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  • #11,821
  • Apr 29, 2010 9:30am Apr 29, 2010 9:30am
Good evening Strat!Today,you named 78.6 fib level and you call it a "critical" level.You said that the price find S at 78.6% so the price keeps the direction.So is 78.6% a maximum limit till where the price could retreace? Ex:up trend-price retreaces till 78.6% fib ,where is the last level where the price could make a HL,if the price goes through 78.6%,could reach 100%>no more HL>no more up trend.Could you please explain more?Thanks.
P.S. Sorry for my "lagging" english and black background. (igmal)

As far as I know (I am just a learner) prices can retrace upto 100%/161.80% and even 261.80% but the main thing is PASR which we should be following. I just wanted to give my view but Strat and other seniors are the best people to answer and don't worry about the background I am very close to you. (simpleman)

Before we get into Fibonacci, make sure you understand the difference between a Swing move (Impulse Wave) and a retracement (Corrective Wave). This is basic trading so if you don’t understand it, do your own research.

The Fibonacci Tool can be used for 2 things:

Measurement of retracement waves
Projection of Targets

Since I prefer to let the Market take me out of my positions, I am only interested in measuring retracement waves.

Again, Fibonacci is basic trading, if you don’t understand it, there is enough information on the web to educate you.

There are many different schools of thought on validity of % retraces so what you believe and understand is up to you.

Whatever levels you believe in, they are, to a certain extent, a self fulfilling prophecy. The more traders that use them, the better and more effective they work. The big boys use them though to what extent I really don’t know.

It has long been thought and promoted by the “experts” that the 61.8% retracement is the “critical” level.

Now it is very important to understand what is meant by “critical level”. My terminology is the “last chance saloon”; this is the absolute last level that it can be a retracement.

Whatever you use as your “critical level”, understand this and understand it well – after your critical level has been breached, it is NO LONGER a retracement. It is now a TREND in the opposite direction.

My critical level is 78.6% because 1), I have proven to myself that 78.6% is more valid and important and 2), the Godfather of Fibonacci, Larry Pesavento, uses it.

You can be sorry for posting a black background (next time post a white background), but not your English. I applaud those who communicate with us when your native language is something other than English.
15 YEARS OF PASR ON FOREX FACTORY!
  • #11,822
  • Apr 29, 2010 10:15am Apr 29, 2010 10:15am
Quoting sixx58
This is a very impressive and interesting thread you created here Strat!!!

One question though... for your daily charts - at what time of day do your bars open and close?

At Oanda for example the daily bars start at midnight EST (US) which is 6 a.m. in Europe (where I live) which means that a good part of the Asian session is already over. Wouldn't it be more reasonable to have daily bars start at a time between US close and Asia opening like 6 p.m. EST (US) for example?
One question though... for your daily charts - at what time of day do your bars open and close?

At Oanda for example the daily bars start at midnight EST (US) which is 6 a.m. in Europe (where I live) which means that a good part of the Asian session is already over. Wouldn't it be more reasonable to have daily bars start at a time between US close and Asia opening like 6 p.m. EST (US) for example?

Ordinarily, your post would have got my “both barrels” response because we have covered this subject many, many times in the thread but since the markets are pretty crap right now, I need something to do.

It is important to understand that because there is no Central Trading Exchange for Forex, it is traded all over the World at all points of the compass and at all times.

The Trading Week really starts with whichever financial institution makes the first trade West of the International Date Line. It is commonly accepted that the financial institutions in Auckland, New Zealand are the first up, followed by Sydney, then Tokyo and so on. This carries on NON STOP (24 hours per day) until the financial institutions and brokers in New York close their doors at 4pm on Friday.

No Forex trading takes place between 4pm EST Friday until Auckland, NZ fire up (whatever that time is in your time zone).

It is incorrectly stated on so many Forums and Threads that Forex closes each day at 5pm NY time. NY closes but NOT the rest of the Forex world.

For our daily trading, we need some reference point and, for our purposes (right or wrong), we are using 5pm NY time (4pm on Fridays) as the time to do our daily analysis.

As to when YOUR daily bar closes, that is dictated by YOUR broker. My new Daily candle prints at midnight NY time.

Everyone: Something to keep in the back of your mind

It is widely accepted that Asian Trading (Auckland, Sydney, Tokyo) is low volume and liquidity. Many traders look for the huge volume traders (London) to reverse Asian trading.

I strongly believe that Asian trading is having more of an impact on Forex as time goes by. I also believe that at some point in time, Asian Trading will become as much a powerhouse (maybe more?) in Forex as London and New York is.

My reasons are that The Sleeping Giant (China) is becoming ever more powerful particularly in financial circles.

There are already Forex financial institutions in Hong Kong, Beijing and Shanghai. Not forgetting that the Chinese Government is the LARGEST financial institution in the World owning all of the USA’s $11.4 TRILLION debt!

There is a very well respected Professional Trader here on FF who firmly believes the Chinese were behind the huge EURUSD and GBPUSD sell off during the Beijing Olympics in August 2008.

Ignore the Yellow Devil at your peril!
15 YEARS OF PASR ON FOREX FACTORY!
  • #11,823
  • Apr 29, 2010 11:07am Apr 29, 2010 11:07am
[quote=strat;3684003]One question though... for your daily charts - at what time of day do your bars open and close?

At Oanda for example the daily bars start at midnight EST (US) which is 6 a.m. in Europe (where I live) which means that a good part of the Asian session is already over. Wouldn't it be more reasonable to have daily bars start at a time between US close and Asia opening like 6 p.m. EST (US) for example?

Ordinarily, your post would have got my “both barrels” response because we have covered this subject many, many times in the thread but since the markets are pretty crap right now, I need something to do.


Normally agree with you Strat, but think I must be looking at a different market.

Fibre is great at the moment.

Boss/Big Boss and Worker all agree - keeps blasting through all S/R's - just like picking cherries.

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  • #11,824
  • Apr 29, 2010 11:08am Apr 29, 2010 11:08am
Quoting tmanbone
I believe 5 pm est. if I'm not mistaken. Be sure to take your time and read the whole thread, it will have been well worth the effort. The answers to your questions are contained within. Strat likes everyone to read the entire thread for getting their questions answered. He has a unique style of teaching and IMO is well worth the time invested. If Strat gets on to you because you didn't read and find the answers don't take it in a bad way, it's just his style and you'll come to appreciate him like the rest of us. You're at the right spot for learning...

Strat likes everyone to read the entire thread

Thanks Tom but UNDERSTANDING is FAR MORE IMPORTANT than just reading.

There are many that read and many more that flash read and finish no better off than where and when they started.

15 YEARS OF PASR ON FOREX FACTORY!
  • #11,825
  • Apr 29, 2010 11:14am Apr 29, 2010 11:14am
[quote=stewrigh;3684169]
Quoting strat
One question though... for your daily charts - at what time of day do your bars open and close?

At Oanda for example the daily bars start at midnight EST (US) which is 6 a.m. in Europe (where I live) which means that a good part of the Asian session is already over. Wouldn't it be more reasonable to have daily bars start at a time between US close and Asia opening like 6 p.m. EST (US) for example?

[font=Arial]Ordinarily,...
When I say "Market", I refer to the overall "Market" - there will always be isolated instances of pairs doing something different.
15 YEARS OF PASR ON FOREX FACTORY!
  • #11,826
  • Apr 29, 2010 11:23am Apr 29, 2010 11:23am
Quoting simpleman
Hi Frank,
Why not have two demo accounts one with EST and anothe GMT? till the time comfortable with any of them. I ahve one with FXCM US and another Alpari UK.
Cheers
Samad
thanks Samad
I will try Alpari UK
  • #11,827
  • Apr 29, 2010 11:40am Apr 29, 2010 11:40am
[quote=strat;3684190]
Quoting stewrigh

When I say "Market", I refer to the overall "Market" - there will always be isolated instances of pairs doing something different.

Yep but I only need one pair LOL .
  • #11,828
  • Apr 29, 2010 11:42am Apr 29, 2010 11:42am
Quoting PistolDave
Strat: I didn't consider the fib retrace on that swing you mention on the EURJPY....
I'm still focused on the worker chart so much that I am really not staying aware of the bigger picture like I should.

At least you know your short comings.

I know I need to do that, but recently I'm getting more oriented toward looking for swings on the worker and neglecting to really think about the Big Boss first. I'm struggling with that. I will overcome that problem with time. Possibly Strat, since you are more aware from experience that the big money is made by catching the big moves, you are confident in waiting for the swings and retraces to work themselves out and then get in for the long term trend. For me, (up to this point) I'm going for the little swings. The "base hits" so to speak. A little nibble here and there.

Taking a smaller swing within a bigger swing in the same direction - Nothing wrong with that Dave.

That may be just an excuse to avoid the self-discipline and patience that required to sit on the sideline and wait until everything lines up. But I am getting better at it all the time, and I have needed some small successes to give me confidence and faith in the system, which I am getting. Experience and some success along the way is improving my confidence in the system so it is getting a little easier to sit tight as time goes by, but it is still a struggle.

Remembering your losses and stress on where you were before PASR also helps. Don’t forget that these crappy times are a TEST of everyone’s patience. Also remember the “calm before the storm”.

One of the main difficulties I have is waiting for the move to play itself out and either prove me right or wrong. Sometimes, after you enter, it can take days for price to finally make its move to the target and in the meantime the market seems to do everything possible to shake you out, scare you, or convince you that you have made the wrong decision. Then just when you change your plan and say to hell with it and throw in the towel the market skyrockets right up to tag the price you knew it would -- and there you are crying in your beer about the lost opportunity. But I am getting better at waiting and having faith in PASR all the time so this is happening less now. That is major progress for me. I still change my original plan sometimes, but not as often as in the beginning, and I am using good risk management which I never violate.

If you are having to change your PLAN in mid trade it means your PLAN was wrong in the first place.

I cannot over emphasise the importance of a correctly thought out structured PLAN. If you can identify the area in your PLAN which you change then give it TOP PRIORITY the next time you make a PLAN.

At the level I'm at presently, I am only focused on finding high-probability setups using PASR and trading from one SR level to the next, just as you have taught us. I try to go with the worker trend as much as I can but I'm still taking some countertrend setups too. But I am getting away from the countertrend as much as possible.

Counter trend trading comes with practice but mainly experience. You CANNOT do it profitably UNTIL you can trade profitably and consistently WITH the trend.

Trading WITH the trend provides us with a “cushion” if and when we screw up with our trade decision making.

Screw up in counter trend trading and you can kiss your ass “goodbye”!

At some point I want to be able to trend trade, but as you said in the beginning, it is much more difficult. I can see that now. For the time being I will keep learning the basics and getting prepared for the big moves that are sure to come.

Trend trading is always “easy” looking back in history. In REAL TIME, it is a bitch! Many times I get screwed trying to latch onto a trend that isn’t there BUT when I do………………(thank you EURAUD, EURCAD, GBPAUD and GBPCAD).

Keep doing basic PASR and over time, as you gain your consistent profits and experience, it will get easier.

So far I am very satisfied with the way things are going. Considering that the market conditions have not been all that easy for a beginner like myself to trade over the last few months I still have been able to increase my account equity to slightly over 10% in the last six weeks.

That’s damn good by anyone’s standards, Dave. Very well done!

That may be small by comparison to some of the heavy hitters but I am excited by it. I have never risked more than 2% on any one trade and therefore have not been stressed about blowing out my account. Best of all, I am gaining the experience and confidence that comes from learning how to trade in a way that I can count on to continue to produce the income I need to reach my goals.

This is VERY IMPORTANT – whatever you do, do NOT put pressure (stress) on yourself to reach those goals whether in terms of time or in $.

Excuse me for going on so long here but I wanted to let everyone know some of the difficulties I have had -- and that if you stick with it you will overcome your own obstacles and be very thankful you did.

Again, this is VERY IMPORTANT – we will be doing much more performance measuring as we move forward with new developments.

Thanks Dave, well done and Keep The Faith!
15 YEARS OF PASR ON FOREX FACTORY!
  • #11,829
  • Apr 29, 2010 12:15pm Apr 29, 2010 12:15pm

Strat likes everyone to read the entire thread



Thanks Tom but UNDERSTANDING is FAR MORE IMPORTANT than just reading.




There are many that read and many more that flash read and finish no better off than where and when they started.





I'm guilty at times of flash reading....sometimes but, if the thread is a winner like this one, I always take time to gain a full understanding

  • #11,830
  • Apr 29, 2010 1:01pm Apr 29, 2010 1:01pm
Quoting strat
Good evening Strat!Today,you named 78.6 fib level and you call it a "critical" level.You said that the price find S at 78.6% so the price keeps the direction.So is 78.6% a maximum limit till where the price could retreace? Ex:up trend-price retreaces till 78.6% fib ,where is the last level where the price could make a HL,if the price goes through 78.6%,could reach 100%>no more HL>no more up trend.Could you please explain more?Thanks.
P.S. Sorry for my "lagging" english and black background. (igmal)...

Hi strat,

I just came in your thread and this is some serious learning stuff.

I am gonna read as much as possible, also i wanna say i use fib also many but i am still learning still demoing.

I have a problem with oil i like the volatilty so much when i started trading i was mainly trying to beat the oil market.

Of course 2 times blowed my account first time was bit gambling had no sentense of the market, just doing somethings.

The funny part was i made a 100 euro acount to 720 in 1 week off course i didnt know anything.

Only 1 thing buy the rumours sell the facts so thats what i did everbody saying another peak oil is comming etc.

My mailbox was full with this shit, but it worked out of course it was luck and i had no experience technical etc.
So my moneymanagement was bad and i blowed it all verry fast.

So thats how i met the markets the second time i opened a account and i was lazy and also didnt know enough of the markets so what i did was news trading i dont think i need to say more.

That account i off course blowed both accounts where not big but after that and till now i am demo trading reading studying etc.

What my point is i saw oil reacts many times close to the 76,4 % fib so maybe this 78,6 is even better.

Wanna say thanks for helping others you like a good man.

Gonna study it this comming months and when i have a question hope you can reply it.

Thanks

Strat!!
  • #11,831
  • Apr 29, 2010 2:37pm Apr 29, 2010 2:37pm
The Trend ran for roughly 5 years on this chart from approximatley 155 to 79
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Annoying Precision
  • #11,832
  • Apr 29, 2010 3:06pm Apr 29, 2010 3:06pm
Quoting erikte279
The Trend ran for roughly 5 years on this chart from approximatley 155 to 79
What about this one?
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Spinner 'Tis in the Waiting.....
  • #11,833
  • Edited 3:22pm Apr 29, 2010 3:08pm | Edited 3:22pm
This trend ran from roughly 102 to 145 over a 3 year period.
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Annoying Precision
  • #11,834
  • Apr 29, 2010 3:19pm Apr 29, 2010 3:19pm
So basically what I gather from STRAT and everyone is we should try to get a few good entries and trade for the Long Term??? Wow Dude, what a Good Idea!!
Annoying Precision
  • #11,835
  • Edited 5:45pm Apr 29, 2010 5:18pm | Edited 5:45pm
Quoting erikte279
So basically what I gather from STRAT and everyone is we should try to get a few good entries and trade for the Long Term??? Wow Dude, what a Good Idea!!
I believe what Strat is trying to teach us is to look for trades that you can get into, stress free, and ride until the riding is done, checking in for trade management once a day and going on with the finer things in life. I would bet my trading account Strat has been in the EUR/CAD since late Nov last year, smiling all the way to the bank, while a lot of us have been fighting the daily/weekly ups and downs of pairs with no real direction, looking for a small handful of pips and missing the real money making trades, the serious % return savings account building type trades that don't need much tampering with. Dr. Joe comes to mind, no wonder Strat admires Dr. Joe so much. I would venture to say that Alexandra and a few other more experienced traders that frequent this thread think and trade in the same manner. So I need to back up on my previous post about just reading the thread, as Strat has noted reading without understanding is futile. On a lighter note give me a S....., S, give me a T....., T, you get my drift. What can I say, thanks Strat for your continued patience with us, you are getting through. Cheers all,
Attached Image (click to enlarge)
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T
  • #11,836
  • Apr 29, 2010 5:32pm Apr 29, 2010 5:32pm
Yeah I know It was a joke . I bet Strat will tell you that he didnt know that trend was going to turn into what it did before it did. I bet he simply traded according to his method and it has turned out nicely because he held onto his trades, nobody can predict the future.

Quoting tmanbone
I believe what Strat is trying to teach us is to look for trades that you can get into, stress free, and ride until the riding is done, checking in for trade management once a day and going on with the finer things in life. I would bet my trading account Strat has been in the EUR/CAD since late Nov last year, smiling all the way to the bank, while a lot of us have been fighting the daily/weekly ups and downs of pairs with no real direction, looking for a small handful of pips and missing the real money making trades, the serious % return savings...
Annoying Precision
  • #11,837
  • Apr 29, 2010 7:16pm Apr 29, 2010 7:16pm
Quoting erikte279
Yeah I know It was a joke . I bet Strat will tell you that he didnt know that trend was going to turn into what it did before it did. I bet he simply traded according to his method and it has turned out nicely because he held onto his trades, nobody can predict the future.

Surely you didn't just throw a stick in my spokes, after all this study and finally thinking I had it all figured out, you've come along and gave me another hurdle to jump, another thought to ponder. Looks like it's back to the grindstone for me. I quoted your post because it provoked my thought process. Your smilies gave you away. Cheers to all,
T
  • #11,838
  • Apr 29, 2010 8:40pm Apr 29, 2010 8:40pm
Quoting tmanbone
Surely you didn't just throw a stick in my spokes, after all this study and finally thinking I had it all figured out, you've come along and gave me another hurdle to jump, another thought to ponder. Looks like it's back to the grindstone for me. I quoted your post because it provoked my thought process. Your smilies gave you away. Cheers to all,

No discouragement necessary. You are correct: You listen, You are humble. You will succeed. No mantra needed. Just keep learning to spot those monthly turns...no need to rush into them, just time them after they occur. When everyone else sees them, then exit.
  • #11,839
  • Apr 29, 2010 9:02pm Apr 29, 2010 9:02pm
At least at the moment, it's good to be down under.
  • #11,840
  • Apr 29, 2010 9:04pm Apr 29, 2010 9:04pm
Strat, I appreciate the comments.
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