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Where can I learn more about Price Action like those in James16 charts? 9 replies

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james16 Chart Thread

  • #66,461
  • Jun 16, 2010 8:36am Jun 16, 2010 8:36am
Quoting ghous
Sheesh! that ain't true.

That went down like a poisonous arrow piercing my heart. lol

g.
Thank god it wasn't a silver bullet ghous - now that would be serious!
LOL.

But truly some of these smaller markets get cornered by a few, which is why forex is so open - it is too big to tamper with for more than a few minutes.
  • #66,462
  • Jun 16, 2010 8:46am Jun 16, 2010 8:46am
Hi Guys,

Here is a trade I took yesterday on the CADCHF where I was obviously itching to give my money away! This was a bad trade for a whole host of reasons that I blatantly missed because I was skimming through charts and it was late and I was tired. Well that's my excuse anyway and I'm hoping I can learn a little something on PBs in the process.

Way back in this thread it's mentioned that a bullish PB should ideally not have the bar after the PB take out the low of the bar preceding the PB. See chart for a clearer explanation. This does make sense if true as it's then showing strength in price. Also with a long entry above the highs of the PB it would also make sense for a stop to be below the lows of the bar following the PB. This would give you a tighter stop with better RR and any weakness in the setup and you'd be out quickly.

What are you thoughts on my thinking?

Thx
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  • #66,463
  • Jun 16, 2010 9:00am Jun 16, 2010 9:00am
Quoting Dan-FX
Hi Guys,

Here is a trade I took yesterday on the CADCHF where I was obviously itching to give my money away!...
Hey Dan

Your thoughts are fine in regards to where to stick your stop. You are basically saying if that intial retrace acn't hold(the right eye) then price will continue to fall or there is LESS to hold it up. Nothing wrong with that. As for the setup itself it was trading into HUGE amounts of traffic and thus needs to be managed tightly from the get-go. So your thought process is fine to do that to bar setups and analyze where you would want to cut out like that too. Of course you run the risk of price stopping you out with your tighter stop and then turning around before invalidating the setup. But every single way of trading a bar has advantages and disadvantages and you just have to exploit the advantages more then the disadvantages.

Best
Mike
  • #66,464
  • Jun 16, 2010 9:05am Jun 16, 2010 9:05am
Quoting mbqb11
Hey Dan

Your thoughts are fine in regards to where to stick your stop....
Thanks Mike. The eurusd has a very similar setup at the moment - A good rally and trend up in price, now at resistance with a BEOB followed by a PB.
  • #66,465
  • Jun 16, 2010 9:06am Jun 16, 2010 9:06am
Quoting Dan-FX
Hi Guys,

Here is a trade I took yesterday on the CADCHF where I was obviously itching to give my money away!...
Didn't know that. Now I learned something new thanks to you Dan. By the way the feed is different on my chart so I didn't see a PB. Here's my chart:

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  • #66,466
  • Jun 16, 2010 9:11am Jun 16, 2010 9:11am
Quoting fxeturn
Didn't know that. Now I learned something new thanks to you Dan. By the way the feed is different on my chart so I didn't see a PB. Here's my chart:

Attachment
Yes that's one thing I don't like about the 4hr timeframe, varying times for a new bar.
  • #66,467
  • Jun 16, 2010 9:19am Jun 16, 2010 9:19am
Quoting extraneo
beob on eur / usd chart 4h
sell [email protected] (still not taken)
what do you think?

EDIT: target 1.2160
bad trade....
  • #66,468
  • Jun 16, 2010 9:43am Jun 16, 2010 9:43am
Quoting extraneo
bad trade....
I took it from the 4hr chart aswell but got my stop to BE after price bounced of the TL and and PB on hourly. Stopped out flat.

Edit: We're still below the daily open and haven't had a down day for the last 6 days so may work out yet.
  • #66,469
  • Jun 16, 2010 10:07am Jun 16, 2010 10:07am
Thanks guys for the analysis of the silver trade. I knocked it on the head for a small loss before it got too bad.

I think I was 'expecting' it to just go up without really paying enough attention to the 18.65 PPZ (I'd drawn a pivot line there as well!) as well as ignoring the traffic to the left which I thought it would clear if it took off.

Think I'm overtrading after that DJIA trade yesterday as well. That's 2 lemons in a row for me this week. Time to sit back and wait... it's not easy but something time and experience will fix I'm sure
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Anything can happen.
  • #66,470
  • Jun 16, 2010 10:24am Jun 16, 2010 10:24am
Quoting Dan-FX
I took it from the 4hr chart aswell but got my stop to BE after price bounced of the TL and and PB on hourly. Stopped out flat.

Edit: We're still below the daily open and haven't had a down day for the last 6 days so may work out yet.

damn hurry...
edit: my sl is 1.2358
  • #66,471
  • Jun 16, 2010 10:30am Jun 16, 2010 10:30am
Hi gang what's up

Fiber's refusing to make some nice kaboom second time, I'm refusing to buy lol, that should mean the strength is not done yet. How high can she go... Anybody know?
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  • #66,472
  • Jun 16, 2010 10:39am Jun 16, 2010 10:39am
Quoting TraderDavo
I'm confused. Are you looking at very short term (as in, intraday volume) v. longterm?

The volume this week has painted a pretty clear divergence picture. actually, the volume since May 20th seems to paint a divergence picture on the SP. especially if it pops another 50 points.
I don't want to sound impolite, but volume hasn't painted anything the way I look at it. Let me repeat what I just said earlier - around 70% of the volume on US stock markets is generated by high frequency trading. These are trades that last anywhere from microseconds to seconds (google it if you want to know more, I don't want to pollute this thread with HFT). If you take a look at the volume that blasted the market off of its March lows, you would've sold thinking it was negative divergence. You also would've done that numerous times during the rest of 2009 and 2010. What I'm saying is that there is no point trying to figure out what the implications of day's volume are because more often than not, you'll be left wondering what went wrong. If 70% of the information has been rendered completely useless, what point is there in following it? I understand that volume is something that is taught all over the place, but from my personal experience I don't see that it has any significance when analyzing stock market indices. I do pay attention to volume on specific stocks, but I spend most of my time analyzing stock indices.
If you don't risk, you don't ever have to lose.
  • #66,473
  • Jun 16, 2010 10:47am Jun 16, 2010 10:47am
Like the location of this Pin Bar. Nice resistance and the left eye was rejected.

Here is why I took it:

+ Off PPZ
+ Nice Shape
+ Swing High
+ With Trend
+ Has Space to move


-- Danny
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  • #66,474
  • Jun 16, 2010 11:29am Jun 16, 2010 11:29am
Mike (anyone else please feel free to chip in),

I am trying to get better with the trendline breakout trades. Trendlines are tough, because they are more subjective than a PPZ and a small miss could get the line WAY off. But they are one more tool in our arsenal.

I have attached a chart of the EURUSD, and a breakout/retrace play I completely missed but now see in hind sight. I am basically just asking if my analysis is correct, and if this is a trade you would take...

The down diagonal line is based on a pretty shapre down trend on the daily chart. It is steep enough, it had to be broken sooner or later.

It appears to break, hit the PPZ of 1.2150, then bounce back down to test the trendline, and form an 8H pin.

This could have been the first play on the trade, IMO.

But my first arrow is the 4H bar that broke the 1.2150 PPZ. This could also be a trade. I believe this is sort of like the (breaking the high or breaking the low after a break out) you had mentioned earlier. So I believe this is another possible trade, even without Price Action.

Then the second arrow is a BUOB that formed at a great time of day, that almost reached the 1.2150 level. This appears to be a second entry.

I was scared out of trading these, due to the strong down trend of the EURUSD, and then over looking the trend line.

What are your (and other's) thoughts on these trades?

Thank you!

T.J.
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  • #66,475
  • Jun 16, 2010 11:32am Jun 16, 2010 11:32am
Quoting unlv_tj
Mike (anyone else please feel free to chip in),

I am trying to get better with the trendline breakout trades....
Hey TJ

Firstly about your trade yes it is valid. The break of the initial breakout, then pullback high is fine. I would not consider that second BUOB as tradeable but more so to help manage the initial trade.

As for me though I don't really use trendlines like that. I look for patterns. So if you have a CLEAR wedge pattern with trendlines that I will trade off. For me b/c trendlines can be so subjective I am looking for clear patterns(wedges, horizontal consolidation, flags, etc). But they must be clear and not curve fitted. Now I would say the same for trendlines too if you want to use them purely. Again the concept is still there of breakout and pullback.

Hope that helps
mike
  • #66,476
  • Jun 16, 2010 11:35am Jun 16, 2010 11:35am
Quoting mbqb11
Hey TJ

Firstly about your trade yes it is valid. The break of the initial breakout, then pullback high is fine. I would not consider that second BUOB as tradeable but more so to help manage the initial trade.

As for me though I don't really use trendlines like that. I look for patterns. So if you have a CLEAR wedge pattern with trendlines that I will trade off. For me b/c trendlines can be so subjective I am looking for clear patterns(wedges, horizontal consolidation, flags, etc). But they must be clear and not curve fitted. Now I would say...
That makes perfect sense. Rather than just a single trend line (which can be used, but is pretty advanced), you can keep it simple and look for the large patterns (which do involve trend lines to visualize).

Thank you Mike!
  • #66,477
  • Jun 16, 2010 11:42am Jun 16, 2010 11:42am
Quoting unlv_tj
That makes perfect sense. Rather than just a single trend line (which can be used, but is pretty advanced), you can keep it simple and look for the large patterns (which do involve trend lines to visualize).

Thank you Mike!
Yes exactly but a pattern to me pulls more weight(for my trading) then a single trendline which it is probably just an issue personally gives me too much leeway LOL
  • #66,478
  • Jun 16, 2010 11:43am Jun 16, 2010 11:43am
Regarding chart formations, Mike, what's your take on the AUDNZD daily flag that seems to be forming? It looks to be setting up for a break to the downside, but I like to get second opinions.
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  • #66,479
  • Jun 16, 2010 11:47am Jun 16, 2010 11:47am
Quoting manperm
Regarding chart formations, Mike, what's your take on the AUDNZD daily flag that seems to be forming? It looks to be setting up for a break to the downside, but I like to get second opinions.
Yep this is more along the lines of where my thinking goes. I drew up what I would like to see happen, but the only issue is this pair just stinks lol. Very choppy PA makes it difficult to get some nice PA often and you are left with a tough trade mgmt the way price moves more choppy then smooth. But never the less the concepts are still there but the aud/nzd is just a less favorable pair, like the aud/cad as well.

Mike
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  • #66,480
  • Jun 16, 2010 12:27pm Jun 16, 2010 12:27pm
I couldn't agree more, in terms of the choppiness, and appreciate you posting the chart with your forecasts, Mike. I've begun to notice that seeking price action on the daily, then finding entries on the 4 hour works very well. Thank you for your response.
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