Higher low, lower high system

Bit early for us that one. Looking at the bigger pic (as above below 200ema is the guide) D was a lower high negative close, bit of a lower wick at 1.0220 where there has been support. 4hr lower high neg close. 1hr shooting star 3 bar reversal rejecting the Asian session high. A bit tight with the lows but enough space to get stop to BE if the lows held.

All in all nice trade.

Today's GU trade. Bagged 40 pips+

Going with the flow and nothing else.

Hello Dave. I have a question.

I spoke to one guy who does sell courses and has got some good name.
In a mail he told me that it's highly unlikely that any trader can consistently make 20% a month. Is it true ? I've been trading just since 15 month's and i've just started to see some gains.

But as you've been into this way before me. I just wanted to know if consistency is really a highly impossible mission >
Your thoughts on this ?

Good question Money. I seem to remember years ago Dave's objective was 40% per month, but let's see what he says. . I average a bit over 40%, risking 2.5% of my capital each trade.

Having said that, I am sure few traders make that rate of return and apparently most lose money. My advice is to start small and compound. And of course to learn from Dave's strategies. His first HL/LH in a trend is a basic part of my trading.

Good trading.

Lovely trade down in line with the bias. Mrs V was focused on EJ buy in the morning. By the time this trade happened the 4 cigarettes (trying to give up again) allowed in the day were long gone and she was, how shall we say it, not focused.

Hi money
You are going to have to get clarity in your thoughts. Getting the direction of the day right and so getting in on that 1st HL/LH in the session as Orientos said is crucial. If you miss that entry your risk gets much higher. As mentioned many times we avoid continuation hl/lh's after LO has had a quick 60/70 pip move. We avoid weak pre/early US hl/lh's counter to London direction based on 1 x 1hr weak candle set up (1 candle doesn't change the flow).

Breaking it down with a 20 pip stop at 2% risk a 40 pip winner is 4% return, 60 pips is 6%. Then its working the odds you need a few good days to even out the bad ones and the average (a 20 pip loss and a 40 pip winner) and the no trade days.

Get the flow right in your head i.e. trend. Be aware of support and resistance levels in particular in ranging periods (have a look at 4hr charts with W pivots). Can it be done, without question. Obviously there will be ups and downs in between.

On a tight range we have not traded the eur for a few days. EJ Mrs V fave (got stops better, waited for 15 min move and retest of stop before any consideration of moving, generally keeping stop as is until exit almost in sight) at the moment then GU.

Week after week I post these on blog and its almost the same story, W pivots magnets with support/resistance levels. Have you got something from this in your trading plan? Clue - targets for exits and then trade the reaction to them.

Recap 7 May

EUR - D closed an inside candle. Range bound trading generally means trading the reaction to the W pivots/support resistance levels. An engulfing negative close on 1hr would set up a move to test 1.3050/1.3000.
Result: A 15 min double bottom at W M2 gave a move to W pivot. A 15 min lower high rejecting W pivot moved back down to W M2. Range bound continues.

GU - Has struggled below 1.5600 which is the top of a D channel for a week. A weak D close and we have not yet crossed below the 8lwma. If the 4hr closes negative here we are on a lower high suggesting move down will continue. Bias down.
Result: Moved down in US session in line with bias.

EJ - D closed a small doji. The 4hr does not appear to be reacting lower in the same fashion as it did after the 25 April doji. A 4hr hammer/engulfing close here would set up a move higher. At the moment the 1hr flow is lower high lower low.
Result: 2 x 4hr hammers set up move higher. 15 min higher low above 129.50. Fell again in US session with a 15 min lower high, setting up on the round number which is an issue for us.

EUR GU EJ 8 May

EUR - D close a shooting star inside candle. Range bound trading continues. No bias.

GU - D closed negative and we are some way from the next support level/lower channel. Bias down.

EJ - D closed negative small range doji. 4hr made a lower low. D and 4hr not agreeing. Would be happy to buy or sell 15 min higher lows or lower highs with 1hr candle set ups, but no bias.

Recap 8 May

EUR - D close a shooting star inside candle. Range bound trading continues. No bias.
Result: 4hr positive close move up off W M2 signaled move up.

GU - D closed negative and we are some way from the next support level/lower channel. Bias down.
Result: Bias down did not play out. 4hr and 1hr engulfing closes clearly show flow reversed up.

EJ - D closed negative small range doji. 4hr made a lower low. D and 4hr not agreeing. Would be happy to buy or sell 15 min higher lows or lower highs with 1hr candle set ups, but no bias.
Result: 4hr hammer and 1hr engulfing close signaled move up.

EUR GU EJ 9 May

With Swiss, French and German holidays and UK interest rate decision before US open might be a day to trade US session.

EUR - D closed positive, RSI crossed up and above 50 level. 4hr has broken the lower high lower low flow. Support at 1.3070 W M2, resistance at 1.3170 W M3. Bias would normally be up but we can easily fall from the resistance levels. No bias.

GU - D closed green with large upper wick. Bouncing between support and resistance levels and W pivots. The D moves down from the upper to lower channels since mid March have not been the cleanest. In general the expectation would be for the lower channel/support level 1.5390 to be tested. Could easily go up but bias down.

EJ - D higher low positive close at the upper resistance level. The smaller bounces lower on D from the 130.50 area are clear. 4hr negative divergence. Bias up but the support/resistance areas have held, 4hr divergence, so obviously potential to fall.

Treasuries fall and i'm ridin EU with 120+ pips..!!
Thanks to Dave, With your method. My trading has got to the next level..!!

Nice, Mrs V had the morning off but at least she bought EJ in the US session.

Recap 9 May

With Swiss, French and German holidays and UK interest rate decision before US open might be a day to trade US session.

EUR - D closed positive, RSI crossed up and above 50 level. 4hr has broken the lower high lower low flow. Support at 1.3070 W M2, resistance at 1.3170 W M3. Bias would normally be up but we can easily fall from the resistance levels. No bias.
Result: Moved up to W M3 1.3177 'to the pip' falling from there started by a 3 bar reversal. Trade trend and if ranging as we have been for a few weeks now, trade the reaction to key levels.

GU - D closed green with large upper wick. Bouncing between support and resistance levels and W pivots. The D moves down from the upper to lower channels since mid March have not been the cleanest. In general the expectation would be for the lower channel/support level 1.5390 to be tested. Could easily go up but bias down.
Result: London open moved price up to the W M3 1.5588 resistance level. Moved lower from there with 3 x 1hr upper wicks and a 3 bar reversal.

EJ - D higher low positive close at the upper resistance level. The smaller bounces lower on D from the 130.50 area are clear. 4hr negative divergence. Bias up but the support/resistance areas have held, 4hr divergence, so obviously potential to fall.
Result: Bias up played out in US session.

EUR GU EJ 10 May

EUR - Negative D close at the 1.30000 support/W S1.We have had 2 similar D closes on 17 Apr and 2 May, neither could follow through lower. Good candles like these should follow through. I do not know if we are going to continue to range i.e. respect 1.3000 or start trend lower. No bias can go either way.

GU - D engulfing negative close. Made a new lower low. Bias down.

EJ - Positive D close and we appear to be through the resistance level. If we continue up target could be 1.3360 - 1.3460 (Jan 2009 body high - candle high). Bias up.

It doesn't matter what method you follow, a healthy respect for SR levels/W pivots (which you can easily identify prior to start of trading session) is vital, in particular when market is ranging. Its much easier mentally to trade CT if you have identified the proven SR level and price respects it or if moves through quickly rejects and fails (big wick or 3 bar reversal).

When market is trending follow those HL/LH's.

Thanks for the reply Dave. I've been watching this scenario since sometime that whenever a huge move is about to happen, Most of the times, There will be clues in the form of HL LH in M15 before the move actually happens.
I've hardly seen V shapes..

Sorry I should have been more specific, big wick or 3 bar reversal on 4hr/1hr. Normally giving enough time for a 15 min hl/lh.

On the subject of 4hr, 1hr set up candles. I was asked by one of the guys I swop emails with why I thought this ej sell failed.

To summarise the question/answer exchange, it came down to when I backtest I look for the solid candles (3bar reversal features strongly but of course not the only one). I had trend up for the day on ej. Whilst we were at a W pivot so we could move down but would be looking more at CT rules to confirm the flow had changed.

In this case there was a 1hr red close doji after the hammer but the candle is so weak we cannot cross the 8lwma. The 15 min looks more sideways than anything else. If this was a strong move in trend fair enough, but it wasn't.

I'd much rather have looked at selling EUR as it looked like moving in line with the previous D's close. Even better was GU as bias was down and we had more space between entry and our next identified support level (the lower TL and support combo). In general rather choose trend V CT and in this case with ej there just weren't any convincing 1hr set up candles and no challenge (candle close with little/no lower wick) on 15 min to the lows of the immediate range.

When you back test and see great moves coming off good 1hr set up candles its easy (I'm sure we've all done it) to see a 15 min candle and forget whats happening on the other charts.

Recap 10 May

EUR - Negative D close at the 1.30000 support/W S1.We have had 2 similar D closes on 17 Apr and 2 May, neither could follow through lower. Good candles like these should follow through. I do not know if we are going to continue to range i.e. respect 1.3000 or start trend lower. No bias can go either way.
Result: The 1.3000 support level failed.

GU - D engulfing negative close. Made a new lower low. Bias down.
Result: Fell in line with bias.

EJ - Positive D close and we appear to be through the resistance level. If we continue up target could be 1.3360 - 1.3460 (Jan 2009 body high - candle high). Bias up.
Result: Choppy day no follow through during London session.