A Bull or a Bear

It's been a while since i have created a thread,but as time has passed upon in my trading life,i feel,that forums are not a best place for traders to give away knowledge,in fact learn more and more.
Neither am i well immersed trader in the trading world,nor am i a beat up trader who can't rack in a consistent profit,i am still finding a balance of emotions with in my body and soul to get to that crucial point where i can be a one man trading machine.

Over my learning phase,i cam across various trading strategies,but after all those years spent (lol 2 years) in trading forex,i just come to a conclusion that,there are just a set of simple things that can make up a great trader.

When i was sitting back on my chair at night,i figured what is it that is so simple and common about this market that i had never ever seen,so i sat there burning my eyes trying to visualize the most simplest trading secret i had yet to see.
It took a bit of frying for my eyes before i came to conclusion,that one thing that never deserts a trader is a trend,and of-course his usual wisdom gained over the years.

What S/R ,what indicators,i think all these are just minor tools in a traders hand,on which one trader can rely upon, like a mere knife and rope as for any person in forest,but what the most important thing for a person in a forest is,its food and water.Am i right or not.
So my food and water in analogy,to use to compare to a trader,is for comparing the food and water to a trend,because thats one thing which is the energy source of all strategies,cauz trend my dear friend is momentum and momentum my dear is working indis and working PA or S/R.

Now i'm not some smarty pants,neither do i think have i found out a bigger secret,that no one has ever told me before,but the most f---g fact is it took me all this while to figure this shit out.


You know,i would have had my share of wisdom long ago,if i only have known what i know now,so i don't have anything to feel sorry about at this point,cauz all was for good of me,that i had to learn what i learn't to come to this stage in life of trading where i know,what really matters.
lol,i dont mean to say that i have lost years of my life,but 2 years is a lot of time to get to a conclusion,right.
well had it been 2 years ago,when i first trading at 19 i would have been better off.

Now all those traders reading this thread,you may be scratching your heads(not the real pros),lol,that what the hell am i talking about,you know i'm just talking about the greatest thing i have learn't,in trading,which is trend.

As Mr Patridge says in Reminiscences of a Stock Operator:
Catch those words
"You see its a bull trend."

For all those poor sods,who havn't yet read "Reminiscences of a Stock Operator" go google it up. okay.

Or i should just mention it right here, what he said.

So,Mr Patridge buys a stock on advice of a trader,who may be good enough to select a stock which is gonna go up,but does not have Mr Patridge's share of wisdom.
So when stock goes up,he says to Patidge,go take your profit and enter at retrace,but Patridge says,if i do that,"i would loose my position".

And then he says to whoever talks to him ,like a thing like this:
"You see its a bull trend"
Get it all of you,Mr Patridge knew that trend was the only thing in his favor,why not ride it ,huh,.
You never know when retrace will be,but if your sitting in a bull run right from the bottom,you are one lucky (SoB),sorry not a personal comment.


So when i say i'm no smarty pants,you better read on,cauz my dear forum buddies especially well versed buddies,i need your help in figuring out something which i need to find out in this thread.
In Short:
"Ohh dear traders,who have wisdom of trading ,please bless this thread,with some of your wisdom,so i and other traders can learn something from you."


Now getting to real part,for which i came here:
To tell you the truth,i don't have much time,even though i am relatively new to forex,cauz i gotta work too right.
So what to say about good traders,will they have time to come and tell me something here.
Hope so,cauz i am requesting a single piece of your wisdom.
Which can help me or anyone who reaches a crucial point to realise that two big weapons in traders hand are:
Trend
And Money Management.

So lets cut the chatter: here it is.

I plan to make this thread a library for the "trend",for which which of course i need your help ie,help of good traders and trend traders.
I want to ask these questions,from you.

What is a trend according to you(the Pro)?
How many types are there?
How do you figure it out?
How do you ride it?
How do you Manage your ride?
And Most important of all:
The Biggest question:
How do i know,if i can,by any means,what is going to be trend tommorrow?
ie how to know bull or bear just for day to come.
As silly this last question is,but it has a biggest nugget in it.

More on that nugget later,after i figure out,the answer to finding it out?

I assure,you,this thread about trend could be a big thing,if i pull it off,using my wisdom,and of course ,wisdom of Good traders.

So signing off ,for now?
See you all on bright side of tunnel,cauz i expect at least some wisdom from you,by the time i post again.

Regards
Taz


Please Read the Rules:

1.You may post in this thread,only if you be a good guest.
2.Try to be precise about your version of trend,and always remember"KISS".
Which is "Keep it Strong and Simple"
3.Try to avoid posting indicators,telling you about trend.
Cuaz i am more interested in knowing fundamental reason if any for bull or bear intraday run.
Or
Techincal Analysis reasoning for bull or bear intraday run.
Or
Orderflow reason of bull or bear run.

And absolutely not an indi telling me,trend has strated,cauz i dont wanna know train left,i wanna know the ticket number,either to south or to north.

4.If you want to post indicators,do so,but keep in moderation.

Well as it just happens,one of the biggest lessons learn't by me in life was:
you can get wisdom without giving away some.

I'm sure as i post regularly some or more of the good traders will contribute here.

So here it Goes:

My Definition of a trend from a Charting Point of view:

A series of Rising Peaks and Valleys is Called an Uptrend

While

A series of Falling Peaks and Valleys is Called a Downtrend.

Please See the attachment:

The Most important thing before any trader can make money is to select a Particular Security on which he is going to trade.
This website being a forex website ,so most of my posts will be concerning that only.

Now getting on to the topic of trend.
Now we know how to look at a trend,so lets go on to tackling more challenging issues,regarding defining a trend in terms of Support and Resistance,and of course other Charting perspectives.

My Version of the Deep concepts associated with trends is.

A trend is a consecutive series of rising or falling surges in price which continue to rip the support resistances apart.
IE: in usual trending market conditions we will see S/R levels breaking and ofcourse a pullback towards broken level,and another leg up or down.

Before i define this in terms of a chart:
I will define the biggest delimma associated with a support or a resistance level.
Not every Support level leads to a bounce up.

Not every Resistance level leads to a bounce down.

You see the above two points are a big smack to any person who wants to trade using support resistance alone.

The above lingo in S/r trading stems from the popular definition.

Buy supports,Sell Resistance.

But i tend to think ,in a little twisted manner.

Why not think in terms of greater probability facets of Support resistances.
That is as follows:

Almost all Support Levels get broken at some point.
Almost all resistance levels do get broken at some points.

So as compared to trading with a 60-40 chance of reversal against no reversal on a Support or a resistance.
Why not trade a 100 % chance of trading on break of these levels.
Huh
Now i will end this post by summing up a few facts:

That S/R levels are not good to trade as bounce points.
That S/R Levels are best in terms of Break and Hold Scenerio.

With this basic primer on S/R i shall continue on in next post.
regards
Taz

For all those S/R gurus out there i can challenge you over the following facts:

1. Even the Most super confluent S/R will get Broken.
Say 50-61 Combo,and a PPZ

2. And No matter what technicals may say trend continues to prevail,if it has the momentum to do so.
In that case:
Trend will rip through every Resistance in the way.
Trend will rip through every support in the way.

3. It takes years of experience to tell whether the level has held or not after it has broken.

Now when i have Laid down some key aspects i will move on to my definition of the trend and its correlation to these S/R apects.

Nice honest posting about your own journey.

Just a thought: why does it take us (me included) so long to figure out that the most important aspect is trading with the trend? The one thing that prevents staying in for the ride is fear of losing money!! Not easy to overcome IMHO.

Kal

Is tomorrows trend Predictable,just using technicals?
Answer:
As ,easy technicals may look,but one thing that is for sure true about them,that they are very good tool to gauge market conditions.
So ,i must say that,it is very much possible to predict tomorrows trend just using technicals and a very basic understanding of Fundamentals.

So what is that Way of gauging the tomorrows trend,using technicals?
Answer:
Well read on.
I have not been trading for quite a long time,but as i have seen,the technicals offer a very firm grasp of present market conditions and ofcourse a little insight into future.

Like:
One Can easily tell,that after a range breakout takes place,the present trend resumes, at least 70 percent of the time.

And

If a swing point gets broken,the trend resumes till a good length of time.
Meaning a very considerable swing high,or low if gets broken,it goes on for a good length of time.


And

Obviously,The regional Support resistances can tell,what the market out look can be for the next few candles,and also the previous candle can tell a lot about the next one.

See attachment:
For further clarification.

No fear,buddy.
If you time entries correctly.
You wont even need a stop loss.
Because ,My dear Friend,if you are so successful in predicting trends,how did price go against you.

Read this Carefully:
When you base your analysis on Something you have learn't, and it does not work out,and you fear something,then it means you lack something in your learning Curve.

Just look at the chart attached with this post,tell me,when there isn't a trend.
And after seeing that,ask your self,what is remaining from my side to figure out,which trend is it gonna be.

What do i get from Knowing Tomorrows trend,or by even knowing trend in the next Week.?
Answer.My Probability of a winning trade gets enhanced many folds.

Additional Comments:

Look at dibs method,of trading the daily breakout of hourly inside bars,as easy it sounds,thats the way it is.
Which means:
It looks Easy,and is Easy.

There ,
Mr Peter Crowns says,take hourly breakout to up side if trend is up for the day.
And take hourly breakout to downside if trend is down for the day.

And What is his definition of trend:

If Price goes above previous days close,its up trend.
If Price goes below previous days close,its a down trend.

And
Read on What real thing has to say about the markets.

All one needs to know,is to know ,one thing for sure about the market.

And Read What Crucial Point Says:

95 % of the time,Price either closes above or below the previous days bar.
Or previous bar in general context.


Because these currencies have to move,either up or down.
And they tip there hand,on either side,by giving some signs.

So What should i do now?
Answer:
Compile previous posts to present a viable trend verification theory.
And
Present Some Risk and Position Management tactics for trend trading.

The Following Chart Covers a Primer on gauging future trend using Candlesticks.

Okay Guys:
I covered Some Prerequisites before i define my trend theory.:

Still Some remain,which are:

Basic Primer on:

1. Support Resistances
2. Fibonacci Numbers
3. And trendlines
4. Elliott Wave Theory(Basics).
5. Different TF's


Then i define my theory of trend in a single post,which will contain all the things,i have illustrated.
Will post back in 4 hours.
See You Soon
Regards
Taz

First,i apologize for a little unorganized posting,maybe i think,i should do some editing.lol

Fibonacci And Elliott Combined:

Before I Talk about Fibonacci's and all,let me first describe,that,i am not a Wave counter,or Elliott fanatic,but i do see that Market moves in Waves.

Part of the reason being,that Market makes a big leap,then some Profit taking,and another leap,again Profit taking,or after that a Consolidation(Which is again profit taking).

So i'm not going to give away,or discuss Elliott wave theory,other then a little description,that,market do move in waves.
And After Every wave theres a correction.
And not relying upon fibonacci's,but my vision,i can say after 2/3 of trend is retraced,then its is for sure headed the other way.
the 2/3,roughly comes up to 66 %.which is very much same as 61.8 Fib.
So Please See.
1. Market Moves in Waves.
2. These Waves are of two types,impulse and corrective waves.
3. Impulse advance the trend,corrective waves,are the retracements.
4. In general scenerio,Market pulls-back to 1/3,1/2,2/3, of the previous wave,before resuming back again.
5. These 1/3,1/2 and 2/3 roughly translate to, 33 %,50 % and 66 %.
6. After a Pullback,the next leg up resumes.
7. The full leg up,goes to either 100 % of previous leg,or fails as double top.
8. After Double top/bottom,we either consolidate(including Double Top/bottom),or we start next trend in opposite direction.

Now the Fibs:

Please Check that your tools of fib retracements exacly use the same fibs as below:
0
23.6
38.2
50
61.8
78.6
100
127.2
138.2
161.8
200.0

Rules of using them are as follows:
Don't take them as just percentage values or magic numbers that,work,but as tipping zones,which signal signs of market bias.
Here:

38.2-61.8 Band is very Important.
Because Market will retrace in this band,ie pull back, and form a leg up.

And Please See:
Stronger Momentum trends Pullback to 23.6-50 Band before going up.

With this Covered, i will Continue forward in next post.

My Trend Theory:

According to my usual observation and back testing,trying to figure out the trend and its various features,i came across some very beautiful observation.
Which are:
Trend=Momentum(Speed of Price)
Trend=Defined Direction.

Now getting to these two useful Observations,i will define them in general context.
We all know trend,is a general strength in a particular direction,that is why we call it a trend,because it can and does move in a single handed direction,irrespective of the barrier.

The Most Important Postulate in Trend theory:

As i described ,trend is momentum,so thats why,we are going to look for the momentum on charts,once confirmed we are going to take that bias and take our entry.
In general thought,a trend is consistent ripping apart of Support and resistance.
As ripping apart signifies the momentum,thats why we can be sure its a trend.
As a good trend,always rips an S/R line and heads on to rip another one,and hold above or below it.
It will continue to do so,till a trend is there.
Once the momentum begins to drop,which you can gauge by speed of price on grid as below,you will know our trend is running out of steam.
Then we can go on to checking our bias whether trend is running out of steam or not,by checking,higher high low or MA envelope or trendlines as described below.

Summarizing:

Trend Rips through S/R.
After every rip apart trend goes to rip next S/r line.
You can read trends momentum on grid.
After verifying momentum,you can carry basic technical analysis tests to verify,the trend,which are higher high and higher low,envelopes etc etc.








And as i described in the above text,trend is general bias to one side,meaning one you can lay down,so if i see,price moving from left to right on up side,its an uptrend,and the opposite is downtrend.

So,here are some very basic ways of finding a trend:

Price Left to Right on Upside: Up Trend.
Price Left to Right on downside: Down Trend


Series of Rising Peaks and Troughs: Up trend
Series of Falling Peaks and Troughs: Down trend

Or
Add an MA envelope,i use 62 MA Envelope,thats 62 Sma,and 62 ema,forming a band,if price stays on either side and flies high above its trend.
If band crosses price back and forth its a range.


Moving Forward to Complete my theory:
For Using this,u need to to open the same Chart in two different windows.
Plz see the attachment.
In first chart:

You have to keep Grid on in MT4,and better keep the grid in a dark color on light chart,because we need this for our purpose.

Now the Second Chart:
This is going to be of same currency Pair,or security,but with all swing Support and resistances marked.
For this You need to go atleast 2 Time frames higher,then you want to trade in.
Say i want to trade 15 min,trend,go draw S/R on 4 hr
If on 30 min,go draw on 1 day.

So,reducing the amount of your pain.
I have posted another chart,second chart,of same currency with S/R drawn in it.
Its the same TF.

The Trade:

We will take the trade,based on our bias,for today,and of course based on trend.
On second chart,you will wait for price to rip the S/R line apart and wait for it to pullback,somewhere deep in the region,and look for the likes of following candlesticks.

Marubuzo brothers,thats a candle without wicks formed at support or resistance,it signifies a controlled move.
A two bar Reversal.
A Pin Bar.
General Congestion.
An Out side Bar,or engulfing bar engulfing previous bar.
A 123 formation.

I will post these patterns here.
Regards
Taz

The Cap,or two Bar reversal ,as i see it:

Candles and some quick facts:

Now Getting Our Hands Dirty:
I know,i know,this will be past chart already happened.
But ,i will post predictable charts too.

Because my dear Friends,i am not going to break,any cardinal rule of my trend verification and trading system,so,everything in past candle will be a genuine thing to be expected in future.

So,here you go,
A sample trade Study,using this wisdom:
Lets take the Gbp/Usd previous day action,and how we could have gone about analyzing that same action in future.
Step 1:

Step 2.
Basic thoughts.

Last Step:
Taking the trade.

5 minute Chart:

Hello Friends,
Don't believe blindly, what i'm saying or posting.
If you want i can upload a cracked version of forex tester the older version.
You can upload ticks in it,and test this thing out.
Because in Forex,experience matters.
And of course faith too.
Reply if you want me to upload it on rapidshare,its older version,but gives good testing.
And Please Moderators,i am not doing anything wrong,that version is easily available online.
Regards
Taz

PS: It would be great,if you do testing using this wisdom,it not only will improve your skills,and also,may lead to some worth while observations,which could help improve this wisdom.