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"Ratios & Harmonics: a Different Way to Trade." Summary 37 replies

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Ratios & Harmonics: a Different Way to Trade

  • #1,821
  • Jan 21, 2013 2:50pm Jan 21, 2013 2:50pm
Also, do you wait for a candle to close in the prz before closing. for example, in this picture, the price candle blew through the ABCD pattern with one candle.

But i didn't offset that impulse wave, so maybe that would have invalidated the abcd trade.
I know in the rules it says to just place a limit order at 127


Attached Image (click to enlarge)
Click to Enlarge Name: PRZ1.jpg Size: 139 KB
  • #1,822
  • Jan 21, 2013 3:00pm Jan 21, 2013 3:00pm
Starry,
Wow, you are going hard, good for you. A thought, maybe Mr. Pip will agree or disagree, but the smaller the timeframe, the less emphasis or strength a PRZ will have, or so I believe. A daily or 4h PRZ off a major pattern (Gartley, etc.) likely has a better chance of being true relative to a 1min PRZ at point D after an ABCD.

While Mr. Pip does not believe in 'noise' and I kind of agree, certain time frames have more vacillation than others. Similarly, there are always time frames with cleaner waves than others. I do not know where that train of thought will take you/us, but something to consider.

Additionally, in your chart that blew through a PRZ, the price action was telling you something on that time frame. There was additional resistance in that area, and in blowing through, it suggests that bulls are still in control. Now, it retraced 100% of that move, but found support. So a breakdown below point A means one thing, a retest of point D means something else entirely.

In the end, some PRZs work, some do not. I suspect you try to find the causative affect for why or why not, which you may never know. Try to gauge the odds, the probability, and your head will hurt far less and you can focus on the actual formation of patterns, not the why.

Good luck!
  • #1,823
  • Jan 21, 2013 4:09pm Jan 21, 2013 4:09pm
Mr PiP
You probabily noticed the obvious bat pattern on Euro on higher TF H4
I know you don't trade H4 however would you say probability is high for Bat completion?
Attached Image (click to enlarge)
Click to Enlarge Name: eu.gif Size: 23 KB
In trading, you have to be defensive and aggressive at the same time
  • #1,824
  • Jan 21, 2013 4:11pm Jan 21, 2013 4:11pm
Quoting BroncoCap
Starry,
Wow, you are going hard, good for you. A thought, maybe Mr. Pip will agree or disagree, but the smaller the timeframe, the less emphasis or strength a PRZ will have, or so I believe. A daily or 4h PRZ off a major pattern (Gartley, etc.) likely has a better chance of being true relative to a 1min PRZ at point D after an ABCD.

While Mr. Pip does not believe in 'noise' and I kind of agree, certain time frames have more vacillation than others. Similarly, there are always time frames with cleaner waves than others. I do not know where...
I dont know, i think harmonics works on any timeframe. a larger timeframe prz will definitely move more if it succeeds though.

yep . thanks! good luck to you too
  • #1,825
  • Jan 21, 2013 4:15pm Jan 21, 2013 4:15pm
Mr Pip,

Could you please confirm what you propose as fib level for the profit targets of harmonics patterns ?
Thanks in advance.

http://izi4x.files.wordpress.com/201...y_signal_4.jpg
Entry is a science, exit is an art.
  • #1,826
  • Jan 21, 2013 4:25pm Jan 21, 2013 4:25pm
Quoting Davit
Mr PiP
You probabily noticed the obvious bat pattern on Euro on higher TF H4
I know you don't trade H4 however would you say probability is high for Bat completion?
I don't know how Mr Pip trades Bat but as it stands the A-B swing on that setup ends at 38.2 fib level. In my experience A 50% entrancement for A-B swing is a much higher probability for a Bat pattern setup. Plus the B-C swings almost forming a doubletop is not desirable.
  • #1,827
  • Edited 4:50pm Jan 21, 2013 4:37pm | Edited 4:50pm
Quoting rumba68
I don't know how Mr Pip trades Bat but as it stands the A-B swing on that setup ends at 38.2 fib level.
Very correct 38.2 which is what ideal bat pattern formation is from X to A.http://www.harmonictrader.com/batbullre.jpg
You probability meant X to A not A to B.Your reference of almost double tops.Its actually .886 which is once again ideal bat.Please see diagram.
In trading, you have to be defensive and aggressive at the same time
  • #1,828
  • Jan 21, 2013 5:00pm Jan 21, 2013 5:00pm
Here the chart of what I think a bearish butterfly. Help needed. Thanks Mr Pip.
Attached Image (click to enlarge)
Click to Enlarge Name: ea4.jpg Size: 94 KB
Empower Your Mind
  • #1,829
  • Jan 21, 2013 5:16pm Jan 21, 2013 5:16pm
Quoting Davit
Very correct 38.2 which is what ideal bat pattern formation is from X to A.http://www.harmonictrader.com/batbullre.jpg
You probability meant X to A not A to B.Your reference of almost double tops.Its actually .886 which is once again ideal bat.Please see diagram.
I never said it wasn't a valid Bat. And I also never heard that 38.2 and 88.6 were ideal levels. 38.2 is the minimum requirement and 88.6 is the maximum retracement level. But it all comes down to rules. A setup is more than just a diagram. For me 50% retracement works better because it has cut down on my loses on Bat patterns. With that said I let the man who opened the thread to comment.
  • #1,830
  • Jan 21, 2013 7:54pm Jan 21, 2013 7:54pm
Quoting Starry
Also, do you wait for a candle to close in the prz before closing. for example, in this picture, the price candle blew through the ABCD pattern with one candle.

But i didn't offset that impulse wave, so maybe that would have invalidated the abcd trade.
I know in the rules it says to just place a limit order at 127


Attachment
These rules were designed for the higher timeframe if I am not there to see what's going on a limit order is what I do. That is not the case in my trading any more I only trade within my ours of operation. So I wait for a candle close and based on the price action in the PRZ I enter next bar market order.
If you fail to plan, you plan to fail.
  • #1,831
  • Jan 21, 2013 8:04pm Jan 21, 2013 8:04pm
Quoting BroncoCap
Starry,
Wow, you are going hard, good for you. A thought, maybe Mr. Pip will agree or disagree, but the smaller the timeframe, the less emphasis or strength a PRZ will have, or so I believe. A daily or 4h PRZ off a major pattern (Gartley, etc.) likely has a better chance of being true relative to a 1min PRZ at point D after an ABCD.

While Mr. Pip does not believe in 'noise' and I kind of agree, certain time frames have more vacillation than others. Similarly, there are always time frames with cleaner waves than others. I do not know...
I put the same weight on all PRZ no matter the timeframe. You have to know what you are trading and what is reasonable expectancy on the timeframe you are trading. If the pattern is high timeframe that's fine just know that there will be significantly more swings and corrections between entry and target. But that does not change the strength of the signal. Because you are already on a smaller timeframe will help you identify a better entry and a more precise SL placement. If you are at the computer always take the time to review price action in the PRZ wait for candle close look for your reversal signal whatever it is and make an informed decision based on the facts not the level or ratio or the pattern completion.
If you fail to plan, you plan to fail.
  • #1,832
  • Jan 21, 2013 8:07pm Jan 21, 2013 8:07pm
Quoting 4xf
Mr Pip,

Could you please confirm what you propose as fib level for the profit targets of harmonics patterns ?
Thanks in advance.

http://izi4x.files.wordpress.com/201...y_signal_4.jpg
This is very personal to the trader but most of the patterns have this draw a fib from A to D and break even is the 38 TP is the 61.
If you fail to plan, you plan to fail.
  • #1,833
  • Jan 21, 2013 8:18pm Jan 21, 2013 8:18pm
Quoting BroncoCap
Starry,
Wow, you are going hard, good for you. A thought, maybe Mr. Pip will agree or disagree, but the smaller the timeframe, the less emphasis or strength a PRZ will have, or so I believe. A daily or 4h PRZ off a major pattern (Gartley, etc.) likely has a better chance of being true relative to a 1min PRZ at point D after an ABCD.

While Mr. Pip does not believe in 'noise' and I kind of agree, certain time frames have more vacillation than others. Similarly, there are always time frames with cleaner waves than others. I do not know where...
i like your journal btw. may the pips be with you! night
  • #1,834
  • Jan 21, 2013 8:56pm Jan 21, 2013 8:56pm
Quoting Davit
Mr PiP
You probabily noticed the obvious bat pattern on Euro on higher TF H4
I know you don't trade H4 however would you say probability is high for Bat completion?
Hello my friend, this does not meet the rules for a bat from my point of view. A bat must achieve at least a 50 correction of XA before it can be considered and this only got to the 38.
If you fail to plan, you plan to fail.
  • #1,835
  • Jan 21, 2013 8:58pm Jan 21, 2013 8:58pm
Quoting Starry
k, cool. i got some questions.

How do you handle the situation where there are multiple przs close together (or did i define these przs wrong?) .

Also, in order to buy from the bottom prz, what would you look for? Since this is not an ABCD, but rather an ab = cd, would you look for confluence of a fib of a main swing which contains that prz ? (which is really far back in time, gbpjpy has been going down alot, so maybe cant do that in this case?) Or maybe just look for price action around the bottom prz. Look for a bullish harmonic abc pattern...
All this does is add strength to the PRZ it's confluence. Price action will tell you if it will hold.
If you fail to plan, you plan to fail.
  • #1,836
  • Jan 21, 2013 9:01pm Jan 21, 2013 9:01pm
Quoting vqtrader
Here the chart of what I think a bearish butterfly. Help needed. Thanks Mr Pip.
Hey bud I will take a look tomorrow my ninja at home died on my and cant look at charts I'm very sorry it's 4H chart so we might still have time.
If you fail to plan, you plan to fail.
  • #1,837
  • Jan 21, 2013 9:04pm Jan 21, 2013 9:04pm
Quoting rumba68
I never said it wasn't a valid Bat. And I also never heard that 38.2 and 88.6 were ideal levels. 38.2 is the minimum requirement and 88.6 is the maximum retracement level. But it all comes down to rules. A setup is more than just a diagram. For me 50% retracement works better because it has cut down on my loses on Bat patterns. With that said I let the man who opened the thread to comment.
I have not posted the rules but in the begining of the thread I posted the anatomy of the Bat you will find it in the attachments. My Ninja died here at home I will have to reinstall tomorrow so I cant provide a chart to help out Sorry.
If you fail to plan, you plan to fail.
  • #1,838
  • Jan 21, 2013 10:01pm Jan 21, 2013 10:01pm
Hi Mr Pip

I am pleased to report that what you are teaching here is starting to sink in this empty head of mine.

I wanted to see if I am right in my analysis and trades that I have taken.

First screen is of an AB=CD. It took a while to eventuate to profit which is shown in the second screen.....and there were other patterns within such as other AB=CD patterns (also on the second screen).

In the second screen I have taken profit and given the confluence (2 AB=CD trades determining D at roughly the same point and some very clear support some days back) I decided to take an against the trend buy at D of both the pre-mentioned AB=CD. I must say, I was somewhat reluctant to take a buy given that price has been going down for a while, but I followed the rules, and guess what...
Attached Image(s) (click to enlarge)
Click to Enlarge Name: gy1.gif Size: 17 KB
Click to Enlarge Name: gy2.gif Size: 17 KB
What you do is a reflection of you....what I do is a reflection of me.
  • #1,839
  • Jan 21, 2013 10:06pm Jan 21, 2013 10:06pm
Quoting Ezzy
Hi Mr Pip

I am pleased to report that what you are teaching here is starting to sink in this empty head of mine.

I wanted to see if I am right in my analysis and trades that I have taken.

First screen is of an AB=CD. It took a while to eventuate to profit which is shown in the second screen.....and there were other patterns within such as other AB=CD patterns (also on the second screen).

In the second screen I have taken profit and given the confluence (2 AB=CD trades determining D at roughly the same point and some very clear support some days...
hey ya! got that humongous spike up nice! i want to know why the market shows the phi ratio, but there are no papers on it. weird
  • #1,840
  • Jan 21, 2013 10:18pm Jan 21, 2013 10:18pm
Hi Mr Pip, I finally finished going through all the posts. After following 9er's topic for a while I was very happy to see you start up your own thread. With time as restricting as it is (wives and small kids have that effect don't they?) I will probably be a lot slower than most at learning your harmonics but I wanna make sure I get it right. So it'll be baby steps for me as I get the basics first; swing identification, etc. I'll worry about patterns later!
Again thank you for opening this thread and I hope it continues for a long time yet!
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