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Silent Service Method

  • #10,301
  • Edited 9:20am Aug 10, 2010 8:14am | Edited 9:20am
Quoting clockwork71
Yes, the FOMC statement later today could change things though. It appears that cable is heading back to 1.55 at least for now.

Sugar huh? Not too long ago, that was a one way trade north.
Hi Clockwork,
This is my first post here. I'm busy working my way through your great thread and I'm very impressed. I'd like to say how much I appreciate your efforts to help struggling guys like myself. What I've read so far has really helped change my views of the market.

I trade GU mostly and have my weekly zones drawn up. Now I'm not sure if I've got it right but it seems there is an obvious support zone which I've drawn between 1.5863 down to 1.5707. Now we're currently trading within this zone (in the lower part of it) and I've just seen an H1 pin close and an H4 pin in the making. I'll be looking for longs before long if PA holds up.

I mention this as I saw your comment about a likely move to 1.55 and was wondering if you were considering this zone to be too far penetrated now.

Thanks for your help!

EDIT: H4 pin fell through anyway. Would be good to know if there were any signs that you picked up on that made this the more likely outcome.
  • #10,302
  • Aug 10, 2010 8:29am Aug 10, 2010 8:29am
Quoting Sutts
Hi Clockwork,
This is my first post here. I'm busy working my way through your great thread and I'm very impressed. I'd like to say how much I appreciate your efforts to help struggling guys like myself. What I've read so far has really helped change my views of the market.

I trade GU mostly and have my weekly zones drawn up. Now I'm not sure if I've got it right but it seems there is an obvious support zone which I've drawn between 1.5863 down to 1.5707. Now we're currently trading within this zone (in the lower part of it) and I've just seen...
The big man has gone to work but if you want my opinion you're looking a little too closely. I find GbpUsd tends to bounce between the big round numbers, 1.35, 1.40, 1.45, 1.5, 1.55, 1.60, you get the picture. Anything other than those levels will only ever be minor s/r. I would say you'd be better off getting the method down on daily charts until you're comfortable with it and then maybe go back to 4 hour charts. I found anything less than daily to give a lot of false signals and heartache. These days I just trade weekly charts. Of course it's a personal thing.
Attached Image (click to enlarge)
Click to Enlarge Name: gbpusd weekly.gif Size: 36 KB
Position trader - Anything intraweek is just noise...
  • #10,303
  • Aug 10, 2010 8:35am Aug 10, 2010 8:35am
By the way, a move to 1.50 would be just over a 50% retracement of the last move. A move to 1.45 would see horizontal and trendline support coinciding. (nice)
Position trader - Anything intraweek is just noise...
  • #10,304
  • Aug 10, 2010 8:44am Aug 10, 2010 8:44am
Quoting Arfer Daily
The big man has gone to work but if you want my opinion you're looking a little too closely. I find GbpUsd tends to bounce between the big round numbers, 1.35, 1.40, 1.45, 1.5, 1.55, 1.60, you get the picture. Anything other than those levels will only ever be minor s/r. I would say you'd be better off getting the method down on daily charts until you're comfortable with it and then maybe go back to 4 hour charts. I found anything less than daily to give a lot of false signals and heartache. These days I just trade weekly charts. Of course it's...
Thanks for the advice, I'll keep that in mind. Just in demo mode for now.
  • #10,305
  • Aug 10, 2010 10:49am Aug 10, 2010 10:49am
Hi After Daily, on your weekly charts do you use any indicator like MACD?
  • #10,306
  • Aug 10, 2010 11:22am Aug 10, 2010 11:22am
Quoting albertsy2
Hi After Daily, on your weekly charts do you use any indicator like MACD?
No, just candlestick patterns at horizontal and trendline s/r and a 3sma of the typical price (pivot point ma). I like the ma after I read a book by John Person, I'd recommend the book but I forget the title.
Position trader - Anything intraweek is just noise...
  • #10,307
  • Aug 10, 2010 1:38pm Aug 10, 2010 1:38pm
Quoting Sutts
Hi Clockwork,
This is my first post here....
I actually had it as a short - but of course the wild card was the fed announcement we just had. So now the main question I will be asking is if 1.60 holds. If I get a set up short - I would take it. Conversely, if we break through, and find a retest of support - I would go long.

Quite often, these news announcements turn out to only be knee-jerk stuff.

Of course....I could be wrong, that's why it's better to be patient about it.
  • #10,308
  • Aug 10, 2010 5:02pm Aug 10, 2010 5:02pm
HI, Chris,

A bit off topic, I'm just wondering if I can ask a question about data feed for your IB account, question is, do you pay for a data feed with IB so you can see realtime quotes on the markets you trade, or do you just do all that with another charting package, or do you have both, I'm just asking around to get a feel for what different people do as far as the data feed.

I hope it's not to far off topic for you thread.


Thanks
Mr Smith
  • #10,309
  • Aug 10, 2010 5:16pm Aug 10, 2010 5:16pm
Quoting clockwork71
I actually had it as a short - but of course the wild card was the fed announcement we just had. So now the main question I will be asking is if 1.60 holds. If I get a set up short - I would take it. Conversely, if we break through, and find a retest of support - I would go long.

Quite often, these news announcements turn out to only be knee-jerk stuff.

Of course....I could be wrong, that's why it's better to be patient about it.
Thanks for the pointers clockwork. The H4 bar I was referring to did in fact close as a pin (GMT based charts) and an entry on the break of this produced 140 odd pips at one point before it fell back a little. Would this be an acceptable trade based on your method that I can file away as an example or was the execution flawed and perhaps saved by the fed announcement?

Just interested as I can't see a short setup in the same region. It's possible I haven't got to the relevant section in the thread yet though.

Thanks again.
  • #10,310
  • Aug 10, 2010 6:31pm Aug 10, 2010 6:31pm
Quoting Mr Smith
HI, Chris,

A bit off topic, I'm just wondering if I can ask a question about data feed for your IB account, question is, do you pay for a data feed with IB so you can see realtime quotes on the markets you trade, or do you just do all that with another charting package, or do you have both, I'm just asking around to get a feel for what different people do as far as the data feed.

I hope it's not to far off topic for you thread.


Thanks
Mr Smith
Forex is actually free, but IB has different prices depending on which market you are receiving data from. Some are more expensive than other ones.

Australia is more expensive than London as an example...
  • #10,311
  • Aug 10, 2010 6:33pm Aug 10, 2010 6:33pm
Quoting Sutts
Thanks for the pointers clockwork. The H4 bar I was referring to did in fact close as a pin (GMT based charts) and an entry on the break of this produced 140 odd pips at one point before it fell back a little. Would this be an acceptable trade based on your method that I can file away as an example or was the execution flawed and perhaps saved by the fed announcement?

Just interested as I can't see a short setup in the same region. It's possible I haven't got to the relevant section in the thread yet though.

Thanks again.
There wasn't a set up, just that 1.58-1.60 was a large area that was S/R, and it turned around at that area. The bars themselves didn't form a trigger - but the area was the correct one.....
  • #10,312
  • Aug 10, 2010 10:18pm Aug 10, 2010 10:18pm
I find it very interesting the various reactions we are getting to the Fed's announcement of weaker than expected economy. NY rallied at first, because they were going to keep interest rates low forever, and then sold off as they realized that maybe it's a bad thing? Go figure. If things were so great, this wouldn't be necessary.

Tokyo sold off hard right away. Makes sense, because they need us (Americans) to buy their stuff. But then again, they understand an environment that has no inflation.

It will be interesting to see what Frankfurt and London do.

NY is so out of touch with reality these days, you never really know what to expect. Friday's NFP report should not have been much of a surprise, yet you would never know it by the initial reaction.
  • #10,313
  • Aug 11, 2010 6:37am Aug 11, 2010 6:37am
I seem to be finally learning how this method works. After having trouble spotting the good signals during the the last couple of months, I have managed to turn things around.

I have taken what I have learned here, namely;

Trend
S/R
Patience

And combined it with what I have studied before;

MA's
Multi-Timeframe Analysis

And I seem to have come up with a winning formula.

For me learning CW's method was a huge step in the right direction, but I was having trouble understanding which of the signals were the most likely to produce a reasonable return. I brought in a couple of things I learned from my previous experience to help me eliminate some of the losing trades, and the results are promising.

I have made only a fraction of the trades I have been making in past months and I am currently up + 3.4% so far this month. It seems that waiting for the best opportunities does pay off, even if it means letting some the good trades go by.

Thanks for all of the help and encouragement. This thread has been an enormous help.
  • #10,314
  • Aug 11, 2010 8:06am Aug 11, 2010 8:06am
Quoting jharvey407
I seem to be finally learning how this method works. After having trouble spotting the good signals during the the last couple of months, I have managed to turn things around.

I have taken what I have learned here, namely;

Trend
S/R
Patience

And combined it with what I have studied before;

MA's
Multi-Timeframe Analysis

And I seem to have come up with a winning formula.

For me learning CW's method was a huge step in the right direction, but I was having trouble understanding which of the signals were the most likely to produce a reasonable...
I'll second that, this thread really helped me too.
Position trader - Anything intraweek is just noise...
  • #10,315
  • Aug 11, 2010 8:18am Aug 11, 2010 8:18am
Quoting clockwork71
There wasn't a set up, just that 1.58-1.60 was a large area that was S/R, and it turned around at that area. The bars themselves didn't form a trigger - but the area was the correct one.....
Thanks CW, I'll just have to keep studying the S/R levels I guess.

I'd really appreciate some advice on why the weekly level highlighted below and the H4 candle closing on it didn't warrant a long trade. Was it because the level wasn't strong enough (not enough fractal clustering)? Sorry, I'm a slow learner!

Thanks
Attached Image(s) (click to enlarge)
Click to Enlarge Name: Weekly.GIF Size: 14 KB
Click to Enlarge Name: H4.GIF Size: 10 KB
  • #10,316
  • Aug 11, 2010 8:25am Aug 11, 2010 8:25am
Quoting aserbfx
here comes one more. will enter on retrace...
Hi aserbfx,

Are you in this trade now?
  • #10,317
  • Aug 11, 2010 8:28am Aug 11, 2010 8:28am
Quoting erdah
Hi aserbfx,

Are you in this trade now?
no, i wait for the 50,xx eur.
meine augen sind die sterne
  • #10,318
  • Aug 11, 2010 8:33am Aug 11, 2010 8:33am
Quoting Sutts
Thanks CW, I'll just have to keep studying the S/R levels I guess.

I'd really appreciate some advice on why the weekly level highlighted below and the H4 candle closing on it didn't warrant a long trade. Was it because the level wasn't strong enough (not enough fractal clustering)? Sorry, I'm a slow learner!

Thanks
I can see your point but a 4 hour chart is less reliable than a longer time frame signal. 4 hour charts can tell you to go long and the next 4 hour candle may well go in that direction, a good trade and you can make money that way. The essence of this method is that you want to take a trade that you can open on the close of a daily/weekly candle and then be kidnapped by pirates for 4 to 8 weeks, be released from captivity and still be in the trade. There are, of course, exceptions. If you see a good range, like GbpChf then take advantage of it, but on the whole you definitely should be looking for home runs. Otherwise you're just in and out of trades all the time. I could have interpreted it wrong myself so get a second opinion but for me it's about finding reversals at key s/r levels and riding the resulting trend as far as you can rather than taking trades for a few hundred pips here and there.
Position trader - Anything intraweek is just noise...
  • #10,319
  • Aug 11, 2010 8:57am Aug 11, 2010 8:57am
Quoting clockwork71
NY is so out of touch with reality these days, you never really know what to expect. Friday's NFP report should not have been much of a surprise, yet you would never know it by the initial reaction.
Not all New York guys are out of touch with reality...Bond guys were said to be crazy bidding the 10yr treasury to the low 3%... now we've bid it all the way up to 2.69%.

Someone holding 10yr bonds since 12/31/09 is up low double digits (~12.5%) and someone holding the S&P500 since 12/31 is negative on the year...

New Yorkers trade bonds too ya know!
  • #10,320
  • Aug 11, 2010 8:58am Aug 11, 2010 8:58am
Quoting Arfer Daily
I can see your point but a 4 hour chart is less reliable than a longer time frame signal. 4 hour charts can tell you to go long and the next 4 hour candle may well go in that direction, a good trade and you can make money that way. The essence of this method is that you want to take a trade that you can open on the close of a daily/weekly candle and then be kidnapped by pirates for 4 to 8 weeks, be released from captivity and still be in the trade. There are, of course, exceptions. If you see a good range, like GbpChf then take advantage of it,...

Thanks for the help Arfer. I just want to start seeing weekly charts the way you guys do and it worries me that I'm drawing weekly levels that don't seem to be relevant.

I hope by following the setups described here, over time I'll tune in to the proper way of seeing things.

I like your advice regarding home runs. It makes perfect sense to wait for the strongest levels and highest T/F signals before entering. I guess the best levels are the ones with the most weekly fractals clustering around.

I'm currently just looking at very strong fractals...lows with 3 higher lows on each side, rather than the standard 2 bars on each side. To me this indicates a stronger reaction and therefore a better level to trade off. Does that make sense? I'd be interested to know the fractal definition that you and CW use.

Appreciate the help.
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