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Trading Made Simple for Day Charts

  • #661
  • Edited 11:00pm Feb 13, 2012 1:43pm | Edited 11:00pm
Quoting michael_k
Fair enough, I understand that, it is your your call




I get that. I guess my problem was and still is: how do you define the perfect entry: as low as possible for the long trades or as high as possible for the short ones?

But then I guess this issue is a universal problem for any forex system

Best,
Michael
From Post #1
Trade Entires:
Is there such a thing as a perfect set up? My ideal scenario would be the following for long entries for reversals (and they do happen):

PA moves with ATR(1) at 75% or higher of ATR(7)
RSI moving above 50
TDI cross within the last 2 or 3 candles and moving up from the 32 region
5EMA broken to the upside
Day chart showing recent trading range of swings with 500+pips (next resistance level 500pips away)

For short entries:
PA moves with ATR(1) at 75% or higher of ATR(7)
RSI moving below 50
TDI cross within the last 2 or 3 candles and moving down from the 68 region
5EMA broken to the downside

Once you develop an understanding for what the candles and the PA patterns are telling you, it gets easier. For day charts there is some great info on You Tube from Oz Trader - obviously he is selling his wares, but worth a watch and worth spending a couple of hours digestiing the charts and candle patterns. Disclaimer - I am not endorsing his training classes / other services and I have not subscribed to anything that he sells.

I like this approach - minimal to no indicators - he occoassionally has one or two MAs on the chart - all Price Action and simple for day charts - wait for day candle to close - analyse patterns / support / resistance and go from there.
"To live with Passion, it takes Courage and Grace to survive"
  • #662
  • Feb 13, 2012 3:50pm Feb 13, 2012 3:50pm
So glad to have stumbled upon this thread, cannot wait to start using it. I will begin the demo this week and see how it goes.
  • #663
  • Feb 13, 2012 10:58pm Feb 13, 2012 10:58pm
Very nice candle patterns for a reversal with a succession of Lower Highs and Lower Lows.

PA moving away from 200ema

RSI continues to drop

Nice TDI lower bounce and heading down to challenge 50 and probably lower.
Attached Image (click to enlarge)
Click to Enlarge Name: gu 2-13-2012.gif Size: 39 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #664
  • Feb 13, 2012 11:34pm Feb 13, 2012 11:34pm
I am watching those EMA's also, need the AUD to come down off it's HIGH, and CAD + JPY to pick up their act and get these 6 main pairs travelling together again, or 3 together and 3 opposite is what I mean; as they used to do !!!

Attached Image (click to enlarge)
Click to Enlarge Name: 0014.png Size: 37 KB
It takes a lot for me to IGNORE you, but you can try.
  • #665
  • Feb 13, 2012 11:34pm Feb 13, 2012 11:34pm
Great reversal set-up but still needs PA to follow through

Also with the inside candles, looking fro the current candle to continue and set a new low

PA moving back towards 200ema

Bouncing off of Resistance of 1.7150
Attached Image (click to enlarge)
Click to Enlarge Name: au 2-12-2012 - inside candles.gif Size: 34 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #666
  • Feb 13, 2012 11:45pm Feb 13, 2012 11:45pm
Quoting Britpip7
Very nice candle patterns for a reversal with a succession of Lower Highs and Lower Lows.

PA moving away from 200ema

RSI continues to drop

Nice TDI lower bounce and heading down to challenge 50 and probably lower.
Also entered short on the break down of the support @ 1.5717
SL 1.5834 ( just above previous day high)
TP1 1.5583 ( 50% Fib extention of the move up from 1.53)
TP2 1.5500 ( 61% Fib ext)

Any comments on SL and TP. I read that you set it up according to ATR multiples, but i have hot done this before and would like to see how it works.

All comments on rights or wrongs are very appreciated.
  • #667
  • Feb 13, 2012 11:49pm Feb 13, 2012 11:49pm
Quoting Britpip7
For day charts there is some great info on You Tube from Oz Trader - obviously he is selling his wares, but worth a watch and worth spending a couple of hours digestiing the charts and candle patterns.
Thanks for the tip, I'll check it.
  • #668
  • Feb 14, 2012 9:52am Feb 14, 2012 9:52am
Quoting Invest_or
Also entered short on the break down of the support @ 1.5717
SL 1.5834 ( just above previous day high)
TP1 1.5583 ( 50% Fib extention of the move up from 1.53)
TP2 1.5500 ( 61% Fib ext)

Any comments on SL and TP. I read that you set it up according to ATR multiples, but i have hot done this before and would like to see how it works.

All comments on rights or wrongs are very appreciated.

Based on exhaustive back testing and also dcginc's posts on the TMS thread, it became clear that the max drawdown rarely exceeded 2XATR(7) based on the value at time of entry.

With the current au set up, the pin bar candle from Monday has an ATR(7) value of 93pips. the most recent Fractal High value was 1.0843 which is only about 160 pips off of current price.

With 2XATR(7) you would have a SL of 186 pips which is probably too much considering the reversal in play, so I would place my SL 10 pips above the Fractal High (swing high).

TP would be 186 pips for my first entry and left open for the second position and manually manage the SL accordingly.
"To live with Passion, it takes Courage and Grace to survive"
  • #669
  • Feb 14, 2012 1:53pm Feb 14, 2012 1:53pm
Quoting smatthew
Perhaps it will trigger!
Up 70 pips.

A number of possible short trades are currently developing.
Mostly xxxCAD pairs. EURUSD looks good too.
Attached Image (click to enlarge)
Click to Enlarge Name: $GBPUSD (Daily) 4-11-2011 - 14-2-2012.png Size: 61 KB
Financial independence is what I live for
  • #670
  • Feb 14, 2012 2:42pm Feb 14, 2012 2:42pm
I'm going short on AUD/CAD, good healthy cross on TDi, and even though PA is bullish, RSI is bearish which would give an overall bearish signal.

http://i49.photobucket.com/albums/f2...chartusd-2.gif
  • #671
  • Feb 14, 2012 3:04pm Feb 14, 2012 3:04pm
Quoting petrolhead88
I'm going short on AUD/CAD, good healthy cross on TDi, and even though PA is bullish, RSI is bearish which would give an overall bearish signal.
My personal preference would be to wait for the day candle to close and then assess PA/momentum as it looks to be pulling back - 21ema may hold as a support level.
"To live with Passion, it takes Courage and Grace to survive"
  • #672
  • Feb 14, 2012 4:43pm Feb 14, 2012 4:43pm
Let's see how this one develops..
Attached Image (click to enlarge)
Click to Enlarge Name: $EURUSD (Daily) 22-11-2011 - 15-2-2012.png Size: 54 KB
Financial independence is what I live for
  • #673
  • Feb 14, 2012 5:12pm Feb 14, 2012 5:12pm
Quoting smatthew
Let's see how this one develops..
My thought here is that your TP1 is below the BRN of 1.3000 and you are facing Fractal Lows at 1.3026 and 1.3025, so this gives you 2 potential support levels to get through.

After that it should be clear sailing for the next 300 pips
"To live with Passion, it takes Courage and Grace to survive"
  • #674
  • Feb 14, 2012 5:31pm Feb 14, 2012 5:31pm
Quoting Britpip7
My thought here is that your TP1 is below the BRN of 1.3000 and you are facing Fractal Lows at 1.3026 and 1.3025, so this gives you 2 potential support levels to get through.

After that it should be clear sailing for the next 300 pips
Also dealing with the right shoulder of a inverted H&S if any of you trade patterns. And to be a failed inverted H&S it has to break below the right shoulder (RED line) which is all the areas BritPip spoke of above. I am looking at this trade after the Break.

Attached Image (click to enlarge)
Click to Enlarge Name: HandS.jpg Size: 85 KB
Always Learning
  • #675
  • Feb 14, 2012 5:32pm Feb 14, 2012 5:32pm
Eventually this pair started moving but still a long way to go for TP.
Attached Image (click to enlarge)
Click to Enlarge Name: gbpusd.gif Size: 33 KB
Forex is boring but profitable with patience and discipline
  • #676
  • Feb 14, 2012 11:28pm Feb 14, 2012 11:28pm
Looks like EJ is making a break for it.

Inside candle has broken to the upside and has broken the previous Fractal High.
Attached Image (click to enlarge)
Click to Enlarge Name: ej inside candle break.gif Size: 32 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #677
  • Feb 14, 2012 11:37pm Feb 14, 2012 11:37pm
This is not a pattern that I have traded before so feel free to comment

This looks like an Inside Candle following a H&S set-up.

All I would do on this would be to trade the inside candle break out!
Attached Image (click to enlarge)
Click to Enlarge Name: ej inside candle following head and shoulders.gif Size: 36 KB
"To live with Passion, it takes Courage and Grace to survive"
  • #678
  • Feb 15, 2012 12:10am Feb 15, 2012 12:10am
[quote=Britpip7;5383830]Based on exhaustive back testing and also dcginc's posts on the TMS thread, it became clear that the max drawdown rarely exceeded 2XATR(7) based on the value at time of entry....

Thanks for your input. will try to use it in my next trades
  • #679
  • Feb 15, 2012 3:45am Feb 15, 2012 3:45am
Hi all,

I thought I would share my worst and best trades that I had so far.

Quoting Britpip7
....
Trade set ups are welcome as well as active trades or trade summaries / rationales for entering / exiting.
This one was taken on February 6, 2012:
USD/JPY, long
Reasons for entering:

 

  1. TDI crossed one (day) candle before and trend is confirmed
  2. RSI still below 50
  3. Angle is OK
  4. Candle shapes indicate strong up trend (no lower wicks)
  5. Weekly trend was actually down at the time of entry but it was clearly exhausting with longer close wicks and the current week formed a spinning top candle

Trade was closed on February 13th with a profit of +90 pips.
Here are the open/close screenshots:

http://img196.imageshack.us/img196/6...usdjpylong.png

http://img840.imageshack.us/img840/5...ylongclose.png


And as far as this goes:

Quoting Britpip7
We also want to see the ooopsies – and the lessons learned from the pain and suffering incurred!
This one is EUR/NZD, taken on February 10, 2012:
Reasons for entering:

 

  1. TDI crossed one (day) candle before and trend is confirmed
  2. RSI still below 50
  3. Angle is good
  4. Candle shapes indicate strong up trend (no lower wicks)
  5. Weekly trend confirms direction up

Trade hit stop loss on February 13th, 2012 at -127 pips


http://img822.imageshack.us/img822/4...dlongentry.png


I guess this was my way of learning why entering trades on Friday should be avoided <bang-your-head-against-the-wall smiley goes here> , since to me in all other aspects this trade's setup was almost perfect.

Another mistake I made is actually covered in this article and I wish I read it earlier, since I did exactly what they talk about in the article -- I let my bad trade run too long and cut my good trade a bit prematurely.

P.S. Sorry if the images will take all of your screen space, I am still learning my way around with this forum...

  • #680
  • Feb 15, 2012 10:34am Feb 15, 2012 10:34am
Quoting smatthew
Let's see how this one develops..
Hi,

I took identical trade to yours on this one. setup looks promising.

My tps are more conservative though. using 4h chart as areas for TP.
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