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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

  • #3,361
  • Mar 6, 2013 12:52pm Mar 6, 2013 12:52pm
Mr Pip,

Not my best day...

This is my second loss of the day... EUR/GBP H1 aggressive C buy with a lot of market structure and PA

What I'm doing wrong? Please help!!!!

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  • #3,362
  • Mar 6, 2013 1:07pm Mar 6, 2013 1:07pm
Quoting lucariga
Mr Pip,

Not my best day...

This is my second loss of the day... EUR/GBP H1 aggressive C buy with a lot of market structure and PA

What I'm doing wrong? Please help!!!!

Attachment
A key, if not THE key in surviving the forex market is being able to accept and appreciate losses. Wanting to be 100% right is human nature, plus what we are taught growing up (think tests, entrance exams, etc.). Losses tell you something if you listen to the market.

I too have two big losses in the book from yesterday and today. Albeit with a small sample size (n=4), my win rate on Stop and Reverse trades is currently 50% rather than the expected 85%. This tells one of two things. 1) The current market price action does not reward this trade and is choppy, 2) Stop and Reverse is not a profitable strategy and February was a fluke.

So, the question becomes what do I do. Since I am at the luxury of demo trading, I will press on to get more trades and see if February was a fluke or March is being a pain in the butt. If I was live, I could either 1) stop trading Stop and Reverse, 2) trade smaller size, 3) press on. If I was using proper money management, I would likely press on as I am still (slightly) profitable in March, even with two nasty losses.

So, long story short, embrace losses, learn from them. Keep pressing on with appropriate money management. Ride out these changes in market dynamics. Overcome!
  • #3,363
  • Mar 6, 2013 1:55pm Mar 6, 2013 1:55pm
Quoting lucariga
Mr Pip,

Not my best day...

This is my second loss of the day... EUR/GBP H1 aggressive C buy with a lot of market structure and PA

What I'm doing wrong? Please help!!!!

Attachment
Hi Lucariga,
Here are a few of the things I see that would have kept me out of this trade. I hope this helps
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Always Learning
  • #3,364
  • Mar 6, 2013 2:24pm Mar 6, 2013 2:24pm
Quoting JayTrader
Hi Lucariga,
Here are a few of the things I see that would have kept me out of this trade. I hope this helps
Attachment
Hey Jay,

I was wondering if you could go into a little more detail on how you determine the wicks to be clearing orders for more down movement and not as rejection?

As I study PA I've noticed sometimes the wicks come before a strong movement in the same direction like the market is begging to go down, wicks then finally plummets but I don't see how to differentiate that from a rejection signal.

Thanks
  • #3,365
  • Mar 6, 2013 2:31pm Mar 6, 2013 2:31pm
Quoting JayTrader
Hi Lucariga,
Here are a few of the things I see that would have kept me out of this trade. I hope this helps
Attachment
Many thanks for your answer. I can't completely agree with you because:
I've ever thought, based on my previous price action studies, that long wicks means rejection of a specified level of price, so, a pin bar like the one I've marked as C point, expecially in an area of strong support (or market structure as defined by MR PIP), means that price wants to go up. Other then that, we've had other rejection wicks before that pin bar that confirms price's desire to go north.
So, for me, Strong support + Price Action with big wicks on the low side + fibonacci ratios is a no brain aggressive C long, but I'm far to consider myself a trader, and this is only my opinion.

Waiting to see MR PIP'S thought on this too... and as usual, sorry for my poor english guys
  • #3,366
  • Mar 6, 2013 2:35pm Mar 6, 2013 2:35pm
Quoting BroncoCap
A key, if not THE key in surviving the forex market is being able to accept and appreciate losses. Wanting to be 100% right is human nature, plus what we are taught growing up (think tests, entrance exams, etc.). Losses tell you something if you listen to the market.

I too have two big losses in the book from yesterday and today. Albeit with a small sample size (n=4), my win rate on Stop and Reverse trades is currently 50% rather than the expected 85%. This tells one of two things. 1) The current market price action does not reward this...
  • #3,367
  • Mar 6, 2013 2:37pm Mar 6, 2013 2:37pm
Quoting FineForex
Hey Jay,

I was wondering if you could go into a little more detail on how you determine the wicks to be clearing orders for more down movement and not as rejection?

As I study PA I've noticed sometimes the wicks come before a strong movement in the same direction like the market is begging to go down, wicks then finally plummets but I don't see how to differentiate that from a rejection signal.

Thanks
100% agree
  • #3,368
  • Edited 3:33pm Mar 6, 2013 3:12pm | Edited 3:33pm
Quoting FineForex
Hey Jay,

I was wondering if you could go into a little more detail on how you determine the wicks to be clearing orders for more down movement and not as rejection?

As I study PA I've noticed sometimes the wicks come before a strong movement in the same direction like the market is begging to go down, wicks then finally plummets but I don't see how to differentiate that from a rejection signal.

Thanks

Quoting lucariga
100% agree

Hi Fine forex and Lucariga.
You have to look at PA in its totality, you cant pick and choose the things that just support your desire for in this case price to rise. Already discussed, price going into the PRZ is bearish and if you notice there are no higher highs with all of those wicks, price has no intention of rising here there is just price determined to move lower. If you look at the Bottom of the chart you see more wicks, but with these wicks you have PA to support a move up, Spinning tops(indecision) and be it subtle you also have higher highs. There is a lot going on ,on this chart from Point B to C that I did not go into that would have told me not to buy at this point but instead pointed to lower prices. I hope this helps, but if you need more PM me and I will suggest a couple of good PA threads that will help with reading PA better.
Always Learning
  • #3,369
  • Mar 6, 2013 3:13pm Mar 6, 2013 3:13pm
okay this is what I was looking at there where some patterns in the there but they were more defined on the 5min and 15min charts due to movement being slow at the london session but what i was more interest was the areas that it they wanted to go to, once i established that the price wanted to test these areas again I mad some aggressive short trades to go to these areas but i pulled out with about 35 40 pips, before going to bed didn't wanna to leave it with NF report.

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  • #3,370
  • Mar 6, 2013 3:16pm Mar 6, 2013 3:16pm
if you look at gbp aud, there is actually a aggressive cd pattern in there because none of those top spike broke the 88.6 and knowing we had an area of consolidation it would of been great trade to take low risk high, profit and way i just rambling on here I'm just posting how I'm starting to look at these charts now don't take my analysis i might be wrong
  • #3,371
  • Mar 6, 2013 3:39pm Mar 6, 2013 3:39pm
Quoting JayTrader
Hi Fine forex and Lucariga.
You have to look at PA in its totality, you cant pick and choose the things that just support your desire for in this case price to rise. Already discussed, price going into the PRZ is bearish and if you notice there are no higher highs with all of those wicks, price has no intention of rising here there is just price determined to move lower. If you look at the Bottom of the chart you see more wicks, but with these wicks you have PA to support a move up, Spinning tops(indecision) and be it subtle you also have higher...
awesome and insightful, thanks

sent you a PM
  • #3,372
  • Mar 6, 2013 6:54pm Mar 6, 2013 6:54pm
SLW Day 2 price action practice .... dipped below PRZ i wouldnt have traded and shot up. but still hasnt formed a new high and closed at resistance, so my bias is still bearish .... well see!

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  • #3,373
  • Mar 7, 2013 2:53am Mar 7, 2013 2:53am
Quoting lucariga
Look at this link: http://www.forexfactory.com/showthread.php?p=6486406#post6486406

Your C point didn't reach the 61,8 retracement of AB. So this invalidate the BAT pattern. Just my 2 cents
Thanks I should read my notes properly next time.
Vandag is die dag.....
  • #3,374
  • Mar 7, 2013 3:51am Mar 7, 2013 3:51am
Quoting liemo
ABCD pattern on GBP/CHF...enjoy..!!
**SL taken to BE - for risk free trade**.....
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  • #3,375
  • Edited 1:47pm Mar 7, 2013 4:12am | Edited 1:47pm
Dear All,

please be so kind to let me have your thoughts.

attached is 4 h chart. i am bullish until 38% (WC). if candle opens and closes above 38 i will remain bullish and wait for further PA and wait to close out and turn bearish.

kind Regards,
Chad
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choose a job you love and you will never have to work a day in your life
  • #3,376
  • Edited 5:25am Mar 7, 2013 4:59am | Edited 5:25am
ewqcorp, I don't see a tradeable pattern on your chart. I don't beleive Mr. Pip advocates aggressive B trades.
  • #3,377
  • Mar 7, 2013 5:28am Mar 7, 2013 5:28am
Quoting jack h
ewcorp, I don't see a tradeable pattern on your chart. I don't beleive Mr. Pip advocates aggressive B trades.
oh shucks thanks for that, could have been a blunder. lucky i have not taken a position yet. since PA has HL and LL, i hesitated to commit trend is down.
choose a job you love and you will never have to work a day in your life
  • #3,378
  • Mar 7, 2013 8:03am Mar 7, 2013 8:03am
I know this is in hindsight, but in my opinion, your point A should be point X. I know I am new to harmonic trading, but if I see strong trends upwards, or downwards, I would treat the starting point as point X. Again, this is hindsight, but you would have had a nice ABCD or AB=CD pattern there.

Quoting lucariga
Mr Pip,

Not my best day...

This is my second loss of the day... EUR/GBP H1 aggressive C buy with a lot of market structure and PA

What I'm doing wrong? Please help!!!!

Attachment
  • #3,379
  • Mar 7, 2013 9:45am Mar 7, 2013 9:45am
...And this is the 3rd loss in a row. Now I'm sure I'm missing something.
Hey MR PIP, where are you?
HHHHEEEELLLLLPPPPPP!!!!!

USDJPY 1HR

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  • #3,380
  • Mar 7, 2013 9:59am Mar 7, 2013 9:59am
Quoting lucariga
...And this is the 3rd loss in a row. Now I'm sure I'm missing something.
Hey MR PIP, where are you?
HHHHEEEELLLLLPPPPPP!!!!!

USDJPY 1HR

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Markets are passive-aggressive, bi-polar bat crap crazy right now (at least compared to Feb.). But remember, based on my stats and talking with others, aggressive C entries only win ~50% of the time or less. I hover around 35%. Money management is key when riding out these markets. It is tough out there, trade small or go to demo if you cannot take the heat.

Still, do not give up and learn from the current conditions. While the market rarely exactly repeats, general themes and patterns are eternal.
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