go to your chart. The HMA “turns and changes colour” on the July 14th candle (or so it says) BUT, because it is calculating moving averages, it CANNOT change colour UNTIL it knows WHAT THE CANDLE ON JULY 15th IS! This change of colour took place, at the very earliest on JULY 15 telling you that on July 14th (the day before), you should have sold. This is HISTORY – what good is that? I want to trade in the NOW, NOT in yesterday’s time frame.

Now, reading PASR, on July 8th we have a bearish bar followed by a bull candle with an equal body – a bullish sign that things may be changing. On July 10th, the sellers try to retrieve their position but cannot and instead, make a poor attempt. The next bar is a Sunday bar and tells me the move is exhausted. I would place a buy stop above the high of the Sunday bar and get filled for a 1200 + pips move. If I was more conservative, I could wait to buy above the next day’s (July 13th) bullish bar.

GET THAT USELESS HMA CRAP OFF YOUR CHARTS & FOLLOW PASR – you will become much more knowledgeable AND profitable!

Zig Zag:
I guess you are using this to identify swing tops and bottoms?

Exactly the same problem as ALL other indicators – LAG!

Here is part of the code for the Zig Zag:

start()
{
int i, counted_bars = IndicatorCounted();
int limit,counterZ,whatlookfor;
int shift,back,lasthighpos,lastlowpos;
double val,res;
double curlow,curhigh,lasthigh,lastlow;

if (counted_bars==0 && downloadhistory) // history was downloaded
{
ArrayInitialize(ZigzagBuffer,0.0);
ArrayInitialize(HighMapBuffer,0.0);
ArrayInitialize(LowMapBuffer,0.0);
}
if (counted_bars==0)
{
limit=Bars-ExtDepth;
downloadhistory=true;

Just by looking at that small section you can see that the indicator is looking BACKWARDS and comparing the last price with COUNTED BARS!

Again, this useless crap REPAINTS and REPAINTS BIG TIME!

Going back in history on your charts or back testing, it looks perfect – the Moly Quail!

In REAL TIME, it is no different than any other indicator and what is WORSE is that some of these Zig Zag derivatives show FALSE tops and bottoms such that unless you have very good management, you can lose a lot of your account in one day if you take their signals!

Now, if you understand how to recognize CONFIRMED SWINGS, you will know that WE, using PASR, need at least one or maybe two bars after the high/bottom to confirm it. These things need even longer depending on their settings!

GET THAT USELESS ZIG ZAG CRAP OFF YOUR CHARTS & FOLLOW PASR

Stochastics:
Stochastics has ALL the problems of other indicators (LAG) and some of its own.
Again, it’s comparing price with that of “n” days ago and will ALWAYS lag PRICE.


Worse than this, some people use it as an oversold or overbought indicator which is the quickest way to unload your account! Many of the best trading opportunities are when this piece of junk is showing overbought/oversold.

Just look what happens to this in a LONG trend – it is STUCK above its overbought level!

If you trade the cross of the two lines then you are ALWAYS at least one day and usually more, late. Again, it REPAINTS. In history/backtesting, it looks perfect – more Moly Quail but in REAL TIME, that cross of the two lines does not come on the day you see it. It comes after the next day – it has to – it needs to know what the next day is before it can draw the line. On short time frames, this is the cause of many newbie burnt accounts.

GET THAT USELESS STOCHASTIC CRAP OFF YOUR CHARTS & FOLLOW PASR

Enough, the bottom line is, if we train ourselves to recognize PASR we can and do, outperform these wiggly lines EVERYTIME.

If you really want a laugh, put these indicators on M5 and watch them not only REPAINT but change backwards and forwards. Better still, try them on M1.
15 YEARS OF PASR ON FOREX FACTORY!
  • #6,147
  • Oct 7, 2009 1:52pm Oct 7, 2009 1:52pm
Big Boss...On retracement from fib 50 ish.....down?

Boss...Rising DT, Price stuck between 20 & 50, 20 rejected price 2 days in a row.....down or sideways???

Worker...3 price rejections at the 20 three days in a row. Currently testing short term support and trying really hard to form that BEOB....can it do it?

This baby wants out! Which way to go? You can figure it out!
  • #6,148
  • Oct 7, 2009 1:58pm Oct 7, 2009 1:58pm
Quoting alter
It looks I was stopped out on CADJPY. It was nice BEOB with the trend so Im not very happy.
alter
the little cluster of fun from 6/23-7/05 is what kept me out on that one.
  • #6,149
  • Edited 2:19pm Oct 7, 2009 2:12pm | Edited 2:19pm
Quoting alter
It looks I was stopped out on CADJPY. It was nice BEOB with the trend so Im not very happy.
alter
I would not be very happy either IF I had sold into SUPPORT!

You also traded into the DEMAND line which was only 73 pips away!
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15 YEARS OF PASR ON FOREX FACTORY!
  • #6,150
  • Oct 7, 2009 2:41pm Oct 7, 2009 2:41pm
Hi Strat, i've a couple of questions if you don't mind, sorry if this is basic for a lot of the traders on here.
I know you said not to read J16 recently, but i think i picked up a couple of things from that thread that have been useful to me: namely, when sizing up a trade, identify the areas where price is likely to falter in the trade.
On Alters chart, the ascending TL just below would have stopped me from taking the trade anyway, not much room to breathe. An agressive trader could have taken it, and still made triple digit pips, by identifying potential problem areas i.e the TL, and beyond that, the previous lows of the preceding pin bar.
The proviso of course, as per j16, is to lock in partial profit, and run the remainder, which requires tight management. I actually demo'd the following pin after the beob, which to me seemed a better signal, targeting the high of the beob signal, and it worked ok.
Just seems on the daily/weekly, the great signals in great locations don't happen that often, which is why i presume some traders on J16 take these types of trade, admittedly with a lot more risk and stress.

Thanks
  • #6,151
  • Oct 7, 2009 2:47pm Oct 7, 2009 2:47pm
Quoting strat
I would not be very happy either IF I had sold into SUPPORT!

You also traded into the DEMAND line which was only 73 pips away!
I did not mean it was bad trade, just Im not happy with the result. Support was easily broken and if I want to stay with the trade for longer run I can not exit after 73 pips.
DeadCowboy I see the cluster, but it did not hold. We can find this kind of S/R every 150-200 pips which is very small profit in compare to SL.
alter
  • #6,152
  • Oct 7, 2009 2:52pm Oct 7, 2009 2:52pm
Thoughts, opinions......
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  • #6,153
  • Oct 7, 2009 3:06pm Oct 7, 2009 3:06pm
Quoting DeadCowboy
Thoughts, opinions......
Most definitely something.
15 YEARS OF PASR ON FOREX FACTORY!
  • #6,154
  • Oct 7, 2009 3:20pm Oct 7, 2009 3:20pm
141.06 is a strong monthly support line.

I use IBFX so you will note the 2 day hammer/pin is really Sunday and Monday.

So, Monday's hammer and todays wanna be hammer (more a spinning top) both had lows within 3 pips of each other.

If you'll notice back on April 28th there is a very similar setup that led to the next run up.

So far all indications it would be a good buy trade. Now the reasons not to take the trade:

1. This is a double top which has only declined ~750 pips of a theoretical 1500 (based on this formation).

2. The trend is still DOWN.

3. The light blue trend line shows only a hundred or so pips to the upside.

4. I've seen GBP/JPY do another hammer/pin in the other direction at this type of juncture.

5. The similar move on April 28th was a continuation of an UP trend, this one is DOWN.

5. GBP/JPY scares me.

Where is it going to go tomorrow? I suspect it will touch the light blue trend line and close there or form another pin bar in the other direction but it could also choose that day to plummet 8000 pips thru monthly support.

Could I take that buy trade for a hundred pips or so? I think so.
Will I? No.

I'm horrible at picking tops and bottoms (which this might very well be given the strong monthly support) but I think that's going to be dependent on those currency's fundamentals and perhaps seasonal trend changes. However, right now it's all I can do to focus on PASR so I'm going to pass.

-m
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  • #6,155
  • Oct 7, 2009 3:24pm Oct 7, 2009 3:24pm
Quoting golfer27
Hi Strat, i've a couple of questions if you don't mind, sorry if this is basic for a lot of the traders on here.
I know you said not to read J16 recently, but i think i picked up a couple of things from that thread that have been useful to me: namely, when sizing up a trade, identify the areas where price is likely to falter in the trade.
On Alters chart, the ascending TL just below would have stopped me from taking the trade anyway, not much room to breathe. An agressive trader could have taken it, and still made triple digit pips, by identifying...
""but i think i picked up a couple of things from that thread that have been useful to me: namely, when sizing up a trade, identify the areas where price is likely to falter in the trade.""

I did this at the very beginning of the thread when I was identifying Daily S&R - all the minor levels in the Daily time frame - some guy even posted that he was amazed that price stopped dead on the pip at these levels.

Due to reader's requests, we moved on to using major S&R as they were not interested in the "minor" wobbles between the major swings.

""On Alters chart, the ascending TL just below would have stopped me from taking the trade anyway, not much room to breathe.""

That, and the support line, should have stopped EVERYONE taking that trade unless of course they are Daily scalpers.

I haven't looked at J16 for months but their style was only to trade to the 1st level of resistance/support and take profit. It may have changed.

Whether it has or it hasn't doesn't matter. It all comes down to, as I keep saying, individual trading styles.

There are traders who only trade to the 1st level of support/resistance, there are traders who trade to targets, there are traders who trade minor swings, there are traders who trade major swings then there are those who like to trade the life of a trend. In and amongst all this, traders put on multiple positions to Take Profit at some previously identified level.

How you trade and how and where you take profit is all down to the individual and their trading style.

But one thing is clear, none of this can be done without first being proficient at consistently trading with a profit to the 1st level of resistance/support.
15 YEARS OF PASR ON FOREX FACTORY!
  • #6,156
  • Oct 7, 2009 3:33pm Oct 7, 2009 3:33pm
Quoting alter
I did not mean it was bad trade, just Im not happy with the result. Support was easily broken and if I want to stay with the trade for longer run I can not exit after 73 pips.
DeadCowboy I see the cluster, but it did not hold. We can find this kind of S/R every 150-200 pips which is very small profit in compare to SL.
alter
Support was easily broken

Where do you see this on the chart that I posted?

Support was TESTED and it HELD
15 YEARS OF PASR ON FOREX FACTORY!
  • #6,157
  • Oct 7, 2009 3:41pm Oct 7, 2009 3:41pm
Quoting strat;3126233<br /> <br /> [COLOR=blue
I did this at the very beginning of the thread when I was identifying Daily .
Sorry Boss, as soon as i'd posted, i thought, Strat would have covered this anyway!!
[/color]






But one thing is clear, none of this can be done without first being proficient at consistently trading with a profit to the 1st level of resistance/support.
Yep, absolutely, the great thing about your method and willingness to share, at no cost i might stress!!,is that at some point, a trader can, once they've grasped the basics of what is being taught here, and if they do persevere, then once they realise what what is comfortable for them, the basics can be tailored.
Great Stuff Strat! This thread's a goldmine!!
Thanks for your continued efforts.

Regards
  • #6,158
  • Oct 7, 2009 3:56pm Oct 7, 2009 3:56pm
Quoting strat
Support was easily broken

Where do you see this on the chart that I posted?

Support was TESTED and it HELD
You have support at 82.33 on your chart. Price went as low as 81.30, which is 103 pips. I thought that 103 pips would be enough.
  • #6,159
  • Oct 7, 2009 4:02pm Oct 7, 2009 4:02pm
Quoting alter
You have support at 82.33 on your chart. Price went as low as 81.30, which is 103 pips. I thought that 103 pips would be enough.
I thought you were trading the Worker? What you have stated happened on intra - day trading which we don't do OR CARE ABOUT.

Where did PRICE CLOSE?

It closed at 82.88 CONFIRMING support.
15 YEARS OF PASR ON FOREX FACTORY!
  • #6,160
  • Oct 7, 2009 4:31pm Oct 7, 2009 4:31pm
Tomorrow morning (Thursday) it is the Bank of England MPC monthly interest rate statement which is a big news event for the currency.
Whilst it is unlikely there will be any change to the rate (even though Australia raised rates o.25% this week) if there is a statement or outlook it can move the markets. It is likely the reason that sterling went sideways today and it is probably best to wait until after the news.

Tomorrow is also the ECB press conference for the Euro which will be closely watched. Again no change is expected but any suggestion that the ECB is close to an exit strategy from stimulus measures will send the Euro soaring.

Nicola

Quoting mstandifer
141.06 is a strong monthly support line.

I use IBFX so you will note the 2 day hammer/pin is really Sunday and Monday.

So, Monday's hammer and todays wanna be hammer (more a spinning top) both had lows within 3 pips of each other.

If you'll notice back on April 28th there is a very similar setup that led to the next run up.

So far all indications it would be a good buy trade. Now the reasons not to take the trade:

1. This is a double top which has only declined ~750 pips of a theoretical 1500 (based on this formation).

2. The trend is...
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