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intraday trend trading with price action

  • #1,361
  • Mar 5, 2010 12:23am Mar 5, 2010 12:23am
Hey Novice,

I believe it was you who posted a chart earlier today on the other thread of a trade you took that stopped you out. I know Sho mentioned that entry was ok and that's why we have stops. I think you know what im talking about, i usually stay away from a trade set up like that not becuase it wouldn't be a good entry but more so becuase i feel there are better setups than that. I usually just look for the pairs where the channels are at an angle, that way i can clearly see the impulsive/corrective waves, and then my chances increase. Just what i do. I would say just doing this will prob cut down on some negative trades. just what works for me, but do what your comfortable with.
  • #1,362
  • Mar 5, 2010 12:42am Mar 5, 2010 12:42am
Quoting rtiger29
Hey Novice,

I believe it was you who posted a chart earlier today on the other thread of a trade you took that stopped you out. I know Sho mentioned that entry was ok and that's why we have stops. I think you know what im talking about, i usually stay away from a trade set up like that not becuase it wouldn't be a good entry but more so becuase i feel there are better setups than that. I usually just look for the pairs where the channels are at an angle, that way i can clearly see the impulsive/corrective waves, and then my chances increase. Just...
Hi tiger
I am so new at this method that any feedback is welcome.
regarding the trade I posted, I thought that it was good as it was preceded by a large bearish bar and the channel was beginning to tilt downwards.
Am I right to say that you would only take a pinbar like that further down the trend?
I have been grappling with that approach too but I found that with this method, many times whether it is successful or even whether you have the chance to bring the trade to breakeven, depends on getting onto the bus as early as possible.
I believe that is why Sho suggests opening trades at the close of bars as opposed to the break of bars as suggested by so many PA traders.
I still need plenty of screen time to be confident with this method frankly.
  • #1,363
  • Mar 5, 2010 1:43am Mar 5, 2010 1:43am
Quoting CodeMeister
I think you have done an excellent analysis of the situation and presented it well. You noticed a few things I didn't and I can't think of anything you missed. By my count that was the 3rd correction not the fourth, but I may be wrong....


Hi Code,

I've shown on the chart below why I thought it was the 4th wave and not the 3rd. Could be mistaken but it looks as though price turned around in the area inside the yellow circle.

I was not sure what happened to price action around the bottom of the move after where I've put a white line to show impulsive turned corrective.

I would be interested in seeing how people interpret price action from that point onwards or whether there was just not enough momentum to make it possible.

Thanks,

Alan
Attached Image (click to enlarge)
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bringing order to chaos....
  • #1,364
  • Mar 5, 2010 2:25am Mar 5, 2010 2:25am
Quoting AlanOne
Hi Code,

I've shown on the chart below why I thought it was the 4th wave and not the 3rd. Could be mistaken but it looks as though price turned around in the area inside the yellow circle.

I was not sure what happened to price action around the bottom of the move after where I've put a white line to show impulsive turned corrective.

[font=Tahoma]I would be interested in seeing how people interpret price action from that point onwards or whether there was just not enough momentum to...

I suspected earlier that my way of counting was different than some of you. I think the big difference is that I consider the first one to be very noticeable ie. a nobrainer. I have used this way for a while and it is what I am comfortable with. So I am going to stick with a count of 3, which means I would have taken the trade, but not consider it an A because it was so close to 1.3600.
  • #1,365
  • Mar 5, 2010 3:08am Mar 5, 2010 3:08am
As Sho wants to discuss our trades from the other thread here:
I have shorted the eurusd at the yellow arrow bar, because
-downward momentum before, and retracement
-retracement to a strong sup/res line and 50%retrace from the previous move down, price unable to break to the upside 3 times
-red arrow is signal bar, strong rejection from middle line

I have been stopped out -12 pips and I asked me why. After looking and thinking, I saw the 2 long lower wicks from the down candles 1 and 2, which means: buying strength is coming in. Is that right or does some one see anything else, why I shouldn't have been short?
Attached Image (click to enlarge)
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  • #1,366
  • Mar 5, 2010 3:14am Mar 5, 2010 3:14am
Quoting AlanOne
Hi Code,

[font=Tahoma]I've shown on the chart below why I thought it was the 4th wave and not the 3rd. Could be mistaken but it looks as though price turned around in the area inside the...

Nice analysis Alan. I agree with your wave count (technically) but I can see CodeMeister's view too and I really don't have the experience to say which is right.

Anyhow, I thought Elliot theory talks about 3 waves and then a correction so whether we'd had 3 waves or 4 impulse waves before the alternative entry bar, shouldn't we have been on the alert for a correction anyway?
  • #1,367
  • Mar 5, 2010 3:33am Mar 5, 2010 3:33am
Quoting Milton
As Sho wants to discuss our trades from the other thread here:
I have shorted the eurusd at the yellow arrow bar, because
-downward momentum before, and retracement
-retracement to a strong sup/res line and 50%retrace from the previous move down, price unable to break to the upside 3 times
-red arrow is signal bar, strong rejection from middle line

I have been stopped out -12 pips and I asked me why. After looking and thinking, I saw the 2 long lower wicks from the down candles 1 and 2, which means: buying strength is coming in. Is that right...

Hi Milton,

I'm not sure if the signal bar was valid or not but what I do know:

1. We were definitely in a correction of a strong impulse move
2. We'd had a decent 61% pull back to the central channel line

The only thing that might have caused concern for me was the strong momentum of the pull back bar.


I think what is more important to learn from this is the trade management side of things. Sho is always telling us to manage our risk first and then worry about profits. His rule is to move to break even after the first 15M bar has closed in order to reduce risk asap.

Now, if you had done this here you would have had to eat the spread as the bar closed as a doji. The doji itself was warning of indecision in the market and a possible turn ahead which might have given you good reason to get out there with a very small loss (unsatisfying and frustrating I know).

You chose to hold on at this point and rode the next 15M bar out. This bar found demand around the same level as the previous bar and ended up quite bullish.

At this point you've had 2 warnings that price may turn and according to the rules you REALLY SHOULD HAVE moved to B/E by now. As it happens, at the close of this bar you probably were around the B/E point so an exit would have been quite easy to take.

So in summary, I think the trade was probably a good one but the trade management was lousy - this could have been just another of those B/E trades that Sho loves but you let it turn to a -12 loser.

Just my take on it. Could be wrong.

Dave
  • #1,368
  • Mar 5, 2010 3:44am Mar 5, 2010 3:44am
Quoting Sutts
Hi Milton,

I'm not sure if the signal bar was valid or not but what I do know:

1. We were definitely in a correction of a strong impulse move
2. We'd had a decent 61% pull back to the central channel line

The only thing that might have caused concern for me was the strong momentum of the pull back bar.


I think what is more important to learn from this is the trade management side of things. Sho is always telling us to manage our risk first and then worry about profits. His rule is to move to break even after the first 15M bar has closed...
Thank you Dave. 100% right (long bull candle, indecision and the possibilty to break-even). Why can't I see the obvious? Perhaps because I want it to be, like I decided. Someone wise said: Too much people prefer to be right than happy!
  • #1,369
  • Mar 5, 2010 4:13am Mar 5, 2010 4:13am
Quoting Milton
Thank you Dave. 100% right (long bull candle, indecision and the possibilty to break-even). Why can't I see the obvious? Perhaps because I want it to be, like I decided. Someone wise said: Too much people prefer to be right than happy!
I think you're bang on there Milton, I've tried a long time to overcome "the need to be proven right" - that is a very expensive need. You might be at the stage I was a little while ago before reading the Mark Douglas book "Trading In The Zone".

When I saw a really nice setup and took it I always expected it to work out and if it didn't I was cross and wanted to know why it could possibly have failed - everything was exactly as it should have been.

The book finally helped me to realize that in the market, anything can happen, there are so many variables and any one of them could tip the balance against your A+ trade setup. Any edge is usually only a small one and simply gives us a slightly higher probability of an expected outcome on any one trade.

So...we just have to take every setup that meets our entry criteria and completely detach from the outcome as we know that ANYTHING CAN HAPPEN. Our edge will ensure that over a number of trades we will be net positive. Each individual trade must simpy be seen as another spin of the wheel and nothing more.

When you let go of a trade and expect that it may go against you, you begin to pick up clues that would have been filtered out by your brain if you were still attached to the outcome.

Sorry, if you're aware of all this but it may help someone, it certainly helped me.

Dave
  • #1,370
  • Mar 5, 2010 4:31am Mar 5, 2010 4:31am
Quoting Sutts
I think you're bang on there Milton, I've tried a long time to overcome "the need to be proven right" - that is a very expensive need. You might be at the stage I was a little while ago before reading the Mark Douglas book "Trading In The Zone".

When I saw a really nice setup and took it I always expected it to work out and if it didn't I was cross and wanted to know why it could possibly have failed - everything was exactly as it should have been.

The book finally helped me to realize that in the market, anything can happen, there are so...
I love Sho's thread with all the people. Thank you.
  • #1,371
  • Mar 5, 2010 4:41am Mar 5, 2010 4:41am
Quoting AlanOne
Hi everyone,

I'm looking at the above post of Pi Pipers and also agree that it would have been a good entry after the signal bar. I can also see a possible alternative entry on the same chart a little later on in the day.


[font=Tahoma][size=3]How would we rate the alternative entry? Obviously hindsight tells us it would have been profitable to enter short after the alternative entry signal bar but does any of the price action previous to it also tell us this? In short was...
Good exlpanation, all I can think of to add is r/r not very good unless you get out quickly at signs of bounce off r/n, in its favour if im correct daily range at that point was only 109 so further downside was probable even if not preciselythen, a lot of the systems strength comes down to Sho,s trade management
  • #1,372
  • Mar 5, 2010 4:43am Mar 5, 2010 4:43am
Quoting Milton
As Sho wants to discuss our trades from the other thread here:
I have shorted the eurusd at the yellow arrow bar, because
-downward momentum before, and retracement
-retracement to a strong sup/res line and 50%retrace from the previous move down, price unable to break to the upside 3 times
-red arrow is signal bar, strong rejection from middle line

I have been stopped out -12 pips and I asked me why. After looking and thinking, I saw the 2 long lower wicks from the down candles 1 and 2, which means: buying strength is coming in. Is that right...
NFP
  • #1,373
  • Mar 5, 2010 4:54am Mar 5, 2010 4:54am
Quoting francis2
NFP
What does NFP mean? English is not my native language.
When you mean Non-Farm-Payroll, I don't understand.
  • #1,374
  • Mar 5, 2010 5:02am Mar 5, 2010 5:02am
Quoting Milton
What does NFP mean? English is not my native language.
"Non Farm Payroll" Milton. Big market moving news release in 2.5 hours. The market often stagnates before such anouncements.

Dave
  • #1,375
  • Mar 5, 2010 5:02am Mar 5, 2010 5:02am
Quoting Milton
What does NFP mean? English is not my native language.
Now that is interesting, arguably the most important news event of the forex calendar, implying the markets prior to this event are usually somewhat erratic and post event even more so for a while
  • #1,376
  • Mar 5, 2010 5:07am Mar 5, 2010 5:07am
Quoting francis2
Now that is interesting, arguably the most important news event of the forex calendar, implying the markets prior to this event are usually somewhat erratic and post event even more so for a while
francis2 and Dave: I'm learning.
  • #1,377
  • Mar 5, 2010 5:09am Mar 5, 2010 5:09am
Quoting Milton
What does NFP mean? English is not my native language.
When you mean Non-Farm-Payroll, I don't understand.
Read all about it here Milton. Scroll down to Friday's news releases and click the little folder icon to the right of the "Non-Farm Employment Change" heading.

http://www.forexfactory.com/calendar.php
  • #1,378
  • Mar 5, 2010 6:22am Mar 5, 2010 6:22am
Quoting jgadefelth
i think Sho have me on his ignore list he have not respended to my last 3 posts


best regards
i am wachting.
  • #1,379
  • Mar 5, 2010 6:26am Mar 5, 2010 6:26am
Quoting AlanOne
Hi Code,

[font=Tahoma]I've shown on the chart below why I thought it was the 4th wave and not the 3rd. Could be mistaken but it looks as though price turned around in the area inside the...
you did great.
with impulsive move from the begining we knew that trend is changing direction.
it will stop you from trading in the wrong direction of the momentum.
  • #1,380
  • Mar 5, 2010 6:29am Mar 5, 2010 6:29am
Quoting Sutts
Hi Milton,

I'm not sure if the signal bar was valid or not but what I do know:

1. We were definitely in a correction of a strong impulse move
2. We'd had a decent 61% pull back to the central channel line

The only thing that might have caused concern for me was the strong momentum of the pull back bar.


I think what is more important to learn from this is the trade management side of things....
brilliant explanation.Dave

sho
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