West and East

Hello Everybody !!!
I want to share this system, I been using it for a while, and after I moved to another systems, but after all I back to good old system.
This system has different names like Power Band, E-75, but the idia of this system coming from Steve Nison. In his books and dvds you can find that Candlestick patterns appears on support and resistance levels, confirming S/R. He offers to use candles with western technology, such as Bollinger Bands and oscillators, in our case it is Stochastic.
I am using M15 time frame for trading, you can use higher time frame, but I wouldn’t go lower.
For set up I am using:
- Bollinger Band standard (period 20, shift 0, deviations 2, apply to close)
- Stochastic (9,3,3)
- Resistance and Support levels
- Candlestick patterns
- EMA 100, 200, 365 (Moving average Exponential apply to close)

The main idea is that we need confirmation for candlestick pattern. This confirmation is Bands, stoch and S/R. We are looking for patterns such as engulfing, piercing, dark cloud cover, stars, hummer and also doji. Doji is not a reversal candle, doji means that market is neutral.
What we are looking for is that candlestick pattern have to be on higher or lower bollinger band, price should cross or touch band, there have to be S/R level, EMA could be support or resistance, and stochastic is overbought, oversold, or in some cases there is divergence, normal not hidden.


Currencies which I am using is 3 amigos EUR/USD, GBP/USD, AUD/USD, this currencies moving pretty much in the same direction, especially when there is a strong move on the dollar.We are choosing only one pair which gives us better set up. During Asia i prefer AUD, during Europe GBP, during Usa Euro. But again we are looking for best set up.



Placing order after candle is closed. We are plasing 2 or 3 lots.


Stop Loss have to be above the candle or pattern, I don’t have exact amount on stop loss, I am placing stop loss 15-25 pips from initial position above candle or above resistance, opposite for buy. Power band system oferring 10% above canle, E-75 3-5 pips above.


Target is middle of bollinger band and lower level of bollinger band, this for sell, buy is opposite. As we have 2 or 3 lots. One lot should be closed on the Middle of bollinger band, and stop loss should be moved to brake even. In some cases there is support level before Middle level, I will close one lot and move stop loss to break even, in case market will be stopped on that support. Second lot should be closed on lower bollinger band, if market is in trend I will leave third lot open to take more profit.


This system works good in ranging market, in trending market you have to wait for retracement.


When you see strong move on the market don’t try to catch bottom or top, wait until market stops.

About trading hours, I am starting at 6pm EST, and usually i am out by 10 am EST, if there is important news on USA, i will close all positions by 7 am EST.

Support and resistance levels, i am going from Weekly to H4 charts to find S/R and placing on the chart. Lower time frame as M15 and H1 R/S i am placing on my charts, but when it is broken i am removing it from the chart

Risk reward is very important. When you are opening the trade, you should look for the targets, first is middle bollinger band, and second high or low of bollinger band. Your risk reward when you are opening trade should be not less then 1:1 to the middle of bollinger band, and not less then 2:1 on the high or low bollinger band.


I will give some examples and place charts every day. I am full time trader, and I watching market all the time, so probably I will place charts on the end of my trading day.
You can apply to this system other methods which you are comfortable with, such as fibo levels, harmonic patterns and other



I will upload stochastic, which is showing divergence with alert, hidden and normal, we will be looking only on the normal.

Examples

Examples 2
First chart on the top. There is support from previous price move, dark cloud cover, we have engulfing in the circle, cross with bollinger band, stochastic over bought.
Second chart, on the bottom. We have H4 resistant level, engulfing with 2 (red) candles, stochastic oversold, cross bollinger band, first take profit on the previous short term resistance (blue line).

Examples 3. I will go on the charts from left to right, first chart is the chart on the left.
First chart :
In the circle on the top We have resistance level from weekly chart (Yellow),inverted hammer, hanging man, and engulfing. 3 patterns one by one it is strong signal, stochastic is over bought, price touched bollinger band. I am entering on the engulfing pattern, and placing stop loss above, star, candle with long wick. First take profit middle of the bollinger band, and stop loss moved to break even, in this case we already locked some profit, and can't loose on the second position. Second position will be closed on the support level which is green.
In the circle on the bottom we have support from H4 chart, and EMA which is acting as support too. We have 2 patterns, or like Nison call it check mate, we have engulfing and piercing pattern, 2 patterns is strong signal, stochastic oversold. I am opening 2 lots on the close of piercing pattern.Stop loss under the EMA, itis lil bit big, around 30 pips, but risk reward is pretty good, and looks like strong single.
Second chart (on the right)
We have the same weekly level ( Yellow), Engulfing pattern, which wrapped around 4 candles, stochastic over bought, there was strong move up after news release, i am waiting when price will break weekly level, and enter position, take profit on previous low, green support. Lets say this is more advanced trade, it is snap and crack or falling from the roof, if you are new to trading you shouldn't take this trade. Risk reward 2.5:1, but stop loss pretty big.

This is 28 of november, it is one trading day for me, I start from Asian session to US

This chart how i place orders, placing stop loss, and taking profits

you need to be commended for 'trying' to tackle ranging markets.

it would help if you were to explain the trades on your chart above and the reasoning for the entry and tp levels. i know whats going on myself. but it would help others, especially newbies.

Thank you !!! I will do it

Example

mavricos,
Thank you for sharing this.

I am looking forword to your strategy. I think strategy based on price action is way of viewing in deep to the market. please explain more with charts.

One more example of set up. First chart is only example of the set up !!!! I will upload more charts later, and will upload charts daily. This set up didn't work out, because it was right before the news release, and you shouldn't take it!! On the second chart you can see what we are looking for, we are looking for the price weakness. by trading this system and watching charts you will see price action from day to day, over and over again. You will understand, and you will see, that price has the same moves all the time, not exactly the same but similar.

You have experience trading? you entered before the nfp on a technical bias.

That is example of set up. As i sad, on the day when important US news will be released, i am closing my trades at 7am EST.

If somebody is looking for trading books, you can take a look at this library, it is pretty big. It is free, but don't download more then one book at the time. You can find 3 books of Steve Nison there

http://www.traders-software.com/Trading%20Books/

Support and resistance. To find this levels, you can open Weekly, daily, H4 charts. And look on the levels, which is market respect, levels which is been resistance should become a support after.

A thread based on Steve Nison's candel stick pattern - Though I’ve studied many of his materials, I haven't traded one yet,

Looking forward with expectations......

Green pips.
Sprabhu

From post 1

1)"This system works good in ranging market, in trending market you have to wait for retracement."
=>Would you mind sharing how and when you define the start of a ranging market in your style of trading?

2) And when you say "Risk reward is very important" - when you take Target 1 (the middle bollinger band) - it can be very close, giving less than 1:1-
=>Do you still take these trades?

Many thanks.

there is a problem with your indi. when i try to load it on mt4 it crashes my platform !

I am uploaded one more file, copy both

I don't know when is the start of ranging market. I opening daily,H4, H1 charts and looking for S/R, and after i shifting to M15, and looking on price action, if price can't break support or resistance and moving from one level to another, it is ranging market, no new highs and lows. Price doesn't move up or down, price is moving from one level to another all the time. When the price reached one of the levels you can see the pattern or couple, and if i see that all rules comes together i am taking the trade. The most important to understand what is behind price action, or candlesticks, and what is behind support and resistance. You may need to read nisons books, for better understanding. I am reading his books over and over again. I didn't pay attention before, but i see that VSA covered by candles, it is very powerful instrument. Look at the post 9. there is chart with a range. Market most of the time is in range, trend on the higher time frames. but you need to see moves from one level to another in order to take trade, if market is moving sideways, don't look for any trade.
Yes i do take trades when risk reward to the middle is less then 1:1, when market is in the range, and it is confirmed, there is a lil stop loss, and usually the R/R to the high or low bollinger band 2:1, so my target is low or high band. On the begging look only for the setups when all rules applied, and after you will get used to it, you will see.