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  • #11,861
  • May 2, 2010 9:34am May 2, 2010 9:34am
Hey guys,
Here is a questions aimed at the big 4 (Strat, Alexandra, Elite Jets and Blackeagle) concerning dojis.

This last month produced some monthly/weekly high wave, spinning top, hammer and shooting star formations which depending on their position may or may not offer trading opportunities.

My limited understanding on this topic from reading previous posts is that these can indicate range or breakout/retest opportunities on the controlling monthly or weekly candles and that daily price can zip along within the range of the controlling candle for months until the extremes are breached and direction is established.

In short, I know there will not be a one size fits all solution but are there other standard strategies any of you follow when dealing with these candles other than looking for small PA candles at the extremes? Can we look to the OHLC of say a highwave formation as possible support and resistance areas to trade off of along with the static S&R on our charts?

Please don’t take this as a lack of trading discipline, I’m in no hurry to trade dangerous areas, I’ve just noticed that lots of big moves come off those monthly formations and would like to know how the professionals take advantage of these areas. If this is too advanced of a topic to be discussed at this time that’s OK too. Thanks for all your help.

Cheers.

John
Finally out of the shadows.
  • #11,862
  • May 2, 2010 9:54am May 2, 2010 9:54am
Quoting gaf
Hey guys,...
A very favourite trade of mine is to mark the 50% retrace of those weekly candles and wait for price action there. If you follow Strat's practice of taking some profit off to keep the little people happy (which I do) then you won't lose your shirt doing this. Your target then is a break of the weekly high or low which is another place you can add to your position (if you want). If you don't get price action there then look to the 61.8 fib retrace.
That's how I trade the weekly ones.
I don't trade the monthly candles but I look at them for direction and I do mark the monthly high/lows for breaks.
  • #11,863
  • May 2, 2010 10:03am May 2, 2010 10:03am
Quoting stewrigh
Not sure this fits with Strats teachings but I'm watching this ATM.

Boss and Big Boss are at the 50 fib - almost.

Nice SS at triple top on worker.

Bit early maybe but worth watching IMHO - As Strat would say tho be patient.

Attachment
This is a counter-trend trade and not for those at the beginning of the path. There is support at 67.00 which needs to break but I think that the support at 64.50 or 65 is more likely where it will go.

What is interesting to me is the last swing up was in three almost equi-distant swings which is also known as a "three drives pattern". This could mean back to the bottom of the range, where those trading with the trend get to buy.
  • #11,864
  • May 2, 2010 10:52am May 2, 2010 10:52am
Quoting elitejets
This is a counter-trend trade and not for those at the beginning of the path. There is support at 67.00 which needs to break but I think that the support at 64.50 or 65 is more likely where it will go.

What is interesting to me is the last swing up was in three almost equi-distant swings which is also known as a "three drives pattern". This could mean back to the bottom of the range, where those trading with the trend get to buy.
Thanks,

Thought it was a bit off topic - but I still like the look of it.

If it gets up to 70 I'll be even more interested.
  • #11,865
  • May 2, 2010 12:08pm May 2, 2010 12:08pm
Quoting stewrigh
Sorry to be picky - but what the hell is the USUK pair.

If you mean GBPUSD why don't you say that.
I was trying to make a joke. The United States (US) + United Kingdom (UK) = USUK or You Suck. I apologize for the confusion.
"Don't trade to trade . . . trade to win." - James16
  • #11,866
  • May 2, 2010 12:15pm May 2, 2010 12:15pm
Quoting Flem26
I was trying to make a joke. The United States (US) + United Kingdom (UK) = USUK or You Suck. I apologize for the confusion.
No need to apologise - just me being dense.
  • #11,867
  • May 2, 2010 1:06pm May 2, 2010 1:06pm
Would anyone care to comment on what is going on with the EUR/CAD. On the worker price has managed to stay below the longer term decending trend line until recently. Now that there is a trend line break I'm in a state of confusion. Being new to trading FX I don't know how to take the recent price action. What does it mean to the novice? All input would be appreciated. Thanks,
Attached Image (click to enlarge)
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T
  • #11,868
  • May 2, 2010 2:16pm May 2, 2010 2:16pm
Quoting tmanbone
Would anyone care to comment on what is going on with the EUR/CAD. On the worker price has managed to stay below the longer term decending trend line until recently. Now that there is a trend line break I'm in a state of confusion. Being new to trading FX I don't know how to take the recent price action. What does it mean to the novice? All input would be appreciated. Thanks,
Eventually trendlines do break. Price retraces. If you open your Big Boss and Boss you will notice price reached a historical support. Also on your daily worker you have had several rejections of the low. This price action in the daily shows us a solid support and a warning of a possible reversal. Use horizontal support lines as explain in the first posts. Most of your support and resistance are horizontal levels. A trendline is more of a timeline guide of where reverals or continuation could possibly happen. You need to start at page one of the tread and learn how to draw support and resistance lines. One more note 2500 pip run is huge bound to retrace at some point. Also EU/Greek bailout this weekend. Eu rose on friday on pairs.
  • #11,869
  • May 2, 2010 2:18pm May 2, 2010 2:18pm
Quoting tmanbone
Would anyone care to comment on what is going on with the EUR/CAD. On the worker price has managed to stay below the longer term decending trend line until recently. Now that there is a trend line break I'm in a state of confusion. Being new to trading FX I don't know how to take the recent price action. What does it mean to the novice? All input would be appreciated. Thanks,
Now draw this line touching the earlier higher highs that you ignored?? Break of this trendline will mean nothing but Euro strengthing over CAD. WHich is very unlikely to happen these days.
  • #11,870
  • May 2, 2010 2:37pm May 2, 2010 2:37pm
Quoting tmanbone
Would anyone care to comment on what is going on with the EUR/CAD. On the worker price has managed to stay below the longer term decending trend line until recently. Now that there is a trend line break I'm in a state of confusion. Being new to trading FX I don't know how to take the recent price action. What does it mean to the novice? All input would be appreciated. Thanks,
Here is an example of support and resistance on monthly. Go to start of thread and read on how to continue with the weekly and daily. Hope this helps.
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  • #11,871
  • May 2, 2010 2:48pm May 2, 2010 2:48pm
Quoting tmanbone
Would anyone care to comment on what is going on with the EUR/CAD. On the worker price has managed to stay below the longer term decending trend line until recently. Now that there is a trend line break I'm in a state of confusion. Being new to trading FX I don't know how to take the recent price action. What does it mean to the novice? All input would be appreciated. Thanks,
The way you have posted the chart looks like the old trendline break and retest, that only may indicate a pause, not necessarily a reversal. I might suggest a look a the higher time frames. It's not quite a coincidence that price is making a stop here is it? Price has stopped in that 1.3559 area four time previously in the last nine years and spiked to 1.3297 once before (nov 07). With the mas so far away in both the weekly and the monthly, the rubber band effect is present, IMHO.

The way we're studying PASR, I think trading countertrend should be off (that BUOB (almost) on the daily IS tempting ). So the thing is, waiting for a place to short again. Maybe that 1.3800 area, aiming for a retest of the bottom... whilst we wait to see if the pair does new HH,HL, etc.

So, Rubber Band or Trend, that is the question (or look at some other pairs that have safer setups....) and patience is the key according to Jessie Livermore.
Attached Image(s) (click to enlarge)
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Spinner 'Tis in the Waiting.....
  • #11,872
  • May 2, 2010 3:04pm May 2, 2010 3:04pm
Quoting tmanbone
Would anyone care to comment on what is going on with the EUR/CAD. On the worker price has managed to stay below the longer term decending trend line until recently. Now that there is a trend line break I'm in a state of confusion. Being new to trading FX I don't know how to take the recent price action. What does it mean to the novice? All input would be appreciated. Thanks,
I do care but take it as student sharing notes. Let price proves itself stop going down first and starts going up by making HH and HL. Every time price takes out supports and goes lower, it is setting up the stages for us to look for PASR later. I think if price stops going down, it will go in ranging first. If we truth want stree free trade, we have wait for the Boss establishes the trend first and Worker for PASR.
Attached Image (click to enlarge)
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  • #11,873
  • Edited 3:11pm May 2, 2010 3:08pm | Edited 3:11pm
Hi All,

Could anyone help me if it is OK to go short on Friday shooting star at resistance on NZDUSD? I demo trade.

Thanks
  • #11,874
  • May 2, 2010 4:23pm May 2, 2010 4:23pm
Quoting simpleman
Hi All,

Could anyone help me if it is OK to go short on Friday shooting star at resistance on NZDUSD? I demo trade.

Thanks
For me that is a risky trade for reasons outlined in my weekly analysis but see what the other more experienced traders have to say about it. Cheers.

John
Finally out of the shadows.
  • #11,875
  • May 2, 2010 4:24pm May 2, 2010 4:24pm
Quoting simpleman
Hi All,

Could anyone help me if it is OK to go short on Friday shooting star at resistance on NZDUSD? I demo trade.

Thanks
What are the Big Boss and Boss telling you?

Where are your Support and Resistance Lines?
  • #11,876
  • May 2, 2010 4:26pm May 2, 2010 4:26pm
Quoting elitejets
A very favourite trade of mine is to mark the 50% retrace of those weekly candles and wait for price action there....
Awesome! Thanks for your reply Elite. I'm often afraid to ask questions in case it is something I should already know. Cheers.

John
Finally out of the shadows.
  • #11,877
  • Edited 6:05pm May 2, 2010 5:19pm | Edited 6:05pm
Quoting Spinner
The way you have posted the chart looks like the old trend line break and retest, that only may indicate a pause, not necessarily a reversal. I might suggest a look a the higher time frames. It's not quite a coincidence that price is making a stop here is it? Price has stopped in that 1.3559 area four time previously in the last nine years and spiked to 1.3297 once before (nov 07). With the mas so far away in both the weekly and the monthly, the rubber band effect is present, IMHO.

The way we're studying PASR, I think trading counter trend should...

Thanks for everyone's replies, I can clearly see that I'm not zoomed out enough and I'm paying way to much attention to diagonal trend lines rather that horizontal S/R. Cheers all,
T
  • #11,878
  • Edited 9:34pm May 2, 2010 6:02pm | Edited 9:34pm
Hello


A polite request for advice/opinions:

Indeed Alexandra, many readers I am sure will be following along and may be concerned as to where we draw the "line in the sand (or dung as Flem prefers)".

I note your final comment:At this point, 93 is a nice (though stingy) protective zone for my positioning...

Those of us still struggling with our "gremlins" look at the charts and think
there is nothing in the Boss or Big Boss to suggest a short (and the "gremlins" say "sure, sure, ..but it's moved a long way since November .. better take it now!!")

If we use price action on the daily, would the correct approach be to place a stop under the low of the 27 april bar (92.80 on my charts)?

But how far under and do we get taken out on a spike just under 92.80 or do we hold out to see if it closes under 92.80?

And then again what about the doji on 13 April, low of 92.56? May be set our stop under that... its just a few more pips...?

Or maybe we say " hey, isn't 19 April an unconfirmed HL at 91.58 - do we make this our "Hard-stop" and then wait for price action at that level to decide on our next move?"

As you can tell the gremlins are a-coming to get me.. (and I can sense a strat-bashing coming my way!)

cheers

Quoting Alexandra
That makes a market....all the way from 86.

I'd have more faith in that opinion if it were based a bit more on the chart as well as the view on rates, i.e why is the monthly TL wrong? why are the weekly and monthly patterns inaccurate? The daily point is acceptable. There is reasonable debate about the implications of the daily chart, but I do not see it as coorrdinating with either the medium term or fundamental view. If that formation occured at 100, I might be ready to sell. Perhaps you will be correct and the daily will develop into more than...
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  • #11,879
  • May 2, 2010 6:06pm May 2, 2010 6:06pm
Now that there is a trend line break I'm in a state of confusion. Being new to trading FX I don't know how to take the recent price action. What does it mean to the novice? All input would be appreciated. Thanks,[/quote]

------------------------------------------------------------------------------------
Hello T,
Perhaps you are drawing a DSRI line, which I think Strat has embargoed so far for beginners on the “Path” like you and I, at this stage.

Attached is my chart with a long term trend line (my understanding).
Attached Image (click to enlarge)
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"Make everything as simple as possible, but not simpler" Albert Einstein
  • #11,880
  • Edited 8:31pm May 2, 2010 7:55pm | Edited 8:31pm
Quoting Brb-Fraudin
Now draw this line touching the earlier higher highs that you ignored?? Break of this trendline will mean nothing but Euro strengthing over CAD. WHich is very unlikely to happen these days.

The TL drawn is actually quite astute. T, that is obviously not a Strat-certified trade, but is is a retest of a broken trendline at major support. No one probably remembers, but when the Loonie sold off the chart was similar, but in reverse. Reading beyond the candle, this is a high risk Alexandra certified long, in the midst of negative tone, as embodied by the quoted post. That said, there are better (safer) trades on the board more in keeping with the object of the thread. The problem wih these trades often is that stop management is difficult. There often are additional re-tests that may be captured later by the W/M analysis a bit more than this one currently. A long here is incorporating more S/R than M/W pattern, but it is not necessarily foolhardy. It may prove quite rewarding, though stressful.
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