The Dance

Hmmm tought I put it in one of the zip files. Nevertheless,,, here it is. Its a free tool I "found" that was created by "www.forextradingseminar.com.

I did not create it and you need to keep in mind, it's by NO means a "full fledged" business plan, but rather calcualtes when to increase lot sizes to maintain the level of risk in trading at a given rate or risk.

With that said, it's still better to set the "risk" and leave it alone for a week or two at least as the account grows, then only increase it about every two to four weeks. That way you get used to the increase mentally. Trying to increase the risk each trade can really cause problems.

You can change the "risk" and some other areas, but not all of them. Just play around with it. That's what I did.

But, have fun with it. Here it is.

I've been looking at Clay's method for the past week or so, having been attracted by descriptions of simplicity and the ability to work on fairly short time frames.

I've read the manual through thoroughly and set-up MT4 as instructed, but I'm finding the system anything but simple. A good number of the trades given as examples in the manual seem to run against the stated rules. For example, page 28 of the pdf manual has triple A trades circled, and one of them is a double bottom below the 35 SMA and 50 EMA, presumably the trade is to go long. Yet, rule 2 of entries on page 6 states I should only be going long when price is above the 50 EMA / 35 SMA and short when price is below those moving averages.

What am I missing?

By contrast, I've spent quite some time in the James16 thread, and while I wouldn't call his method simple, I have a very clear idea of what I'm looking for in an entry. I can't see to get to that stage with this method. Please don't take this as an insult, I'm just trying to illustrate that I can understand other methods and am not sure why I'm struggling with this one.

Touch trades should be taken in the direction of the trend, clearly an entry with a double bottom is not a trade with the trend but one based on price action & s/r There is more to this trading approach than just taking touch trades and trading with the trend. However what people tend to focus on most are the touch trades and yes these are always with the trend.

Hi Daneel,

I really appreciate the question my friend. Trading at it's simplest STILL requires a fair amount of discretion no matter what we do. So, with that in mind, let me answer the best I can first about the manual, second about the specific trade you talk about.

Don't know if you have ever written a manual, but I have written lots of them for software users and so on. When writing a manual, the two main issues are that it's not possible to address every possible question in advance. You need input from the users of the software to address things that the author of the manual either takes for granted now that he or she is used to the software, or to address things the author never encountered.

It's not possible to address every possible permutation of the things that happen in "live" systems. This latter is the reason for threaded discussion forums like this.

SO, please forgive the weakness of the author in my efforts to document everything. There is so much that can be documented!

NOW, on to the trade analysis.

(Clarification* I scrolled the charts back to that exact spot on all three charts so you can see clearly what I am talking about in the images below, whici I then captured from that spot in time.)

The trade in question only shows the M15 chart in the manual and part of the reason for that is that I was still trying to use only ONE chart at the time, which (as you read the thread) you will see I gave up on because there is so much info that the other two charts give you to work with.

D1 gives us a little clearer look at overall, longer term P/A against which to balance entry decisions. H1 does the same but narrows it down a bit, and about 90% of the time the actual entry signals DO come from M15, and mostly the DO co-ordinate with H1 and D1 pretty closely. BUT NOT ALWAYS! and that is the issue here.

M15's signal is "short" as far as "trend of the moment" BUT as you can see by my comments on the image below, D1 just finished a pretty strong "Touch" trade and this would be a "re-entry" BACK INTO THAT "touch trade" off D1, in addition, H1 agrees with D1 on a reversal here that seems pretty strong.

With ALL of that info against which to balance my discretion, on M15 we have a solid trade LONG and "counter" to the M15 "Trend of the moment." It also happens to be a "double bottom" but one that we could also anticipate in advance because of what I say on the charts below.

I hope this clears up your confusion. At some point in the future I will probably re-write the manual, but not any time real soon as my schedule is not as free as it was when I did the manual. And it took MONTHS to get the manual to where it currently is.

When I re-do the manual I will move all the files on page 1 to another post to keep them permanently available, but will always keep the most current versions either on or linked to from page 1 of this thread. I believe there is a link to a slightly newer version on page 1 now in fact which is on page #256 (http://www.forexfactory.com/showpost.php?p=3568994&postcount=256).

Again, good question. Hope this helps you and others to understand a bit better.

God bless,
Clay

Hi Eclayf,
Just want to say " Thank You " to you , I have learned forex for 1 years , tested many many system even robots but seem all them not working well....I'm learning to read price actions and candle stick and looking for strategy base on them . After reading your journeys before invented this strategy , I realize that this is what I'm looking for
I'm reading all documents and comments here ...Hope that I can understand it and practice it soon .
( Sorry I'm not good at English )
Good Trading !
Regards

No worries about the english Tuan. No one starts speaking it perfectly from the beginning, not even (perhaps not especially) those born to it. We all learn the same way, one word at a time.

Patience has it's rewards in life as well as in trading.

Welcome to the thread and God bless, and Good trading to you too.
Clay

Hi , I'm reading books of you , but I look on chart that I just setup and saw some signals that I could be profitable , so just trade it demo like a homework of "The Dance"
Sorry if I was wrong , just the first homework
After first trade using "The Dance" , I can see that although StopLoss placement is not much but it's really strong and hard to be touched with RoundNumber , MA ... Am I right ?
I'm happy to become member of FF family ^_^
Good trading
Regards !

Hi Tuan,

The "real reason" to take a trade like that is the "resistance" provided by the RN. I passed on that one because of the turned over 10 EMA, but it was an acceptable trade. The next key is the exit area, which you needed to watch really closely at the next RN.

Not bad for a first trade. You'll get better at it too.

God bless,
Clay

Tuan, there is one thing you need to learn pretty quickly. To post on this thread, you absolutely MUST learn to post smaller images and to post them DIRECTLY to the interface provided. When an image becomes too large it becomes extremely difficult for people to navigate the thread. SO, go back to page 1 and read the "how to post" rule there. Then come back and delete that over sized image. Either replace it with a properly sized one, or just delete it.

Doesn't matter which you do, but get rid of that over sized image tonight before that post becomes locked and uneditable or I'll have to ask to have the entire post removed.

Other than that issue, your posting was fine and we look forward to your participation and to helping you.

Be sure and visit Juneman's Chat Room too, lots of ppl there to help you.

God bless,
Clay

God bless,
Clay

By the way, here's my only trade tonight. Off to bed now,,, gotta get my sister in a few hours and need some sleep. Still +12 % isn't bad for one trade tonight. Up overall now +29% in the past week and a few days.

Enjoy

Good Morning Clay,

I just wanted, once again, to thank you for your words of wisdom. Since this reply I have been spending a little time on the simulator, despite not being able to get the orders working propertly, I have been noticing how much of an effect large wicks cause on PA.

I was infact just about to take this trade on the GU (short) but then noticed the wick, so now I will wait for further confirmation.

Without your reply I would now have already have been in this. Right or wrong, its certainly made me think more!

Regards

Lee

ps. On a side note, may I ask how many and which Og Mandino books you have read?

Glad it's helping you to stay out of the bad ones. Endroute once asked me "Can you sit on your hands all day long, looking for that ONE perfect signal? If you can, you have arrived, if you can't,,, you're gonna have problems."

Learning how to stay OUT of trades is ABSOLUTELY as important, maybe MORE so then learning how to take good trades.

As for the books, I've read most of them. Though they have a good solid "christian" bent, they are also extremely good for life in general. As for the "christian" thing, that's a whole 'nother conversation. If you interested in THAT conversation, P.M. me and we'll talk.

For any who want the answer, yes, I do "follow" Christ, but do NOT consider myself to be what most would normally call "christain." I am actually pretty weird to most "churchians."

OK,, 'nuff of that,,, it's for another time and another thread perhaps.

God bless,
clay

Hey again,

I was going to post this in my last post, but I see that you have replied already...... I guess you are pulling a late one!!!

This obviously turned into a great move and at the risk of sounding like I want to get in on every move, would there have been a way to take this trade by the rules or does it simply have to be put down as a missed one and to look for another entry further down the line?

Regards

Lee

personally i didn't took that trade. For me it was situation what i'd like to avoid.
On that almost doji candle, price stuck betwen ma's, there wasn't clear bounce from ma's. For me it wasn't "by the rules". To high risk, market is still very volatile

Yeah,,, that spinning top is a pretty clear signal that the "shorts" have ended for the most part. You could have taken a long based on Price Action "by the rules" and placed the SL at the bottom of the Spinning Top's sick -1 pip. Risk would have been pretty low, probably around 9 pips or so on M15, but the real "signal" here is the H1 10 EMA bounce and using M15 to fine tune it a bit is all.

Often you will see a "secondary" bar that fails to go past the primary bar and when that failure also agrees with the overall trend, you have the makings of a pretty good P/A based trade using the M15 50 ema (in this case) which is also an almost perfect match for the H1 10 EMA as the resistance level you trade against.

It takes a bit of experience, and seems "weird" the first few times you do it, but it's usually pretty solid, especially when the pips at risk are small like that was.

Couldn't sleep, so I thought I'd come back and read a bit then go to bed again.

God bless

Thanks again for the detailed reply. I AM getting lots from all your replies, and I know there is a ton to learn but i WILL stick with this, as I KNOW I can do it!

Not getting much sleep here this end either. The little one, 3.5 months now has just started to teeth, add that to some injections he had and an upset tummy..... and you see what I am coming from!

Lee

Hi Eclayf,
Sorry for lately editing , I just edited it to smaller size by attached them to my post , hope it's ok now . If it's still too big , tell me I will cut it again
Good trading ,
Regards

Hi,

I was wondering if an approaching MA will push price in a direction?

Take the chart below as an example. On the 15minte chart, where I have highlighted in yellow. you will see PA starting to struggle at the RN of 1.3.

What I am wondering is, when the 35sma gets to this RN and assuming the price is still around here, does it/can it (the MA) push price up?

or does it not work that way?

Regards

Lee

Many thanks for taking the time to respond to my question so thoroughly, it's much appreciated.

Took three trades at the same time, which I am not sure is a good thing or not. I was waiting for them to form, so I was happy to take them. Whether they are good trades or not is certainly up for discussion.

Please note that at the time of posting this I have already closed out the EU trade (the middle one) when it bounced off the 15min 35sma.

I was a little blind to the 15min 10ema reversal that seems to be in effect until the 35 was hit twice. I closed on the second hit.

Close:

Got stopped out on the GU (left) and the EJ (right)

GU: I can understand where I went wrong on the GU. I trade a doji at the top of a very large move! I think my faith in the magical RN 1.5 was a little to strong. To coin a phrase from another thread.... trade what you see, not what you expect!

EU: This was a nothing move, when I look back now, despite making a small profit (very small) there was nothing there 'to take'. Price closed on the 1hr 10, however it was rather flat by this point and the double low, I don't think was that strong either (I might be wrong on this point).

EJ: Now I see indecision here or rather two weak signals contradicting eachother. I see the 15min 10 holding price in with a 'scoop' signifying a short, but also six RN holds signifying a long. Should have stayed clear.

Lee

Clay, cant thank you enough for the work you’ve put into this thread, the supporting manual, updates and ebooks are very inspiring, I’ve read and reread the manual and updates, but am having trouble getting a handle on constrainment entries, am I looking for the break of bar or a pull back into the 10ema, as the entry technique following constrainment, I’m sure its not overly difficult but its just not clear to me at the moment.