Vegas Method, "fib line" confusion | Forex Factory

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Vegas Method, "fib line" confusion

  • #1
  • First Post: May 8, 2006 12:12pm May 8, 2006 12:12pm
This might be a silly question, but reading Vegas' Method, he talks about the "outer edge of the fib lines".

??

My familiarity with the fib lines (fib retracements) is that I pick the high point, and the low point, and use my little tool, and it will draw out the fib retracement lines for me.

Is this what Vegas is talking about? Because one of the problems I have with the Fib lines, is usually, which bar do I select as my "bar in which I begin my fib?" (pun intended). What price point is my "0" so I can measure if the current price is on the outer edges??

He also talks about taking profit in fig number sets; like 144 etc.. Does he mean, when I'm up 144 pips, if I am in for 3 units, I close 1 of the units, etc?

Hope someone can help me clear up the confusion with a sample chart!

Thanks everybody, new here, but great forum.
google:
  • #2
  • May 8, 2006 12:47pm May 8, 2006 12:47pm
Hi there, in the image below you will note that the price is playing off the "outer fib line" on the Vegas model set up for this particular currency. It has little to do with the "Fibonacci Tool" and more to do with the peculiar common occurance of a given price/currency to "bounce" or play off/at a particular fibonacci related number of pips away from the central moving average:

http://www.accrete.com/fx_posts/misc...F31mar2006.PNG
Hope this helps to clarify a bit : - )
Thom
  • #3
  • May 8, 2006 1:10pm May 8, 2006 1:10pm
Quoting twoblink
This might be a silly question, but reading Vegas' Method, he talks about the "outer edge of the fib lines".

??

My familiarity with the fib lines (fib retracements) is that I pick the high point, and the low point, and use my little tool, and it will draw out the fib retracement lines for me.

Is this what Vegas is talking about? Because one of the problems I have with the Fib lines, is usually, which bar do I select as my "bar in which I begin my fib?" (pun intended). What price point is my "0" so I can measure if the current price is on the outer edges??

He also talks about taking profit in fig number sets; like 144 etc.. Does he mean, when I'm up 144 pips, if I am in for 3 units, I close 1 of the units, etc?

Hope someone can help me clear up the confusion with a sample chart!

Thanks everybody, new here, but great forum.
The attached image should help. Your zero point for taking measurements from is the central 55 moving average. You measure and place parallel lines above and below the central MA. Thus in the image four lines are drawn at fibonacci distances from the central 55. In this case 89 and 144 pips above the central 55 MA, and 89 and 144 pips below the central 55 MA. For a trade with three units, the first unit is taken off when price hits the 89, the second unit is taken off when price hits the 144, and the final unit it taken off when the 8 SMA reverses slope.

Does this help?

Dial
Attached Image
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  • #4
  • Edited 2:50pm May 8, 2006 1:35pm | Edited 2:50pm
Quoting diallist
The attached image should help. Your zero point for taking measurements from is the central 55 moving average. You measure and place parallel lines above and below the central MA. Thus in the image four lines are drawn at fibonacci distances from the central 55. In this case 89 and 144 pips above the central 55 MA, and 89 and 144 pips below the central 55 MA. For a trade with three units, the first unit is taken off when price hits the 89, the second unit is taken off when price hits the 144, and the final unit it taken off when the 8 SMA reverses slope.

Does this help?

Dial
Dialist thanks for the explanation, One thing I have been struggling with is entry on the 4 hour VWB. To subjective , I mean when is the slope of the 8 ma good enough for entry, been stopped out to many times to keep trading that time frame , Is there something I am missing regarding entry on the 4 hour besides the slope of the 8ma ?????????
  • #5
  • May 8, 2006 3:06pm May 8, 2006 3:06pm
Quoting vinn234
Dialist thanks for the explanation, One thing I have been struggling with is entry on the 4 hour VWB. To subjective , I mean when is the slope of the 8 ma good enough for entry, been stopped out to many times to keep trading that time frame , Is there something I am missing regarding entry on the 4 hour besides the slope of the 8ma ?????????
Hi Vinn,

First, don't confuse the Vegas 4 hour Tunnel (V4) with the Vegas Wealth Builder (VWB). They are two different methods.

You've asked a very good question, namely, how much of a slope change constitutes a good slope change. See the chart below for an explanation of how I determine the slope change. This technique is called NL+X, where NL is the Neutral Line and X is the number of pips beyond neutral that an entry is taken. You can either used a fixed value for X or set it to a value large enough to clear recent support or resistance. If you're getting stopped out a lot, be sure that the 8 SMA and/or the NL are not buried in ranging price bars. If that is what is currently happening, then set X a little above the range for long or a little below the range for short.

The chart below was taken from my post #25 of the "Lost in the Tunnel" thread located here:

http://www.forexfactory.com/forexfor...2&page=1&pp=15

I highly recommend you read the entire "Lost in the Tunnel" thread.

Hope this helps.
Attached Image
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  • #6
  • May 8, 2006 3:52pm May 8, 2006 3:52pm
Dial, this looks like one of those Hall Of Fame moments, so I want to make sure I understand you...


So if there is consolidation I should look to buy above where I have drawn a red line or short below where I have drawn a red line? This entry has been a bit of a sticky bit with me too... thanks scott
Attached Image
  • #7
  • May 8, 2006 4:02pm May 8, 2006 4:02pm
Scott,

I think you are right that is probably how I'd do it too. That is where the discretion comes in NL+20 or NL+30 etc.
JOHN 3:16
  • #8
  • May 8, 2006 11:21pm May 8, 2006 11:21pm
Quoting smjones
Dial, this looks like one of those Hall Of Fame moments, so I want to make sure I understand you...


So if there is consolidation I should look to buy above where I have drawn a red line or short below where I have drawn a red line? This entry has been a bit of a sticky bit with me too... thanks scott
No sir. In the chart posted, the 8 SMA is not relatively horizontal, nor is it buried in the price bars. The upper and lower lines you drew might be part of a range on a longer time frame, but it is not a range on the 4 hour chart given.

Below I've attached a chart which shows a little more clearly what I mean by a range and the 8 SMA and/or NL being buried in the price bars.

Dial
Attached Image
sxaxlxvxaxtxixoxnxbxyxgxrxaxcxexdxoxtxoxrxgx
  • #9
  • May 8, 2006 11:22pm May 8, 2006 11:22pm
Dial, yes I saw that else where and saw my error.. thanks Scott



Quoting diallist
No sir. In the chart posted, the 8 SMA is not relatively horizontal, nor is it buried in the price bars. The upper and lower lines you drew might be part of a range on a longer time frame, but it is not a range on the 4 hour chart given.

Below I've attached a chart which shows a little more clearly what I mean by a range and the 8 SMA and/or NL being buried in the price bars.

Dial
  • #10
  • May 8, 2006 11:30pm May 8, 2006 11:30pm
Quoting smjones
Dial, yes I saw that else where and saw my error.. thanks Scott
Saw it elsewhere huh? Been pokin' around in the PF, haven't ya?
sxaxlxvxaxtxixoxnxbxyxgxrxaxcxexdxoxtxoxrxgx
  • #11
  • May 8, 2006 11:34pm May 8, 2006 11:34pm
Well, I did not want to make anyone feel bad so I did not say I found the answer, until you had decided if you were going to post it... So I will take my lumps... LOL, Scott



Quoting diallist
Saw it elsewhere huh? Been pokin' around in the PF, haven't ya?
  • #12
  • May 9, 2006 12:34am May 9, 2006 12:34am
Thanks everybody!

This is what happens when you read this stuff at 2am. I woke up this morning, reread it, and it made perfect sense The charts just confirmed it, that's all.
google:
  • #13
  • May 9, 2006 4:07pm May 9, 2006 4:07pm
Quoting diallist
Hi Vinn,

First, don't confuse the Vegas 4 hour Tunnel (V4) with the Vegas Wealth Builder (VWB). They are two different methods.

.........

Hope this helps.
Dial, I always thought the two were the same :surprised...Now I am going back to the "drawing board"....LOL

But thanks for clearing my "clouds"....
  • #14
  • Last Post: Nov 11, 2007 8:55am Nov 11, 2007 8:55am
he/she wanted to know that it means it lines punctuated green in the indicative ff tunnel chart
thank you
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