Strat's Long Term Stress Free Trading

When I plot the 200 simple or the 250 linear weighted it looks pretty close to what you have. Throwing out ideas, could be my MT4 platform?

As we've been discusing in scattered posts for a few weeks, the current forex structure seems to support economically positive, resource driven, currently non-inflationary growth. The Loonie-oil relationship and the equity-JPY relationship remain interesting. The pair I am really interested in ,despite the low end of the week volume, will be AUDUSD. Overall, it seems readers may be well positioned. The aussie, however, remains a bit illusive vis a vis the USD, though not certainly against the economically sensitive JPY. That pair (AUDJPY) has driven much of my trading, as readers are aware. Today's EUR CHF dichotomy deserves some additional study. Perhaps the EUR recovers some of the excesses, while the USD remains favored.

Count the bars - you have a broker showing sunday bars, tmanbone does not. Hence your MAs are different. At least, that's what I SEE.

Where are you looking/thinking you'll be going long? Are you waiting on a pull back, if so to where? Where is your target? How far do you think it will go? Have you plotted all your resistance levels? Have you written all this down on paper so you will know without a doubt when the time comes, how much you can lose, your % risk, your % reward, where to enter, where to set your stops, and where to take your profit? I see what you are looking at, that eight month parabolic drop, and thinking man if only I could of traded that. I'm guilty, I think the same things, but after further study I'm thinking first daily support to first daily resistance or vise versa depending on direction. Please post your trade plan. I'm still not sure exactly what you are thinking.

This is my first attempt at a serious analysis so any advice appreciated. I am analyzing GBP/JPY.

Trend: The past week has seen a major rally but weekly chart shows us the pair is still in a long term downtrend, and on daily chart it is trading well below its 200 SMA. It is also hitting upper TL which has offered resistance 3 times beginning in august. Therefore I am waiting for the pair to reverse and start falling.

Support/resistance: price has currently hit major resistance, and there are many levels of reistance above it but little support below it. I think downward from here is the path of least resistance.

Fundamentals: Most analysts seem to remain more bearish on the GBP than they are on the JPY. This also points toward a short position.

If we look at a 4H chart the current rally has been consistent with little action from sellers, which indicates they are all waiting in the wings.

All these things seem to indicate the pair will fall soon.

My plan:

I will wait to see a reversal candle pattern, then wait for a confirmation candle to close. If this happens I will open a short position with SL slightly above the swing high which may be forming right now. I expect price to fall to around 137, a 650 pip swing. I will start adding to my position when first trade is about 100p in profit, up to 3 positions. If price falls to 137 I will start scaling out of positions.

Thanks trogger, I new it and I should have thought about it....it must be due to that definetly, and of course the 250, which is counting many past sunday bars, is showing the biggest difference.
So then I am assuming that a broker with Sunday bars is not the way to go. I remember now that even the daily Fozzy method is advising on not using brokers with Sunday bars, because it is screwing the system.
Ok, sorted out, thanks
Max

hi all,
i'm a newbie in forex. i've heard there will be a good news release for us economic data later today, can anybody give me a good strategy to trade news release? thank you in advance.

Hi,

what you've said is very interesting to me, if you can show me more that i can understand of what you mean by counting bars thanks

Ancient Chinese trader's proverb: "Top down analysis sometime lead to bottom up entry"

Everyone go ahead with your analysis. I'll post something on the usdcad in a day or two -- 'til then I'm gonna grab the fishin' pole and see if I can catch me a mess of them ole slab crappie fer a good old fashion fish fry.

I'll see all y'all later,
Dave

Hi DORELLINO

I`m on the Path , still in the background reading the threat.
Aa far as I kwow Strat is using sunday candles for trading. Should we use 300 sma on daily chart to give us the information of the 50sma on the weekly chart ? 6 days x 50 = 300
On my chart the 300sma daily looks like 50sma weekly , I have 6 daily bars per week.
My other question is: Do we use MA`s on close or hlc or lw ?


Wonna say hi to all traders on the Path of learning . Hi Strat and thanks a lot for this great opportiunity for study. I will take my time to read and understand . happy easter. carlo

Hi T ! I'm looking for a long arround 1.52(23.6 fibb+20 ema+retest of TL) My SL will be under the PA candle ,TL and 20 ema.My Tp is around 1.57(strong SR level+50 fibb+TL).My risk is never more than 2%.Thanks you all and I wish you and yours family a Happy Easter.

Hi Carlo (italian?), I'm as you on the path, and I really cannot help you much. I'm sure we use EMA & SMA on close. I think Strat or some of the experts should elaborate more on this issue. Seeing how the 250 plots differently in the 2 cases (with or without Sunday bars) it is of major importance, methinks.
Goodluck
Max

Most definitely. Thank you,

T

exactly what it says.....count the bars!
every bar on daily chart = 1 day
There are MT4 broker showing Sunday bar (first few hours of asian market) and there are MT4 broker which are not showing this. So then, one broker has 6 bars (smtwtf) per week and the other has only five (mtwtf).
This will change how a MA plots on the long run....it seems...
Max

Hello all,

Just to comment on USDCHF BaliuxXx and mstandifer.

USDCHF monthly is a downtrend with nice trendline not even close to being broken yet. Also 50 and 20 both pointing down with 20 below 50. Last month ended as bearish bar after hitting the high of previous month close to 1.0900 looking close to BEEB . Making it look now like the retracement is over and further to expect down action.

Weekly - looks like price is stuck in a triangle and will have to break out soon. 20 and 50 are converging, and price is desperately trying to break the weekly upper trendline but being rejected, wich made the monthly BEEB , this makes to me the significance of BEEB on monthly not so strong as I see as much buying pressure as selling pressure on weekly.

Daily - What hammer on 17th? I see there only a small doji bar or at best a bond hammer on my feed. But it was at the right place for longs.

If I was to trade this I would look for PA at upper trendline on the daily at around 1.065 to go short. As we have ant upper trendline and I have a SR zone around 1.065 as well, with hope that triangle breaks down with the direction of BEEB on monthly, with a target of lower trendline and SR zone at around 1.0150. To reach it first we would have to break SR zone at 1.045 wich is strong and makes me wonder if I want to play this or rather look elswhere for better looking opportunities.

I don't want to derail this thread, but I had to chime in here.

Your magnetic field analogy is interesting and at least partially correct.

But you assessment that it is our job to see and watch what it (price) does as it approaches, hits and stop/goes through is DEAD ON PERFECT.

From my perspective it is all about SEEING what you want to see WHERE you want to see it.

Let's back up for a minute and talk about the where. It is no secret that I use and prefer the term Supply/Demand Delta Zones. These zones are created by both specific WRBs and specific Long Shadows. These areas or zones can be thought of as S/R areas, however I believe Supply/Demand Delta Zones implies a better understanding of what has happened in the area of note. In other words, a S/D Delta area is an area where a key change in the supply/demand dynamic has occurred. This change may mean going from the bulls in charge (demand) to the bears in charge (Supply). It may be bulls in charge (buyers) to significantly more bulls (buyers) entering the market.

The question that must be answered is, "What does price do the next time it nears or enters this zone?".

There are a few things it can do: Assuming a zone where the supply/demand dynamic changed so that there was more supply than demand (more sellers than buyers).
1. The bears (sellers) can reassert their dominance as they did the first time and again drive prices down.
2. New bears who "missed" it the first time can enter en mass and swamp any level of demand pushing prices up.
3. Bulls (buyers) that caught the bottom or got in on the way back up to this level, can look to take profits (sell). This could add additional downside pressure.
4. New bulls (buyers/demand) may enter the market to add to the bears that are trying to get out at break even. This could push price up and through the zone.

There are a couple of other scenarios that can occur. But that doesn't matter to us. Because we can focus on all of them by only focusing on one thing: our entry signals. Our only concern need be the appearance of either a buy signal or a sell signal. I look for price action patterns, but others can look for RSI readings, MA cross overs or whatever.

Take a look at the chart below.

A Supply/Demand Delta Zone was created when one the inverted hammer noted on the chart. I do not want to get into a Japanese candlestick name argument as that can go on ad infinitum. From my perspective this inverted hammer line fails to traverse to a valid engulfing pattern even thought the next candle does indeed engulf it. But regardless, the long upper shadow qualifies this candle as a Long Shadow. The subsequent price action confirms it as a S/D Delta Zone. Let's look at the interval itself. The close is in the lower portion of the range and closing up from the previous candle, on increasing volume. If there was more buying than selling going on, then the close would not be so low in the range. Therefore, supply must be swamping demand to drive the close down. Plus, the next candle is down. This confirms that there was more supply (selling) than demand (buying) on the inverted hammer.

Okay, so we had a key change in the supply/demand dynamic. In this case we can't take advantage of that knowledge just yet. Our question is what will price action do as it nears, enters this area again? After a muted down to sideways down move, price nears the zone. From my perspective nothing of note here. Once price enters the zone, however, things change. A beautiful Doji Sandwich (a reversal signal) appears. I don't want to get into the pattern here as it may be too far off the thread topic. But l will draw your attention to the doji itself. Again, not a perfect doji as the close does not equal the open, but it is close enough for government work. Call it a PinBar Sandwich if need be. While the pattern does not need volume to confirm it, we see that the doji here comes on increasing volume. But the range is narrower than the previous candle. This is a squat, a sign that supply is swamping demand.

Now we are cooking with gas. We have seen what we want (doji sandwich), where we want to see it (within the Supply/Demand Delta Zone). No need to worry about wave counts, fib extensions, 4 different timeframes, diamonds changing colors, planetary cycles or whatever.

Price is attracted to Supply/Demand Delta Zones for a specific reason I will not mention here, but to think of them as magnets is correct.

http://i43.tinypic.com/291dipx.gif

Don't forget 1.5368, Worker 50, and BOSS 20. These are strong resistance. Remember Strat's guidance to trade from 1st daily support to 1st daily resistance, or vise versa depending on direction, rinse and repeat. I see better opportunity out there; consider broadening your watch list by a few pairs. Be sure to study up on your Fibonacci. Happy Easter,

T

I keep complaining that I can't post from home and it is still an issue, (writing a quick note from work on lunch is OK but I can't post charts). And though this is a real issue and the techs cant work out whats wrong, I think I have been scared, procrastinating. This is limiting my learning 100%. I am now trying to find a way around it by preparing my notes in email with links then attaching images through IMG tags to tinypic rather than uploading to the thread (something else I can't do) and am getting the codes from support now.


For Easter I want to share a recent story that hopefully avoids others from making the same mistake I did. I was given a private EA from a friend, backtests from 2001 to March showed only one small loss. I ran it Jan and Feb on demo and it made around 5%/month. Thinking to myself, "well I am studying now and not live trading, my account is just sitting there, why not put it on on live low risk and after several months of demo provided I am progressing and reach a profitable level I can move some funds out to my Strat manual trading account". It made 10% March, but late last week, right below 1.33, when I was at work, it started opening sells like mad, way beyond what backtests showed. It continued doing this up and up and by the time I caught it it was too late. In the end it decided to trade the other way and closed the longs but I had take it off my account by then. I lost more than half my (small but in the last year with hard work I made 50%) account. What was the main reason for my loss? GREED. I thought "Why not? I'll have more when I get to the live trading stage." I did not think about my potential loss first and foremost. And I thought I was understanding this thread. Does it really take it happening to oneself to learn? Can we not learn from the mistakes of others?

Not lurking, but talking a long hard look in the mirror right now and am committed to never making that same mistake twice. I will not let the demons trick me into thinking there is an easy way and will work harder to get up to speed and contribute here a.s.a.p.

Yours ashamedly and I will work harder and more carefully,

forexample

Hello strat my first post.
I am eager to learn about trading where I can put a trade on and walk away from it.
I have tried forex intraday but do not like it.
Any other type I do not have a clue but I am willing to learn.
Can u help.

Hi Guys,

My quick observation on EurGbp, see the chart attached. Area between 0.8800 and 0.8850 has served as S/R around ten times since the beginning of 2009.

This is really healthy pin


All the best ,
Cheers
Baniu