I do not understand how to use the COT as additional consideration for open positions.
if you do not mind, please explain?
WMD and teman2 sorry, maybe my question a little out of theme.
I do not understand how to use the COT as additional consideration for open positions.
if you do not mind, please explain?
Ignored
WMD does not use COT data (so will try to not go off track), but its something I take note off, if only for interests sake. Google "Committment of Trader". Its futures data, but does has relavence to FX.
Hi dazzdude,
How do we get the levels and trade it?
Ignored
Hi juzgood, great qu!
ALL the details are in this thread, but it is a long thread so finding the right information can take some time (though it would be great investment). The Wmd Hook has to be one of the simplest and most reliable trading patterns even presented to the FX trading community!
In fact, this entire thread (one of the best on FF) started off from this single pattern (though it was not called that). It was referred to as trading an untested support or untested resistance level, and that is really what it is. However, price tends to follow a certain pattern after the break out. That pattern looks tends to look like a hook, hence the name.
Like all trading patterns, some instances are better than others. In time, you get better at picking the good ones. Once you do, the pattern is remarkably reliable, simple... and... the potential risk to reward ratio can be excellent. You can also place a limit order with the setup and so you do not need to be the computer to catch the trade.
It's my birthday! so no trading today! I am going to watch a movie now, but be patient... I will come back and explain this pattern in full detail for you. It's too good not the know about!
ALL the details are in this thread, but it is a long thread so finding the right information can take some time (though it would be great investment). The Wmd Hook has to be one of the simplest and most reliable trading patterns even presented to the FX trading community!
In fact, this entire thread (one of the best on FF) started off from this single pattern (though it was not called that). It was referred to as trading an untested support or untested resistance level, and [i]that is really what it...
Ignored
Hey Dazz
Happy B'day and thanks for sharing your thoughts.
Joined Aug 2011
|
Status: riding the lightning
|935 Posts
is the hook more reliable than double bottom/top,head and shoulders? how often does it occur? how much discretion does it require?over time anything that seemed amazing always disappointed.from oversold underbought indis,channel breakouts,123patterns,inside bars,pin bars,divergence,pivots.
all this systems require a lot of discretion aka 10000 hrs screentime.my quest to find high win rate system has not yielded results which does not mean that they don't exist .seems to me its very hard to have results that are better than random with same risk reward i.e 40% factoring spreads.
seems the mantra cut your losers short and let winner's run is my main edge.well these are my honest observations.
hope you guys are making fortunes with this which the word surprising would be an understatement.
here is a perfect example of a "wmd hook" - deadly!
Ignored
Nice catch DD.
I tried to message you, but I cant seem to be able to. Took a nice setup on the usdjpy in the last few hours. Would love to talk to you more and exchange info. PM me if you would like to.
Lets take a look at your example. In this case, I have chosen to look at the 4 hr chart to get a closer look at the price action, though what you have is just as good. A picture tells a thousand words.
I tried to message you, but I cant seem to be able to. Took a nice setup on the usdjpy in the last few hours. Would love to talk to you more and exchange info. PM me if you would like to.
This is a follow up to post 1914 and explains why I am comfortable with this pattern.
I am aware of some trading patterns that have a high rate of success. However, I do not understand why they work. Their effectiveness baffles me. For this reason they can be as useful as tits on a bull. Not understanding why something works makes me nervous and inhibits my ability to pull the trigger.
This pattern on the other hand, it makes sense. It has the most basic and sound logic behind it.
1. If you were to ask the question "What is the most common form of trading analysis that LOTS of people are watching and placing orders from, especially large institutional traders?" That answer would most likely be support / resistance and breakouts.
2. If you were to ask the question "What is it that moves price from point A to point B?" That answer would most likely be order flow. If the amount of buy orders exceeds the amount of sell orders, price goes up (and vice versa). The degree of this imbalance determines the velocity and duration of the move.
If you are looking to buy, what you are really looking for is a price where you have reason to believe that the order flow will be greatly out of balance, with a much greater depth of buy orders than sell orders (and vice versa).
Looking at point 1 and 2, as Wmd points out, when you have a strong and obvious break of a support or resistance level, this will be noticed by many traders and automated trading systems... from small retail traders to your large institutional traders. These large institutional traders are the ones placing the big orders and these large orders create an order flow imbalance. And… everyone is looking at roughly the same price level or zone.
Orders get placed on anticipation of the retest of the level, but it does not happen.
However, the orders remain. Down the track when price comes back, traders are also waiting to enter at market. Some at the point of the retest, some after the reaction has been confirmed and chase the price, others when they observe that the level is holding, etc. It all adds up.
We are looking for trades that have and proven edge, but also where the logic makes sense. This pattern fits the criteria.
1. The simpler you can see the market structure, the better. You can draw your pictures however you like, but at the end of the day you have a support/restance level that is broken or you don't. If you are unsure, then you don't.
2. The more plainly obvious something is, the more chance of it being noticed. When driving down the highway, do you notice the car on the side of the road with a flat tire or the 6 car pile up?
My reasoning behind the trade setup suggests that in order for this setup to work, it's needs to be noticed and generate a lot of interest.
I am re-posting the last two example pictures below which I posted in this thread. To me, the:
If you are interested, look at the EURUSD (being the most commonly watched currency) on the 1hr or 4hr chart. Mark of the most recent untested support or resistance level following this pattern which you consider tradable and and post it. Lets go from theory to application. Also show where you might place your stop.
