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Higher low, lower high system

  • #1,581
  • Jun 29, 2010 8:10am Jun 29, 2010 8:10am
Quoting tdeu
Hi,

sorry for the confusion.

not according to Vantage's system was only meant for this part of the message: 1st entry LONG would be the PA at the low / 2nd entry LONG is the first HL (8:50 candle)

your entry was good - but I would have entered SHORT, when the low of the 8:50 candle broke (4 pips higher)
this was at 9:05 (this bar too had a nice bearish momentum)

you increase the success rate of your trades a lot, if you enter at places, where other traders are forced to give up their positions

cheers

thomas
sorry I understand now I have never thought of it like that before so when shorts are coming in to that trade longs will also be exiting? have i got that right ill post a chart showing what I think you mean and can you tell me if I'm right please.
Entering short below the HL which may have got people into longs would have given me a 3 or 4pip better enrty?
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  • #1,582
  • Edited 8:30am Jun 29, 2010 8:12am | Edited 8:30am
Quoting reflex
Hi V watched both your trades go couldn't click the button for some reason having a nervous day! just did this one out +2 when it pulled back up through yesterdays low didn't want to take a loss on it really. bearish 15min and hourly.
Tough luck that it never followed through but any entry that gives you chance to win ie you can get stop to BE and have risk free chance is good in my book. Some will go some won't.

Late replying a friend of mine came over for coffee (his employers parking is being used for world cup park and ride service and they want everyone out) and ended up staying almost 3 hours.
  • #1,583
  • Jun 29, 2010 8:14am Jun 29, 2010 8:14am
Quoting Vantage
1st trade of day push up to 5100 where price had stalled previously, 5 min inside candle, 1 min lh see trade 3 1st post. +18 out.
Hi Van,
Thanks for showing what u mean. Indeed London headed ~100pip south after. I wander the fake-out is due to taking out the limit orders or something else...
  • #1,584
  • Jun 29, 2010 8:15am Jun 29, 2010 8:15am
Quoting tdeu
was 10:28 the setup bar?
10.24 1 min lh co-incided with close of 5 min inside candle.
  • #1,585
  • Edited 8:31am Jun 29, 2010 8:29am | Edited 8:31am
Quoting lefteye
Hi Van,
Thanks for showing what u mean. Indeed London headed ~100pip south after. I wander the fake-out is due to taking out the limit orders or something else...
I'm not even going to guess, there are some good traders around that avoid London open altogether fully expecting the fake out moves. There are guys like Islander that trade these ranges successfully. I don't know what happened this month but I think clashes of style got Mrs V and I in a spin month when a poor start brought some issues to a head.

Have a look at Medici and Islander's trading the European open. My trade 3 on post 1 is based on that and the simple fact that Euro/London opens are famous for fake outs and +-50 pip moves. Sometimes the levels are really clear eg yesterday (was a better example than today which wasn't bad).

Finally Mrs V and I are thinking same, 7-9 gmt if we get reversal candles at right area once range done etc etc we will take trade lookng for around 20 pips. After that we'll hope to be in the bigger run for the days where the bigger moves do happen we'll get a decent portion and yes some days we'll have +20 go to BE.
  • #1,586
  • Edited 9:08am Jun 29, 2010 8:43am | Edited 9:08am
I got this pm and if OK will answer here.

Do you know the book "Reading Price Charts Bar by Bar" written by Al Brooks?

If not google for the pdf and have a look. This fits your method perfect.

This guy is trading 5min charts with only one EMA on the charts.

It's the best book about PA I came across yet.

I'm reading it atm and it improved my trading considerably.

One major snippet is:

"Trends, no matter how small, must first break a trendline from the
prior trend or trading range and then have trending swings (such as a series
of Higher Highs and Lows in a bull). Absent either of these, there is no
trend. The best risk reward ratio occurs when you enter on the First Pullback
after a trendline break, before there is a clearly established trend. As a possible trend day is unfolding, traders should look for signs of strength,
each of which increases the odds that the trend will continue.
The trend continues until after it breaks its trendline, and then it continues
some more. You should not be trading countertrend until the market
has enough strength to break the trendline. However, even then, you
should not be entering countertrend until the market first goes back to test
the extreme of the trend. This means that even after a trendline break, you
should still be looking for With Trend trades because there should be a test
of the old extreme. Sometimes there is so much strength on the trendline
break that there should not be much of a test of the trend extreme, but this
is the exception and not the rule."

Cheers

Thanks for this I'll defintely have a look for the book.

You have hit the nail on the head (well partly). There were 2 reasons I took to this method, firstly I liked the idea of hl/lh 1 2 3 tops/bottoms especially after a good trader said to me first retracement is the best trade. I couldn't get that idea out of my mind.

Then the other development. I was trading tl breaks on higher charts with the usual indi confirmation/divergence etc. Sometimes doing well and sometimes not. Seeing pa come back to test a tl and liking the above point that really fixated me on hl/lh. What are hl/lh's after all, so often just a tl break, test and the tl holding to see the hl/lh complete.

So basically if you believe that tl breaks and tests are frequent events you shoud like hl/lh trades.
  • #1,587
  • Jun 29, 2010 8:58am Jun 29, 2010 8:58am
you're right, but shorts came in already above the candle, that setup the long and drove prices down again before even long scalpers could take their profit

the profit for a scalp long from that setup was only 7.4 pips, take away 2 pips spread and a stop buy of 0.5 pips above the candle you're down to 4.9 pips

so it was likely, that even people who scalp 5 pips were stopped with their full position, when the low of that candle broke

Quoting reflex
sorry I understand now I have never thought of it like that before so when shorts are coming in to that trade longs will also be exiting? have i got that right ill post a chart showing what I think you mean and can you tell me if I'm right please.
Entering short below the HL which may have got people into longs would have given me a 3 or 4pip better enrty?
  • #1,588
  • Jun 29, 2010 8:59am Jun 29, 2010 8:59am
Good morning,

Got up for NY just in time to get short on EU. Had a quasi hammer on hour and a strong close on m15. I took +7 as it was heading into support.
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  • #1,589
  • Jun 29, 2010 9:00am Jun 29, 2010 9:00am
Quoting Vantage
Thanks for this I'll defintely have a look for the book.
This is the link for the publishers website. There are 3 pdf excerpts, and a zip file of all the charts referred to. It is also for sale at Amazon.
  • #1,590
  • Jun 29, 2010 9:05am Jun 29, 2010 9:05am
Got this pm and will again answer here.

I am lurking around a little while.I've read only few pages as I don't have much time at the moment,but I like your system it is look interesting..I have question I am not sure If I understant properly.Basically first we look at 1 hr,then 15min and than entry at 5 min.Example if I see at 1 hr say bearish pin bar I scroll to 15 min,which I should see say bearish indication like bearish pin bar Outside bearish bar,then scroll to 5 min and I should enter after lh or some bearish indication?What about if they don't line up these 3 TF?So reason is enter at discount price with very tight SL and confirmation from higher TF than,which direction market go?
Ps.I relly don't want be rude as I didn't read much from your thread and now I try get key answear your system.Only if u can confirm if I can see that picture how really that system work.
After all Enlish is not my mother language so if some sentences are not very polite I apologize in advance.
Anyway thank u for this thread and time you post here .I think this is very good learning material .
Happy trading and have a nice day.

Hi
There are 3 distinct trades. 2 off 5 min (and 1 off 1 min but thats only during 7-9 gmt).

5 min.
1)Follows for example a negative close on 1 hr candle so yes you think price is going lower. You would then look at 15 min chart for confirmation. If the 15 min is going up where's it going to stop, I don't know. You could sell 5 min lower highs and some will work and some won't. So I look to sell 5 min lower highs where 1 hr has a negative close candle, where 15 min chart either has a negative close OR if it had a positive close the 5 min lh has taken out the bottom of that 15 min candle. If these items are not lining up leave trade. Yes some of these missed trades will work (and those you'll remember) and some won't (those you'll forget). The system trades are pretty high % winners. Your challenge is to take some time to understand the system, look at the charts posted and check on your own that it does, it'll be worth it.

5 min.
2)A normal 1 2 3 top/bottom ie lh/hl. This must occur at an extreme level at a key point (round number, pivot, fib etc etc). It does not have to be following 1 hr charts.

Please see attached chart, line on left is following neg 1 hr close and neg 15 min close.

Line on right is a straight hl.

So yes the idea is to enter the market at a good price and tight stop loss. I don't know where market will turn (sometimes its more obvious than others and I'm pretty confident it will turn - sometimes) and usually most such higher time frame trades need big stops to enter. That runs against (A) my skill level to trade this way consistently and (B) my personality (big stops) so I prefer to wait for hl/lhs to confirm a move.
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  • #1,591
  • Jun 29, 2010 9:09am Jun 29, 2010 9:09am
Quoting Royston
This is the link for the publishers website. There are 3 pdf excerpts, and a zip file of all the charts referred to. It is also for sale at Amazon.
Cheers
  • #1,592
  • Jun 29, 2010 9:14am Jun 29, 2010 9:14am
Quoting Vantage
Tough luck that it never followed through but any entry that gives you chance to win ie you can get stop to BE and have risk free chance is good in my book. Some will go some won't.

Late replying a friend of mine came over for coffee (his employers parking is being used for world cup park and ride service and they want everyone out) and ended up staying almost 3 hours.
Had a -4 trade a around 12pm couldnt seem to break a support line just under the 50 so got out.
I'm really going to have to pay more atention to trades once I am in them becasue cutting a losing trade at BE or - just a few can make a massive differnce to your account today for example not watching for follow through at key areas and waiting for full stop to be hit could have cost me -30pips but watching the key areas cost me -4.
I hope we get a nice 125pip run tomorow!
  • #1,593
  • Jun 29, 2010 9:15am Jun 29, 2010 9:15am
Quoting tdeu
you're right, but shorts came in already above the candle, that setup the long and drove prices down again before even long scalpers could take their profit

the profit for a scalp long from that setup was only 7.4 pips, take away 2 pips spread and a stop buy of 0.5 pips above the candle you're down to 4.9 pips

so it was likely, that even people who scalp 5 pips were stopped with their full position, when the low of that candle broke
Cheers tdeu I fully understand now thatnks the help!
  • #1,594
  • Jun 29, 2010 4:31pm Jun 29, 2010 4:31pm
I seem to get these great after noon trades setting up. Wasn't great hour set up but the m15 was a semi hammer price action looked nice. +12 net. This set up is turning my computer into a ATM machine. Just cant let the wife know what the balance is or I will be the ATM machine for her. LOL
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  • #1,595
  • Jun 29, 2010 4:33pm Jun 29, 2010 4:33pm
I have the reading price charts bar by bar pdf. If anyone wants me to eamil to them shoot me your eamil address and I can send it.
  • #1,596
  • Jun 30, 2010 1:20am Jun 30, 2010 1:20am
Quoting bpips
I have the reading price charts bar by bar pdf. If anyone wants me to eamil to them shoot me your eamil address and I can send it.
Its quite a big file to email I've been told and someone has offered to post it here.

bpips were you around for these eur moves up?

The earlier discussion on tl's. I have put in some tl's to show that a hl (or lh) are invariably confirmations of a tl break, test and move, thats why I no longer use.
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  • #1,597
  • Jun 30, 2010 2:55am Jun 30, 2010 2:55am
I think I'll wait until after the news before I do anything looking at the 20pip range it has had since London open!
  • #1,598
  • Jun 30, 2010 3:01am Jun 30, 2010 3:01am
Good move - it's terrible price action.
  • #1,599
  • Jun 30, 2010 3:54am Jun 30, 2010 3:54am
Just got back and missed move down (tricky one to enter). 5410/5400 is a key area, (see from 24 June) a small bounce would suggest more downside to W pivot 4941.
  • #1,600
  • Jun 30, 2010 4:05am Jun 30, 2010 4:05am
Just got a +10 on a 1min lower high enrty. got out when it came back up through the 15000. enrty on the chart was wrong i entered 6 bars before
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