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  • #1,881
  • Jun 1, 2012 8:11am Jun 1, 2012 8:11am
Quoting Balhana
AN is not looking good right now...
Got a little bit better. Now hovering near entry.
Attached Image (click to enlarge)
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  • #1,882
  • Jun 1, 2012 8:49am Jun 1, 2012 8:49am
Bought AU @ 0.9655, SL @ 0.9630
Attached Image (click to enlarge)
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  • #1,883
  • Jun 1, 2012 9:01am Jun 1, 2012 9:01am
Quoting Balhana
Got a little bit better. Now hovering near entry.
Manually closed 2/2 at 1.2855 for +20 pips.
Attached Image (click to enlarge)
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  • #1,884
  • Jun 1, 2012 9:14am Jun 1, 2012 9:14am
Quoting Balhana
Bought AU @ 0.9655, SL @ 0.9630
Closed 1/2 at 0.9692 for +37 pips and moved SL to BE+1.
Attached Image (click to enlarge)
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  • #1,885
  • Jun 1, 2012 9:37am Jun 1, 2012 9:37am
Quoting Balhana
Closed 1/2 at 0.9692 for +37 pips and moved SL to BE+1.
Moved SL from BE+1 to BE-10 (0.9645) and set TP2 at 0.9790. But I don't think it will go there this late Friday.
Attached Image (click to enlarge)
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  • #1,886
  • Jun 1, 2012 2:34pm Jun 1, 2012 2:34pm
Quoting lovejoy80
Some nice trading guys...I'm a bit confused by what you are calling a bull flag at supply cos that's not what your chart is showing?
Hmmm, now you got me confused ........ I've made some notes on the chart of my entry ..............
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Pipcrawler
  • #1,887
  • Jun 1, 2012 3:18pm Jun 1, 2012 3:18pm
Quoting xmzhang
Hmmm, now you got me confused ........ I've made some notes on the chart of my entry ..............
You stated that the previous supply zone was a bull flag breaking south after an FB...if it broke south then it wasn't a bull flag is it?

A bull flag is price consolidating after a rise - spiking whilst dipping to clear the supply above, often falling to a clear demand zone and then price continues up in another 'pole' like move.

All that was happening here was a rally, a base (i.e. a consolidation) and a drop with the buyers trap / false break being the catalyst to cause the move south.
  • #1,888
  • Jun 2, 2012 6:21am Jun 2, 2012 6:21am
Quoting lovejoy80
You stated that the previous supply zone was a bull flag breaking south after an FB...if it broke south then it wasn't a bull flag is it?

A bull flag is price consolidating after a rise - spiking whilst dipping to clear the supply above, often falling to a clear demand zone and then price continues up in another 'pole' like move.

All that was happening here was a rally, a base (i.e. a consolidation) and a drop with the buyers trap / false break being the catalyst to cause the move south.
Aha, allright I see, so the whole movement down is the actual flag, price pulling back to the base of the flagpole, as price approaches the base you'll see a DBD-decision to break the demand at the base, so could you say we've got a failed bullflag. That base-demand got respected later on, which also completed a QM, good for 20 pips.
Attached Image (click to enlarge)
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Pipcrawler
  • #1,889
  • Jun 3, 2012 6:56am Jun 3, 2012 6:56am
Hello LJ and fellow members, can you explain what is QM?

And for the FTB to SD zone, you do usually price limit orders or prefer to watch price action within the zone and decide the orders?

Thank you for sharing =)

  • #1,890
  • Jun 3, 2012 7:53am Jun 3, 2012 7:53am
Quoting kenkoo
Hello LJ and fellow members, can you explain what is QM?

And for the FTB to SD zone, you do usually price limit orders or prefer to watch price action within the zone and decide the orders?

Thank you for sharing =)

A QM is a Quasimodo which is a reversal pattern - I've described in on a vid on my website (Price Action - Part2).

The very nature of an FTB means that I place limit orders on these type of setups. I'll always watch price action leading into the area but unless I see something untoward (like price moving impulsively for example) it's always a limit order.
  • #1,891
  • Jun 3, 2012 7:58am Jun 3, 2012 7:58am
Quoting xmzhang
Aha, allright I see, so the whole movement down is the actual flag, price pulling back to the base of the flagpole, as price approaches the base you'll see a DBD-decision to break the demand at the base, so could you say we've got a failed bullflag. That base-demand got respected later on, which also completed a QM, good for 20 pips.
Ah I was going off your previous chart so didn't see the complete move.

Yep I'd agree that the DBD was where the decision was made to break lower i.e. it is a source of supply which we'd be looking to hold on the first retest.

When it comes to flags, yes it's a failed bull flag, but I'd be getting concerned long before where the DBD occurred that the flag wasn't working out. For me flags are essentially tight periods of consolidation in a RBR pattern, price taking a slight pause to clear supply above and thus the retrace compared to the pole distance should be relatively small. I'll attach some examples later.
  • #1,892
  • Jun 3, 2012 8:12am Jun 3, 2012 8:12am
I've started running 'learning quizzes' on my forum as members find it a useful way to learn to apply the material. At the moment we're focussing on buyer/seller traps and false breakouts. Here are a sample of the current setups that I've given members to analyse. If you want to learn and think you know what makes for a great FB setup, a tradable one* and one to pass on then have a go for yourself...

* A tradable setup is one that is clearly not 'A+' but one that if traded over a sufficient period has a positive expectancy. Great traders trade setups that they know will give a positive expectancy and vary their risk accordingly to the quality of the setup. (Amateurs focus on trading A+ setups, having a high win rate and sitting on their hands more often than trading)
Attached Image(s) (click to enlarge)
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  • #1,893
  • Jun 3, 2012 3:54pm Jun 3, 2012 3:54pm
Quoting lovejoy80
I've started running 'learning quizzes' on my forum as members find it a useful way to learn to apply the material. At the moment we're focussing on buyer/seller traps and false breakouts. Here are a sample of the current setups that I've given members to analyse. If you want to learn and think you know what makes for a great FB setup, a tradable one* and one to pass on then have a go for yourself...

[size="1"]* A tradable setup is one that is clearly not 'A+' but one that if traded over a sufficient period has a positive expectancy. Great...
Hi LJ

Hope you don't mind me chipping in? I like the idea of this active learning technique.

I personally like to see a proven level or heavily consolidated area to form before a false breakout. The GBPNZD D1 chart is an example. Or to see a newly formed swing low based on the previous (AUDUSD D1 chart attached). The bar however MUST close within the previous swing low/high for it to be valid.

Therefore, under my own set of rules, I would only trade the 1st chart. The second chart is also interesting but given the range of the last candle I wouldn't trade it. I am unfamiliar with the criteria to enter chart 3 and 4 so I would therefore pass.

Forgive my ignorance if I am completely off. I've been studying for exams outside of trading.
Attached Image(s) (click to enlarge)
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Click to Enlarge Name: 357_audusd d1.jpg Size: 87 KB
  • #1,894
  • Jun 3, 2012 8:12pm Jun 3, 2012 8:12pm
Quoting lovejoy80
I've started running 'learning quizzes' on my forum as members find it a useful way to learn to apply the material. At the moment we're focussing on buyer/seller traps and false breakouts. Here are a sample of the current setups that I've given members to analyse. If you want to learn and think you know what makes for a great FB setup, a tradable one* and one to pass on then have a go for yourself...

[size=1]* A tradable setup is one that is clearly not 'A+' but one that if traded over a sufficient period has a positive expectancy. Great traders...
I would only trade the 2nd chart. Maybe the 1st chart too depending on further PA.

The chart 3 would be a breakout setup, rather than an FB setup, and regarding the chart 4, I don't know where price will go and would wait until price gives me more clues.
Attached Image(s) (click to enlarge)
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  • #1,895
  • Jun 4, 2012 12:46am Jun 4, 2012 12:46am
Quoting 5.25
Hi LJ

Hope you don't mind me chipping in? I like the idea of this active learning technique.

I personally like to see a proven level or heavily consolidated area to form before a false breakout. The GBPNZD D1 chart is an example. Or to see a newly formed swing low based on the previous (AUDUSD D1 chart attached). The bar however MUST close within the previous swing low/high for it to be valid.

Therefore, under my own set of rules, I would only trade the 1st chart. The second chart is also interesting but given the range of the last...
The FB's / traps at consolidation areas are definitely my favourite compared to the 'swing' style setups, thus I'd always be more keen on the GNZD style setup than the AU.

On AU I wouldn't be looking to enter straight away after the close, I'd be looking for further signs of price turning. We are fighting a big down trend here and an FB off that swing could just be demand consumption for price to move lower again...the point is there is a higher level of uncertainty with this type of setup. The size of the FB bar does suggest bears losing strength as demand clearly came into the market, but it certainly isn't enough of a trap given the strong trend to likely cause price to just shoot up (as we would expect in a consolidation type setup). Thus there is no value in trading this as a daily setup in a mechanical fashion, scroll down the timeframes and find a long setup is what I'd be doing and watching the correlated asset classes for confluence

If you look back over AU H1 you'll be plenty of times an FB has just been demand consumption when compared to a previous significant swing...this is definitely something that many aren't considering when they trade these setups...once again it all boils down to trying to trade them mechanically rather than thinking about the price action that is occurring.
  • #1,896
  • Jun 4, 2012 4:26am Jun 4, 2012 4:26am
It's a very slow day today. Shorted EU at 1.2437 for a scalp....
  • #1,897
  • Jun 4, 2012 4:42am Jun 4, 2012 4:42am
Quoting Balhana
It's a very slow day today. Shorted EU at 1.2437 for a scalp....
Closed 1/2 at 1.2428 for +9 pips and the remainder got stopped out at BE+1.
  • #1,898
  • Jun 4, 2012 4:49am Jun 4, 2012 4:49am
Quoting 5.25
Hi LJ

Hope you don't mind me chipping in? I like the idea of this active learning technique.

I personally like to see a proven level or heavily consolidated area to form before a false breakout. The GBPNZD D1 chart is an example. Or to see a newly formed swing low based on the previous (AUDUSD D1 chart attached). The bar however MUST close within the previous swing low/high for it to be valid.

Therefore, under my own set of rules, I would only trade the 1st chart. The second chart is also interesting but given the range of the last...
Why would you trade the 1st setup and not the 3rd and 4th ... they are all essentially the same overall setup - a false break of a previous clear significant swing?

How would you trade the 1st setup, SL + entry + exit?
  • #1,899
  • Jun 4, 2012 5:07am Jun 4, 2012 5:07am
Quoting Balhana
I would only trade the 2nd chart. Maybe the 1st chart too depending on further PA.

The chart 3 would be a breakout setup, rather than an FB setup, and regarding the chart 4, I don't know where price will go and would wait until price gives me more clues.
I won't comment on the others for the moment but you identified what I was looking for in Chart 2.

Very few people would have thought about that...give someone a chart like that, tell them it's an FB setup and to tell me whether that is one they would trade and they immediately go into a mode of evaluating it against a series of rules for FB setups.

This is the WRONG approach, I don't believe in 'rules' I believe in guidelines in evaluating setups for starters, but the bigger point is the ability to think laterally when looking at a chart, being able to use your price action knowledge to identify what is happening and what price is likely to do next.

Most people that have knowledge of FB's in the retail space would pass on that setup, others would identify it as a BUOB but would evaluate it as a poor one because of lack of space and a poor close. Thus you'd end up with very few people taking such a setup.

What does this highlight - it highlights how people a) think too mechanically when it comes to price action trading and b) possess a lack of fundamental price action and order-flow knowledge.

For example if you'd evaluate that as a BUOB off an SR then you're not seeing the true price action, the compression, the supply consumption and the sellers trap is the TRUE price action here.
Attached Image(s) (click to enlarge)
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  • #1,900
  • Jun 4, 2012 5:45am Jun 4, 2012 5:45am
Sold AU at 0.9713.
Attached Image (click to enlarge)
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