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  • #13,421
  • Nov 2, 2009 12:52pm Nov 2, 2009 12:52pm
Quoting pipimo88
Wouldn't taking a countertrend trade, in a falling market, constitute "catching falling knives"? So, if a currency recently broke one level going down, we would look to go long once it reaches the next (lower) area of support. Right?
Yes, but the thing is that retracement is a trend of it's own on a faster timeframe. We're all trading with and against trends, so whether or not we are countertrend trading is a matter of perspective.

Quote
Would you even consider this a valid S/R level... since it failed its only test?

All levels have the potential of failing. The level you showed did not fail at all - it only failed to hold as support. I would bet the level was established before the line first hit it on that chart, so it held once as support. When it did break, it retested the level twice and held as resistance.

Quote
This area, back in time, has in fact been used as S/R but a bit lower
How much lower? S&R tends to be an area, rather than a price.
  • #13,422
  • Nov 2, 2009 1:18pm Nov 2, 2009 1:18pm
Thank you for that reply. I believe that I just had a... "moment". A light might have turned on

Basically... We're looking for levels where price had a noticeable reaction... Not necessarily where price bounced/rejected and went completely the other way for a while. Correct?
  • #13,423
  • Nov 2, 2009 1:38pm Nov 2, 2009 1:38pm
Quote
We're looking for levels where price had a noticeable reaction
I'm sure definitions of S&R vary, but that would be my definition. I'm sure definitions of "reaction" would vary as well though. I don't need price to bounce, but just for the price action to say that level is significant. The market will usually bounce somewhat from these levels, but at other times it will just straddle them.

Here's an example of what I'd consider S&R.

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  • #13,424
  • Nov 2, 2009 5:42pm Nov 2, 2009 5:42pm
Hi,

what is the typical number of pips you place stop loss from the S/R level?

- cash_machine
  • #13,425
  • Nov 2, 2009 9:13pm Nov 2, 2009 9:13pm
BRV uses a "40 pip stop by default"... But trades are closed manually depending on how the 1H bar closes. PDF has a section called "importance of hourly closes". Hope that helps.
  • #13,426
  • Nov 4, 2009 4:11am Nov 4, 2009 4:11am
Write now seeing what market conditions it is not easy to find that S/R which holds. I am looking for price action confirmation and then enter. and my stop is smaller than 40 pips now. No more than 30, but I am generally looking for situations where my risk is the smallest. Right now I only scalped. Got too late to PC before those trends broke out. so, I scalped some pips on long side but I am waiting for reversals. Set some resistance lines and watch. as it approaches, I am not taking position but watching what will be happening. i am doing it on 5-15 min charts.
  • #13,427
  • Nov 4, 2009 9:41am Nov 4, 2009 9:41am
So, what is a confirmation of S/R? Often price consolidate near S/R and eventually break it. You watch for candlestick patterns signaling reversal or what is the confirmation to you?
  • #13,428
  • Nov 4, 2009 2:14pm Nov 4, 2009 2:14pm
Quoting okrutny
So, what is a confirmation of S/R? Often price consolidate near S/R and eventually break it. You watch for candlestick patterns signaling reversal or what is the confirmation to you?
I used to enter right away. but in this market condition you see levels are goping bust, some levels work but we cannot say in advance. so, I watch, level hit.
price tries to break it. I am watching if it crosses level if it makes higher/ lower prices. if it fails, and opposite candlestick breaks some predetermined point, I enter. stop loss usually 5-10 pips above/ below the highest/ lowest point.
today I was only long. frankly, should have picked a lot more pips than I did , same yesterday, but in both cases was right about direction. hence made %%% .
  • #13,429
  • Nov 4, 2009 4:11pm Nov 4, 2009 4:11pm
I backtested this system on historical data, 3 years of EUR/JPY (2001-2003) ans three years of EUR/USD (2001-2003), and I can't get any profit from this method. I made hundreds and hundreds of trades so I've got a meaningful statistics. In average I am loosing 2 pips per trade. What I am doing wrong? I think I got levels more or less right as I often see price bounce from the levels I marked. But my biggest problem is to determine when level will hold and when not... How do you tell if it is time already to close the position in the red because level not going to hold?
  • #13,430
  • Nov 4, 2009 4:36pm Nov 4, 2009 4:36pm
Possible e/j short for you guys here at 155.88-156.
Good S/R here previously
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  • #13,431
  • Nov 5, 2009 12:19am Nov 5, 2009 12:19am
Quoting cash_machine
I backtested this system on historical data, 3...

you cannot back test it. it is not a mechanical system. It is discretionary approach of trading. You gotta use your own discretion when and how to use S/R levels. Sometimes you take, sometimes you don/t and sometimes you need confirmation and sometimes you do not and what level will hold and what will not. it is all experience. It is working for me, not 100% as I wish, but it takes time.
  • #13,432
  • Nov 5, 2009 12:22am Nov 5, 2009 12:22am
Quoting chazlanning
Possible e/j short for you guys here at 155.88-156.
Good S/R here previously

i am waiting for confirmation on E/J at 134.36 to go short. not yet.
  • #13,433
  • Nov 5, 2009 12:23am Nov 5, 2009 12:23am
Quoting cash_machine
I backtested this system on historical data, 3...

well, it is not even located in trading strategies part. but it is professional approach to trading. S/R areas.
  • #13,434
  • Edited Nov 7, 2009 12:13am Nov 6, 2009 5:46pm | Edited Nov 7, 2009 12:13am
Waiting on AUDJPY short 88.00 level.hasn't been there in a year.

00
61.8fib
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  • #13,435
  • Nov 9, 2009 9:51am Nov 9, 2009 9:51am
Here's a nice one on GU on 5M... "It's the 1-2-3-break". I tried posting just as trade was triggered but there is too much going on to manage a 5M trade breaking a level... taking a snapshot.. logging in.. posting.. etc... anyway

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  • #13,436
  • Edited 10:15am Nov 9, 2009 9:57am | Edited 10:15am
Now ready for more. (GBP/USD on 5M)... If this triggers, I'll probably let it run down to about the 1.6640 level... which is pretty good support on the 1H chart AND it's the 138.2 (fib completion) level.

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  • #13,437
  • Nov 9, 2009 10:14am Nov 9, 2009 10:14am
Here's A/U on 5M... buy limit at .9275 (with trend, so will let it go a bit). Confluence of S/R level and 50 Fib. (GU short from above post just triggered)

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  • #13,438
  • Nov 9, 2009 10:30am Nov 9, 2009 10:30am
That GU short.. now on 1M.. watching.. it's making the "1-2-3-break" (maybe break).. it's at +14 now and at b/e.

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  • #13,439
  • Nov 9, 2009 10:42am Nov 9, 2009 10:42am
Wow pipimo88 you are right on the money on the rally and the breakthrough... wow man just wow
  • #13,440
  • Nov 9, 2009 10:47am Nov 9, 2009 10:47am
Yes pipimo good calls..
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