E/U daily correction system | Forex Factory

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E/U daily correction system

  • #1
  • First Post: Dec 28, 2009 5:31pm Dec 28, 2009 5:31pm
Hello,

I would like to explain my knowledge about E/U correction that work 90% every day, and can be noticed on other --/USD/-- charts but not as perfect as on EU.

so, everyday on 16 pm GMT / 4 pm GMT watch on 5m the candle close and draw horizontal line and watch the price go far of the line by average of 45 daily to maximum of 70 to 80 pips some days then it have to go back to the line exact price and some times can be away of the line within 3 to 10 pips that most to happen when there a big move from the line like < 45 pips.

I share this to know the behavior of EU at this time zone better than to be completely blind of whats going.


Regards,
Alaa Maanawi
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  • #2
  • Dec 28, 2009 5:42pm Dec 28, 2009 5:42pm
Thanks for posting your observations.

I too have noticed that the 0400 hours GMT hourly candle usually points to the direction of the breakout. Bull candle usually gives a bull market for the next 12 hours or so, while bear candle gives a bear market for next 12 hours or so.

Peter
Holy Grail part 1. - Cut loses short.
  • #3
  • Dec 28, 2009 5:51pm Dec 28, 2009 5:51pm
Hi Peter
its take usulaly between 4 to 7 hours maximum at most days to finish the correction, some times jump to 16 or 18 hours but price keep in the range of the hi / low of the USA session after 4 pm GMT..

Quoting mystic
Thanks for posting your observations.

I too have noticed that the 0400 hours GMT hourly candle usually points to the direction of the breakout. Bull candle usually gives a bull market for the next 12 hours or so, while bear candle gives a bear market for next 12 hours or so.

Peter
  • #4
  • Dec 28, 2009 6:22pm Dec 28, 2009 6:22pm
Quoting maanawi
Hi Peter
its take usulaly between 4 to 7 hours maximum at most days to finish the correction, some times jump to 16 or 18 hours but price keep in the range of the hi / low of the USA session after 4 pm GMT..
Please what are the settings for the Moving averages
on your charts?
Thanks
  • #5
  • Dec 28, 2009 7:02pm Dec 28, 2009 7:02pm
ema 5
ema 23
ema 32
tf 5m

Quoting aelimian
please what are the settings for the moving averages
on your charts?
Thanks
  • #6
  • Dec 28, 2009 7:33pm Dec 28, 2009 7:33pm
How long have you been trading this system?
What's your win loss ratio?
Do you wait for the trade to go to the horizontal line before entering?
Thanks.
  • #7
  • Dec 28, 2009 7:42pm Dec 28, 2009 7:42pm
Hi,

I'm posting this so traders know how EU move at this period, you can open trades against the trend until its do the correction but you have to be careful , for me I only follow the trend I dont like to work against it.




Quoting ochuko
How long have you been trading this system?
What's your win loss ratio?
Do you wait for the trade to go to the horizontal line before entering?
Thanks.
  • #8
  • Dec 28, 2009 7:44pm Dec 28, 2009 7:44pm
That's a pretty awesome observation, thank you
  • #9
  • Dec 28, 2009 7:51pm Dec 28, 2009 7:51pm
I don't understand the observation or the time. You said 1600 GMT and 0400 GMT. What exactly do you do? Can you put it in numbered steps? For instance:

1. Draw a horizontal line at 1600 GMT.
2. Wait until price retraces to this line.
3. Place order in the direction of the retrace.
4. Stop loss/take profit are.......
  • #10
  • Dec 28, 2009 7:55pm Dec 28, 2009 7:55pm
He means 16:00gmt and I'm guessing there is no system he is proposing? Rather prompting discussion on how to trade using the knowledge
  • #11
  • Dec 28, 2009 8:07pm Dec 28, 2009 8:07pm
OK upon backtesting, sure enough the market always returns to the 1600 GMT open price. There has to be a way to trade this.
  • #12
  • Dec 28, 2009 8:15pm Dec 28, 2009 8:15pm
Well, sorry for confusin you, 16:00 GMt is 4 Pm gmt
1. Draw a horizontal line at 1600 GMT. (correct)
2. Wait until price retraces to this line. (no) when price go away of the line open position into the direction of the line
I really dont recomend trade on this system its easy and in same time hard, I only trade this method if the price away of the line 30 or 40 pips .

3. Place order in the direction of the retrace. ( yes) twoard the vertical line
4. Stop loss/take profit are....... Open SL ( for me I dont trade it with SL as this is a dead time no news or any thing daily! - TP is below the vertical line within 3 or 7 pips this if the price went away of the vertical line more than 40 ~ 45 pips but


Quoting Dreamliner
I don't understand the observation or the time. You said 1600 GMT and 0400 GMT. What exactly do you do? Can you put it in numbered steps? For instance:

1. Draw a horizontal line at 1600 GMT.
2. Wait until price retraces to this line.
3. Place order in the direction of the retrace.
4. Stop loss/take profit are.......
  • #13
  • Dec 28, 2009 8:26pm Dec 28, 2009 8:26pm
Sounds good so I'd say the minimum 30pip move away from the line before we enter on the retrace rule is key
  • #14
  • Dec 28, 2009 8:27pm Dec 28, 2009 8:27pm
The bars you marked on your charts are 1700 GMT, not 1600.
  • #15
  • Dec 28, 2009 8:34pm Dec 28, 2009 8:34pm
Got it now, thank you. Do you suggest opening at the open of 1600 hour or close of 1600 hour (like Bill says 1700)?

Quoting maanawi
Well, sorry for confusin you, 16:00 GMt is 4 Pm gmt
1. Draw a horizontal line at 1600 GMT. (correct)
2. Wait until price retraces to this line. (no) when price go away of the line open position into the direction of the line
I really dont recomend trade on this system its easy and in same time hard, I only trade this method if the price away of the line 30 or 40 pips .

3. Place order in the direction of the retrace. ( yes) twoard the vertical line
4. Stop loss/take profit are....... Open SL ( for me I dont trade it with SL as this is a dead time...
  • #16
  • Edited 8:47pm Dec 28, 2009 8:35pm | Edited 8:47pm
Well I will tell you how I trade it some times and gained from it but again its not yet a perfect to trade this way for small accounts as its risky as its not a 100% guaranteed

so I found its more safe to open a normal trade away of the HL with 25 then 35 or 40 pips , but not too many positions as in the attached picture.

A good idea too I use some times fibo to know where may price go away of the HL "Horizontal Line"

Quoting Sim
Sounds good so I'd say the minimum 30pip move away from the line before we enter on the retrace rule is key
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  • #17
  • Dec 28, 2009 8:38pm Dec 28, 2009 8:38pm
Quoting Dreamliner
Got it now, thank you. Do you suggest opening at the open of 1600 hour or close of 1600 hour (like Bill says 1700)?
He's using 5M bars. The bar he is calling the 1600 bar is actually the 1700 bar. I've matched them up with my charts.
  • #18
  • Dec 28, 2009 8:43pm Dec 28, 2009 8:43pm
Quoting maanawi
Well I will tell you how I trade it some times and gained from it but again its not yet a perfect to trade this way for small accounts as its risky as its not a 100% guaranteed

so I found its more safe to open a normal trade away of the VL with 25 then 35 or 40 pips , but not too many positions as in the attached picture.

A good idea too I use some times fibo to know where may price go away of the VL "Vertical Line"
I assume you mean "HL" for horizontal line, not "VL" for vertical line.
  • #19
  • Dec 28, 2009 8:44pm Dec 28, 2009 8:44pm
Hi,
No my time is not GMT im in Egypt time zone after GMT within 2 hours, if you saw 17 on my chart its 17:55 ...
Quoting billbss
The bars you marked on your charts are 1700 GMT, not 1600.
  • #20
  • Dec 28, 2009 8:46pm Dec 28, 2009 8:46pm
oops sorry yea its the HL I will change it in posts above so traders dont get confuse, thanks for notice
Quoting Dreamliner
I assume you mean "HL" for horizontal line, not "VL" for vertical line.
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