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  • #3,621
  • Oct 1, 2012 11:44am Oct 1, 2012 11:44am
Only this one trade for me today. USDCHF FTB.

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  • #3,622
  • Oct 1, 2012 12:10pm Oct 1, 2012 12:10pm
Quoting MinceMeat
Only this one trade for me today. USDCHF FTB.

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I presume you entered at market because price had hit the the upper part of your first decision point i.e. this was a level where price could have feasibly reversed from?

Nice liquidity spike + reversal further down into the area which lead to the actual reversal.

Of course with the relative tight ECHF range there was a opposing setup on EU - easy SL above the former demand.
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  • #3,623
  • Edited 12:53pm Oct 1, 2012 12:17pm | Edited 12:53pm
Nice example of how a LTF can reveal more information. Entry at source of the move.

QM's are a new pattern for me. Does this classify as one?
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  • #3,624
  • Oct 1, 2012 12:34pm Oct 1, 2012 12:34pm
Quoting 5.25
Nice example of how a LTF can reveal more information. Entry at source of the move.

QM's are a new pattern for. Can anyone confirm this change in trend as one?
Very nice approach!
  • #3,625
  • Oct 1, 2012 12:42pm Oct 1, 2012 12:42pm
Quoting lovejoy80
I presume you entered at market because price had hit the the upper part of your first decision point i.e. this was a level where price could have feasibly reversed from?

Nice liquidity spike + reversal further down into the area which lead to the actual reversal.

Of course with the relative tight ECHF range there was a opposing setup on EU - easy SL above the former demand.
I'm somewhat new to those decision points on a very small timeframes. So do you actually take a trade like this from 1 minute chart and with a 4-5 pip stoploss? I mean... I have decent results trading S/D on a higher timeframes, but shorting like this takes some serious guts.
  • #3,626
  • Oct 1, 2012 1:01pm Oct 1, 2012 1:01pm
Quoting Supernaut
I'm somewhat new to those decision points on a very small timeframes. So do you actually take a trade like this from 1 minute chart and with a 4-5 pip stoploss? I mean... I have decent results trading S/D on a higher timeframes, but shorting like this takes some serious guts.
I wouldn't necessarily call it gutsy, I for one scale my position size relative to the setup be it 1m, 5m, 1h etc. I also expect price to react at a level/zone, if it doesn't, I am wrong in my analysis. I don't want to leave my position on the market when I am not in control. I would also only ever us a 4-5 pip stop loss on selective pairs, but my approach would remain the same. It is all relative.

Just my thoughts
  • #3,627
  • Oct 1, 2012 2:02pm Oct 1, 2012 2:02pm
Quoting lovejoy80
I presume you entered at market because price had hit the the upper part of your first decision point i.e. this was a level where price could have feasibly reversed from?

Nice liquidity spike + reversal further down into the area which lead to the actual reversal.

Of course with the relative tight ECHF range there was a opposing setup on EU - easy SL above the former demand.
Yep, that's right .... price missed my limit order by a fraction of a pip first time round so decided to enter at market shortly after ...... bit of patience and I would have got my entry a few bars later with that liquidity spike and reversal you mentioned.

Yeah, liked the EU setup too.
  • #3,628
  • Oct 1, 2012 2:49pm Oct 1, 2012 2:49pm
Quoting Supernaut
I'm somewhat new to those decision points on a very small timeframes. So do you actually take a trade like this from 1 minute chart and with a 4-5 pip stoploss? I mean... I have decent results trading S/D on a higher timeframes, but shorting like this takes some serious guts.
My standard approach is to find clear SR and SD zones on Daily, H4 and H1 TF's (for the most part) in regards to FTB setups. I'll then zoom in and see if I can pinpoint more exact decision points.

Typically, on a zone that has 'substance' you'll find a decision point that defined the edge of the zone i.e. where my entry will be based on and then at least 1 other decision point and lastly the source of the initial move (i.e. source of supply / demand that lead to initial breakout).

At the very most my SL is going to go below the source, if the zone is a large zone then my SL might be tighter than this and go beyond another decision point. This would be on the basis that for an FTB setup I do not expect price to test the 'source' - it should react at a decision point nearer the edge - for a zone of decent size / substance.

You should be able to follow this from my first video on FTB's, but more is to come with regards entries and stops in the next video (which will definitely be uploaded tomorrow).

Trading with small stops can definitely be a psychological challenge if you are not used to doing so. Most people will have fear of taking a loss - a much smaller SL than you are used to means you can suffer a full 1R loss much quicker - this is where lack of confidence and thus fear comes into play.

I can place tight stops because a) I fully understand how price should move and react at an FTB area, b) I understand why this to be the case, c) I have 100% confidence when I'm trading due to this knowledge coupled with hours and hours of chart watching - both through past charts and 'forward' trading.

The mindset you want to get to with trading is one where you are thinking 'where can I place my stop that provides me with the maximum risk/reward without materially affecting my win rate - where does price have to go to tell me on the balance of probabilities that the setup isn't going to work out'.

This type of thought process is essentially maximising your edge and expectancy and thus producing the highest potential profit over the long term.

But what most traders do is trade without 100% confidence (lack of knowledge and lack of chart watching / research) and thus use wider than needed stops - some will even look to tighten their SL very quickly and will congratulate themselves on not taking a 1R loser if it is hit - if you would never take a 1R loser in the first place then your SL was in the wrong place to start with as all you are doing is negatively impacting your risk/reward to overcome your mindset issues.
  • #3,629
  • Oct 1, 2012 3:07pm Oct 1, 2012 3:07pm
A quick example - using the EU 15min short setup from the post above, zooming into M1 TF - analysis on the chart below.

Where is my entry going to be - just below the 1.2909 DP level.

Where is my SL going to be - just above the DBD @ 1.2918 as the probability of price moving above there and still holding that SR as resistance is very low.

It doesn't mean it won't happen and indeed it does from time to time, but we want to place our SL where we know that we are very likely wrong, not at a level that feels more comfortable or at an area that ensures we have a higher chance of a winning trade - we put it where we know we are wrong and thus maximise our potential risk reward and thus our profit.

From what I've seen of how other people trade (and I've seen a lot of people trade over time), people would typically look at that setup and would not feel confident about an absolute SL of 10 pips (fear of taking such a quick loss) and would instead look at a higher SL - maybe even above that previous high around 1.2937.

I even see some people placing wide SL's above highs like that and still consider this to the area where they are very likely wrong - this just comes down to lack of knowledge of how price moves and why.
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  • #3,630
  • Edited 6:56pm Oct 1, 2012 6:44pm | Edited 6:56pm
I was presented to this thread by a fellow trader and it seems that all the content here makes a lot of sense to me in many ways.
So after reading part of the thread and watching a few of the videos on the web site, I decided to make a post.

Here we go...

Price seems to be "trapped" between two rather strong S/D areas as well as diagonal S/D areas (trend lines). A break north is more likely IMHO.

I probably missed the 'perfect' long entry at the confluence of demand/support/ascending trend line observed on H4. (see 1st chart) I'll leave the order there just in case...

Right now I see price inside some supply area in lower TFs(m5 or so) but there's a clear support @ 1.2876. Actually price hesitated somewhat before breaking resistance (now support) and falling into supply area.

3 options come to mind:

1. An attempt to long with very tight stops close to support level with a good R:R;
2. An attempt to play the break from supply level;
3. An attempt to play the retrace if and when the break from supply level occurs.

Hope this makes sense.

Cheers to all.

JP.
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  • #3,631
  • Oct 1, 2012 9:55pm Oct 1, 2012 9:55pm
Quoting lovejoy80
My standard approach is to find clear SR and SD zones on Daily, H4 and H1 TF's (for the most part) in regards to FTB setups. I'll then zoom in and see if I can pinpoint more exact decision points.

Typically, on a zone that has 'substance' you'll find a decision point that defined the edge of the zone i.e. where my entry will be based on and then at least 1 other decision point and lastly the source of the initial move (i.e. source of supply / demand that lead to initial breakout).

At the very most my SL is going to go below the source, if the...
Thank you very much, sir. A superb explanation.
  • #3,632
  • Oct 2, 2012 10:38am Oct 2, 2012 10:38am
Quoting lovejoy80
Yes, this is how I have drawn my demand zone based on H4 - lower edge is easy, upper edge due to the previous resistance and then retest that occurred on 12/9 - then I would find the decision points/levels/areas by zooming in and thus refining where I expect price to find demand.

Did you regard the outer edge of the zone at 1.2817 as used up by th 4 hr pb on the 12th sept therefore for a better entry for minimum draw down etc you look for the NEXT logical decision point for entry
Constant and never ending improvement
  • #3,633
  • Oct 2, 2012 12:11pm Oct 2, 2012 12:11pm
Quoting jupiter_peak
I was presented to this thread by a fellow trader and it seems that all the content here makes a lot of sense to me in many ways.
So after reading part of the thread and watching a few of the videos on the web site, I decided to make a post.

Here we go...

Price seems to be "trapped" between two rather strong S/D areas as well as diagonal S/D areas (trend lines). A break north is more likely IMHO.

I probably missed the 'perfect' long entry at the confluence of demand/support/ascending trend line observed on H4. (see 1st chart)...

Here are my current H4, H1, M30 TF charts of EU.

Just had an M30 bull trap setup from the upper supply with a compressed channel to assist.

I think the daily TF has a distinct bull flag look too it so I'll be focussed on PA if price returns to this supply zone, alternatively I'll be interested in a return down towards the lower demand again.
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  • #3,634
  • Oct 2, 2012 12:13pm Oct 2, 2012 12:13pm
Quoting matk
Did you regard the outer edge of the zone at 1.2817 as used up by th 4 hr pb on the 12th sept therefore for a better entry for minimum draw down etc you look for the NEXT logical decision point for entry
This is how I would define the edge of the zone - but as the 12th September retrace represents an FTB what I would do is mark up the DP's and then just watch PA as price hits one of them next time, looking for signs of strong rejection (which indicates Pro buying) and signs of supply consumption above.
  • #3,635
  • Oct 2, 2012 12:26pm Oct 2, 2012 12:26pm
Not much happening in the market today, so did some VLTF PA trading - here are a few...

1. FTSE M5 TF - bull trap + very tight compression, easy pips down to base of compression.

2. EJ M15 TF - much the same, bull trap and compression, TP at base of compression.

3. GU - M5 TF, standard FTB.
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  • #3,636
  • Oct 2, 2012 12:51pm Oct 2, 2012 12:51pm
Following the EU situation presented by LJ above, bull trap + compression, it seems to me that there is no "real" demand until the bottom of the range, near weekly lows.
Now if H4 closes down will have a BEOB that kinda confirms the bull trap and demand being low in middle range we can TP just above the demand at the lows. Makes sense?

Thanks.
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Trading = a mirror to your human flaws. Fix them or be fixed.
  • #3,637
  • Edited 1:50pm Oct 2, 2012 1:34pm | Edited 1:50pm
Quoting lovejoy80
Here are my current H4, H1, M30 TF charts of EU.
A slightly different approach, but a effectively the same trade.

x3 trades today.

10m Euro, 15m Euro (FB's)and 1m Euro 9fTB). Me thinks there is a growing trend here?

Edit: In hindsight, the 5m FB would have been enough of a signal to short.
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  • #3,638
  • Oct 2, 2012 2:12pm Oct 2, 2012 2:12pm
USDCAD seems to be reaching a supply area as well as a descending trend line (diagonal supply). It seems to be an interesting level for a short.
  • #3,639
  • Oct 2, 2012 2:42pm Oct 2, 2012 2:42pm
Quoting jupiter_peak
USDCAD seems to be reaching a supply area as well as a descending trend line (diagonal supply). It seems to be an interesting level for a short.
Yeah, interesting situation alright. Multiple S levels above also.
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  • #3,640
  • Oct 2, 2012 3:04pm Oct 2, 2012 3:04pm
Quoting 5.25
Yeah, interesting situation alright. Multiple S levels above also.
I agree with all other levels.

Resistance level along with what was/is, IMHO, a strong demand level in the past. The trend line is keeping strong, but will most likely be taken out soon. A fourth approach is normally enough to take out a TL.

Still might be worth a 'bet' with rather tight stops.
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