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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

  • #89,881
  • Feb 23, 2011 3:32am Feb 23, 2011 3:32am
GBPCHF..hit my SL..reached till 250+ yestrday but happy with 135pip profit.. no worries!
  • #89,882
  • Edited 3:52am Feb 23, 2011 3:36am | Edited 3:52am
Quoting supremeChaos
btw, i have been reducing my posts lately. based on FF stats, i now make 7.xx posts a day on average, compared to last year's 9.xx avg.
end of year, maybe down to 3-5 avg.
I'm writing a derivative to sell over your daily post count as we speak

<actual content>
Quoting Ifmyante
Hi Jim.

Do you imagine that they're respected because they used to be used for seasonal commodities like corn, coal, heating oil and the like, and the respect has just spilled over into forex?
Quoting jarroo
That may be . .but they are long term averages and they tend to have some added strength in them.

This is a better question for Joel . . You out there buddy??
Kinda. It has more to do with market structure and participants - but this incorporate seasonality, amongst other things.

Traditionally, you had some seasonality based on demand - your example of heating oil in winter is a good one. But, like any predictible pattern, seasonal patterns have mostly disappeared thanks to the greater access to information and market efficiency.

This may come as a shock... but the main roots are about greed

(this is a massively simplified explanation, but close enough is good enough in my book)

Say you are an equities dealer. A hedge fund client says 'buy us a million shares of Wayne Enterprises in the next 3 months, before we have our quarterlies due!', and your boss yells at you to get off the internet and do your damn job. So, you know that your bonus is going to be driven by how much money you make your boss - and this is going to be be driven by the spread between how much you pay for those shares, and the price that they could have been bought on the open market if the client just jumped on the internets and pressed buttons.

How is this going to be calculated? Well, its usually going to be the average price you pay, compared to the average price over the specified horizon. So, in this case, the three month average price. Which.... is 90 days or thereabouts. Compare the average price you paid with the 90d average on that day and that's the difference between a Datsun and an Aston.

So, in order to get said Aston, you are going to buy all the way up to that MA, then stop...wait for a pullback... then start buying again. Resistance.

And then, on the other side, you have the enemy dealer (who you can tell is the evil one, because they always have a goatee) who is selling for his client, and wants his average price to be above that MA. Or if price breaks through, you wait for it to start falling and start accumulating. Support.

(obviously, this is a very simplified example... dont do this.)

Market segmentation theory tells us that different investors have different time horizons. And that's probably pretty accurate. It says a bunch else, but we will ignore that for now. From broker/dealers who have orders that need filling now to hedge funds with quarterly results to boast abount out, super/pension funds with annual returns to file and all the way out to Warren Buffet who thinks a 5 year chart is daytrading. So you get a bunch of other common horizons where the MA is 'meaningful' - daily volume weighted average price, the 6 month average price, 12 month average price, etc.

Obviously, this is going to apply to more than just equities, which is why you see it cross markets - fx dealers for insto banks, traders for hedgies, prop desks at ibanks, even the guys hiding in their bunkers under Jungfrau with their fingers on the button.

In short - if someone (with money) is watching it, it is probably meaningful. And if someone is getting judged, paid or threatened with it... then someone is watching it.

On top of that, you have the usual things you expect to see whenever someone has a chart and a ruler - the self reinforcing nature of TA (if people think it works, they trade based on it... and so it works), level 1/2/3 games (amateurs trade a trendline bounce, traders try to stop them out of said bounce, smarter traders know what they other traders are trying to do and so try to stop them out, etc) and so on.

Also: sometimes, things are just a coincidence. Draw enough lines and some are bound to work
When you have to shoot, shoot. Dont talk.
  • #89,883
  • Feb 23, 2011 3:56am Feb 23, 2011 3:56am
Quoting joelcf
I'm writing a derivative to sell over your daily post count as we speak

<actual content>




Kinda....
Joel,

thanks so much for taking the time to explain that so adroitly.

It just shows how insignificant traders like us really are, scrambling over the scraps from the giants' foodfight



Michael
  • #89,884
  • Feb 23, 2011 4:13am Feb 23, 2011 4:13am
Quoting joelcf
And then, on the other side, you have the enemy dealer (who you can tell is the evil one, because they always have a goatee) who is selling...
Love it!
  • #89,885
  • Edited 5:36am Feb 23, 2011 4:56am | Edited 5:36am
I didn't take these..... like to be awake when these occur and was sleeping...I have found these need to be managed...and this is "critical." You are not waiting for a PA signal bar to enter...and therefore it is my belief that one must monitor the following bars to indicate WIPG.

But, thought by posting maybe this would help ....they are TT at fib levels and ppz's ......I don't particularly care for the 38 fib.....but the 61 is a favorite....here are two charts daily and then scoped down to the 1 H.


I need to edit this....just to be clear that location is everything...the ppz must be there and have show strength and the first touch back is also very important. The Fib is just a confluencing tool as J16 states and seniors would confirm.
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  • #89,886
  • Feb 23, 2011 5:01am Feb 23, 2011 5:01am
Oh no ...not another G/Chf chart........Waiting patiently....
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  • #89,887
  • Edited 6:04am Feb 23, 2011 5:54am | Edited 6:04am
How could I have traded this?
Is it too late now?

I don't know why, but my Daily chart won't upload. It showed PBT&CA.

I would love to have touch traded long at PPZ, but the last time I tried that I got burned. I know I shouldn't let that affect me, but that highest bar to the left kept me out.
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  • #89,888
  • Feb 23, 2011 6:12am Feb 23, 2011 6:12am
Quoting Ifmyante
How could I have traded this?
Is it too late now?

I don't know why, but my Daily chart won't upload. It showed PBT&CA.

I would love to have touch traded long at PPZ, but the last time I tried that I got burned. I know I shouldn't let that affect me, but that highest bar to the left kept me out.
would be a failure to enter now....u missed the train, but doesnt matter....next spot will come soon.

the long would've been nice, you could set a tight sl, buy low in an uptrend with nice R:R isnt bad at all

thanks
jonas
Hero calls followed by margin calls...
  • #89,889
  • Feb 23, 2011 6:23am Feb 23, 2011 6:23am
Quoting PhAnTi'
would be a failure to enter now....u missed the train, but doesnt matter....next spot will come soon.

the long would've been nice, you could set a tight sl, buy low in an uptrend with nice R:R isnt bad at all

thanks
jonas
Yup. I need to miss a few more of those opportunities before I start to take them. I learn backwards

Must start a journal of missed trades!

Thanks Jonas mate
  • #89,890
  • Feb 23, 2011 7:02am Feb 23, 2011 7:02am
Quoting Ifmyante
Yup. I need to miss a few more of those opportunities before I start to take them. I learn backwards

Must start a journal of missed trades!

Thanks Jonas mate
i did have the same problem, to buy the VERY lows and sell the VERY highs cause you are afraid that price might move more in previous direction, then you see price bouncing 15-20 pips and you say to yourself why i didnt sell the fuckin 61.8 fibbo on the daily ?

Then you enter late and lose usually : p


kind reg
jonas
Hero calls followed by margin calls...
  • #89,891
  • Feb 23, 2011 7:05am Feb 23, 2011 7:05am
Quoting PhAnTi'
i did have the same problem, to buy the VERY lows and sell the VERY highs cause you are afraid that price might move more in previous direction, then you see price bouncing 15-20 pips and you say to yourself why i didnt sell the fuckin 61.8 fibbo on the daily ?

Then you enter late and lose usually : p


kind reg
jonas
When the train has left there's no point stepping off the platform!
  • #89,892
  • Feb 23, 2011 7:10am Feb 23, 2011 7:10am
Quoting supremeChaos
sorry for the late reply, i was asleep then.
anyway, u already had great replies..

im not sure if u are being too picky. i think u are already at a stage wherein u know what u want, what to look for, what to trade. if that is the case, getting a bit more flexible may harm u. unless u test this flexibility & see if it fits your trading personality.

personally, a weekly chart is too slow for me.
also, just like any higher timeframe (Daily & up), there will be trends within trends (price moves up & down, not a 1 way street)...
meaning, if...

Wow... excellent answer... the charts makes it very easy to understand.

Thx a lot SC !
Trade Smart
  • #89,893
  • Feb 23, 2011 7:15am Feb 23, 2011 7:15am
Quoting Ifmyante
When the train has left there's no point stepping off the platform!
this !


jonas.
Hero calls followed by margin calls...
  • #89,894
  • Feb 23, 2011 7:32am Feb 23, 2011 7:32am
Quoting supremeChaos
hahah, yeah i often goof around so about 500 of my posts is equal to 1 of yours, in terms of content.
btw, i have been reducing my posts lately. based on FF stats, i now make 7.xx posts a day on average, compared to last year's 9.xx avg.
end of year, maybe down to 3-5 avg.
more lurking time.. hahah


u mean im the culprit?
Hey Supremo

I for one enjoy reading your posts so keep your average up!!
  • #89,895
  • Feb 23, 2011 7:33am Feb 23, 2011 7:33am
Hey trading is really easy... wait ...move to BE... you are done now watch
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  • #89,896
  • Feb 23, 2011 8:05am Feb 23, 2011 8:05am
Nice one Adi
What's the plan?

I've been broadening my horizons and see some very clear zones on Euro-Bund
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  • #89,897
  • Feb 23, 2011 8:09am Feb 23, 2011 8:09am
Quoting Ifmyante
Nice one Adi
What's the plan?

I've been broadening my horizons and see some very clear zones on Euro-Bund
thanks! this one was easy.
For now the Plan is to hold until 1.3777 that second high.
Or until I see a reversal against me...
That is if my BE survives
  • #89,898
  • Feb 23, 2011 8:11am Feb 23, 2011 8:11am
Quoting Adilius07
Hey trading is really easy... wait ...move to BE... you are done now watch
Hey Adilius

Nice setup there and well spotted! I was looking at this one last night but did not plot/look for the bear flag on my chart! Will need to be more vigilant!!

Kal
  • #89,899
  • Feb 23, 2011 8:13am Feb 23, 2011 8:13am
Quoting Kalbar
Hey Adilius

Nice setup there and well spotted! I was looking at this one last night but did not plot/look for the bear flag on my chart! Will need to be more vigilant!!

Kal
Hi Kalbar, yeah I don't know if I get it right, but I try to copy Mike as you see, even the lines are of the same color, lol. For now works ok, I'm happy
  • #89,900
  • Feb 23, 2011 8:19am Feb 23, 2011 8:19am
commendable, I looked at this and passed, now that I see your trend lines it makes more sense... another Mike in the making!

Quoting Adilius07
Hey trading is really easy... wait ...move to BE... you are done now watch
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