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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

  • #2,801
  • Feb 11, 2013 7:58am Feb 11, 2013 7:58am
Quoting Good2Cu
Hi Starry, like you mentioned in your previous post, you could have shorted higher. At the high point there was a nice ab=cd completion and price action reversed beautifully.
i know, i was just scared by the resistance level it pierced, so i waited for it to pierce it and then retest. i thought it would drop. missed that ab= cd too, was looking at some other swings, if id seen that, definitely! two abcds .... a bat ,very nice
  • #2,802
  • Feb 11, 2013 8:00am Feb 11, 2013 8:00am
Quoting Good2Cu
Hi Starry, like you mentioned in your previous post, you could have shorted higher. At the high point there was a nice ab=cd completion and price action reversed beautifully.
two 1:1 waves completing there, but missed it! AND a bat! if only, 20 beautiful pips , i still havent got one trade that got that many

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  • #2,803
  • Feb 11, 2013 8:13am Feb 11, 2013 8:13am
Here is a lower time frame view of GU on 15m chart. GL to all and may you continue to make bank!!
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  • #2,804
  • Feb 11, 2013 10:51am Feb 11, 2013 10:51am
Quoting Good2Cu
Hi Starry, like you mentioned in your previous post, you could have shorted higher. At the high point there was a nice ab=cd completion and price action reversed beautifully.
Hey Good2Cu, this one is not a valid AB=CD (though it worked), because price invalidated your first C point. Then for an AB=CD price must reach at least 0.382 of previous swing
  • #2,805
  • Feb 11, 2013 10:56am Feb 11, 2013 10:56am
Quoting Mr. Pip
Hello Traders,

Just popping in to say hello and to show you why I do not care about news. As you can see from the chart attached the market and news respected ratios, structure, and maybe harmonics just not quite there yet. I did not take those trades I do not trade the higher timeframes but wanted to point them out. Enjoy the chart.
but if it wasn't for the news that pattern was setting itself nicely for a Bat but than 13.30 GMT Draghi spoke and the Euro took a dive
  • #2,806
  • Feb 11, 2013 11:02am Feb 11, 2013 11:02am
Quoting Georji
but if it wasn't for the news that pattern was setting itself nicely for a Bat but than 13.30 GMT Draghi spoke and the Euro took a dive
it would've still been profitable, and it just spiked through the bat zone, so you would've been atleast at breakeven before it made the bat, the bat was a while down.
  • #2,807
  • Feb 11, 2013 12:07pm Feb 11, 2013 12:07pm
Quoting CNTrader
Here is an update to the Aud/Usd on 15m chart with a bullish Bat pattern completion
Hello traders hope you all are making bank. Here is an update and zoomed in snap shot of the AU 15m bat pattern chart I posted earlier. Target 1 attained for 25pips and rolled my stops to break even here. Green lines are the targets for a 38%, 50% retrace on target 1 and 2 with an ambitious target 3 for a 15m chart. It has to battle 2 TLs right now but im keeping the bigger picture patterns in perspective until they are invalidated. Until then I will continue to roll stops and see how much she wants to give me after target 2 is attained, lol IF it is attained. Enjoy the voyage of life.
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  • #2,808
  • Feb 11, 2013 12:35pm Feb 11, 2013 12:35pm
Here's something else I'm watching as a bigger picture scenario. Usd/Cad Daily potential bat pattern completion and some ab=cd patterns that show up on daily, 4hr and 1hr charts that complete at decent structure with good ratio confluence for some bankable pips as well. Anyways hope you enjoying your journey. Until next time!!
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  • #2,809
  • Feb 11, 2013 3:19pm Feb 11, 2013 3:19pm
I think this ideal will help me pull the trigger. First, define the first zone that price needs to break to go your way. Then, wait for price to close in it. then, form a mini prz and enter there. If there is resistance below the mini prz, simply wait for the candle to close in or below the miniprz, and enter. If there isnt, simply enter when price enters the prz (because it will mostly probably spike in)

This allows you to enter when it is about to break. Clearly wont work with extreme movement, which can be seen a little after the first example, but probably can tell them apart, extreme moves that will reverse will approach the prz very quickly, while ones this strategy might work best on, price approaches slowly.

Im working on overcoming my fear of nearby support/resistance
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  • #2,810
  • Feb 11, 2013 3:53pm Feb 11, 2013 3:53pm
Quoting CNTrader
Here's something else I'm watching as a bigger picture scenario. Usd/Cad Daily potential bat pattern completion and some ab=cd patterns that show up on daily, 4hr and 1hr charts that complete at decent structure with good ratio confluence for some bankable pips as well. Anyways hope you enjoying your journey. Until next time!!
Hey, maybe it will finish at the magic 161.8 time extension!

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  • #2,811
  • Feb 11, 2013 4:00pm Feb 11, 2013 4:00pm
Quoting CNTrader
Here's something else I'm watching as a bigger picture scenario. Usd/Cad Daily potential bat pattern completion and some ab=cd patterns that show up on daily, 4hr and 1hr charts that complete at decent structure with good ratio confluence for some bankable pips as well. Anyways hope you enjoying your journey. Until next time!!
I bet harmonics would be a great way to create a equity millipede. Enter trades on the tick chart, just when its about to turn around on the larger chart, and let run!
  • #2,812
  • Feb 11, 2013 4:25pm Feb 11, 2013 4:25pm
Quoting horuxito
Some important technical considerations

There are some things that have not been discussed when establishing the Stop Loss and Take Profit whether we are Buying or Selling.

Most charts display the current BID PRICE. That means that when we draw our Fibonacci levels we are considering those bid prices. The difference between the BID and the ASK price is the spread. That's why in a Sell you could be taken out of the trade before the chart price equals the stop loss you had established or, on the other hand, you could travel beyond...
Hella true Horuxito!

Just as an example, I put on this ABCD trade today.

EURUSD 1min--
http://farm9.staticflickr.com/8095/8...98d116d5_b.jpg

Although the chart shows the 61.8% level hit 3 times, I did not get a fill until the last breach, when it plummeted. Bad luck, although the earlier touches did not result in a target anyways, but my statistics based on price action while in the trade are completely different. The two early touches easily went 61.8% BC (Mr. Pip's target).

It is just another example of how asymmetric the market is. Slippage, bid-ask spread, commissions, blah, blah, blah. As an individual trader, you must overcome all these factors that can make or break you. Just as importantly, you cannot blame these factors for your success or failure. You and you alone are responsible. Work hard and win!

Cheers guys!
  • #2,813
  • Edited Feb 12, 2013 8:52am Feb 11, 2013 6:43pm | Edited Feb 12, 2013 8:52am
I am with you BroncoCap. But I would go even further and say that there is no need to live with those factors (Spread to be said).

You have developed your EA and those calculations could be valuable. I will add those "correct" prices to the Indicator I made.

It helps having both lines running at the same time (bid and red ask on mt4) but let's be honest, it's only helpful if you are infront of the screen. If not you should had taken off that spread before and calculated the target based upon that.

Taking that into account I have defined some "rules".

- Bar prices (chart candles) are always BID prices. So the ASK price is somewhere above that due to the SPREAD.

- To be even considered, the AB leg must have at least 20 pips to get a 12 pip retracement (618 AB). With that I get some nice BC retracement targets: 4 pips (382 BC) and 7 pips (618 BC) - After spread, a Net 2 and 5 pips.

- SELL Orders: Open price in the Order Tab is placed at BID (which is the same from the bars). To set the SL and TP I'll need to ADD* the spread, because the exit will be at ASK (which is always higher than BID), and my bars (and retracements/extensions) are showing only BIDS.

* Edited last paragraph: I wrote Substract instead of Add. Ask price is always higher than chart price (bid) so it is price plus spread.

- BUY Orders: Open price is placed at ASK on the order tab so I instantly see that the price as to travel above, I mean, the "loss" (SPREAD) is seen right after the order is placed, no calculations needed. To place PENDING BUY Orders though I will ADD the spread to the expected price (remember that buys open at ASK). To define the SL and TP with BUY orders there won't be any calculations needed since they close at BID, the same from the bars.

Well, hope that help you guys. I struggled with it the whole weekend ^_^

Keep it up!!

Quoting BroncoCap
Hella true Horuxito!

Just as an example, I put on this ABCD trade today.

EURUSD 1min--
http://farm9.staticflickr.com/8095/8...98d116d5_b.jpg

Although the chart shows the 61.8% level hit 3 times, I did not get a fill until the last breach, when it plummeted. Bad luck, although the earlier touches did not result in a target anyways, but my statistics based on price action while in the trade are completely different. The two early touches easily went 61.8% BC (Mr. Pip's target).

It is just another example of how asymmetric...
Best time to plant a tree was 20 years ago, second best is now
  • #2,814
  • Feb 11, 2013 7:17pm Feb 11, 2013 7:17pm
Aggressive C hit 61.8 TP on EUR/CHF

wondering what you guys think for when it hits D (if it does) because of the time it takes for CD would be a lot longer than XA.
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  • #2,815
  • Feb 11, 2013 9:10pm Feb 11, 2013 9:10pm
Hi, this is my first time attempting to draw these patterns and would appreciate if someone would critique it and let me know if it needs to be corrected. I just pulled up a random daily EUR/USD chart to practice. I assume that this is a ABCD pattern since it closed between 61.8 and 78.60. I am still not exactly sure where I should be looking for my profit targets and stop losses. Perhaps my SL should be 10 pips below or above the highest fib level on a higher TF chart, of course dependent on if it is a sell or a buy. Looking forward to learning from you. Thank you.
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  • #2,816
  • Feb 12, 2013 12:59am Feb 12, 2013 12:59am
[quote=Starry;6436967]I think this ideal will help me pull the trigger. First, define the first zone that price needs to break to go your way. Then, wait for price to close in it. then, form a mini prz and enter there. If there is resistance below the mini prz, simply wait for the candle to close in or below the miniprz, and enter. If there isnt, simply enter when price enters the prz (because it will mostly probably spike in)

This allows you to enter when it is about to break. Clearly wont work with extreme movement, which can be seen a little after the first example, but probably can tell them apart, extreme moves that will reverse will approach the prz very quickly, while ones this strategy might work best on, price approaches slowly.

Sounds good...micro view in the PRZ area...question is where will you put your stop....micro or macro...
Master that, and you are surfing...pattern is easy, just some measurements...these other details: entry, trail, and TP make the difference..."big eagle stop hunter" is always hovering around our heads, specially in the smaller time frames...we are the little mice running for shelter...run fast enough and you hit homerun..donīt pay attention and you become their lunch....
  • #2,817
  • Feb 12, 2013 1:01am Feb 12, 2013 1:01am
Quoting Starry
I bet harmonics would be a great way to create a equity millipede. Enter trades on the tick chart, just when its about to turn around on the larger chart, and let run!
Yes, provided you have the patience to let many many trades BE and dissapear next day...till you get a big winner...
  • #2,818
  • Feb 12, 2013 3:04am Feb 12, 2013 3:04am
Gartley and Butterfly all in one, interesting setup ...

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  • #2,819
  • Edited 3:54am Feb 12, 2013 3:43am | Edited 3:54am
Quoting tropics
Hi, this is my first time attempting to draw these patterns and would appreciate if someone would critique it and let me know if it needs to be corrected. I just pulled up a random daily EUR/USD chart to practice. I assume that this is a ABCD pattern since it closed between 61.8 and 78.60. I am still not exactly sure where I should be looking for my profit targets and stop losses. Perhaps my SL should be 10 pips below or above the highest fib level on a higher TF chart, of course dependent on if it is a sell or a buy. Looking forward to learning...
yes this is an ABCD pattern, as for agressive C target it should be a fib extension of 1.272 of the AB leg as for S/L i would personally place it a bit more than 10 pips above A ( considering the high TF), than PRZ draw a retracement of A to D and place 1st target BE at 0.382 and 2nd TP at 0.618 with S/L at least 10 pips below the 161.8 extension level
  • #2,820
  • Feb 12, 2013 4:31am Feb 12, 2013 4:31am
Hello All, Not much time to trade today but I just took an aggressive C Long on the EURUSD 1M Chart. I took profit just below 1.3400 at 1.3399 for a quick 17.5 pips. I know that it isn't the exact rules because I should be targeting the 127.2% but I didn't have time today. Your comments and questions are welcome.
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