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Flag trading the trend

  • #4,221
  • May 5, 2011 3:25am May 5, 2011 3:25am
Hi Divergence,

I just took at loss on EU on what I thought was a good trade. Can you please advise?

I went long on the break of the shaded candle. Entry is blue line, stop is red line (20 pips).

The divergence you can see only appeared after I had entered.

Thanks
Attached Image
  • #4,222
  • May 5, 2011 3:34am May 5, 2011 3:34am
Quoting Ultimatus
Hi Divergence,

I just took at loss on EU on what I thought was a good trade. Can you please advise?

I went long on the break of the shaded candle. Entry is blue line, stop is red line (20 pips).

The divergence you can see only appeared after I had entered.

Thanks
Hey Ultamatus,

my understanding is that if you enter and then see divergence, you bail.

~Pure
Enter Signature
  • #4,223
  • May 5, 2011 3:51am May 5, 2011 3:51am
Thanks Pure, I didn't know that.
  • #4,224
  • May 5, 2011 4:10am May 5, 2011 4:10am
That's why we should keep the RSI on the chart... IMHO.
  • #4,225
  • May 5, 2011 4:55am May 5, 2011 4:55am
Standard trade: 5 waves, breakdown in structure, look for 123,
enter hopefully with a mo bar
Attached Image (click to enlarge)
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  • #4,226
  • May 5, 2011 5:15am May 5, 2011 5:15am
Quoting Ultimatus
Hi Divergence,

I just took at loss on EU on what I thought was a good trade. Can you please advise?

I went long on the break of the shaded candle. Entry is blue line, stop is red line (20 pips).

The divergence you can see only appeared after I had entered.

Thanks
Hi, you were at the top of the trend when you entered the trade; best not to enter there as more often than not you're gonna lose.
Check my prev post #4227
  • #4,227
  • May 5, 2011 5:48am May 5, 2011 5:48am
is this a flag trade i see developing before my very eyes?
I think there's cable news aproaching though.

Could be or it could not be. The charts play various tricks; that's why patience is a virtue!
Attached Image (click to enlarge)
Click to Enlarge Name: diver 16.jpg Size: 123 KB
  • #4,228
  • May 5, 2011 5:56am May 5, 2011 5:56am
ultimatus, my charts show that the 2 previous bars were both valid sub, obviously the 1st was not taken out but the 2nd was by the bar u used as ur sub
  • #4,229
  • Edited 7:08am May 5, 2011 6:04am | Edited 7:08am
let's reposition the trend line

UPDATE: Nothing doing on the flag; look for next opportunity.
Attached Image (click to enlarge)
Click to Enlarge Name: diver 17.jpg Size: 105 KB
  • #4,230
  • May 5, 2011 7:01am May 5, 2011 7:01am
Quoting tbjohnton
ultimatus, my charts show that the 2 previous bars were both valid sub, obviously the 1st was not taken out but the 2nd was by the bar u used as ur sub
You are right, I just added a CCI to my chart and yes the previous 2 were valid. I have been relying on this Ret Setup indicator that I found on here, will go back to the CCI now!
  • #4,231
  • May 5, 2011 7:04am May 5, 2011 7:04am
pretty amazing how well this works when the rules are followed. nice how div is passing on lessons that would be expensive to learn on our own.
  • #4,232
  • May 5, 2011 7:09am May 5, 2011 7:09am
Quoting Ultimatus
You are right, I just added a CCI to my chart and yes the previous 2 were valid. I have been relying on this Ret Setup indicator that I found on here, will go back to the CCI now!

Ultimatus, hi there,

To my best understanding, the Retracement Finder is just a CCI histogram, so it's either way...
  • #4,233
  • May 5, 2011 7:25am May 5, 2011 7:25am
Beautiful flag setups across 3 pairs just as multiple high-impact news is upcoming in 6 minutes... gaahhh!
  • #4,234
  • May 5, 2011 7:33am May 5, 2011 7:33am
Quoting ultimatus
you are right, i just added a cci to my chart and yes the previous 2 were valid. I have been relying on this ret setup indicator that i found on here, will go back to the cci now!
hi,
just rem it's not just about what is the right entry but also where it is.

Where u entered long, regardless of sub etc, was in the wrong place because the trade may turn on you there--at the top of the mountain.
Even if u r having difficulty picking out the waves, you can see that there's already been lots of peaks on the way up; lots of waves.

Therefore prob not a good idea to try for another one (long trade).

Keep positive and stick with it!

Gray.
Attached Image (click to enlarge)
Click to Enlarge Name: DIVER 18.jpg Size: 139 KB
  • #4,235
  • May 5, 2011 7:33am May 5, 2011 7:33am
Quoting Ral1n
Ultimatus, hi there,

To my best understanding, the Retracement Finder is just a CCI histogram, so it's either way...
You can see here in this screen shot, the two bars before the one I entered on are also +50 on the CCI but the Ret Setup did not pick them up (was not a green bar).
Attached Image
  • #4,236
  • May 5, 2011 7:39am May 5, 2011 7:39am
Quoting Ultimatus
You can see here in this screen shot, the two bars before the one I entered on are also +50 on the CCI but the Ret Setup did not pick them up (was not a green bar).
Ultimatus,

to be honest I stopped using the Ret Setup version. I found that the Green Bar/Red Bar indicator did not seem to be accurate all of the time. I found plenty of set-up bars that were 100% valid and did not turn green or red on that indicator. It kept me out of some trades because of that. I do not know what the coding is for why/when it turns a color. I use the same CCI that Divergence posted at the beginning. Works for him, works for me.

Regardless, others have commented on why they would not have taken that trade which are valid reasons.
  • #4,237
  • May 5, 2011 7:51am May 5, 2011 7:51am
Quoting Ultimatus
You can see here in this screen shot, the two bars before the one I entered on are also +50 on the CCI but the Ret Setup did not pick them up (was not a green bar).
The first bar there was more than 2.4 above the 10 sma of median price
The second bar was the wrong direction.

That is why they didn't turn green. As far as whether they were valid or not I guess it depends on your interpretation which can be subjective.
  • #4,238
  • May 5, 2011 7:55am May 5, 2011 7:55am
Quoting Paradox
The first bar there was more than 2.4 above the 10 sma of median price
The second bar was the wrong direction.

That is why they didn't turn green. As far as whether they were valid or not I guess it depends on your interpretation which can be subjective.
I am aware of why those were not green. I am simply saying that I have found that there are have been bars that did not turn green and followed all of the rules.

Bottom line: I would not rely 100% on a green bar versus another color bar to make my entry decision. You need to check and verify the rules for yourself. If someone is blindly following and not verifying the set-ups that is a sure way to blow up an account.

Just my experience and observations with that indicator. I believe it can be a valuable tool but as with anything "trust but verify."
  • #4,239
  • May 5, 2011 7:56am May 5, 2011 7:56am
Hey Ultimatus, I use the trend ret indicator (cci) that Div uses and had originally posted. It seems to work just fine. On that trade above.....the first candle with the line through it is not a valid s u b because it is too far from the ma. (at least on my chart) The 2nd was a valid set up bar (still closed above ma and cci 50) and a winner.
  • #4,240
  • May 5, 2011 7:56am May 5, 2011 7:56am
Quoting Paradox
The first bar there was more than 2.4 above the 10 sma of median price
The second bar was the wrong direction.

That is why they didn't turn green. As far as whether they were valid or not I guess it depends on your interpretation which can be subjective.

OK that makes sense, I must admit I forgot about the 2.4 pip rule and also didn't know the indicator takes that into account, will carry on using it, thanks.
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