Mechanical trend trading

usd/chf break the downtrend 2 days ago, since then I am only looking for longs. This is also a setup that I have pending orders waiting to reach the round# 1.0350 area.

nzd/jpy shows a downtrend on a 4hr chart. It was a good trade from point C this morning for me, it was a good rally to the downside. After this rally I looked at it and I found out the points A,B,C,D and to take another trade if price retraces to point E then I am short with this one again.

That is it for me tonight, I hope this is helpful let me know so I can continue tomorrow if I see some other great possible future setups.

Hi Fed alot of good stuff there..its a good style and consistant.

Keep on posting I used to trade round numbers on day trading US stocks never really looked at it on Forex..I will continue to try and develop mechanical rules

Kostas I will try and answer your questions a bit later I would prefer untill I have some solid rules I know by other threads I have started just how complicated things can get when rules keep changing I hope you understand

'USDCAD + 60 currently long from 1.0472 TP 1.0524 SL 1.0454'..this hit its tgt of 52 pips

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Hi Fed alot of good stuff there..its a good style and consistant.

Keep on posting I used to trade round numbers on day trading US stocks never really looked at it on Forex..I will continue to try and develop mechanical rules

Kostas

Do you wait for a visible swing to consider "point 2" of the line?

This is the part Im trying to make mechanical but yes we need a decent swing to identify point 2

2. You draw and up or a down trendline based on what trend? (daily, 4hr, 1hr?)

1 hour

3. Would you agree with lines A, B, C in this chart?

Yes I have similar most importtant thing here is that traders are in the same direction look for contact or reactive points and keep the RR to 3;1

4. Is line A giving a valid signal at the arrow?

Yes valid signal with TP at last swing low



'USDCAD + 60 currently long from 1.0472 TP 1.0524 SL 1.0454'..this hit its tgt of 52 pips

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great job getting 52 pips from that usd/cad trade. That pair with usd/chf will retrace a bit then look for long again.

I always work with round numbers, if a res/sup line is not based through round numbers I don't take the trade live, I do it demo but not live, round numbers play a big part of forex, it is very psychological. Try to bring them back to forex as you were using them with stocks.

my pending short entry trigared. This pair break the 4hr uptrend, ralleyed down and retraced up and if it swings down again which I will collect the profit.

chf/jpy just triggered at 87.00, I always set the pending orders 5 pips below these round numbers because the market is not perfect, sometimes the price would miss my entry by few pips so that way I don't want to miss out a great trade. this setup has every single element, price is sitting on a falling trendline, at the same time a round#, 50% fib line and prev sup line now playing a role of a res line, if I loose this trade at least it was an excellent setup.

I missed gbp/jpy, it is too late now by 25 pips, but it is a good setup, it is missing one element though and that is the trendline.

here is a nice set up developing for next week eur/gbp, this pair was a single sided for the past 9 days and finaly it found a support @.8650 untill the bears got tired and decided to close their trades, most of the bulls jumped on the trade and we are seeing some up movement. My plan is to set up pending orders right at .8850 a nice round # which matches with other 2 elements.

Ok so far today..

USDJPY no sig
USDCHF +51
USDCAD no sig
GBPUSD +71-30
GBPJPY no sig
EURUSD -10
EURJPY currently short 127.71 TP 126.53 SL 128.13
EURGBP -10

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Good trades, I also have aud/usd still running, eur/jpy still running, I missed this one nzd/usd by 2 pips, It came so close to the round# 7150 and I set pending orders at 7148 (usually I do it 5 pips less but this one I chose not to follow that rule) if price gives me another chance and retaces back to the area again then I will enter in manualy

Paulus did you take the trade for usd/chf from point A area? Looks like a good setup and it looks like it is shaping the 'W' shape, the only thing it is violated one of my main round # rule that is why I didn't got on to that trade. The price landed right between the 2 round#s. But other then that it is a very good setup, I hope it will not retrace back to 350 area and will give you that scare before it really takes off to the north side. But again it is a good indication with that double buttom to take off sooner than I thought.

have to be quick going out signal on USDCHF

short 1.0420 19.32pm Uk time

TP 1.0377
SL 1.0438

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I like this thread! This is pretty much the method that I have settled with over the past 9 months along with fibs. Simple and powerful! Good stuff Paulus!

Paulus would you be able to post the charts along with the trades. It will help us understand the system better.

Guys if you don't include any indicators except fib levels and trendlines then you are on the right trackto become a successfull trader, just learn how to read what price is doing and you will not need to look at bullcrap indies, for new traders believe me they don't work. Soon I am going to do this full time and leave my regular job because I am showing consistant profit for a very long time with my powerful setups. Currently I am doing it full time because I do work night shifts and do trading day time mostly the London session and and US session and 1/3 of Assian session. This didn't happend overnight either, with alot of sleepless nights and hard work, just figuring out how to read price. I have waisted my first 1 year just relying on indicators and take it from an experienced trader, it is waist of your time. I love trading, it is addictive. I rather trade then gamble because trading is not gambling if you follow strict money management rules like not risking more then 3% on each trade.


Paulus if you don't mind if I may post my set ups just because they are similar to yours, strictly with trend lines and fibs.

I have closed all my trades just because it is end of the trading week and all reached to 1:1.5 RR and a gain of 1% on each trade. I took 4 trades today starting from the London session, they were 8 hour intraday trades with 1hr setups. With 4 hr setups I do leave them for up to 5 days with 2 entries and daily setups I do leave them for up to 2 weeks again with 2 entries.

The reason I dont post charts with signals is

 

1. time
2. Prob more important ...I know it will result in a huge debate about interpretation the whole point of this thread is for me to try and formulate some rules I dont want to get into many hours of posting regards the drawing of the lines once Iv worked out my rules that will be how I draw them irrespective of others views because i will have a months work of solid results to back it up

..hope that doesn't sounds precious but I hope you under stand ...............here is the 2 trades that closed at market close yesterday with the charts

1st

EURJPY currently short 127.71 TP 126.53 SL 128.13

This closed for 70 pips

You can see point 1 and then the rally to point 2 the short was taken at the white arrow.

2nd

have to be quick going out signal on USDCHF

short 1.0420 19.32pm Uk time

TP 1.0377
SL 1.0438

This closed for 12 pips

the chart shows point 1 and 2 then a signals that went to 51pips and the late signal last night

The fib tool you see is just set to 0 ,1 and -0.33, to give me visual lines for my SL and TP if you put %$ into the description box it posts the price on the chart

cheers all

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Hi Paulus,

even if Fab invested a lot of time in a very interesting explanation, thanks to him, I would apreciate more of your work, the way to see the TP and to draw the TL was very interesting.

Keep going please.


Regards,
Billy

A note on trends

Read the chart ABC etc etc

the trades

E at this point we have no Higher high or swing high to act as our TP so we measure the last touch on the trend line to the last swing high and copy that as our TP I have marked this as the 2 horizontal red lines,we use these pips between the 2 as our TP for the trade at E

Trade F TP is the last swing high marked by the red line

If you look at signal G there was no HH made so possible trend reversal and break we do not take this signal.Thumbs up was swing high thumbs down is where a swing high should of occured but didnt so the signal after this is ignored

Im looking at this to short cut all this so give me time
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