On My Way To The Top

MTF-TF Alerter/Display thoughts.: http://www.forexfactory.com/showthread.php?t=287188

I created this thread so we do not spoil to much pmullin86 journal, as he does a good thing explaining his trading method.

Here is a quick picture with some description of the entries on the EUR USD on Friday April 1,2011...The first thing here is to notice the nice instances of bearish divergence at every peak made by the stochastics with a constant test and fail of the 50 fib level and the fib pivot r1 level...we also want to always take note to our higher time frames and see whats going on in which we can clearly see that on the higher time frames there is also bearish divergence confluent with the divergence on the 5 minute right at a significant level that price is having a hard time breaking so we have those two criteria met and look for our stoch rope to support our trade...the first line has an x because I don't like when the blue lower time frames stoch rope moves away like it is trying to do as it often will try and snap back once it pulls price away from it and typically we are on the right side of the trade but this would give us a higher drawdown than wanted and so would take price on the scenic route to get to where we want it...So I just prefer to stay out of unclear situations like that...the next vertical line was a nice entry with 4 out of 5 criteria being met...we have divergence a test and fail as well as the stoch ropes being converged very nicely and the price closing below the moving averages...so this and the next vertical lines are trades with an 85 percent probability of price going in our desired direction...fourth vertical line fourth vertical line...we can enter a bit early on that bar as we have 3 criteria met and the moving averages are tight which means that price should have no problem closing below and remember in the revisions I did mention that we can have 3 out of 5 rules met as long as we have either an instance of divergence or an instance of the candle closing below or above the moving averages which ever our trade direction is...we could wait until the next candle and set our stops to the 15 pip stop that I use and all that would happen is as you can see price will stop out that trade just suggesting that it was an early entry...if we look to the higher time frames again it is clear that we are in a consolidation box that the eur usd loves to go in before making its move...and so we know that a break out is coming and can think that it would be to the downside with all the bearish divergence and resistance which has created somewhat of a ceiling for the price...5th vertical line marks another entry where we have 3 out of 5 so this is a 70 percent probability trade but this is where we hit our pot of gold finally as price has broken out of its consolidation box...and we have price closing below the moving averages, stoch rope supporting our trade and also we have that test and fail which I love so much...we can also see that stochastics have been building the short as it has been creating a nice series of lower highs after the last instance of bearish divergence..and we always keep an eye on the mtf stochastics to keep that broad and general idea of what is going on or the grander scheme of things...simple enough and there you have it...oh and of course we always want to keep an eye on our daily range for the day as this can be quite telling often times of what we should expect or what may be to come...

Paul

Here is a pic of the nice up move that occurred on Friday with EUR USD with entry and details..one thing that made this trade really nice was the bullish divergence on five minute which happened at 4 hour 78.6 fib retrace level which was confluent with bullish channel bottom and also this level was confluent with a five minute 161.8 fib extension and the -50 fib level of the previous day's high to low...so a lot of confluence which is what we really look for to mark off these high potential reverse zones as both target areas as well as entry areas alike....a lot of this is becoming very repetitive in this journal as it just clearly happens in the market over and over again...the same patterns but we just have to recognize these patterns and reoccurring scenarios...oh and it probably goes without saying but vertical line is the entry...

Paul

One thing that I always like to keep in mind before entering a trade is that I want to see many different things telling me to enter that trade before I do an example like the one right above this one with a high confluence of levels as the support and resistance levels is the basis of what the bigger guys that move the market are using so why wouldn't we...as I explained to someone the other day as I look at it...the smaller timeframe support resistance and fib levels and everything are good to look at and do obviously affect price but we really have to consider the higher time frame i.e. the 4 hour and daily because these time frames represent the big institutions and such and these are the timeframes that they are looking at...so if there is a support or resistance level coming up on the 4 hour or daily timeframe than this is what they see and use as their logical take profit level and since these bigger institutions move the market when they take profit at these levels it causes the big bounces that we see like the hundred and some odd pip up move on the eur usd on friday...so we just always want to consider these things and realize what it really is that is going on when we are trading but back to what I was saying about taking a trade only with a lot of different things telling me to...this is good because if you dont have good reason to enter a trade than chances are you shouldn't be entering...if you cant explain in detail the various reasons you entered than you are probably forcing an entry which is never a good thing in this business...

Did you take that trade? You entered on the next opening candle after the VLine?

BTW: close above EMA you mean only the red once?

No I didn't take this as I saw this trade setting up while at work but missed my entry candle...but yes entry would have been at the open of the very next candle...and yep you've got it absolutely correct...I do just mean the red ema's which are the 5,10,15 and 20 ema's...but I just wanted to post these entries for my own future reference and anyone else who may be interested in seeing what I'm doing here...

Just to let you know I'm still around

I'm back as well!

Kicked my wife out for the second time(should have kept it that way after the first time).
She can keep the dog though; the rest is mine!!
Need some time to read and study again..

Mark

I will be travelling but hope to resume work on the alerter when I'm back.

In the meantime - good trading to all of you.

MJ


PS: despichtt: sorry hearing of your problem.

Test..

Test

Entry Examples

late entry should have entered at close of previous bar instead of where vertical line is
eur usd long--currently running
exit red h1 stoch bar or next pivot

Here attached is the daily range indicator. As far as the arrows go, it came with one of Dredds templates. Hope this helps.

picked up buy on eu

So with the daily stochastic almost oversold and the hour stochastic making its way to touch the 80 level and now seeming to turn over I would be anticipating some type of short movement as can be reflected by the picture being attached...but in this picture there is clearly a down move being built on the 5 minute chart as there are two 123 patterns to the down side with the second being accompanied by some bearish divergence present on the 5 minute chart to show the momentum being to the downside...though I put more significance to divergence on the higher time frames but most importantly there is divergence on the hour chart as the one hour stochastic rope forms to head down or what looks like it would be getting to converge and head down to meet the daily in oversold...with the second 123 pattern closing below the pivot level which is also a good sign to go short. I would consider this a counter trend trade as far as the shorter term trend but trading with the daily trend it is right on target and this is an earlier type entry picking up on the reversal and resumption of price with the daily trend...as the daily rope is still to the down side...with price on the one hour testing the 50 ema...with an inside bar created at that point and a break of the low of that inside bar with price also closing below the mother bar of that inside bar...with a nice triple touch of a trend line on the 1 hour as well...and also our current daily haiken ashi color is red further confirming our down trend...but i suppose I will see what happens...price on 1 hour seems to be closing as bullish pin bar...but I know I wont actually enter on the 5 minute until I have the moving averages in order with price testing and stochastics in order...with the test and fail at or around a fib pivot level of course....

So this is a perfect example of why I must wait for price to tell me what it wants to do as oppose to assuming what the market will do...while awaiting my counter trend trade to materialize and get with the long term trend...a buy emerged which is with the shorter term trend....and price ran up for over a hundred pips...as said earlier...very interesting...ema's still heading up...price came down and touched...and at that time...the 1 5 stoch rope is nice and smooth...15 stoch rope getting on board with price showing similar set up with ema's and of course bullish divergence,30 minute blue ltf stoch rope portion pulling away to snap back to the wall and htf portion of the rope to turn it up, one hour stoch rope turned up with htf heading into wall and ltf portion of stoch rope...h4 rope also closed up and unclosed portion of rope nicely converged heading up so we have a nicely established momentum to the upside...and since all the lower time frames build and move the higher time frames the lower time frame stoch ropes will push the 1 hour into overbought and that would be my exit as in the buy I took this morning... ***note to self*** trust the stochastic ropes as you see them...and I would be exiting right now as the one hour just closed above the 80 level...most times stochs will follow what spud outlines as the 80/20 rule or 20/80 rule whichever but most times as long as it takes to get to either extreme they will and price will move with it...this buy actually looks just like the buy from this morning as it should... first vertical line would be entry and second is exit where one hour is closing...


Paul

This post is the only entry for today that was actually taken as the others will just be for my own reference only...posting this somewhat late because I didnt have a chance to take pic during and just now getting around to it...but reason for entry...eur definitely seeming bullish from looking at the 50 and 100 ema direction and slopes on the different time frames as well as the daily stochastic rope was nice and tightly converged heading up with the four hour stochastic rope still overbought so tells me that we are definitely in a nice up move with price dancing around the pivot level and taking support around the 50 and 100 ema's sloped up as mentioned already...and there is nice pin bar at swing low where stop was and also can't see here but there is a nice bullish pin bar on the 60 minute chart as well...along with slight bullish divergence on 15 minute...bit of a late entry but its ok as stop is the same and pretty confident in entry...also in this picture one can note the harmonic pattern that will lead into the next trade...

Here is an entry that was taken on the AUD USD 06/30/2011 which clearly was a failed buy. ***Note to self*** price was making lower highs with thirty minute stoch rope a bit messy to the down side but still trending down nonetheless and price also at the top of the m30 tma as price just closed above the 15 minute middle band of the tma with h1 stoch rope moving down as well...need to be sure to pay attention with 15 minute 5 ema and 10 ema crossed to the downside with the 10 about to cross below the 20....but with the h4 stochastic still in the overbought region so the trend in my eyes would still be up for the most part and 15 minute 50 and 100 ema still sloped up pretty nicely and second screen shot shows a good entry that makes up for the first loss where price comes down and tests the 50 ema with the 15 minute stoch rope supporting an up move as well going back up to the overbought region to meet the 4 hour stochastic. As we all know the lower time frames stochastics will always make cycles between the overbought and oversold region up and down and back and forth to bring up/down the higher time frame stochastics or at least to just move from whatever position they are currently in until the move in that designated direction loses steam which can usually be evident in the form of divergence on the 1 hour time frames and up for the most part and these reversals also present with harmonic patterns confluent with these levels of divergence....


Paul

hi sweetmoya,

in response to your PM:
I'm personally not using any emai alerts - so I never tested it.

I hope it works: see attachment.


My new stuff is at: http://www.forexfactory.com/showthread.php?t=285687
for some background to the new indies check out: http://www.forexfactory.com/showthread.php?t=287188