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Trading with Deadly Accuracy

  • #301
  • Dec 3, 2009 5:56am Dec 3, 2009 5:56am
For secondary confirmation i use trendlines. There are many good threads dedicated to trendlines here at ff so i dont need to say too much.

I have also attached template for gbp/chf with trendlines drawn.

As mentioned in previous posting, we are not looking for trendline break. We should be in a trade much sooner than that. So for upward move we use the upper trendline. And for downward move we use the lower trendline.
Attached Image (click to enlarge)
Click to Enlarge Name: trendlines.GIF Size: 19 KB
Attached File(s)
File Type: tpl gbpchf trendline.tpl   3 KB | 724 downloads
  • #302
  • Dec 3, 2009 10:51am Dec 3, 2009 10:51am
Hi wmd,

Thank you for your wonderful lessons. I am thinking differently (or trying to)
now. Thank you again.

I do have a question, sorry if it seems dumb, but here goes.
On the last picture you say the 3rd touch is mostly successful and 4th
touch has good reaction, can be more aggressive. Sorry, but I'm not clear what that means.

Is 3rd touch of TL fairly likely to continue the trend breaking through the TL?
Is the 4th touch also likely to continue or do you mean strong reaction
in a reversal? Please add a little more....Thanks again.

trademeister
  • #303
  • Dec 3, 2009 11:39am Dec 3, 2009 11:39am
In a diagonal fall, there is a positive expectation for the line to hold. It will do so more often then not.

If the 3rd touch holds, then more often then not the 4th touch will hold and give a good strong reaction. The pshycology behind this is that all buyers saw 3rd touch hold proving dynamic s/r so they place their trades.

If the line is breached, (it should have never happened), then the price will return to retest the level. This is fakeout testing resolve of buyers. You can see how strong resolve is in pips by measuring the deviation. This may help you change your mind about the trade if necessary.

Please note. We are looking to tie a diagonal fall with a horizontal level.

To trade this approach on its own would be contrarian so extra care would be advised.

Trendlines drawn between extreme points on higher time frames have more significance.

It may sound silly but its important. Like this '|' is vertical. Never stand in its way, wait for reversal pattern. Like this is (\) diagonal. The more shallow the diagonal the better.
  • #304
  • Dec 3, 2009 1:23pm Dec 3, 2009 1:23pm
Hi all
Still confuse about entry but i will give a try.
I like KISS trading.
I have one question.
This kind of patterns works on all markets or only on volatile one?

Great thread wmd
  • #305
  • Dec 3, 2009 1:39pm Dec 3, 2009 1:39pm
Just closed my gbp trade as i was a little loaded, but would like to see price around 6459 ish for a possibly buy, thanks Vmd...
Attached Image (click to enlarge)
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  • #306
  • Dec 3, 2009 1:42pm Dec 3, 2009 1:42pm
Quoting Thenew
Just closed my gbp trade as i was a little loaded, but would like to see price around 6459 ish for a possibly buy, thanks Vmd...
Attachment
On GBP can you show me witch line you follow for BUY and why?

Regards
Catalin
  • #307
  • Dec 3, 2009 1:53pm Dec 3, 2009 1:53pm
This is what i see on GBP 1 h timeframe
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  • #308
  • Dec 3, 2009 2:26pm Dec 3, 2009 2:26pm
Agree with you 1.6460 historically a strong S/R level...

Quoting Thenew
Just closed my gbp trade as i was a little loaded, but would like to see price around 6459 ish for a possibly buy, thanks Vmd...
Attachment
Attached Image (click to enlarge)
Click to Enlarge Name: gu.jpg Size: 83 KB
  • #309
  • Dec 3, 2009 2:38pm Dec 3, 2009 2:38pm
Quoting redart007
Agree with you 1.6460 historically a strong S/R level...
Thats the most confusion part on S/R but i can have the same level if you look on my chart

Catalin
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  • #310
  • Dec 3, 2009 3:19pm Dec 3, 2009 3:19pm
Quoting justcatalin
Thats the most confusion part on S/R but i can have the same level if you look on my chart

Catalin
Today's range has taken out yesterdays high and is a breath from taking out yesterdays low, the supporting trendline has held for the moment, and small timeframe reversal patterns along the edge could be seen as an opportunity to buy, but the better view would be to look for shorts from the broken support at #2, specially if level #1 is taken out at the Asian start.

sorry to detract from the thread,

fwiw
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  • #311
  • Dec 3, 2009 4:24pm Dec 3, 2009 4:24pm
Quoting wmd
In a diagonal fall, there is a positive expectation for the line to hold. It will do so more often then not.

If the 3rd touch holds, then more often then not the 4th touch will hold and give a good strong reaction. The pshycology behind this is that all buyers saw 3rd touch hold proving dynamic s/r so they place their trades.

If the line is breached, (it should have never happened), then the price will return to retest the level. This is fakeout testing resolve of buyers. You can see how strong resolve is in pips by measuring the deviation....
Once again, thanks for your input. I like the way you tie the simple and obvious together and point out things we may have overlooked in our chart reading. http://smileys.smileycentral.com/cat/36/36_1_75.gif
  • #312
  • Dec 3, 2009 4:34pm Dec 3, 2009 4:34pm
Quoting justcatalin
This is what i see on GBP 1 h timeframe
I was thinking that might be good buy, but level didn't hold, may be good to buy around 50% fib, 00 area of 1.6500 - reconnect tl over there perhaps?
  • #313
  • Dec 3, 2009 4:40pm Dec 3, 2009 4:40pm
Not trying to be a cheerleader but I am all ears.
  • #314
  • Dec 3, 2009 5:02pm Dec 3, 2009 5:02pm
I have a question about your swooshes and hooks. The top square appears to be a hook to me but in the same regard half of it appears to be leading into a swoosh. Should I be looking for the swoosh to be completed during the present or would this be a decent looking spot for a reversal
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  • #315
  • Dec 3, 2009 5:12pm Dec 3, 2009 5:12pm
Quote
On GBP can you show me witch line you follow for BUY and why?

This is what i see, but i am still learning (have to reread the thread) so donīt take my view for granted, also usually i zoom in to see the price around this area to look for clues.
Glad if i could help anyway...

Regards;

Attached Image (click to enlarge)
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  • #316
  • Dec 3, 2009 5:31pm Dec 3, 2009 5:31pm
Just to throw my 2 pips in on the gbp, I agree with auxesis that current pips are found going south. But I agree with some of the analysis presented here that 1.6463 is a level to exercise caution (former resistance and significant fib level) and perhaps take some profits on approach. I know fibs are not part of the approach discussed here, but the .786 level can be a place to show some respect. Will follow PA on lower time compression from here. Good trading to everyone and stay focused.

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  • #317
  • Dec 3, 2009 5:43pm Dec 3, 2009 5:43pm
Quoting kodflakes
I have a question about your swooshes and hooks. The top square appears to be a hook to me but in the same regard half of it appears to be leading into a swoosh. Should I be looking for the swoosh to be completed during the present or would this be a decent looking spot for a reversal
If it's not clearly a hook then you can ignore it.

Same goes for swoosh.

Note aswell that swoosh is sign of exhaustion so we look for it at the end of trend, in the direction of trend.

If you see it in the beginning of a countertrend wave then it could represent strong impulsive wave. Don't try to fight it. It's a vertical movement. See gu last week.
  • #318
  • Dec 3, 2009 8:42pm Dec 3, 2009 8:42pm
Props to WMD, this is an awesome thread with some incredibly valuable information within it. For the last 6-9 months or so I have researched, studied and traded price action from areas where established trend-lines have been breeched by extreme imbalances in supply/demand in expectation that traders will deem the price of the initial breech to represent value. WMD's simple, logical approach to determine high probability areas where limit orders exist in abundance at untested break-out points chimes and adds another dimension to my ability to 'read the market' and anticipate where these 'hot-zones' might be.

The best ideas are those that when you hear them you think to yourself; that is so obvious why didn't I think of that myself? I swear I would have invented the wheel if I was born in a different era. I'm not one to readily lavish praise, but this thread is up there with the best of them on this forum and I am personally grateful to WMD for freely sharing his concept of The Market.
  • #319
  • Dec 3, 2009 11:37pm Dec 3, 2009 11:37pm
Just a reminder: NFP today. Cover ur butts!
  • #320
  • Dec 4, 2009 2:53am Dec 4, 2009 2:53am
The last level hold for buy and great 80 pips, lets see if the sell area hold for 180 pips
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