B.S. Trading with Kenneth Lee

Well done bullzeye, nice trade but even better trade management

Congrats mate !!

Have you ever thought of making a new forum, where we can just post trades that we are taking and/or setups that we might be looking at? Then this forum can just be about the "theory of S&D" and questions about the way to trade it.

Yes , As we posted over the weekend taking what are Counter trend trades against higher time frame levels , can be the hardest part , But I find on my 30 min levels They will React to some point if not a huge move.

But even if the daily demand is going to reverse price here and start a long trend for awhile. We will still get minor swings on the faster charts. It is knowing this may happen and being willing to accept that fact that can allow us to take SCALP trades. But what is scalping to some is a nice trade to others.

There are swings then there are micro swings and there are even macro swings. Which are you watching ?

I was personally stopped on a OZ long last night but re-entered and closed for 60 pips. My trade was based off the macro swings(5min) at the bottom of a micro swing (30 min) , at the bottom of a longer swing (4 hr was at a swap level straight line area),,

Price action leads the way. it is ones improving abilities to see within the big picture that can allow us the edge we seek.

And now we can see that OZ had come up to a supply level. But we have made a new high , on the 30 min swing chart. But even if we THINK price will continue up , we at this point are still in a down trend off higher charts. But we will look for a higher low which leads the way into a up trend.

So if we took a short here we should move to break even at the common sense point to protect equity.

The whole point of trade management is the fact we are looking for our direction of move to make new lows or highs the common sense area is the first swing it has to break to do this .

The issue is that everyone trades different time frame charts so we again get into the swing , micro swing and macro swing ideology. But this is also how traders that enter off say a 2 min chart . Have less risk their first swing to cover at is a lot closer than say mine on a 30 min.

Plus the feeling of knowing your trade is free and clear even if it fails is a nice feeling to have . We all need to learn to embrace that feeling that break even is a win and we will be better for it.

For the most part if your trade moves far enough to allow you to cover it . It will continue if it is a continuation of the trend if it comes back and stops you out, there is a good chance your regular stop would have been hit anyway , Plus you can always re evaluate and re enter as I did last night.

Basically getting a better entry. Ken

well said Ken

G/U H4 waiting for that area

NZD/USD just curios how it will react

Still very new to this but i am long NZ and its looking good so far.

I have never looked at this thread But it has some good information within the first 10 or so pages ( as far as I have got) Plus you should see the relationship to S/D trading. The part on post 10 is interesting, Some trade management.

Ken

http://www.forexfactory.com/showthread.php?t=287794

Afternoon all, hope everyone had a good weekend and had a good morning (if you were up).
Just wanted to share some things that I'm putting into practise which are working well. WAFFLE ALERT.
Kenneth/Sam both say what I'm going to, but I think it should be burned into our heads, and the first thing we look at.
Obviously, the odds enhancers at the end of Kenneth's pdf come into play after this, but we must remember this one fact that comes before all others.

So what I'm doing when looking at price is this.
When looking at what might be an S/D zone-I ask this question:
Was price unable to stay in this area? Could it simply not bear to hang around whatsoever? Did it leave the area with speed and violence, and as fast as (insert metaphor here).

My mental note/the thing I remember here is the word violence. Yeah not pretty I know. Force, power, whatever, it all works.

Our best set ups when price moves violently/forcefully away and look different to preceeding price action.

And they travel long distances and they do it damn fast.
When I say long distances, I mean that they break 1 or 2 previous highs/lows, as this shows that a new sheriff is in town, and the S/D equation has changed (the swap zone I suppose?).

And if I'm not sure, if there's conflicting info? Then don't trade it. The best trades are ones where, if you have the hang of this, they're blindingly obvious.

Obviously, price moves are all relative, but I think we all know a violent price move when we see one e.g. EURUSD and GBUSD shorts last week. That's what we look for-the A1 trades, where prices reach a certain area and then react like a scalded cat/insert metaphor here and leave the area with violence.

I think a lot of trading problems (including my own) is down to hunting for trades.
In the absence of these really violent price moves, because we want to trade/are bored, we then look at S/D areas which are still decent but showing nowhere near the same S/D imbalances.
As such, some trades work, but some don't, and it clouds our judgement for future trades.

Discipline is the key to all trading, and having the discipline to only trade those areas is the key to success.

So how to develop that discipline?
Here's what I've been doing for the last week, and it's working.
I have a free account with an online charting firm (it's free for everyone) that gives me EOD data across fx pairs, indices, commodities, stocks, ETFs etc etc. So you look at charts in daily/weekly/monthly timeframes. Can't say who as I think FF might see me as selling something.

They're presented in lists, and when you scroll to each new stock etc, the new chart comes up for each stock (it's v quick and smooth).
So you get to look at 100s, and I mean 100s, of charts in a very short amount of time (rather than switching timeframes on the same currency pair which I don't think is the same but hey that's just an opinion).

And when you do that, looking at 100s of charts, with 100s of different set ups and subjective S/D areas, ones which fail, ones which work etc, what comes across is this: the ones that work/have a higher % chance of working are blindingly obvious.

But they don't happen all the time. You have to wait. And a lot of them are still to happen-you have to wait for price to return, and that's where I, and maybe others, fall down. In our eagerness to trade, we trade lesser S/D levels as we can't wait.

Look at the charts of these stocks (think they are UK-use google or yahoo?) and tell me that you won't be peeing yourselves when prices reach certain areas. I won't point the levels out-they should be obvious. And that's what we want.
AFR/ Afren
AGK/ Agreko
AML/Amlin
BP (weekly chart)
BskyB (weekly chart)
DRX/Drax
OJXXXX (Orange juice futures). Yeah I know-who knew-orange juice futures?!
Dax (weekly chart)

These are just a few, I flagged up 43 or so stocks/commodities/indices etc. But I looked at HUNDREDS, maybe a thousand charts, and only took the most obvious slap you in the face set ups, combined with my rule that price was yet to return to these S/D areas for the first time since their electrifying moves.

And what I'm trying to do is: unless I see what's on those charts, then I'm not looking to trade until price returns to those areas.
I should add that I know nothing about stocks/shares and what drives them-BP/BSkyB have obviously had bad times, so the S/D equations might be different in all of what I've shown above so I hope no-one will actually trade them! But those charts should show you what we're looking for (at least I hope so-comments?).

I trade daily/4 hour charts. Occasionally drop to 1 hour charts and will take some intraday trades only if price moves like it's been shot up the arse and is now returning to this area.
But, once again, the price movement has to be VIOLENT to get me to trade. As Kenneth says, we don't want moves where price moves away slowly/meanders.

The only trades I've looked at this morning are on the 1 hour charts: EURUSD (profit taken) and GBUSD (my preferred trade of the 2 thanks to more violent price move on 1 hour chart-didn't reach my sell zone-dammit!) and CADCHF (4 hour chart). Missed my long order by about 10 points-oh well.
While the price action on the CADCHF may not mirror those on the stock charts I posted, what it does show is the price movement relative to the preceeding price action.
In just two 4 hour price bars it had moved almost double the previous range that had been in place for the last week. So when it moved back down to the price zone where it first decided to do set off on it's journey then I was rather curious to say the least.

I really hope that helps, I really hope it was clear, and I really hope that I haven't waffled (think I know the answer to that one-doh!)

Very Nice Thanks for Sharing , ken

Anyone planning on taking this demand on UJ H4?

I'm undecided at the moment mainly due to the fact the previous move was created by boj intervention and the fact its in a down trend.

I could easily see price breaking through this zone and taking stops before (if) boj intervene again...

waiting...

waiting...

Great piece of advice. Thanks for sharing.

bullzeye,

That is how I roll with this........higher tf's from weekly down to the 15M.
Looking for an alignment of all & then enter. Also take note of how many visits to that level. It may take until Tuesday, but EUR/USD should continue the down trend. As you know nothing is 100% accurate in this business as it only takes one news flash to change everything.


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Hello all and Happy New Year!

That demand was created mainly by one player: BOJ. Of course other jumped in and contributed to the huge demand but it seems to me that their contribution was negligible. The price might react to that level but imo the demand was artificial and trading that level is like betting on another BOJ intervention.

Hey Ultimatus
I also like the oil chart on the 4 hour. My level is 99.50-100 using my patented precise charting technique called 'where did price previously take off like a scalded cat.'
Dropping to 1 hour,there's a gap open in the midst of all that too, but either way price is moving into what looks like a nice area so nice work.
Might not even get that low though...

Thanks for posting Ken, I've read a few pages, I think thats the final nail in the coffin I needed to stop moving my stops to break even!

Yes looks like a good level, but as you say might not even get there...oil is pretty strong right now.