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Ken's Continuing Successes with EO's system

  • #1,561
  • Aug 17, 2010 5:40am Aug 17, 2010 5:40am
Quoting kodziro
I watch mostly at majors: G/U, U/J, A/U, N/U, U/C, U/CH
and other : E/J, E/G ( spreads between 1-3 )

I trade MA`s but pain attention to 50/100/200 mostly. I don`t believed in a touch trade of them. It`s just a line but when I got TL or important S/R there along with MA i trade it. I like when candle close with wick rejecting major MA then I set PO at end of it.
So.... just to clarify this point. If you get a pin type candle (say a hangman on a downtrend) that has been rejected from an MA/TL, you will enter a PO at the bottom of that wick to pick up a retest of that low?


Quoting kodziro
PS. Just noticed that all this time got private messages disabled. So can`t send or received any messages until now.
  • #1,562
  • Aug 17, 2010 6:17am Aug 17, 2010 6:17am
Quoting leemonk
So.... just to clarify this point. If you get a pin type candle (say a hangman on a downtrend) that has been rejected from an MA/TL, you will enter a PO at the bottom of that wick to pick up a retest of that low?




TL no. See example on EJ. I like it when I got this at fibo zones. It`s just one of my setup. Got couple of them in my mind each time I look at chats. You must know at what are you waiting for and when it happen act.
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  • #1,563
  • Aug 17, 2010 6:28am Aug 17, 2010 6:28am
Quoting kodziro
TL no. See example on EJ. I like it when I got this at fibo zones. It`s just one of my setup. Got couple of them in my mind each time I look at chats. You must know at what are you waiting for and when it happen act.
Okay, so I think I understand what you look for. You are looking for a rejection off an MA (50/100/200).

However, I am still confused about 'where' you enter. Do you look to place a PO at the bottom of the wick of the candle that was rejected by the MA?

If so, then (I have copied your chart), trades 1, 3 and 4 would NOT have worked as they would not have picked up your PO.

But trades 2 and 5 would have worked as they would have triggered the PO.

Is this correct?

Regards

Lee

ps..> Ken, you okay with us talking about this here?
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  • #1,564
  • Aug 17, 2010 6:52am Aug 17, 2010 6:52am
Quoting leemonk
Okay, so I think I understand what you look for. You are looking for a rejection off an MA (50/100/200).

However, I am still confused about 'where' you enter. Do you look to place a PO at the bottom of the wick of the candle that was rejected by the MA?

If so, then (I have copied your chart), trades 1, 3 and 4 would NOT have worked as they would not have picked up your PO.

But trades 2 and 5 would have worked as they would have triggered the PO.

Is this correct?

Regards

Lee

ps..> Ken, you okay with us talking about this here?
Correct. Notice that if you would be looking 15/5 min pa near each end of the wick you will be at 5 trades but your sl would be a bit bigger.

Ps. see at trade no 3 like price after MA bounce testing last time important line.
  • #1,565
  • Aug 17, 2010 6:53am Aug 17, 2010 6:53am
[quote=leemonk;3953492]Okay, so I think I understand what you look for. You are looking for a rejection off an MA (50/100/200).

However, I am still confused about 'where' you enter. Do you look to place a PO at the bottom of the wick of the candle that was rejected by the MA?

If so, then (I have copied your chart), trades 1, 3 and 4 would NOT have worked as they would not have picked up your PO.

But trades 2 and 5 would have worked as they would have triggered the PO.

Is this correct?

Regards

Lee

ps..> Ken, you okay with us talking about this here?[/quote]


What threads are for... I thought ...
Good Trading To All ; Ken Lee
  • #1,566
  • Aug 17, 2010 6:57am Aug 17, 2010 6:57am
Quoting leemonk
Good Morning Ken,

Some great responses there, much to take in !!

May I ask, when you have the time, to expand a little for me on the quoted comment.

I know this is something that you bang on about (meant in a nice way) that SR/TL lines are JUST AREAS, however I often find myself missing a good move because it did turn a little earlier and for some reason or other, despite there being good PA, I still think it will come back to the TL.

I know this is crazy, because as you pointed out in the part that I didn't quote, there are many ways of...
need to adjust your grammar a bit a TL is a Diagonal line connecting areas of S/R - PPA at a angle , They are different and carry different weight than a S/R - PPA Horizontal line ..


Yes I will find a print a example ,, after breakfast.. ken
Good Trading To All ; Ken Lee
  • #1,567
  • Edited 7:21am Aug 17, 2010 7:07am | Edited 7:21am
Hi,

I am a little confused now. I understand that TL - trendlines, connect key areas with diagonal lines......

But, and I think this is where the confusion is coming in, these too are 'areas' to watch rather than being exact turning points.

Are we on the same page now? I am not sure........

*edit*

What I was trying to get at is that although these are diagonal lines, they work in a similar fashion to standard SR lines..... in that the are only areas to look for rather than exact turning points. In fact, they are more likely to be areas as they are more often draw differently than those of the SR variety.

With that comment in mind, I was asking about your quoted comment.

Cheers

Lee
  • #1,568
  • Aug 17, 2010 7:34am Aug 17, 2010 7:34am
Maybe I am wrong but if were are trying to talk about something but using a different word to describe it . It is never clear.. Just thought you were using TL to ask about S/R -PPA lines . Then again I just woke up ..

Cheers Ken

PS I have tried to download this reply 3 times now so it gets shorter and shorter each time. If it fails this time Might just be my name... LOL
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Good Trading To All ; Ken Lee
  • #1,569
  • Aug 17, 2010 8:09am Aug 17, 2010 8:09am
Okay.......... I think I see where "I" confused the issue.

In the reply that I quoted, you made reference to taking note of how long a wick is in relation to where you place the SR line. Your point was that the length of the wick can help ensure you do not miss a trade because you are looking for a perfect touch of the SR line.

Now, I misread this and applied it to Trendlines too (you may infact be able to do this, but it is not what you said).

So.......... I can try and ask my question again, but in a different manner.

1. How do you use the length of the wick of a candle when you are drawing an SR line to get a better guide for a later entry somewhere else?

2. Can this principal be applied to Trendlines too.

3. (new question) Is it common for your trendlines to be touching key areas of SR - as you indicated in your last attachment?

4. Will you start or connect areas that are not neccessarily areas that would create key SR points?

Often I will see these areas anyway, but I rarely 'look' for them. I just try and draw trendlines that match up best rather than looking for them OFF KEY SR AREAS.

Okay, so apologies for the confusion in the last few posts and I hope I have cleared things up a little.


Thanks

Lee
  • #1,570
  • Aug 17, 2010 10:14am Aug 17, 2010 10:14am
Quoting leemonk
Okay.......... I think I see where "I" confused the issue.

In the reply that I quoted, you made reference to taking note of how long a wick is in relation to where you place the SR line. Your point was that the length of the wick can help ensure you do not miss a trade because you are looking for a perfect touch of the SR line.

Now, I misread this and applied it to Trendlines too (you may infact be able to do this, but it is not what you said).

So.......... I can try and ask my question again, but in a different manner.

1. How do you use...



1. How do you use the length of the wick of a candle when you are drawing an SR line to get a better guide for a later entry somewhere else?

Price can go to the extreme of the wicks or it may turn back anywhere within the wick . The wicks are normally showing the rejection of the area. A strong move may produce a longer wick as maybe a very large order has sent price flying but once the opposite orders start to fill the price stops and reverses. Which can produce a long wick.

When price again aproaches this area if the volume is less it may barely reach the area where that last large wicked candle closed and turn back right at the close price or body of the candle.

If when drawing my S/R - PPA lines. I consider PPA Previous Price Action. This menas I look and I see how many long wicked candles I have , are they from the bottom or the top. Which has turned price the most the top or the bottom.

Lets say for ease that the wicks are about the same from the top and bottom. Then the LINE would be IN the middle of the wicks The AREA to the bodies . Price can turn anywhere between the bodies of the area.

If price turns more from resistance than it does from support at this area I would maybe give more importance to a short trade .

It is nothing more than a quick averaghing of the distance between bodies. Don't dwell on it to much. Just draw your lines on as many charts as you can then later go back and see what took place.

The only thing especially if you don't take touch trades is to know you are at a potential area where price can turn . If price stays below resistance look for shorts . if it Breaksout above then look for a continuation trade. It isn't rocket science..

2. Can this principal be applied to Trendlines too.

Yes maybe even more so. you will see alot of times that a erattic spike pushed through a trend line right in the middle of a great solid line. I look at the timing of that to see if it is news . Also the price to see if it was maybe a stoprun.

But if it is just a false break of my trend lien I will just go through it , That being that it is just one candle through one back . just a single wick more so. to ignore . But keep it in mind as it can change the angle of your trendline if it comes into play .

So I guess I would ignore it till the old trendline breaks then use that spike or new extreme as your new lines point. Just like Fibs when the old one is broken you have to move to the next.

3. (new question) Is it common for your trendlines to be touching key areas of SR - as you indicated in your last attachment?


Yes , for me . I think trendlines with the most chance of succees and especially for large moves have confluence of s/r and even a fib level then throw in a major MA and that is the perfect entry area.


But Trendlines are nothing but a line connecting extreme edges of a swing that are most likelly S/R - PPA of some time frame .


But again we mainly care about the higher time ones 4 hr and daily. Until we get into a tight range then hrly comes into play more.

4. Will you start or connect areas that are not neccessarily areas that would create key SR points?


Yes if they are touching extremes and there isn't ppa . It would be follish not to take notice of that area. but it doesn't have the value a s/r touched trend line would . the reasoning is very simple.

You might have some traders that can only see trend lines then you might have others that can only spot S/R so when you have both you have more traders interested.

This is the main focus of our trading Confluence . The more happening at a area the more people interested in taking the trade. just like if it is a level on many time frames the more the merrier.

Plus big money trades the higher charts . So when you have a level on a fib area off s/r with a trendline and a 50 or 200 MA on a daily. To not try that trade for a hundred pips on almost any pair would be a crime against nature.. LOL


Any clarifaction need ,, just ask. or any counter views .. all points of view welcome..
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Good Trading To All ; Ken Lee
  • #1,571
  • Aug 17, 2010 10:39am Aug 17, 2010 10:39am
Ken, pls dont go too fast, I cant catch up

Quoting Kenneth Lee
1. How do you use the length of the wick of a candle when you are drawing an SR line to get a better guide for a later entry somewhere else?

Price can go to the extreme of the wicks or it may turn back anywhere within the wick . The wicks are normally showing the rejection of the area. A strong move may produce a longer wick as maybe a very large order has sent price flying but once the opposite orders start to fill the price stops and reverses. Which can produce a long wick.

[b]When price...
  • #1,572
  • Aug 17, 2010 10:42am Aug 17, 2010 10:42am
Quoting Buildcity
Ken, pls dont go too fast, I cant catch up
Just trying to get in as much as I can while I have the time ,, LOL

You don't need much . Plus your busy painting the new office and hanging up pictures of fancy cars and big yachts.. hehe

Hope your new home is coming together.. Cheers.
Good Trading To All ; Ken Lee
  • #1,573
  • Aug 17, 2010 11:10am Aug 17, 2010 11:10am
Hi ken and all

All thuis talk about trendlines and S/R, PPA. I just have to take notice. My charts live and die by these things.

A few weeks ago I was spending some time with a comercial forex trader. Trades a lot for himself as well. He also deals with banks and trading floors.

So anyway he started explaining to me how banks do things in the Forex. I will number out the things I remember. This is a in general type of thing.

1. Traders and analists are in different areas and don't intermingle.
2. There are traders that specialize in methods. Fundamental, algorithmic. Then with technical trading they have specialists. fibs, pivots etc. which is why pivots and fibs can be so reliable.
3. Most banks make 40% or so of their profit from forex trading. So they trade a lot.
4. They work on monthly, weekly, daily charts for the most part. Which is why we put our ppa,s/r, trendlines here to start with.
5. One of the reasons trendlines are not as reliable as horizontal zones in the forex is, as large positions get built or liquidated it is at horizontal precalculated areas. A bank cannot use a trendline break to enter or exit. They are moving to much at once.

I know there was more and as I remember I will put it down.

Rufus
Illegitimi non carborundum - Noli pati a scelestis opprimi.
  • #1,574
  • Aug 17, 2010 12:08pm Aug 17, 2010 12:08pm
Quoting Kenneth Lee
Lets say for ease that the wicks are about the same from the top and bottom. Then the LINE would be IN the middle of the wicks The AREA to the bodies . Price can turn anywhere between the bodies of the area.
Apologies Ken, but can you please clarify this point. Are you saying that with this you effectively have three lines(if only one is draw). If price is dropping then you look for a reaction betweent he bodies and the middle line. If price is raising, you look for a reaction between the lower bodies andthe middle line?

Quoting Kenneth Lee
If price turns more from resistance than it does from support at this area I would maybe give more importance to a short trade .
But you wouldn't draw your line any lower? You would simply consider a short to be a stronger trade?

Quoting Kenneth Lee
It is nothing more than a quick averaghing of the distance between bodies. Don't dwell on it to much. Just draw your lines on as many charts as you can then later go back and see what took place.
My concern with this, and I know this changes as I become more experience, is that I have HUNDREDS of Trendlines......

Quoting Kenneth Lee
It isn't rocket science..
No, Rocket Science is a little easier

[quote=Kenneth Lee;3954142]2. Can this principal be applied to Trendlines too.

Quoting Kenneth Lee
But if it is just a false break of my trend lien I will just go through it , That being that it is just one candle through one back . just a single wick more so. to ignore . But keep it in mind as it can change the angle of your trendline if it comes into play .
One of the main reasons for havingmany TL's is that I will often draw a new TL from one of these breaks. Even if the old TL holds future price, I will still draw a new TL from the failed break.

What is your view on this?


ps.... There was a lot of great detail in there, and these are just a few bits that I wanted clarity on...... so a big thanks...

Lee
  • #1,575
  • Aug 17, 2010 1:03pm Aug 17, 2010 1:03pm
Quoting Rufus
Hi ken and all

All thuis talk about trendlines and S/R, PPA. I just have to take notice. My charts live and die by these things.

A few weeks ago I was spending some time with a comercial forex trader. Trades a lot for himself as well. He also deals with banks and trading floors.

So anyway he started explaining to me how banks do things in the Forex. I will number out the things I remember. This is a in general type of thing.

1. Traders and analists are in different areas and don't intermingle.
2. There are traders that specialize in methods....
Thanks for this.. You have a gold mine there.

The more we can understand what the MOVERs of the market are doing the better we will be able extract our tiny bit (in the begining) from it. Why when you find a realcommecail trader that posts a bit pay attention.

I remember also a group of commercial traders a actual family firm , That posted on Babypips some, may still. but they talked of having weekly meetings with the different departments fundies and techs. to iron out the weeks strike zones . or interested levels. but it always did sound like they were seperate groups . kept apart to keep from influencing each others analysis. As they are sepereate ways of seeing things..


Thanks again Great pot hope you think of some more tidbits.. Ken
Good Trading To All ; Ken Lee
  • #1,576
  • Aug 17, 2010 1:04pm Aug 17, 2010 1:04pm
Quoting leemonk
Apologies Ken, but can you please clarify this point. Are you saying that with this you effectively have three lines(if only one is draw). If price is dropping then you look for a reaction betweent he bodies and the middle line. If price is raising, you look for a reaction between the lower bodies andthe middle line?



But you wouldn't draw your line any lower? You would simply consider a short to be a stronger trade?



My concern with this, and I know this changes as I become more experience, is that I have HUNDREDS of Trendlines.........

Sorry to have to break this up, But I am getting ready to go to work now. will reply later some charts look to be required and that takes a while.. I will respond later. Ken
Good Trading To All ; Ken Lee
  • #1,577
  • Aug 17, 2010 2:49pm Aug 17, 2010 2:49pm
Quoting Kenneth Lee
Sorry to have to break this up, But I am getting ready to go to work now. will reply later some charts look to be required and that takes a while.. I will respond later. Ken
Hey,

Sure thing..... Absoloutley no rush at all.
  • #1,578
  • Aug 18, 2010 2:27am Aug 18, 2010 2:27am
Hello everyone!

Great stuff here lately!

Got two question here for you gurus on a GU chart.

1) On the first red arrow, its a good ppa line, its broken by the big red candle. But when it comes up and retests the line, is this a good place to take a touch trade perhaps set a PO?


2) The second one behind the long wicked hammer. Pretty standard trade I guess good rejection of price at ppa/s & r, enter after hammer. My question is what can we really expect from a counter trend move like that in regards to risk/reward?

Im pretty new on the subject and havent really payed any attention to it befor now, but it seems like there is a general rule that we at the minimum want a 1 to 1 risk on our trade.

As we put our sl at the end of the hammer its about 20 pips, so to get 1 to 1 we should aim for 20 pips.

So what I did instead of closing her at +10 as I normally would seeing as its against the trend I moved my sl to 1+ aiming for the 20. Coupple of minutes later it took me out.

How would you approach this?
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  • #1,579
  • Aug 18, 2010 3:19am Aug 18, 2010 3:19am
Holy pipperoni that was a sick candle on gu!

Just entered long on the previous candle, looked at forex factory and two minutes later my tp is hit. Why couldnt it be like this everyday?
  • #1,580
  • Aug 18, 2010 5:18am Aug 18, 2010 5:18am
Quoting Storeball
Hello everyone!

Great stuff here lately!

Got two question here for you gurus on a GU chart.

1) On the first red arrow, its a good ppa line, its broken by the big red candle. But when it comes up and retests the line, is this a good place to take a touch trade perhaps set a PO?


2) The second one behind the long wicked hammer. Pretty standard trade I guess good rejection of price at ppa/s & r, enter after hammer. My question is what can we really expect from a counter trend move like that in regards to risk/reward?

Im pretty new on...
Hi.

Here`s my opinion.
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