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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

  • #3,021
  • Feb 19, 2013 6:15am Feb 19, 2013 6:15am
the problem with FXCM spreads is that they are not fixed (variable) which in volatile sessions they'll vary a lot, and to my understanding you need big funded account to be eligible for a low spread. however Capital Spread they offer a 1pip Fixed on few majors and 0.8 on Usd/Jpy with an account as little as 500$ or even less
Quoting Jason Rogers
Hi n00b4ever,

FXCM recently introduced new lower spreads. Below is an example from Forex Factory's table of live spreads (http://www.forexfactory.com/brokers.php#spreads).

http://img819.imageshack.us/img819/5...parison201.png

* Note that brokers with an asterisk next to their spread charge an additional commission. FXCM charges no commission on top of the spread.

Jason
  • #3,022
  • Feb 19, 2013 6:24am Feb 19, 2013 6:24am
Quoting Georji
the problem with FXCM spreads is that they are not fixed (variable) which in volatile sessions they'll vary a lot, and to my understanding you need big funded account to be eligible for a low spread. however Capital Spread they offer a 1pip Fixed on few majors and 0.8 on Usd/Jpy with an account as little as 500$ or even less

The problem with fxcm is not only the spread...

http://forexmagnates.com/full-details-of-fxcms-class-action-suit/
Entry is a science, exit is an art.
  • #3,023
  • Feb 19, 2013 6:25am Feb 19, 2013 6:25am
Quoting Starry
Attachment
Hi Starry and others
In this chart you calculated fib extensions "backwards", kinda like +100% fib retracements to calculate your prz's. Is it common way to use it since I haven't seen it before in this thread?
  • #3,024
  • Feb 19, 2013 6:37am Feb 19, 2013 6:37am
Quoting foxybunny
Starry, looks like you are getting confused.
Better to go back to the basic structure of harmonics.
Print out the "Advance Pattern Reference Guide", and look at it each day in the morning and night time and refer to it before and after you put in your fib.
I do this as well be referring to the "Advance Pattern Reference Guide" as an easy reference.

When you draw too many fibs, it does get confusing, and I also done the same when I have too many fib lines, best is to delete them.
Focus on the Main Swing still as a starting point.
If a fib line...
woops thanks !
  • #3,025
  • Feb 19, 2013 7:18am Feb 19, 2013 7:18am
Quoting nomadic123
Ok I'm going to keep posting these until I nail it.

Feel free to critique.

EUR/GBP. 5 min. Aggressive C Cell.

Now you can add another Fib line on BC for your EUR/GBP.

You will then see if the BC fib of 127% or 162% or something else, that will also be close to your original PRZ(AB's 127% - 138%) that you have drawn.

This is the confluence factor of how BC's extension relates to AB's extension.
  • #3,026
  • Feb 19, 2013 8:37am Feb 19, 2013 8:37am
Regarding the earlier discussion about pending orders...

In the brief time that I've been trading this style, pending orders have caused far more loss than profit for me.

It is frustrating to come back and see I missed an entry by a couple of minutes, wishing I had set a pending order.

But too often I've come back and seen that a pending order was filled in my absence as the price shot straight through the PRZ... with such obvious price action negating the PRZ that I never would have entered the trade manually.

Just my $0.02
  • #3,027
  • Feb 19, 2013 9:29am Feb 19, 2013 9:29am
Quoting profitpips
Hi Starry and others
In this chart you calculated fib extensions "backwards", kinda like +100% fib retracements to calculate your prz's. Is it common way to use it since I haven't seen it before in this thread?

fib extensions can be projected downward or upward depending on where price is projecting (so its really downward). As an example, if you look at the advanced pattern reference guide, the bullish crab has a 161 fib extension from leg A to X which projects below the x leg.... i guess its not the most common thing, and i havent seen it often, but it is in one of the pattern rules....
  • #3,028
  • Feb 19, 2013 9:46am Feb 19, 2013 9:46am
This is what confuses me about the audusd, i would expect a burst up after such a steady move up, actually after it steadily goes up and then pauses and becomes flat, as bulls temporarily overcome the steady bear pressure, and then i would look for the 138-161 extension and a burst up. but its just moving up up up, no bursting, i guess audusd is different? It will be interesting to see how this will work out ..... maybe this bursting characteristic is only typical in eurusd for current market conditions ....

eurusd burst
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audusd steady up?? will it ever burst up, and then go down?
Attached Image (click to enlarge)
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  • #3,029
  • Feb 19, 2013 10:36am Feb 19, 2013 10:36am
Today's chart. I had difficulty once again with letting the main swing dictate reversal thinking. I missed the 8:00 trip up to the prz in brown/pink and it wasn't the most confluent of zones. I took the trade regardless and got out with a pip while watching it stall near the 38% of what should have been a completed ABCD correction. Watching the ride up and cursing the fact that I have trouble reversing from bearish to bullish I took another trade in a new PRZ blue based on the blue abcd against a really bullish leg which stopped me out. Then after some confusion I drew the purple prz and watched as my 2:1 was achieved without me of course.

I use a stop 3 ticks above the 161% of the prz and try and enter high in the zone based on exhaustion or price patterns on the 1 min chart. Does anyone else trade the 233 tick like Mr. Pip and if so how do you reverse your thinking to gather those pips against the main swing? We're usually with order flow but on those days when we're wrong what tips you off and how do you position yourself to take advantage of the change in order flow. It isn't uncommon to be buying into weakness or selling into strength with this method at the prz especially if you want a good fill and are trying to make the R:R work. Thanks. Cheers.
Attached Image (click to enlarge)
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Finally out of the shadows.
  • #3,030
  • Feb 19, 2013 12:00pm Feb 19, 2013 12:00pm
Quoting 4xf
The problem with fxcm is not only the spread...

http://forexmagnates.com/full-details-of-fxcms-class-action-suit/
Hi 4xf,

The case was dismissed as of November 29, 2011.

Jason
  • #3,031
  • Feb 19, 2013 2:59pm Feb 19, 2013 2:59pm
Quoting gaf
Today's chart. I had difficulty once again with letting the main swing dictate reversal thinking. I missed the 8:00 trip up to the prz in brown/pink and it wasn't the most confluent of zones. I took the trade regardless and got out with a pip while watching it stall near the 38% of what should have been a completed ABCD correction. Watching the ride up and cursing the fact that I have trouble reversing from bearish to bullish I took another trade in a new PRZ blue based on the blue abcd against a really bullish leg which stopped me out. Then...
heres an ideal. just analyze how price wicks from various horizontal supports, and how much strength the horizontal supports have when price is above or below it....
Attached Image (click to enlarge)
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  • #3,032
  • Feb 19, 2013 3:57pm Feb 19, 2013 3:57pm
@ mr. pip

would you please post your chart for today?
it really helps me alot and most likely also others.
  • #3,033
  • Feb 19, 2013 4:10pm Feb 19, 2013 4:10pm
[quote=foxybunny;6455700]Nomadic, my A/U H1 chart showing the potential ABCD based on my understanding of the"Advance Pattern Reference Guide" and the "Rules Of Engagement".
Hope you also refer to those documents before and after you put on your fib lines.


PRZ is between 127% and 138%, and anywhere within this PRZ is good Entry point for a Short in this example.

SL is 162% +/- 10-pips depending on your time frame.

If you are watching the screen when the price is near 127%, then you may want to watch Price Action while you are at the computer before you decide whether you want to enter or not at 127% or 138%.

If you are NOT watching the screen, and you are confident of your price levels of 127%, you may want to place an automatic entry order as you are away from your computer.


If price is beyond 162% and less than the Stop Loss, and you are watching it at that time, it is up to you if you want to exit the position manually, or let price play out to see what happen.

If price goes beyond 162% on H1 timeframe price may still close below 162% meaning your entry is still OK if it did not hit the Stop Loss first, and may end up in profit later on.

Also 10-pips on a H1 timeframe is not much, so if it goes beyond 162% and you are not watching it, just let it hit the SL if that what happens.

Note that I am not saying whether this is a good or bad ABCD example, I am just using it to show the PRZ and the Stop Loss if that was what you see as an ABCD.

Hope this clarify and explains your A/U H1 example.


I´m glad somenone saw the similar potential trade on aud usd....got hit twice...but at least it proves I understand this...sometimes you just loose...
  • #3,034
  • Feb 19, 2013 4:20pm Feb 19, 2013 4:20pm
[quote=Starry;6457480]This is what confuses me about the audusd, i would expect a burst up after such a steady move up,

yeah Starry, nothing special, AUDUSD just decided to make some "artistic" almost
non stop climb....
I t reached the 0,944 fibonacci Magic number, this is another Magic one, similar to the 0,86..:nerd:

But again, markets sometimes follow books, rules and Patterns, sometimes they Forget all they read...just for fun on retailers.
  • #3,035
  • Feb 19, 2013 4:46pm Feb 19, 2013 4:46pm
Quoting Starry
heres an ideal. just analyze how price wicks from various horizontal supports, and how much strength the horizontal supports have when price is above or below it....
Attachment
Thanks Starry but I've traded S/R for some time now. I could see the strength but again we often trade into strength at przs.

I was wondering more at what point you trash your main swing hypothesis. If we go back on the 15 min chart we can see that the move today may be part of a bigger ABCD pattern but I would love to know if there are other ways to do this real time without having to consider several higher timeframes. I want to keep things as simple as possible.

Any other ideas.

Mr. Pip. I know you are busy but it would be really awesome to hear your thoughts about todays action. Cheers.
Finally out of the shadows.
  • #3,036
  • Feb 19, 2013 6:06pm Feb 19, 2013 6:06pm
Quoting gaf
Thanks Starry but I've traded S/R for some time now. I could see the strength but again we often trade into strength at przs.

I was wondering more at what point you trash your main swing hypothesis. If we go back on the 15 min chart we can see that the move today may be part of a bigger ABCD pattern but I would love to know if there are other ways to do this real time without having to consider several higher timeframes. I want to keep things as simple as possible.

Any other ideas.

Mr. Pip. I know you are busy but it would be really awesome...
this isnt trading support/resistance, this is looking at how price reacts around important support resistance (formed by the previous trend). see chart, i guess i didnt explain it before .....

i mean, i dont see how you could do anything else except how price moves around the support/resistance lines before it reaches the prz that you want to trade. if the candles hint it might be gaining strength upward, then that should add some confidence .....

ill be interested in what mr pip has to say...

I didnt trade today but thats how im trying to see it......
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  • #3,037
  • Feb 19, 2013 7:55pm Feb 19, 2013 7:55pm
Hey traders hope you are all having a great week. Here is what i've been doing with Eur/Nzd. This morning I took an agressive C buy at 1.5779 (lower white line) in expectation of a bearish Gartley to complete. The structure was broken but PA avoided my stop loss (lower red line). I banked 80 pips on the trade and price action has given me yet another opportunity to potentially make bank with another great RvR opportunity with the completion of these multiple pattern formations on a 15m chart. I am now short with targets in Green. Please be advised that there is a fundamantal event this evening that could have either a negative, positive, or absolutely no impact on this trade. lol check FF news feed for details. Enjoy and may everyone make bank this week!!
Attached Image (click to enlarge)
Click to Enlarge Name: eurnzd 15m.jpg Size: 164 KB
Don't follow me! You can and most likely will LOSE all your money!!!!
  • #3,038
  • Feb 19, 2013 8:33pm Feb 19, 2013 8:33pm
Target 1 attained stops were rolled to break even and we were taken out
Attached Image (click to enlarge)
Click to Enlarge Name: eurnzd 15m.jpg Size: 169 KB
Don't follow me! You can and most likely will LOSE all your money!!!!
  • #3,039
  • Feb 19, 2013 9:14pm Feb 19, 2013 9:14pm
Here is what I'm looking at on a 1hr chart for Eur/Nzd
Attached Image (click to enlarge)
Click to Enlarge Name: eurnzd 1hr.jpg Size: 134 KB
Don't follow me! You can and most likely will LOSE all your money!!!!
  • #3,040
  • Feb 20, 2013 12:34am Feb 20, 2013 12:34am
Quoting Georji
the problem with FXCM spreads is that they are not fixed (variable) which in volatile sessions they'll vary a lot, and to my understanding you need big funded account to be eligible for a low spread.
Hi Georji,

Our spreads, which you can see on Forex Factory's live spread table (http://www.forexfactory.com/brokers.php#spreads), are available for account balances as low as $50. The spreads are variable, because on our No Dealing Desk forex execution, we simply pass on the best prices we receive from 10+ liquidity providers and add a fixed pip markup for our profit which acts as a commission. That means when you see the spreads widen, it’s because the banks quoting prices widen their own spreads during volatile markets.

That’s also the reason why with a fixed 1 pip spread, there’s a risk of you getting a requote. A requote is when a trader makes an order for a specified price, but the order is manually rejected by their broker's dealing desk, because the prices in the market have already changed. The dealer sends a new price back to the trader, often a worse price, which they can either accept or reject.

Requotes usually only occur when the market is moving in the direction you want to place your order, not when the market is moving against your order. For example, suppose you are trying to place an order to buy EUR/USD during a news event, and you see a fixed spread of 1 pip, such as 1.3400 bid and 1.3401 offered.

If the momentum of the market is moving upwards, there is a greater chance you will be requoted trying to buy at 1.3401, because the broker’s dealing desk won’t be able to fill your order at that price without taking a loss in the market. The requoted price you receive could be 1.3410 of more, effectively widening your spread to 10+ pips. If on the other hand the momentum of the market is moving downwards, you will most likely get your buy order filled at 1.3401 without any problems.

Requotes can slow down your trading and can take a nominal 1 pip spread and effectively make it wider. FXCM does not requote. Even on our new dealing desk execution which offers lower spreads, we use our No Dealing Desk price feed as a base to derive prices and execute orders. We simply reduce our pip markup to lower the spreads, so there are still no requotes and no restrictions on stops and limits, which can also occur with fixed spreads.

Jason
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