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Price Action Trading with Indicators! The Freebie System

  • #2,181
  • May 5, 2011 6:54pm May 5, 2011 6:54pm
Here is the 4hr EU chart. We had a massive drop on Thursday all the way drop to that nice support line, amazing how that works. See how price blew right by the first support line indicating strong momentum. I would anticipate a bit of a pullback today but keep in mind it's NFP Friday so anything can happen.
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  • #2,182
  • May 5, 2011 6:59pm May 5, 2011 6:59pm
Oh great ive got a stalker.

Read the first para I only took the one trade on the Dow.

When the pivot gave way I sold on LHs when it blocked the move back up.
I have not traded since then as been out this afternoon and evening and just back in.

I see that oil is the winner today on a massive +1288 pips in one day .... gulp

ST

Quoting stochman
NYMEX, Brent, Gold and Dow eh ST. Did you trade everyone of those, and if you did were any of them live? of
" Dont wait for your boat to come in ..... swim out and meet it"
  • #2,183
  • May 5, 2011 8:39pm May 5, 2011 8:39pm
Here is an Asain session long trade on the AUD. See we broke the DPV and we have several retest of the DPV (green arrows). Trade entered on green vertical line. Good for +20. This is really a great methodology. You just need to study price action around the pivots and practice your entries.
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  • #2,184
  • Edited May 6, 2011 6:17am May 5, 2011 8:57pm | Edited May 6, 2011 6:17am
GU in a overall down trend daily pivot failed going to try for this short...


Target hit +30
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  • #2,185
  • May 5, 2011 9:54pm May 5, 2011 9:54pm
Here is the GU 4hr chart for those who are looking at longer term projections.

You can see we have the start of the first leg down. Very strong down move on Thursday (note that price has formed a weekly high purple rectangle and price actions is below that weekly high now). Now if you know anything about wave patterns you know that corrective waves have 3 waves. At this point we're not sure if this is just corrective or a trend reversal but we really don't need to know that to figure out direction. If this turns out to be a trend reversal we'll have more than 3 waves down but either way the overall direction you should be looking at is down. The only way this will be changed is if price breaks the green horizontal line and goes higher. What we would expect is the first leg to finish it's down move, followed by an up leg and then another down leg (white lines). Now my white lines are there as an example to demonstrate how this move might look.

When price pulls back for leg #2 up, we want to start watching smaller time frames and focus on pivot levels for moves that fail to the downside. These moves can be traded in the up direction. Once we get to the end of wave #2 and we start to see failures of long positions at pivot levels we start to watch for shorts. No one can predict exactly where this will happen but be assured that you should be looking for short positions especially if your trading higher time frames at this time unless we break back above the last high (green horizontal line).

Hope that helps some of you.
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  • #2,186
  • May 6, 2011 1:26am May 6, 2011 1:26am
Dredding, I would just like to thank you for this thread. I was on the verge of giving up hope on forex after battling for more than 2 years. This thread gave me hope and just showed me that I should just keep it simple. It just started making sense to me and now I'm off to a great future making money from home and having more time with my family.

Thanks again Dredding82 for the great thread and that you are so patient with all of us.

My pips for yesterday totals 350

Cheers and happy trading all
  • #2,187
  • May 6, 2011 3:34am May 6, 2011 3:34am
Well done!!!

Quoting bluexpec
Dredding, I would just like to thank you for this thread. I was on the verge of giving up hope on forex after battling for more than 2 years. This thread gave me hope and just showed me that I should just keep it simple. It just started making sense to me and now I'm off to a great future making money from home and having more time with my family.

Thanks again Dredding82 for the great thread and that you are so patient with all of us.

My pips for yesterday totals 350

Cheers and happy trading all
" Dont wait for your boat to come in ..... swim out and meet it"
  • #2,188
  • May 6, 2011 10:16am May 6, 2011 10:16am
Quoting ozziedave
Stochman...

I would say a net 85 pips in a day is a bit more than slowly...that is a fantastic result. Keep doing that everyday and you'll never have to worry about a day job again.
Cheers Dave, what I meant was that I'm slowly building my own individual trading method as I think we all, as individuals, will do, and it slowly appears to be coming together whereby I am hitting a high percentage of positive trades now. Dredding & Paulus have been absolutely instrumental in my progress to date and, to be quite honest, without their generous advice I would still be flapping around like a flappy thing that flaps around

Anyway here's a trade that I took today, I never traded this morning due to other commitments, and my afternoon plan was not to trade anything until after NFP had had time to settle.

I was testing a trade management tool and unfortunately it helped my first long trade to go against me as it set my stop loss too short at 20 pips which took me out for 20 x 2 pips, one of which trades you can see in my terminal.

Unperturbed I re-entered at 15.55, my entry was based upon a combination of Dredding and 123. HA was still white, my number 1 (low) came at 13.25, number 2 (high) at 14.30 and number 3 (HL) at 15.30, if I hadn't been messing with the trade management tool my entry would have been on the 15.40 candle as M2 looked to be supportive and price was above my MA's with good seperation, as you can see in my terminal I entered a little later at 15.55 and hit tp1 & tp2 within 30 minutes for 120 pips

So today's summary is as follows :-

Brent first trade -20 and -20
Brent second trade +20 and +100
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  • #2,189
  • May 6, 2011 11:10am May 6, 2011 11:10am
Impressive my friend, well done.

Your next assignment, should you choose to accept it, it to repeat that come Monday
  • #2,190
  • May 6, 2011 11:56am May 6, 2011 11:56am
Quoting ozziedave
Here is the GU 4hr chart for those who are looking at longer term projections.

You can see we have the start of the first leg down. Very strong down move on Thursday (note that price has formed a weekly high purple rectangle and price actions is below that weekly high now). Now if you know anything about wave patterns you know that corrective waves have 3 waves. At this point we're not sure if this is just corrective or a trend reversal but we really don't need to know that to figure out direction. If this turns out to be a trend reversal we'll...
I'm just really start to get my head around wave patterns and 123's but the chart you posted is a great example of both, I can see that I'm gonna have to add you in as one of my mentors Dave
  • #2,191
  • May 6, 2011 12:48pm May 6, 2011 12:48pm
so I had some things to do this morning so decided not to trade until after NFP myself if something happens to materialize for me with a clear entry and so when I got to the charts I saw the eur setting up for a short entry...attached is the 5 minute which is the close up and then i have attached for different view points the 15 and 30 to where we can clearly see price repeatedly testing and failing at the monthly pivot confluent with the weekly support level with everything else lined up...target next pivot/support level down for a little more than 1:3 risk:reward ratio


Paul
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No man is free who is not a master of himself. -P.M.-
  • #2,192
  • May 6, 2011 12:58pm May 6, 2011 12:58pm
update

EU - No trade
AU -5%-5%+15%-5% short from 1.0715
GU +15%-5%
UC 5%+12%-5% long from 0.9669

ROC - 22%

Glad your all making pips

cheers

paulus
  • #2,193
  • May 6, 2011 4:23pm May 6, 2011 4:23pm
Quoting Paulus
update

EU - No trade
AU -5%-5%+15%-5% short from 1.0715
GU +15%-5%
UC 5%+12%-5% long from 0.9669

ROC - 22%

Glad your all making pips

cheers

paulus

The AU short closed for 7%
The UC long closed for 5%

ROC for the day +34%

cheers

P
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  • #2,194
  • May 6, 2011 4:26pm May 6, 2011 4:26pm
....you've earned a weekend off

Quoting Paulus
The AU short closed for 7%
The UC long closed for 5%

ROC for the day +34%

cheers

P
  • #2,195
  • May 6, 2011 4:35pm May 6, 2011 4:35pm
Quoting Paulus
The AU short closed for 7%
The UC long closed for 5%

ROC for the day +34%

cheers

P
Hi Paulus;

Can it be this graph, a good guide to better understood ways for your entrys ?
Cheers
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  • #2,196
  • May 7, 2011 1:41am May 7, 2011 1:41am
Quoting Paulus
The AU short closed for 7%
The UC long closed for 5%

ROC for the day +34%

cheers

P
Hey Paulus,

Good to see you back here. I'm a big fan of some of your past threads. Maybe we can chat sometime. Send me PM if you're interested.
  • #2,197
  • May 7, 2011 2:47am May 7, 2011 2:47am
Quoting chaveznqoos
Hi Paulus;

Can it be this graph, a good guide to better understood ways for your entrys ?
Cheers
Yes its a classic 123 reversal ..pure trader psychology in a long trend the weaker players give up and a lower hi goes in..the previous low is broken and those weak long players now join the main drag and price drops

Its the cow in the field syndrom

herd of cows one leaves and walks to another corner followed by another 2 or 3 ... as soon as a mini herd is in place at this new location the main herd gives up and wanders over ..and then when 1 gets bored it starts all over again

P
  • #2,198
  • May 7, 2011 2:52am May 7, 2011 2:52am
Here is a 4hr EJ chart. I wanted to show this so people could see the corrective wave.

Starting at the highest high we have what appears to be a strong 5 wave down pattern. Followed by a nice 3 wave corrective pattern. The top of the 3 wave pattern never breaks above the highest high which is a hint that we might go lower. The corrective pattern also retraced back to the 76.4% fib level which is a deep retrace and is usually seen in the second wave. Now if you were lucky enough to be around you could have taken a ride short on this and made some good pipage.

Now we're hitting resistance so we might see a bit of a pullback before we resume the down move. Price needs to get through the resistance area and we could go much lower.

Again my comments are for learning purposes and not trade advise.
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  • #2,199
  • May 7, 2011 3:16am May 7, 2011 3:16am
We looked at the 4hr EJ chart and many of you say ok great but how does this help me when I'm trading a 15 of 5 M chart.

Look at the far left and you see a purple rectangle, that is the high of the 3 wave corrective move. Now I know in real time you can't tell this is the high yet but when you look at the higher TF you need to start to see the bigger picture. On the 4hr chart we had a nice 5 wave down move followed by some type of up move. Now ask yourself what can price do from here. If it keeps going higher and breaks the previous high we have a resumption of the up trend. If price starts to fail and it falls from here we have what looks like a 3 wave corrective pattern that has formed and we would expect price to continue in another wave to the down side from here. As you can see it takes several days for this to happen but we get a nice down move. Now if you have your head stuck in a 15 or 5 M chart you'll more than likely never see what I've pointed out on the 4hr chart.

As price moves down from the purple rectangle we start to see lower highs and lower lows being formed. We also start to see price bounce off of the pivot values, especially the DPV, which is the trading mid point for each day. Note all of the blue rectangles, when you start to see the rejections of the pivot levels and price closing the day lower, you start to look for pivot rejections so you can take short trades with price momentum.

I hope this doesn't confuse any of you. If it does, I'll stop posting this kind of stuff.
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  • #2,200
  • May 7, 2011 11:43am May 7, 2011 11:43am
Hi Ozzidave

I am a newbie however understand the importance of keeping in view the bigger picture, but fail to undersand how the latest downward move from 117.34 to 115.50 has anything to do with purple triangle occured on 28th April when I am trading on 5 M chart. From 5M chart perspective I believe the downward move was not because of purple traingle but because the price hit 3rd time to the resistance line as marked on your chart as S3.

Please correct me if I am wrong.

P.S. I only trade daily and weekly TF.
Forex is boring but profitable with patience and discipline
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