For Medici - :
1.You mention about price action at a pivot, (not regular pivot points) do you mean areas where price has pivoted away from and the pivot zone acts as both S&R? From the chart examples I have assumed that is what you mean?
Not sure we understand each other here, but by price action at a level (pivot or not) I mean the patterns in tick flow and chart that indicate what is happening - reversal, breakout/continuation, etc. It takes a bit of practice to learn to recognise these, and everybody's perception is unique. The masters of old times (Livermore, Wyckoff, Gann, and others) were very skilled at this and Wyckoff's books are useful for this.
According to the dictionary, pivot means (among other things) that which something revolves around or a decisive level. On the one hand there are the pivot levels calculated from the high, low, and close of the last period, on the other hand people, including myself, use it to mean a level around which price action revolves or an otherwise decisive level. For example, the 1.6272 level was a pivot during the consolidation phase in cable 8-16/12/09 and recognising that was profitable, as order were placed there in both directions. Another example of pivot is what I call the 'line in the sand' pattern where the pivot is overnight or over the past 24 hours or so.
2. In your chart examples re trend continuation - you mention that price rarely moves for more than 3 consectutive candles before consolidation/reversal signs. Are you talking specifically about the 6 - 9am time frame or just trending in general - I will of course observe for myself in future.
I meant three down days, not just morning sessions, and I was referring to (relatively speaking) ranging conditions such as since early summer, rather than the wild moves of the the summer and autumn of 2008.
3. Regarding order book flow - I haven't a scooby about that - I will get the book you recommended, but am assuming from comments on thread it is obvious areas where orders are likely to be, i.e. today at the lows where PA was bouncing away indicating tug of war between buyers & sellers, or was it buyers pushing price back down to add to positions once sellers were on board? It is the not so obvious areas that perplex!
Order book flow is what happens in the mornings when dealers execute orders on their books leading to the patterns we observe. S/R levels are such because orders are placed at those levels. Sometimes dealers push the rate there to execute orders, and sometimes there is a tug of war - so one needs to learn to recognise which is which by price action.
3. You mention the toyko fix/London fix - What is that?
Fix hours are times when official rates are set by various entities. For example, at 9am London time the rates used for retail fx transactions that day are set. Other fix hours such as the Tokyo fix at 1:55am and the London fix at 4pm are times when the official rate of the day is set for that session. Some market participants have judiciary obligations to trade at those rates and that means that their orders tend to get executed around those times. Today, for example, there was cable and Euro demand at the fix. The London fix is also important as that is the time when London dealing desks close, so that is also the time when order books are cleared for the day. Then there is a whole hoard of fix times relating to such official rates or option expiries, but rather than learning the details about those it's better to learn the chart patterns that occur at certain times of the day.
4. Lastly, you have mentioned looking at euro or swissy to see when to exit cable - I have noticed that if there is weakness in £/Euro, the £ will hardly move, then when euro starts its retrace, £ weakens further...I used to trade the cable with correlation between euro/Chf...most often the scenario was Chf moved first, then euro, then cable, purely a momentum scalp pre London open. Effective tho if you set strict parameters, till £ weakness. Is that sort of what you mean?
Being the major global currency, much of currency pair fluctuations are dollar driven, if you are looking at dollar pairs, that is. This means that they, cable and Euro, often reach support/resistance levels at the same time. So the correlation is worth watching. In the late NY session today there was a clear support level in Euro at 1.4385. There was a bounce from a slightly higher level, and cable bounced from 1.5982 at that time. Knowing that Euro would very likely go down to 1.4385 before continuing upwards, one would be ready to close the cable long at a nearby resistance level as cable would very likely display a move down in conjunction with Euro's dip to 1.4385. In fact, cable dipped to 1.4375 before moving higher.
All the best,
Medici
1.You mention about price action at a pivot, (not regular pivot points) do you mean areas where price has pivoted away from and the pivot zone acts as both S&R? From the chart examples I have assumed that is what you mean?
Not sure we understand each other here, but by price action at a level (pivot or not) I mean the patterns in tick flow and chart that indicate what is happening - reversal, breakout/continuation, etc. It takes a bit of practice to learn to recognise these, and everybody's perception is unique. The masters of old times (Livermore, Wyckoff, Gann, and others) were very skilled at this and Wyckoff's books are useful for this.
According to the dictionary, pivot means (among other things) that which something revolves around or a decisive level. On the one hand there are the pivot levels calculated from the high, low, and close of the last period, on the other hand people, including myself, use it to mean a level around which price action revolves or an otherwise decisive level. For example, the 1.6272 level was a pivot during the consolidation phase in cable 8-16/12/09 and recognising that was profitable, as order were placed there in both directions. Another example of pivot is what I call the 'line in the sand' pattern where the pivot is overnight or over the past 24 hours or so.
2. In your chart examples re trend continuation - you mention that price rarely moves for more than 3 consectutive candles before consolidation/reversal signs. Are you talking specifically about the 6 - 9am time frame or just trending in general - I will of course observe for myself in future.
I meant three down days, not just morning sessions, and I was referring to (relatively speaking) ranging conditions such as since early summer, rather than the wild moves of the the summer and autumn of 2008.
3. Regarding order book flow - I haven't a scooby about that - I will get the book you recommended, but am assuming from comments on thread it is obvious areas where orders are likely to be, i.e. today at the lows where PA was bouncing away indicating tug of war between buyers & sellers, or was it buyers pushing price back down to add to positions once sellers were on board? It is the not so obvious areas that perplex!
Order book flow is what happens in the mornings when dealers execute orders on their books leading to the patterns we observe. S/R levels are such because orders are placed at those levels. Sometimes dealers push the rate there to execute orders, and sometimes there is a tug of war - so one needs to learn to recognise which is which by price action.
3. You mention the toyko fix/London fix - What is that?
Fix hours are times when official rates are set by various entities. For example, at 9am London time the rates used for retail fx transactions that day are set. Other fix hours such as the Tokyo fix at 1:55am and the London fix at 4pm are times when the official rate of the day is set for that session. Some market participants have judiciary obligations to trade at those rates and that means that their orders tend to get executed around those times. Today, for example, there was cable and Euro demand at the fix. The London fix is also important as that is the time when London dealing desks close, so that is also the time when order books are cleared for the day. Then there is a whole hoard of fix times relating to such official rates or option expiries, but rather than learning the details about those it's better to learn the chart patterns that occur at certain times of the day.
4. Lastly, you have mentioned looking at euro or swissy to see when to exit cable - I have noticed that if there is weakness in £/Euro, the £ will hardly move, then when euro starts its retrace, £ weakens further...I used to trade the cable with correlation between euro/Chf...most often the scenario was Chf moved first, then euro, then cable, purely a momentum scalp pre London open. Effective tho if you set strict parameters, till £ weakness. Is that sort of what you mean?
Being the major global currency, much of currency pair fluctuations are dollar driven, if you are looking at dollar pairs, that is. This means that they, cable and Euro, often reach support/resistance levels at the same time. So the correlation is worth watching. In the late NY session today there was a clear support level in Euro at 1.4385. There was a bounce from a slightly higher level, and cable bounced from 1.5982 at that time. Knowing that Euro would very likely go down to 1.4385 before continuing upwards, one would be ready to close the cable long at a nearby resistance level as cable would very likely display a move down in conjunction with Euro's dip to 1.4385. In fact, cable dipped to 1.4375 before moving higher.
All the best,
Medici
