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  • #101
  • Mar 10, 2010 6:23am Mar 10, 2010 6:23am
Quoting herzog21
Dan, you mentioned you went short at EU at 1.3650. I could find no compelling reasons to short there. did you do so based on trendline and switched to H1 tf yo see if prices were losing upward momentum?
appreciate yr comments there.
thanks
Hi Herzog,

I got in at above level - must be glutton for punishment. I am using the same s/r levels as yesterday, although some of my time has been distracted on the dibs forum - "Do It Better" system - prickly bunch!
  • #102
  • Mar 10, 2010 8:40am Mar 10, 2010 8:40am
Quoting DanUK
Hi herzog21,

You are partly right - I did drop down to the H1 to watch for an entry. But my reasons for entering are as follows:

Chart 1 - Resistance shown at 1.3700

Chart 2 - Confluence of factors; resistance at 1.3700, trendline (as you indicated) and the 50% retracement - creating what I call an "area of interest". It is an area like this that I look for price to slow and start to turn. As it happened, price started to slow in the 1.3680/1.3690 area - it then hit 1.3700 and started to fall, hence my entry at 1.3650.

Hope that makes...

With the greatest of respect, my areas of fib would have been 61.8% between 135.30 and 137.37 (3 and 5 March 2010) and 34.33 and 37.38 (2 and 3 March 2010) - again 61.8% on 4H.
  • #103
  • Mar 10, 2010 8:46am Mar 10, 2010 8:46am
Quoting herzog21
Dan, you mentioned you went short at EU at 1.3650. I could find no compelling reasons to short there. did you do so based on trendline and switched to H1 tf yo see if prices were losing upward momentum?
appreciate yr comments there.
thanks

Herzog, a possible entry was cause of the outer TL too.

Ignore the sell line. This is the screenshot of the demo and I put a short at 1.35 which I forgot to remove.

http://content.screencast.com/users/...03-10_2011.png
  • #104
  • Mar 10, 2010 9:17am Mar 10, 2010 9:17am
Quoting Knight Rider
With the greatest of respect, my areas of fib would have been 61.8% between 135.30 and 137.37 (3 and 5 March 2010) and 34.33 and 37.38 (2 and 3 March 2010) - again 61.8% on 4H.
Hi,

I can see why you would have done that but that is not the best way to use the fib tool for this method.

Also this is not a fib method - the only level I use is the 50% level which is not actually a fib level (as you probably know).

Back to drawing fibs... in line with this method, when price is stuck within a range you would be better off (in my opinion) using the most recent engulfing high and low points rather than each swing within the range.

Hope that makes some sense!

Regards,

Dan
  • #105
  • Mar 10, 2010 9:28am Mar 10, 2010 9:28am
Quoting DanUK
Hi,

I can see why you would have done that but that is not the best way to use the fib tool for this method.

Also this is not a fib method - the only level I use is the 50% level which is not actually a fib level (as you probably know).

Back to drawing fibs... in line with this method, when price is stuck within a range you would be better off (in my opinion) using the most recent engulfing high and low points rather than each swing within the range.

Hope that makes some sense!

Regards,

Dan
Yes it does and thank you! I always liked the simplicity of Mr Jackson, which is why I was interested in your journal.

Best,
K
  • #106
  • Mar 10, 2010 9:37am Mar 10, 2010 9:37am
Quoting Knight Rider
Yes it does and thank you! I always liked the simplicity of Mr Jackson, which is why I was interested in your journal.

Best,
K
If/when it rises up to 1.37, how would you play this again? I'm really interested to know your thought process. If it shoots past 1.37 also, how would you play this?

I see you had the trend line in place as well as the s/r. The only thing I am a little unsure of is how you formulate your 50% retracements.

Thank you for your comments.

K
  • #107
  • Mar 10, 2010 10:18am Mar 10, 2010 10:18am
KR, no offence but i think you are thinking a wee bit too much.

if and when it goes to 37, wait for the h4 to be completed. re draw the trend line from the most recent high to as many recent highs as possible. see if there is a confluence of a round number, horizontal s/r line and 50% fib, else a confluence of atleast the two, see how bar formation forms and then take a trade.

dan and most followers of this system take a trade +/- 50 pips. ie: if 37 is the confluence point, then 3650 would be the entry point.

btw this is how I would trade, not necessarily how Dan would.





Quoting Knight Rider
If/when it rises up to 1.37, how would you play this again? I'm really interested to know your thought process. If it shoots past 1.37 also, how would you play this?

I see you had the trend line in place as well as the s/r. The only thing I am a little unsure of is how you formulate your 50% retracements.

Thank you for your comments.

K
  • #108
  • Mar 10, 2010 10:38am Mar 10, 2010 10:38am
Quoting coolshades
KR, no offence but i think you are thinking a wee bit too much.

if and when it goes to 37, wait for the h4 to be completed. re draw the trend line from the most recent high to as many recent highs as possible. see if there is a confluence of a round number, horizontal s/r line and 50% fib, else a confluence of atleast the two, see how bar formation forms and then take a trade.

dan and most followers of this system take a trade +/- 50 pips. ie: if 37 is the confluence point, then 3650 would be the entry point.

btw this is how I would trade,...
Thanks Mr "Coolshades" - like the name.

Yeah, I figured as much - I am trying to get an entry level much closer and I think Dan alluded to this when he asked about price action and yes I do look at this very closely around turning points. This is fun for me, although I do take this extremely seriously and bet with significant amounts of money. If you are with the long term trend, then you can afford to dabble with systems, which is what I am doing right now. I take it you would go short at 3650 in your analogy above? I wonder though whether this time the Euro has some legs?

My last question is how you draw 50% fibs. In the last diagram, I couldn't understand exactly why Dan drew his lines from those points to get the 50% retracement (see above). The high just seemed a little far out to me on the 4 hour. Perhaps, you could explain why in order to finally put this to bed! I do understand, though, about the significance of drawing fibs from the weekly and more importantly monthly charts. Most bond traders would do the same.

Thanks for the reply.

K

Thank you.

K
  • #109
  • Mar 10, 2010 10:42am Mar 10, 2010 10:42am
Quoting Knight Rider
Thanks Mr "Coolshades" - like the name.

Yeah, I figured as much - I am trying to get an entry level much closer and I think Dan alluded to this when he asked about price action and yes I do look at this very closely around turning points. This is fun for me, although I do take this extremely seriously and bet with significant amounts of money. If you are with the long term trend, then you can afford to dabble with systems, which is what I am doing right now. I take it you would go short at 3650 in your analogy above? I wonder though whether...
I've gone short (36.50) with small amount to test your theory. Maybe it doesn't have the legs this time?
  • #110
  • Mar 10, 2010 10:58am Mar 10, 2010 10:58am
Quoting Knight Rider
I've gone short (36.50) with small amount to test your theory. Maybe it doesn't have the legs this time?
Got a bad feeling about this. Closed out.

No harm done.
  • #111
  • Mar 10, 2010 11:00am Mar 10, 2010 11:00am
if it doesnt, it doesnt. once a trade is taken, stop worrying.


re fibs, a bit of discretion there. will try to post some charts later tonite.

Quoting Knight Rider
I've gone short (36.50) with small amount to test your theory. Maybe it doesn't have the legs this time?
  • #112
  • Mar 10, 2010 11:08am Mar 10, 2010 11:08am
Quoting coolshades
if it doesnt, it doesnt. once a trade is taken, stop worrying.


re fibs, a bit of discretion there. will try to post some charts later tonite.
ta
  • #113
  • Mar 10, 2010 12:27pm Mar 10, 2010 12:27pm
Had a gut feeling EUR/USD wasn't ready to give up. Will look for a much better set up than I did before. I wasn't comfortable with shorting at 3650 - a school boy error.

At some point (I was thinking around 1.38) you want go short on this pair big time. Based on my analysis, this will go to 1.10 by the end of this year. We shall see.

I am also waiting on going long on the USD/JPY although this could take a bit of time before the trend reversal is significant and w/o dispute.

Japan is crying out for a cheaper currency. Investors have been waiting for two decades to get a decent investment. Perhaps, now is around the time people want to be investing in Japan - a contrarian view once again.

Unlike the UK and other western economies, Japan does have a productive capacity and arguably (forget about Toyota) a quality export industry to sell into Chinese prosperity. We shall see.
  • #114
  • Mar 10, 2010 1:47pm Mar 10, 2010 1:47pm
Quoting Knight Rider
Thanks Mr "Coolshades" - like the name.

Yeah, I figured as much - I am trying to get an entry level much closer and I think Dan alluded to this when he asked about price action and yes I do look at this very closely around turning points. This is fun for me, although I do take this extremely seriously and bet with significant amounts of money. If you are with the long term trend, then you can afford to dabble with systems, which is what I am doing right now. I take it you would go short at 3650 in your analogy above? I wonder though whether...
Hello again Knight Rider,

One of the important things to recognize is when price is trending smoothly and when price is in a period of consolidation.

Chart 1 - when price is trending smoothly, draw the fib retracement using the highs and lows of the most recent swing in the direction of the trend; this is a good example of how the 50% retracement works best.

Chart 2 - price is consolidating so use the highs and lows of the congestion area. The 50% then serves as a guide to the buy or sell area (depending on which direction the trend is running).

Hope this clears things up.

Regards,

Dan
Attached Image(s) (click to enlarge)
Click to Enlarge Name: EU_2010-03-10_1.png Size: 29 KB
Click to Enlarge Name: EU_2010-03-10_2.png Size: 36 KB
  • #115
  • Mar 10, 2010 2:11pm Mar 10, 2010 2:11pm
Quoting DanUK
Hello again Knight Rider,

One of the important things to recognize is when price is trending smoothly and when price is in a period of consolidation.

Chart 1 - when price is trending smoothly, draw the fib retracement using the highs and lows of the most recent swing in the direction of the trend; this is a good example of how the 50% retracement works best.

Chart 2 - price is consolidating so use the highs and lows of the congestion area. The 50% then serves as a guide to...
Perfect charts. Thank you. I understand exactly what you mean now. My analysis had 1.38 as an entry to go short (following shorter term patterns). It is quite conceivable that this consolidation is forming a triangle with 136.50 as one of the last entry points before the big move down, following the trend. This is not a given though, but I now see the relevance of 50% with both charts.

In any event, thank you for posting the charts.

There was a reason I chose to post in your forum.

Knight Rider
  • #116
  • Mar 10, 2010 2:50pm Mar 10, 2010 2:50pm
Quoting Knight Rider
Perfect charts. Thank you. I understand exactly what you mean now. My analysis had 1.38 as an entry to go short (following shorter term patterns). It is quite conceivable that this consolidation is forming a triangle with 136.50 as one of the last entry points before the big move down, following the trend. This is not a given though, but I now see the relevance of 50% with both charts.

In any event, thank you for posting the charts.

There was a reason I chose to post in your forum.

Knight Rider
Glad to be of some use!

I should also add that I agree with your 1.38 as being a good place to short - I have the 1.3800/1.3850 area marked up as being a key support and resistance level. If price breaks up from here that is where I would expect price to stop and turn back around. It is also a "turning point" level for me - say for example price were to break above it and remain above then I would consider a change of trend to be taking place.

Regards,

Dan
  • #117
  • Mar 10, 2010 4:09pm Mar 10, 2010 4:09pm
does that mean you are back short at 365? i presume you wld have got stopped out at be on previous

Quoting DanUK
Glad to be of some use!

I should also add that I agree with your 1.38 as being a good place to short - I have the 1.3800/1.3850 area marked up as being a key support and resistance level. If price breaks up from here that is where I would expect price to stop and turn back around. It is also a "turning point" level for me - say for example price were to break above it and remain above then I would consider a change of trend to be taking place.

Regards,

Dan
  • #118
  • Mar 11, 2010 2:20am Mar 11, 2010 2:20am
Quoting DanUK
Glad to be of some use!

I should also add that I agree with your 1.38 as being a good place to short - I have the 1.3800/1.3850 area marked up as being a key support and resistance level. If price breaks up from here that is where I would expect price to stop and turn back around. It is also a "turning point" level for me - say for example price were to break above it and remain above then I would consider a change of trend to be taking place.

Regards,

Dan
Yes, I agree, although I would be surprised if this pair broke trend.

I was looking at the oracle this morning (market oracle) - nice piece on currencies (JPY).
  • #119
  • Mar 11, 2010 3:09am Mar 11, 2010 3:09am
Quoting coolshades
does that mean you are back short at 365? i presume you wld have got stopped out at be on previous
Hi coolshades,

Yes my previous trade got stopped out at BE yesterday. I am not short yet... I'm waiting to see if price is going to break the trendline or if not I will look to sell below current price action.

Regards,

Dan
  • #120
  • Mar 11, 2010 4:35am Mar 11, 2010 4:35am
Quoting DanUK
Hi coolshades,

Yes my previous trade got stopped out at BE yesterday. I am not short yet... I'm waiting to see if price is going to break the trendline or if not I will look to sell below current price action.

Regards,

Dan
I feel there is a breakout coming soon.
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