CHOROS System

Dear traders, this is a trade I took in a demo
(as I am new to this system) for 20 pips profit .
short @ 1.3785 12:15gmt because of touch M15/10 & H1/35 emas and also H1 emas started to get flat.
Is this a choros trade by the rules?
H4 was bullish at the same time and m15 50sma was under
the M15/35ema.
Also want to say "bravo" to kostas again as I am Greek too.

Welcome to the thread Makonen,
I see two red arrows in your chart. Both decent Choros trades. Not perfect conditions for the reasons you mentioned, but still good pips there. Keep up the good work.

Hi everyone!

I'm not totally new in FX trading, but relatively new in Forex Factory and also MetaTrader4. I have started to read this thread and it seems very interesting. I'm wondering could someone send me a hint from where to find scripts for bar cloc/spread indicator and for round number indicator!? Thanks in advance!

Payles

welcome, the RN indicator is for 5 digit
both files in the zip

This thread seems to be attracting its share of new 'readers' that hang around for a while. So Kostas and 'helpers' must be doing something right.

Thanks to all for your hard work and help. I for one really appreciate it.

Took the bounce off the H4 10 and H1 40 confluence.

15 pips on first part, taken out at SBE+1 on second.



PS: Looks like I should have gone for a second dip in that well.... was tempted!

Took a little bounce/retouch on the pound as it went past the Weekly pivot, got 15 on the first bit and was intending to trail the second, and went to move the TP up and metatrader crashed!

When I got back in, I found I'd been taken out for 28.4 pips. Well a lot better than a loss, but bloody annoying.... would have been over 50 now!

So who do I blame for it? The Forex Gods or the Microsoft Demons?

Could have taken a bounce at H4 35 as well... that was sweet.

Still in one on the Aussie, bu tlooks like that'll end up SBE+1 on both positions, because it isn't moving.

I've fallen woefully behind.

1) Willkohsg took a trade around this area, but I'm not sure exactly where he got in on the trade. On my chart I've got this huge 14 pip gap at about 4:15 EST. Did anyone else have this? Because of the gap, I don't know whether my chart in that area is reliable. If so, then it looks like there is a fine retrace to the 35 and 50. Those MAs are kind of flat, but right on top of each other.

2) 10 Touch. It's the first touch, but a three bar retrace to the 10. I think this one is a good trade, but only for 15 pips. If you shot for more, you would end up with BE.

3) 10 Touch. Loser. This one has only a two bar retrace, but there have been repeated touches of the 10 at the last consolidation before this breakdown. Moreover, the down move ended with a pin bar that almost hit a major (Monthly) S/R line. And the downward move has already been more than 125 pips. On the plus side, there is another S/R line in confluence with the touch, and that touch is happening right near the swing low just a few hours ago, which is now acting as resistance. I don't know whether I would have taken this trade or not.

4) 35 Bounce (almost). The MAs are steep but starting to diverge. That by itself is enough to keep many dancers out of the trade. Even if I had tried to get into this trade I would have missed it because the touch didn't happen. The bounce was good for 20 pips, but I think this is better as a no trade.

5) 50 Bounce. BE. Here the MAs have widely diverged. But its the first touch of the 50, almost in confluence with a round number. Looking to the left, this area has acted solidly both as support and resistance on the move down. So, even ignoring the 50, I think this is probably an OK trade. But it turns out that, unless you got out with 10 pips or so, it was just break even.


6) There were also two very good H1 10 Touch trades available. The second is probably better since it’s at a confluence with the RN.

I have found an error in my trading in the last days. Eclayf was saying to trade in counfuelnce of a PA bar, i have almost forgot about this, but i think they are critical confirmation for a trade. Kostas is often saying that he waits for a 5M confirmation PA bars, i think most of us forget for that very iportant "tool" and focus only on MA's angle, direction, bar counts, pivots and other tools in the system.

P.S. I think that clay gave us a list of things to check before take a trade. I would be grateful if somebody shares it and i think it would be good for the new ones, if kostas put's it in the first post. I know that it is not a "perfect" list but was very tidy with the points to sum. It will also help us with the clarification "By the rules trade" and "AAA+" trade.

1) 10 Touch. Winner or BE. This trade comes before London/Frankfurt open, so is not strictly by the rules. The MA is nice and steep. The touch comes and retraces to form a dragonfly doji, moving 9 pips in the trade's favor, before giving it back to a second touch. I think lots of dancers would either take a break even on the move back to the 10, or get out with a small profit. I've seen any number of posts where people say that the bounce happens, and then if the trade starts moving against you, it doesn't often come back. And I think that may be true. Here's a case, however, where it comes back strongly. Holding on would give you 30 pips at the Weekly Pivot or 44 at the Round Number.

2) 10 Touch. Loser. I had just finished watching the Oscars (Tivo recording) and was at the computer when this set-up happened. It looked much better in real time than it down on this chart. It's a second touch, and the top was at a Round Number, together with an S/R line. But the price action at the top wasn't terribly bearish, and the retrace to the 10 was a perfect two bars, and the 10 was at a near perfect confluence with the 200. I put on a limit order, and missed getting into the trade by 3/10ths of a pip. There was an immediate bounce of over 7 pips, and I left the computer to go to bed. It turns out I should be happy that the limit didn't get hit. Seven pips was about as far as it got, before it blew through everything. (I think the lesson here is just not to take these trades when they need to break through significant support/resistance, or at least be sure that that S/R is far enough away.)

3) 35 Bounce. This is a very interesting situation. The 35 and 50 are maybe slightly diverging, but they are also getting pretty steep. The Round Number is between them, and the Daily Pivot just underneath, in confluence with the 100. The H4 150 (an EOHater MA) is just six pips underneath the bottom that forms here. How to trade this? Taking the bounce off the 35 would be a by the rules Dance trade, and it would work out well. But I don't think many people would take this as a straight dance trade.

If you waited for a good rejection candle on the M5 chart, you would find one. It would eat up 15 pips before you got into the trade. You would then get 12 pips in your favor before the trade dipped back again to BE. And then after kicking you out, the rocket ship would take off.

EOHater treated this as a cross and reverse. Survivor has talked about that on the H1 chart. This one works on the H1 chart as well. When after a decent trend in one direction, a candle retraces and crosses both the 35 and 50, and then closes near the MAs with a short or no wick, EOHaters says to fade the retracement. Here, the bar in question does exactly that. It also coincides with a one hour candle that crossed the 35 50 and 62. And on top of that, the close of the bar is within two pips of a Fib retracement from Friday's low. That's alot of non-Dance stuff. But EO's cross and reverse is very, very close to the Dance bounce trades.

With all of the above, there should be some area where a person could get in near the bottom of this move. (Assuming you weren't lazy and asleep, like me.) The harder question is how to stay in the trade. It would be really tempting to close out with the consolidation around the Daily R1. Did anyone actually catch this move?

4) 10 Touch. This is the first touch after the long move. The Weekly R1 got tested 5 times leading up to this touch, and that's not a good sign. On the other hand, during the same time there were generally higher lows. All in all, I think this is a good trade. In keeping with the suggestion of taking price action into account, I've marked a tweezer bottom 5-6 bars before the touch. That area would be my stop for this trade, and if price closed below it, I would strongly considering reversing the trade. Instead, after several bars, this trade would finally yield 15-30 pips.

5) 10 Touch Constrainment. Instead of bouncing off the Weekly R1, price has not started to bounce off the Round Number. This doesn't look like that good a trade to me, but its worth noting that 5 bars out of 6 have their lows defined by the 10. I would be interested in hearing whether Survivor thinks there is a constrainment trade in here.

This is a very good point. Kostas uses price action to "fine tune" entries on lower time frames. That's not part of Clay's Dance, but definitely has become a core aspect of Choros. We haven't had too much discussion on exactly what constitutes a good rejection on the lower time frame, and, as with most things, I would love to hear anything Kostas has to say on the matter.

Clay talked about two other kinds of price action with the dance. First, in the thread, he constantly reminded people to "look to the left". Here, the idea was mostly to look for trades that came in areas where there was confirming support or resistance. Second, he would also sometimes take trades that were not strictly by the rules because of the price action. The one that comes immediately to mind is double tops or double bottoms where the tops or bottoms were EXACTLY the same.

I think that even Eclayf was talking of rejection bars around the MA's and i will check the manual, i might also be wrong, but it would be good if we take a little time for this.

Correct me if i'm wrong but clay had in mind a double top/bottom on two consecutive bars with tops/bottoms at about the same levels, i think sometimes 1 pip would not violate it. Not like the W shape bottom or top, right?

You may be right about rejection bars. If so, they are something to consider in addition to the pure touch trades. I know there is at least one early trade in the thread where there was a near bounce off the 35 or 50, and Clay says that if you missed that entry, you could take the trade on the close of the bar because there had also been a clear break of the 10. And yes, I agree that this is something we should try to be careful about. Sometimes, when I talk about this stuff, I feel like a blind man trying to describe a picture to others.

On the double tops and double bottoms, yes, they are definitely best on two adjacent bars. They are also called tweezer tops and bottoms.

Looks like we may have some movement on the E/U at last. Maybe it's making up its mind which way to go.

I agree.
I would also be interested in better understanding the way of "fine tuning" the entries.

I think Kostas use sometimes (or mostly ?) M1 for that purpose.
Could we perhaps study shortly a bit more about this point ?

Thanks

Again , I can see a perfect choros trade eu: touch of H1/62ema some minutes (15) before London open.
I think that the stops (for longs) have to be under the 62ema always...

Yes, last nite had a perfect confluence of the higher TF MA's, as both the H1 35/50 lines as well as the 62 converged together at that area of .3790, which also happened to be prior H1 support right under it at 1.3786...SL was at the prior pivot low, beneath that area, which was .3779, so the risk was very acceptable to the possible reward. The RN of .3850 was the target as that was just under prior resistance of the prior day's high of .3855. This play could have been taken twice - once during the London open and then again during the US Session as price "ping-ponged" between support and resistance. This play is an example of where you have to step back and look at the "bigger" picture as seen by the H1. This was also evident during the prior day's session as we had a beautiful D1 "touch" trade off of the 10ema which also coincided with the H4 "touch" off of the 35sma and was also an area of prior support. Currency traders always need two sets of glasses - Micro and Macro at all times...and thus the 3 time frame setup to give you the info you need.

Going into the day, after yesterday's big move, all the time frames were showing an uptrend.

1) 10 Touch. Loser. The 10 is steep enough. I'm not sure how to count the retrace here. From the top, its only a one bar retrace, but it's a double top, so is it a four bar retrace instead. More important, I think, is that the retrace here is from a double top (though not on consecutive bars), and the first of the bars is either a shooting star or dragonfly doji, depending on how you look at it. This is definitely a by the rules trade, but not an A+ trade. I don't know if I would have taken it. The draw down is over 14 pips. If you held a 15 pips stop, you might make some money, but with Clay's nine pip stop, its a loser.

2) 50 Bounce. Break Even. I think the MAs are steep enough going into this bar. This is the bar where they begin to get really flat. And they were also converging going into this bar. The retrace to the MAs from the top is very long, but this bar is a big retrace, so its not the series of small bars Clay warned against. It's also definitely not a nice two bar retrace. There is a 13 pip drawdown, followed by an 11 pip upswing. You might get a few pips out of this trade by exiting quickly, but its probably break even.

3) 10 Touch/50 Bounce. This is a retest of the 50 and the 10 after price has crossed the MAs. I tried to get into this trade on the previous bar, where the touch did not happen. My limit order got missed by half a pip. When that bar formed a dragonfly doji, only two bars after the very bullish pin doji, I decided that I would not take the touch on the next bar (the bar marked for this trade). My reasoning was that this would now be the fourth bar in the retrace, there was a good support level below the trade that had held up three times already, and the near touch on the last bar would make the real touch here be sort of like a second touch. I think my reasoning was pretty good, despite the fact that it turned out to be wrong. I'd be happy to hear if someone disagrees. Good for 15 pips.

4) 10 Touch. Loser. This is one of those trades that is good "by the rules" but would be a no trade if you look at price action. First, look to the left: the high here is 1/10th of a pip off the last swing high, almost a perfect double top. The first two bars forming this high are within a half pip of each other. The first has a long top wick. The second is a dragonfly doji, and the third is a long legged doji. Combined these show a possible reversal, combined with extreme weakness and indecision. Now, combine these things with the top bar coming exactly at London close (price tends to revers at London close), and I think there's more than enough reason not to take this trade. If anything, I think there might be good enough reason above to enter the trade short.

5) Price action only. This part is strictly not dance. Look at my purple S/R line. This is a weekly S/R line that I put on the chart probably 4-5 weeks ago. Today, it catches the bottom on five distinct moves. On the third of these, I contemplated taking the trade, but I was also still thinking about taking the touch trade that I saw coming after the move up. I passed on it, mostly because I don't trust myself enough yet. And then I passed on it again, at the fourth circle. When that moved up, I stopped trading in disgust at myself. If I had hung around for the fifth trade, and passed it again, who knows what I would have done... This is the sort of trade that gets taken all the time in the EOHaters/Ken thread, and I should probably talk about it there instead of here. If this is too far afield from the dance, please let me know and I will stop posting these sorts of things. (BTW, if there had been any kind of confluence here, I would have been all over these trades.)

hello m8, i love your reviews but i have a few things here.

1) not sure if this is a loser, on the touch it only goes negative for 9 pips and on the next candle up for +32 pips. so for me thats a winner.

2) the thouch of the M15 35 is also a confluence with H1 10, and M15 50 is less than 4 pips away, both M15 35/50 probably were in a slope and parallel at the time the trade happened although afterwards they seem to be flat.
the price goes negative for -16pips so that would have taken out my 15pip stop. loser

3) its a counter trend trade, because as you say all TFs say UP.
i would not have taken it also because i try to unlearn my risky ways and only like to trade with the trend.
also that area looks a bit congested now, pretty much all of yesterday looks like a big (50pips high) box range but it wouldnt show in live session.
i suppose the only reason this touch worked is because its a touch (to the pip) of H1 10 also.


4) my broker has a bit of a different picture on that one, i dont have 2 dojis on the top and the touch happens on the 3rd bar (see below)

5) im not quite sure what trade that is as i have not read the EOHaters thread yet, i suppose you refer to a Resistance line off some H4 high that now acts as resistance, there are also 2 others in yesterdays range that never held any resistance yesterday.
my view in these static SRs is they are good when they work and not when they dont heh... you get my drift.
i prefer the dynamic SRs from the MAs we use, because if i am to start throwing more staff on the charts, then why not some fibs and a gazillion other things that will make me think all the time.. should I or should I not?
"to be or not to be?"

This is in "advanced" category.
The M15 10 is changing direction and there is a two bar retrace to the 10. At the same time it was bouncing from M5 35/50. I took the long exactly on the M15 10 with initial target close to Daily Pivot. I closed manually at +18p since there was hesitation at the confluence of H1 50/62 with H4 10. In fact, this could be a point to short, but I am waiting for the confluence of RN(1.38) with daily pivot, H1 35, and M15 200 before shorting.