M&W-Trading

That is what I am looking at too Joa. The consolidation on the 4hr GU of late is unusual and tighter than it looks. There are pinbars and railroad tracks on both sides of it so it is winding up pretty tight. As you posted, we will probably get a retracement of the break but is worth watching for 15 min patterns.

Very nice reaction from the first level pointed out: http://screencast.com/t/NaRneg6iKIF

I didn't take it... did you?

No, didn't take it. Was stopped out of my long at SL. SM would call this a stop hunt. Sure looks like it, if they exist. Got mine.... I hdidn't have a trigger from my method to take the long.

Yes, no problem if you think it is better.
I like to put the links because it is faster! :-)

Cheers!

Some comments on euro.
It is in a very narrow range this week, like 152 pips. Today is Friday, breakout can still happens but with the Cyprus issue postponed to Monday, there is a high chance that the range will be kept until there.
Here is a 1hr chart with this week cycle:



Here is a daily chart showing a possible monthly cycle. We see that there is a potential PFH for the month. If that is violated, than the rest of the month will be down.



And here, just for exercise because it is too long time frame, is a weekly chart, with a possible annual cycle. Well, this is only to think about...



Cheers!

It will be interesting to hear your progress after taking Steve Mauro course. Can you update us without giving away too much "secrets"?

I hate it when Steve is so wrong, on so many levels, so many times. Please, please, someone explain it to all of us what happened in the EUR/USD & USD/JPY this week. GBP/USD is behaving like a little b****.

My mind is blank. Please correct me.

My trades are winners on demo. Losers on real.

Have a good weekend guys. I won't have it.

Hi Ishtana.
Sorry but your questions are not correct. Nobody can explain why the market failed to make 3 pushes, why the market failed the M's or W's.
The market does what it wants to do. Out job is to identify it, without preconceptions, and follow it.
The market has no obligation to follow 3 pushes before a correction; the market has no obligation to make a peak formation and never more revisit it.
Stop trying to find absolute answers for what the market is doing or did.
If the levels and all this is confounding you, forget it. And concentrate on recognizing supply and demand.

Think about it. It is crazy if we think that the market HAS TO MAKE 3 pushes and then correct, that the market HAS TO MAKE a peak formation and never go over it, that the market HAS TO MAKE a weekly reversal... the market has no obligation.

Now, if you think about what SM teaches, what he is saying is that the day has a cycle, as the week has one, as the quarter has one, as the month has one and as the year has one. Why? Think about it. Every period I lined above, is a candle(or bar), right? And it has its own open, high, low and close. Right?
So, what SM says even in his sales pitches is that, we have to recognize the peak formation and trade away from it UNTIL the market reverses.
For example, the weekly cycle. Identify the peak formation for the week, trade away from it during 3 days and trade back after the weekly reversal.
Let's put it in terms of the weekly candle.
1. Sunday/Monday starts the week. It is the weekly candle OPEN.
2. Monday or Tuesday will make the peak formation high or low. It is the weekly candle HIGH or LOW
3. the market move for the next days, the market maker trend. It is the BODY of the weekly candle
4. the market makes the weekly reversal, that is the LOW or HIGH of the weekly candle
5. the market trade back to the range on Friday, what makes the CLOSE for the candle.

You can apply the same for the daily cycle, as below:
1. asian is the OPEN of the candle
2. London makes the HIGH / LOW for the day
3. the market maker trend starts, the BODY of the daily candle
4. NY reverses it, that is the LOW / HIGH for the day
5. NY trades back to the range, that is the CLOSE of the daily candle.

See it? Yo can think the same for the month, year and... you guessed it, even for the 1min market maker cycle(yes, because even the 1min candle has its open, high/low, body, low/high and close).

You can read better the weekly cycle on the 1hr or 4hr chart, the daily on the 15min, the yearly on the weekly, the 1min on the 5 secs... and so on.

Now, think about how many types of candles we can have and you are starting to have a better idea of what is happening. Dojis, hammers, shooting stars, narrow ranges, wide ranges, etc. For each of the daily, weekly, yearly, hourly, 1min....

What SM says is correct, meaning that if you identify the POTENTIAL high or low for the candle you are trading with, then the best idea is to trade away from it because the candle will have its body and you can catch the body until you see it is forming the low(or the high).

That's it! Again, if you think about all the candles that we can have, you start to recognize that the 3 pushes, levels, etc. are, well, questionable.

The market owns us nothing. The market is our boss, period. If you want absolute answers for the behavior of this animal(the market), you will not have.

Sorry if it is a bit rude but, as soon as you figure it out, I think your trading will improve a lot.

Cheers!

I'd like to post an almost ideal daily cycle that happened today in the euro.
Although it is in hindsight now, it serve to reinforce the cycle so we can recognize it when it happens next.

I took 45 pips on the move up on this one.

Here is the chart:



Cheers!

Easy in Hindsite Ishtana. The long gave up 50 pips and the short close to 50.
Study hard and good luck.

Thank you Joao for such a speedy and thorough reply. I understand what you're saying, I'm just furious the fact that the most basic, the most fundamental, and beginner friendly of all SM theories do not work this week. If the dealer resets once, I can understand. The safety trades failed 4 times? SM is losing it. And I don't really use the levels, I was only pointing it out to refer to the safety trades. They are coming out of level 1 inter day consolidation, and I don't understand why they didn't work out 4 times.

Thank you Russ for the explanation. I never heard SM talking about 50 pips movement unless it is ADR/3. Even then, it's only as a projection and not to predict reversal. Are you saying by knowing the close-to-50-pips short gives a clue that the safety trade won't work?

Btw, anyone here understands and trade fractional disparity? SM never teaches this concept completely.

In the course videos I have seen he says for new people to take profit at 50 pips. 50 pips is TP, not a reversal point.

I believe people are taking the "guidelines" literally to mean that market MUST do certain things, or the Method fail. For the suggested 50 pips take profit, it depends on where is your entry, how large is your stop, and how volatile intraday the currency is moving on that particular day. So if you have wide 25 pips stop loss, to hit your 50 pips take profit the price must move at least 75 pips from end to end. But if you have 10 pips stop loss, price only need to move 60 pips end to end. Then again, why must market move 60 or 75 pips just because YOU entered a trade?

Also, about the timing issue, remember that to induce a move, nothing better than news. So, we often see that a pair consolidates(accumulation) and we never see the move so we stay confused. Then came the news and the pair takes off. It is normal as SM(Smart Money) was waiting for the news to hit the wires, because they know it will attract liquidity so they can unload their positions.
This week started with the Cyprus issue and only on Friday there was some light on what is gonna happen.

Anyways, my point is that we must keep an eye on when strong news is scheduled and also be aware of what is the "theme" of the week, because, most often than not, it will be used to trap traders and unload positions.

Have a nice weekend!

Hello JOAOBORRAS,
Thank you very much for really simply explanation in post 1248,

Dan

Hello friends,
(Jaoborras, Ishtana, FX-Trader)
Did I correct find PFH and PFL on Weekly Cycle (1H)?

Dan, I saw your 15 M chart trying to spot the PFs. Good thing you switched to 1HR chart before I make this post =)

Yes, you got them all right. Use my previous post on identifying PFs as guidelines. Just be careful that PFs are so easy to spot in the past chart, but not in real life. If PFs are so easily identifiable before they even happen, traders wouldn't be suffering as they are now.

Like Steve said, you have to keep training your conscious mind until your subconscious mind see it AS IT develops. Only then you can trade them.

I'm still far ahead from mastering SM method. Joao, Russs, and FX-Trader are far more advanced than me.

I'm still waiting for FX-Trader for his analysis of my chart myself.

Please post your Myfxbook link when you are profitable with this Method.

It certainly would be a good way to promote the course to have a MYFXbook record out there for all to see.... How hard can that be?

Funny I just asked the same question to another course vendor, and he basically ridiculed me.