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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

  • #86,241
  • Jan 18, 2011 7:12pm Jan 18, 2011 7:12pm
Quoting decentchap
Thanks, sometimes I feel I am on right track but sometimes I feel as if I don't know anything...

To summarise what i know!

PPZ levels
basic bar formations (Pin, BUOB, BEOB)
I can draw trend lines, fibs etc..

I understand we have to look to see how the price is closing around ppz level
- Strong close above - ppz is support
- Strong close below - ppz is resistance

Do we than simply just wait for price to form a specific bar formation like pin, beob, buob etc? if the bar as formed we check the size of the bar relative to previous bars, traffic,...

I think its simplistically perfect, decentchap . . ..

And an understanding what Mike is saying is also so important. Its what Mike teaches that really puts it altogether . .the Story.

Its it a wedge breakout? is it a bearish flag breakout? Is it at the top or bottom of a box consolidation? Is it trading into a box consolidation? Is it in the middle of a box consolidation? . .

It is this bigger story that can add support or confluence to our setups.

This is what Mike shows us all the time . .and believe me, if it wasn't for Mike, these stories would have been hidden from me (us) forever.

Indicators show the past. Price Action "Indicates" the future.
  • #86,242
  • Jan 18, 2011 7:13pm Jan 18, 2011 7:13pm
Quoting jarroo
The crosses can be a bit messy . . its like they color outside the lines at times . . .USD pairs rule more often. . .they color inside the lines . .
This is a way, way more important point than people realise, and it isnt getting the love it deserves

Take AUDCAD as an example. How much volume does this cross really do? Like twelve bucks a day for maple syrup imports? Barely anything. And given the similar fundamental drivers of Canadia and Aussieland, it isnt like there is any kind of risk/yield/bric/etc play there either driving flows.

I'd propose that the true drivers of moves in AUDCAD are movements in USDCAD and AUDUSD. The third leg is really just closing an arbitrage loop. It isnt driving anything.

So, if we accept my premise that moves in AUDCAD are 95%+ driven by moves in AUDUSD and USDCAD, exactly how much real information do we think is contained in the PPZ/176.314EMA/supperfibbo382retracementpro/etc levels on the AUDCAD chart?

From there, we can draw some pretty obvious conclusions.
When you have to shoot, shoot. Dont talk.
  • #86,243
  • Jan 18, 2011 8:20pm Jan 18, 2011 8:20pm
Quoting joelcf
This is a way, way more important point than people realise, and it isnt getting the love it deserves

Take AUDCAD as an example. How much volume does this cross really do? Like twelve bucks a day for maple syrup imports? Barely anything. And given the similar fundamental drivers of Canadia and Aussieland, it isnt like there is any kind of risk/yield/bric/etc play there either driving flows.

I'd propose that the true drivers of moves in AUDCAD are movements in USDCAD and AUDUSD. The third leg is really just closing an arbitrage loop....
It makes perfect sense to me joel . . but I still draw the super fibo ema cluster trendline on those crosses . . . . .but I am shying away from that slowly on the crosses .
Indicators show the past. Price Action "Indicates" the future.
  • #86,244
  • Jan 18, 2011 8:29pm Jan 18, 2011 8:29pm
Quoting jarroo
It makes perfect sense to me joel . . but I still draw the super fibo ema cluster trendline on those crosses . . .
haha. that was directed at the world at large, rather than at you. I'm yet to see the ultra rare (and generally presumed extinct) Jaroo birdcage in the wild.
When you have to shoot, shoot. Dont talk.
  • #86,245
  • Jan 18, 2011 8:40pm Jan 18, 2011 8:40pm
Quoting jarroo
Interesting don't you think, xmz ?. . . .

Just think if the Weekly PB was of better quality.
Now will it act as Resistance?

I should have also said . . not only a better quality PB on the Weekly but a less choppier pair . . . .and better time of day.
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Indicators show the past. Price Action "Indicates" the future.
  • #86,246
  • Jan 18, 2011 8:48pm Jan 18, 2011 8:48pm
Dang, feeling pretty good tonight. Saw a chart that looked eerily similar to mine.
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  • #86,247
  • Jan 18, 2011 9:03pm Jan 18, 2011 9:03pm
Quoting slade1986
Dang, feeling pretty good tonight. Saw a chart that looked eerily similar to mine.

Yeah me too . . and once I applied this to the setup it worked out nicely.

Quoting jarroo
Good example of James16's "This is Critical":



Let's see how it works out. . .or did it already work out . . . .
Indicators show the past. Price Action "Indicates" the future.
  • #86,248
  • Jan 18, 2011 9:26pm Jan 18, 2011 9:26pm
Quoting joelcf
I'd propose that the true drivers of moves in AUDCAD are movements in USDCAD and AUDUSD. The third leg is really just closing an arbitrage loop. It isnt driving anything.

I kind of came to this conclusion myself. I also notice when the big guy James posts his trades, they are not too often of the crosses.

I still see a lot of good technicals on some of the "bigger" crosses, such as E/J, G/J, even CHF/J.

As far as the very distant crosses (as you were saying, AUD/CAD is a good example), I don't even look at them anymore. I still notice some of the peeps in this thread posting up a PA chart on them though, and it is odd.

I've only made 2 live trades this month so far (both winners). Possibly the least I have traded in the year I have been tracking everything and taking it seriously. My demo trades don't typically end well, and it makes me smile that I chose to do them on demo.

Keep posting, Joelcf.
Many choose unhappiness over uncertainty.
  • #86,249
  • Jan 18, 2011 10:42pm Jan 18, 2011 10:42pm
Quoting mbqb11
Hey Pub

I think this is a very unconvincing pinbar. It would barely be closing within the prior bar and has a very large body. Don't let a long wick fool you into thinking it is a strong reversal. This too me looks like price hit the BRN and bounced. As opposed to a strong selling(which a strong close would have shown us). Now imagine price closed down near where it opened? It could change the entire look.

Hope that helps
Mike

Mike!!

That really confused me. I mean I have seen the Big Guy taking worse looking PBs than this one in the videos.

If we look at the higher horizontal line I drew, we can see the close is still below this area, if it closed as it is right now, you would still pass on this?
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  • #86,250
  • Jan 18, 2011 10:45pm Jan 18, 2011 10:45pm
Quoting Pinbar
Mike!!

That really confused me. I mean I have seen the Big Guy taking worse looking PBs than this one in the videos.

If we look at the higher horizontal line I drew, we can see the close is still below this area, if it closed as it is right now, you would still pass on this?
Hey PB

Yes this one would have to close near its open for me. It has a very fat body with a nearly equal size tail. This is reactionary to the 1.6 BRN rather then telling me for sure if the bears are coming in. I explained today in a webinar that these wicks don't mean reversals they simply mean orderflow was absorbed at this area. In fact wicks can most often be a sign for the least path of resistance and where price will likely go. A close is very significant to tell me if it was a good chance for true selling. This for me would personally(again everyone is different), be an easy pass. A close below the open? And now we are talking

Best
Mike
  • #86,251
  • Jan 18, 2011 10:46pm Jan 18, 2011 10:46pm
Quoting joelcf
haha. that was directed at the world at large, rather than at you. I'm yet to see the ultra rare (and generally presumed extinct) Jaroo birdcage in the wild.

I want to see one of those rare Jarroo Birdcages! Please!
  • #86,252
  • Jan 18, 2011 10:52pm Jan 18, 2011 10:52pm
Quoting Dan Gilbert
I still see a lot of good technicals on some of the "bigger" crosses, such as E/J, G/J, even CHF/J.
chfjpy is the kind of one where it gets interesting for me. There isnt a huge amount of two way movement there, but they both respond to much the same external forces. Which means the cross essentially hedges out that effect (in this case, the risk aversion trade), and leaves you with more 'signal' related to the underlying currencies, as such.

Of course, that more than often just leads to chop. But at least there is actual movement on the three you singled out (audjpy makes that list too thanks to UIA, audnzd for much the same reason as usdcad, and there is enough play on gbpchf to make it worthwhile watching)


Quoting Dan Gilbert
As far as the very distant crosses (as you were saying, AUD/CAD is a good example), I don't even look at them anymore. I still notice some of the peeps in this thread posting up a PA chart on them though, and it is odd.
I will still trade them, on occasion - its just a different approach is needed. While the levels, MAs, etc are probably alot weaker and I wont rely on it, the PA is still just as valid - but rather than the straight cross, more as a proxy for the other pairs actually driving it.

I wouldnt trade a fib bounce on AUDCAD (or on anything ever, but whatever), but a bigass pin would still get my attention.

Quoting Dan Gilbert
I've only made 2 live trades this month so far (both winners). Possibly the least I have traded in the year I have been tracking everything and taking it seriously.
Pickiness is an underappreciated artform.

People posting charts on like January 2 and December 28 need to shut down the laptop and go to the beach. Cause you are pretty much the only ones entering positions.
When you have to shoot, shoot. Dont talk.
  • #86,253
  • Jan 18, 2011 10:59pm Jan 18, 2011 10:59pm
Quoting mbqb11
Hey PB

Yes this one would have to close near its open for me....

Thanks Mike but,,,,,,LoL
Just looked at the chart and it did close above the eye.

Just one question though, the long nose is a criteria for a good bar is it not?

So, from what you mentioned, does this mean the close takes preference in importance over the length of the nose?
  • #86,254
  • Jan 18, 2011 11:07pm Jan 18, 2011 11:07pm
Quoting Pinbar
Thanks Mike but,,,,,,LoL
Just looked at the chart and it did close above the eye.

Just one question though, the long nose is a criteria for a good bar is it not?

So, from what you mentioned, does this mean the close takes preference in importance over the length of the nose?
Everything is important as a whole. One thing can break a bar for me, while another can make it. I can't give a one size fits all answer for that one. Clearly in this case though the close is a deal breaker no matter what else is there for me personally

Best
Mike
  • #86,255
  • Jan 18, 2011 11:12pm Jan 18, 2011 11:12pm
Quoting mbqb11
Everything is important as a whole. One thing can break a bar for me, while another can make it. I can't give a one size fits all answer for that one. Clearly in this case though the close is a deal breaker no matter what else is there for me personally

Best
Mike

I guess that is down to the subjectivity of non mechanical systems.

Appreciate the input Mike.
  • #86,256
  • Jan 18, 2011 11:13pm Jan 18, 2011 11:13pm
Quoting Pinbar
I guess that is down to the subjectivity of non mechanical systems.

Appreciate the input Mike.
you got it bud
  • #86,257
  • Jan 18, 2011 11:18pm Jan 18, 2011 11:18pm
Quoting joelcf
chfjpy is the kind of one where it gets interesting for me. There isnt a huge amount of two way movement there, but they both respond to much the same external forces. Which means the cross essentially hedges out that effect (in this case, the risk aversion trade), and leaves you with more 'signal' related to the underlying currencies, as such.
Understood, but wouldn't you say that C/J responding to round number levels would place some weight on the fact that many are speculating on that pair itself? IE, the daily bearish pin from April 1, 2010 where the high of that pin was almost directly on 90.00.

Quote
Of course, that more than often just leads to chop. But at least there is actual movement on the three you singled out (audjpy makes that list too thanks to UIA, audnzd for much the same reason as usdcad, and there is enough play on gbpchf to make it worthwhile watching)
I understand you relating AUDNZD to USDCAD, but do you still place more "accuracy" (I wish I had a better word for what I'm describing than "accuracy" lol) on speculation between all USD (namely USDCAD in this conversation) pairs more-so than most other crosses?


Quote
I will still trade them, on occasion - its just a different approach is needed. While the levels, MAs, etc are probably alot weaker and I wont rely on it, the PA is still just as valid - but rather than the straight cross, more as a proxy for the other pairs actually driving it.

I wouldnt trade a fib bounce on AUDCAD (or on anything ever, but whatever), but a bigass pin would still get my attention.
I absolutely hear you on this part 100%.


Quote
Pickiness is an underappreciated artform.

People posting charts on like January 2 and December 28 need to shut down the laptop and go to the beach. Cause you are pretty much the only ones entering positions.
there was no way I was going to miss that I4B straddling 1.0000 on USDCAD Dec. 30th

Maybe I'm still a bit anxious?
Many choose unhappiness over uncertainty.
  • #86,258
  • Jan 18, 2011 11:23pm Jan 18, 2011 11:23pm
Quoting Dan Gilbert
Understood, but wouldn't you say that C/J responding to round number levels would place some weight on the fact that many are speculating on that pair itself?...

Dan,

Can you look at my following post ?


http://www.forexfactory.com/showthre...60#post4319760

Many Thanks
0908
  • #86,259
  • Jan 18, 2011 11:51pm Jan 18, 2011 11:51pm
Quoting forex0908
Dan,

Can you look at my following post ?


http://www.forexfactory.com/showthre...60#post4319760

Many Thanks
0908
ah, the 4hr double inside I4B...

I would take BIG note of what time of day I am trading when in the smaller time frames. Which market is opening? Which market is closing? Is the breakout a result of the opening of the market at the time you executed the trade?

as far as the VBRN, you are on point with that. location looks great, bar size looks great.

but you need to remember that a tight price wind-up on a 4hr chart is far less relevant than on a daily chart.

there was a period of time where I gave up sleep so I could trade the london open 4hr bars. The main thing I learned from the experience is that sometimes all you get from the open, is a blast of action, followed by slow down, although there are times you will catch a nice runner off some PA formed at the london open, I don't think it's worth putting your health on the line to trade it, though.

What I'm saying is, the location looks great, the bar size is nice, but that trade could have easily broken out north first and then shot downward depending on what time it was around the globe.

Obviously people like Mike seem to have spent enough time on his craft to be superb at the 4hr charts, but I personally don't see it happening for me based on market openings/closings having a huge effect on very very short term action that does not necessarily indicate what will happen over the next day or more (depending how far out your target is)


I shouldn't even tell you this, and let you learn manually . But I'll be nice
Many choose unhappiness over uncertainty.
  • #86,260
  • Jan 18, 2011 11:51pm Jan 18, 2011 11:51pm
Quoting Dan Gilbert
Understood, but wouldn't you say that C/J responding to round number levels would place some weight on the fact that many are speculating on that pair itself?
Definitely. There is enough volume flowing between c/j (and the other couple you listed - the majorminors, I guess I would call them) that I still watch levels, same as the others you listed - while they are crosses, they are traded ones. Unlike something like AUDCHF or NZDCAD.

On the other hand, I wont rely on levels as much as I would with USDJPY or EURCHF. I wouldnt touch trade or anything. Whether the RNs come into it, or whether it is just a (small) coincidence...

Quoting Dan Gilbert
I understand you relating AUDNZD to USDCAD, but do you still place more "accuracy" (I wish I had a better word for what I'm describing than "accuracy" lol) on speculation between all USD (namely USDCAD in this conversation) pairs more-so than most other crosses?
Generally, most currencies are heavily traded against the USD, and so the signals are most reliable there, and so I will absolutely weight them alot more heavily when considering a position. Signals are cleaner, levels hold better, etc. The only real exception (well, that we watch) would be CHF.

As a general rule, I definitely weight usd pair interaction more heavily than, say, with the euro or pound. Want to know what the CAD is really doing? You have to look at USDCAD. No point looking at EURCAD, because there just arent enough dollars being jammed into that cross to shift the euro or the dollar, and consequently the levels are weaker. Same with AUD, JPY, EUR and GBP. Their interactions with the USD trump their interactions with each other, to varying degrees of strength.

Amongst the actively traded non-usd pairs, it is a bit of a case by case basis - someone recently said that each currency has its own personality, and I totally agree.

AUDNZD is a special case, in that new zealand is to australia as canada is to the us. I imagine similar dynamics emerge between the scandanavians, but I wouldnt touch those with a 10ft volvo/wooden shoe/something norweigan.

Similarly, I will quite happily watch an audjpy chart (in fact, it is one of my main ones to watch and trade), because it has a dynamic all of its own. But EURAUD? I'll trade it (and have, alot) but I accept that I am trading AUDUSD strength against EURUSD weakness, rather than watching for strong levels on the pair itself. In a way, its more of a fundamental trade than anything. I want PA, with my directional bias, and no conflicting signals.

Hope that made sense, and didnt go around in circles too much
When you have to shoot, shoot. Dont talk.
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