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B.S. Trading with Kenneth Lee

  • #5,261
  • Apr 4, 2013 3:57pm Apr 4, 2013 3:57pm
Quoting Kanzler
What I've started to notice is that when a level is about to fail, you just don't see a lot of opposing market orders being placed. Price kind of just sits along the edge of where the order stack is at (white space left in the zone) and chips away at it in chunks with minimal push back. When a level is still solid though we see competition to get the best price with the opposing market orders coming in and quickly pushing price back. Anybody else want to comment on this and perhaps other things they've noticed?
I think this is a great way to think about what is happening at levels. It is exactly what pro traders trading with the DOM and Time & Sales look at trading stocks/futures. They watch for floods of market orders on the T&S hitting the bids/offers (as shown on the DOM), to gain a perspective of who is in control. Whilst we don't have these tools for forex, the next best thing is looking at the evolving price action as you have just described.
  • #5,262
  • Apr 4, 2013 5:25pm Apr 4, 2013 5:25pm
Quoting Porkpie
Could you reference that Sam Seiden video Ken? as I have never heard him talk about flips. As a rule he always states he never cuts through candles. If its the video I am thinking 'Forex Trading for Short Term Income', then I got a different interpretation. He's looking for momentum moves off the higher time frames 240-30 min, identifying 15 min levels and then making sure they are fresh by refining these levels down to the 5min. Not being pedantic just just seeking clarity. Perhaps it was another vid that I haven't seen. With regards the purple...

He never has that I know of. Just my way of stating the first reversal swing at a level
when price hits a level , we are looking for price to reverse or flip over. It is this reversing he looks for on a faster chart when price is in or near a level that he takes his daily trades on. Longer term or investment type trades i am not sure.

That is the basis of this style. if your day trading look for levels on 30 min or 1 hr charts . then look for less risk entries off faster ones. I just watch the 30 min but I have been watching charts for years so can see momentum slowing and getting ready to reverse. Don't have time for charts right now but have posted a good many examples of this.

Cheers Ken

About swap levels I have personally decided That S/R are to flexible and the interpretation leaves a lot to be desired. So I use Supply and Demand or buying and selling to define almost anything . especially at or near swing highs or lows and breakouts. Just My way ...
Good Trading To All ; Ken Lee
  • #5,263
  • Apr 5, 2013 2:58am Apr 5, 2013 2:58am
Hi Ken

I'm pleased to come across this thread. Would you be kind to elaborate on "use of a buy entry stop to enter the 2nd retracement into the demand level"? Specifically, where exactly is the stop entry level supposed to be? Is this what you wld call confirmation order?

Thx & regards/Bliss
  • #5,264
  • Apr 5, 2013 11:15am Apr 5, 2013 11:15am
Quoting Kenneth Lee
He never has that I know of. Just my way of stating the first reversal swing at a level when price hits a level , we are looking for price to reverse or flip over. It is this reversing he looks for on a faster chart when price is in or near a level that he takes his daily trades on. Longer term or investment type trades i am not sure. That is the basis of this style. if your day trading look for levels on 30 min or 1 hr charts . then look for less risk entries off faster ones. I just watch the 30 min but I have been watching charts for years so...
Ahh ok, I was confusing your terms of flips and swaps. Yeah I know what you mean.
  • #5,265
  • Apr 5, 2013 12:53pm Apr 5, 2013 12:53pm
Quoting Kenneth Lee
He never has that I know of. Just my way of stating the first reversal swing at a level when price hits a level , we are looking for price to reverse or flip over. It is this reversing he looks for on a faster chart when price is in or near a level that he takes his daily trades on. Longer term or investment type trades i am not sure. That is the basis of this style. if your day trading look for levels on 30 min or 1 hr charts . then look for less risk entries off faster ones. I just watch the 30 min but I have been watching charts for years so...
I see "swap" levels as incarnations of supply and demand levels at higher time frames, though most of them have poor r/r if you were to take them at that level. Looking for the level to enter on on the shorter frame solves that problem though and gives you confluence at the same time.
  • #5,266
  • Apr 6, 2013 4:38pm Apr 6, 2013 4:38pm
Hi Ken

Would you consider this to be a valid fresh HTF supply zone?

Thx
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Those that say do not know. Those that know do not say.
  • #5,267
  • Apr 7, 2013 4:04am Apr 7, 2013 4:04am
Hi there,

I'm new to this supply/demand thread but I've been trading exclusively S/D levels for some time now.

I'd not consider shorting at that 4H supply area you drew because look at where the next D1 fresh supply is located. There is a H1 supply area at the distal line of that D1 supply area. Prefer to wait for the extreme or confirmation with a brand new supply area formed absorbing some previous demand. That D1 area matches with first pullback to Wk 20 EMA, will try that short myself. Take a look at my D1 chart on the pound, you will see the D1 fresh speedbump supply (drop, base, drop), would prefer to short within that higher timeframe area.

I'd prefer to be conservative and short within the fresh D1 supply. However, that 4H supply you drew on your short is too wide. Look at the H1 supply right at that same area on my second snapshot. That's the origin of a big imbalance, as you detected. There has not been any pullback to the WK 20 EMA for quite some time and this 1st pullback would coincide with the fresh D1 demand seen as yellow trendlines on my H1 chart on 2nd screenshot.

Alfonso
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Set and Forget supply and demand trading community
  • #5,268
  • Apr 7, 2013 7:20am Apr 7, 2013 7:20am
Hi Alfonso,

Thx for your post. If I take into account the daily chart I assume that we are already in a fresh daily supply zone based off a possible swap scenario? With regards to the amount of candles, naturally there will be more in a lower TF but I take into account the amount with reference to the TF the zone was identified in.

I agree with your identification of the daily supply zone however if the 4H supply zone is confirmed then this would suggest a possible supply on supply – be it within 2 different TF – suggesting price may not reach the daily supply zone, hence my initial question regarding the 4H supply zone.

Trust this makes sense.
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Those that say do not know. Those that know do not say.
  • #5,269
  • Apr 7, 2013 7:35am Apr 7, 2013 7:35am
Hi OHenry,

Thanks for your reply and detailed explanation. I took into account that swap zone, but I am just following my trading plan. If more than 2 4H supply areas haven been violated then I look to short at the next fresh d1 supply area. Specially on the pound pairs, the pound levels spiking through levels, get you out of the trade and then continue on the expected direction.

Don't use swap zones for entry though, I just base my decisions on supply and demand levels, not swap. Will only use this d1 swap if there is a brand new 4h/1h supply zone formed, showing me there are willing sellers, no candle formations, just a brand new zone. Will then short the pullback into it.

But as I said, I just follow my trading plan's rules, have seen many of those swap zones fail, so I want to see supply confirmed.

As far as the 4h level u had drawn, i didnt mean it had too many candles, number of candles depend on the timeframe where u detected the level, as you said. I meant that that 4h supply had a rally base drop, I would use the top base to maximize risk/reward, moreover if it's a pound pair, which I call the Hyena, lurking at the levels to bite your bump

But as I said it's just my rules. Will watch out both levels, set alerts on the area.

Thanks a lot!
Alfonso
Set and Forget supply and demand trading community
  • #5,270
  • Apr 7, 2013 9:58am Apr 7, 2013 9:58am
Ok… I see what you are referring to Alfonso and I’m inclined to agree with you, I initially didn’t see that RBD as it is quite a shallow set of candles but none the less valid.

Looking at the DIXY there may be some weakness to come on the crosses as price retraces into that possible supply level but with a decent rejection we may well see 1.55xx being reached…but as always time will tell…Good Luck
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Those that say do not know. Those that know do not say.
  • #5,271
  • Apr 7, 2013 5:53pm Apr 7, 2013 5:53pm
Hello Ken:


I've read your pdf on supply and demand trading and I like it a lot. Lots of excellent charts and examples. You obviously put a lot of care and thought in to making it. You have clarified a lot of things for me.


Thank You
May the Forex be with you.
  • #5,272
  • Apr 7, 2013 10:21pm Apr 7, 2013 10:21pm
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Hereis the set up for the SD Gap trade. Basically we are looking to trade into thegap is we can get a set up for the short.
I gave it this name as I really do not know whatelse to call it? I tend to do that as to be able to indenify the differenttrading structures within the SD method.. My own thing.
  • #5,273
  • Apr 7, 2013 10:24pm Apr 7, 2013 10:24pm
Quoting TraderinSD
{image} Hereis the set up for the SD Gap trade. Basically we are looking to trade into thegap is we can get a set up for the short. I gave it this name as I really do not know whatelse to call it? I tend to do that as to be able to indenify the differenttrading structures within the SD method.. My own thing.
I think Sam called it the "novice gap" IIRC.
  • #5,274
  • Apr 7, 2013 10:27pm Apr 7, 2013 10:27pm
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Pricemoved with good volume into our Supply 'Area'..We got short a 2 lot. Given weare trading the 1M and the spread can be a little wacky, I got in a bitearly...I think this is a KL entry This level was picked based on a Drop-Base-Drop pattern

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Larger view of the SD Gap trade.

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One could have taken profit for a quick scalp 10-12 pips .. Usinng multiple positions.
  • #5,275
  • Apr 7, 2013 10:55pm Apr 7, 2013 10:55pm
Quoting TraderinSD
{image} Pricemoved with good volume into our Supply 'Area'..We got short a 2 lot. Given weare trading the 1M and the spread can be a little wacky, I got in a bitearly...I think this is a KL entry This level was picked based on a Drop-Base-Drop pattern {image} Larger view of the SD Gap trade. {image} One could have taken profit for a quick scalp 10-12 pips .. Usinng multiple positions.
Hello TraderinSD:

When you say sm active in your charts does that mean smart money active ?

And some how by the PA and volume you can tell when smart money is active at a particular bar ?

Also what does the letter B mean on the chart ?

The letter D on the chart means demand I assume ?

Thank You
May the Forex be with you.
  • #5,276
  • Apr 7, 2013 10:56pm Apr 7, 2013 10:56pm
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Price rolled back up a tested the 98.50 area.Took some patience to see what would happen. We got a LH on the second test so we stayed in.

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Price continued to move in our direction to area B. Price then rolled back up as expected. Level B is a small Supply level as well as a S/R level. We see a good move into the level and rejection as inidcated. So we stay in. Price looked like it might break the 98.32 area.. Next stop the 98.00 area??

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As you can see we had a good bounce with considerably higher volume back into our previous rejection level. Sometimes you will get these bounces only for price to turn back and continue down. That was not the case here. Price did not show itself in this manner so we took our leave. Total pipage 30 plus.

As of this writing price has climbed back up to 98.59..So we made the right move.

Price may be approaching the 98.74 Supply 5M. This is the top of the range ( S/D levels at the top or bottom of ranges can be good trades ) .. So we may get a second chance to take this short for the SD Gap trade....Will see ??

Good trading to all

TSD
  • #5,277
  • Apr 7, 2013 10:59pm Apr 7, 2013 10:59pm
Quoting Borg
Hello TraderinSD: When you say sm active in your charts does that mean smart money active ? And some how by the PA and volume you can tell when smart money is active at a particular bar ? Thank You
I think this thread is now his personal blog, he never replies to anybody but keeps posting his trades.
  • #5,278
  • Apr 7, 2013 11:04pm Apr 7, 2013 11:04pm
Quoting Kanzler
I think this thread is now his personal blog, he never replies to anybody but keeps posting his trades.
Thanks for letting me know.

Do you know what sm active means ?

Thank You
May the Forex be with you.
  • #5,279
  • Apr 7, 2013 11:22pm Apr 7, 2013 11:22pm
Quoting Borg
Thanks for letting me know. Do you know what sm active means ? Thank You
Probably "smart money" as you guessed, I can't imagine anything else it would stand for anyway.
  • #5,280
  • Apr 7, 2013 11:28pm Apr 7, 2013 11:28pm
Quoting Kanzler
I think Sam called it the "novice gap" IIRC.
Yep... Your probably right...A carry over from my Emini trading..

TSD
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