Nearly Naked (Simple Trades)

H&S??

you are right....i dont know why i am being too lazy to work out the actuaries on that approach(stacking....).

thanks...

Core Elements of Technical Analysis

Another thing that i have noticed about trading S/R and TL confluence on larger time frame is that, whenever or where ever they occur, they hardly occur in isolation. They also tends to be part of another pattern, i.e., the TL could be part of a pennant formation or a channel or a head and shoulder or a double top/bottom, ascending/descending triangle, or flag formation, or Gartley formation, etc. For the S/R Levels or demand and supply zones, it is not uncommon for some of them to concides with flat top/bottom triangles or rectangle formations. All these different formations probably serves to bring in other players looking at different things to put their money at that spot of confluence.

Also, it is not at all unusual to see FIB levels zones of 38 or 50 or 61 in close proximity to the confluence spot. Which probably brings in the fib players.

Since focus is on H4 and above, most likely the confluence spot will fall very close to a round number psychological area, which has its attraction for some people.

Even candlesticks comes into play here, because when you zoom into candlesticks, there are times when a candlestick is just a classic chart pattern when viewed from a lower time frame. Try this, go to monthly time frame and choose any random candlestick. Mark its boundaries. Then go to lower and lower time frame to view those boundaries. I can almost guarantee it, that the weekly candlestick will morph into one of many classic chart patterns within those boundaries when viewed from lower time frames. In essence, the candlestick trader could be trading S/R and TL confluence while trading his candlesticks.

Basically, what i am saying is that the reason why S/R and TL confluence on higher time frames shows such remarkable success rate could be because of the converging different styles of traders focusing on the confluence spot for whatever personal reasons.

Take for example, this EUR/HKD trade, immediately, i see at least 7 things converging on the confluence zone.

1. A gartley C-D bullish leg completing itself into the confluence zone.
2. I can see a pennant doing the same too....
3. Same for S/R level or demand zone.
4. Same for a channel
5. Same for 50% fib level.
6. Same for round number.
7. Flat top triangle.

All concentrated at confluence zone. These are just for the ones i can see for now. Maybe this is why confluence on higher time frames(where it gets more noticed by different traders with different style)works so well. Due to many different style of traders putting their money down around that spot for whatever different reasons. I am just hypothesizing here.

Bottomline here is this: the way i see it is that i dont even need to see all these other patterns, when all i need is a confluence of S/R and T/L. That is it. That take care of everything. Which goes to a hypothesis: most technical chart patterns and candlesticks are simply S/R and TL or one of the two, when you really, really think about it.

shahab8b

I've been watching AU and got surprised that it went against your take. Why do you think it happened? News (cash rate)? If so, limit orders can't be placed before news hours?

Did you actually hit the SL?

Sorry, but I'm very curious.
Thank you very much!

Why? I got the move I wanted, 20 pips or so, moved SL to B/E and stopped out.

Nice detailed explanation!

Oh, that's what you wanted! makes sense! Sorry, I just thought your TP was 1.03ish..

Sorry and thank you for the reply.

A tiny pin bar, but might mean something...

hi guys,

This is my first time posting on a forum so be kind . I'm a swing trader and usually only trade on higher timeframes. I'm based in Asia and I hate trading before bedtime, so higher timeframes and UK open works great for me.

I trade PA and basic S&R, trendlines, channels and 1 oscillator. Sometimes I use MA but that's just my last tick in the box. So this thread looks perfect so far.

Been reading through the chats. I'll try to get into the flow of things when I can. Anyway, just dropping a message to say hi.


Alwin

Isn't this interesting??

UPDATE.....unfortunately, price didnt pullback enough...

thank you, boss. i share the very little that i know...hope to learn new things from others.

Hopefully you got in!

Kiwi:

50pips and out Thank you! master shahab8b!

GY Simple and beautiful! Is it not?

Here is my conceptual framework and identification of major trend cycle which indicates what trading method you should adapt to get the best result in various market conditions.

Here is an example of daily trend cycles on Gold

Hi shahab8b,

Hope you don't mind me asking.

Price would often re-test the trendline but your SL is pretty tight/low. Is that because you don't expect price to retest the trendline after such a big move from Kiwi?