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B.S. Trading with Kenneth Lee

  • #5,861
  • Jul 10, 2013 5:02am Jul 10, 2013 5:02am
Quoting Gxp1
Hi Kenneth, Thanks for the chart ,just wondering why the prominant supply level as i have indicated on the chart was not considered? as we can see it was later breached when the price revisited, is there anyway we could have figured that out? Thanks {image}
Hi, as Sam Saiden would said.. that supply is not good because price was there 3 times before if you look back.
also i think breakout pullpack setup would work best with trend not agaist as Kenneth pointed out on chart. coz AUDUSD was clearly down.
  • #5,862
  • Jul 10, 2013 5:19am Jul 10, 2013 5:19am
Quoting adriann
{quote} Hi, as Sam Saiden would said.. that supply is not good because price was there 3 times before if you look back. also i think breakout pullpack setup would work best with trend not agaist as Kenneth pointed out on chart. coz AUDUSD was clearly down.

Thanks -forgot about the price revisiting the zone before
  • #5,863
  • Jul 10, 2013 6:10am Jul 10, 2013 6:10am
Hi!
I have a question and perhaps somebody know answer for it.
So, at USD/CHF recently we had a test of a supply zone. The supply zone was created by three of candles and they have open / close price at the same level. So, the market just tested the level and went down.
There is an opinion if one wants to get into the market with tighter stop, he should swift to less timeframe and found where more exact level.
In the zoomed red rectangle you can find the place. So, actually levels of entry can be higher and we just loose the opportunity.
So, perhaps somebody use here any rules in such situations how to find more exact level and don’t miss an opportunity..
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  • #5,864
  • Jul 10, 2013 6:37am Jul 10, 2013 6:37am
Quoting TraderinSD
{image} For all those just moving into S/D trading. The above chart, posted previously #5847, is about as classic as it gets. 1) We have a well defined Supply level. See how price left the Supply level. Very aggressive, very obvious, strong drop. 2) Price stayed away for a good amount time. The Base.. Well defined.. Lets look at the base for a moment. See how significant the first move was from Supply. We also have a smaller Supply on the 19th and again on the 23'd. And yes, you could trade these but really, they are part of the Base in the Drop-Base-Rise...

Hi TSD,


Thanks a lot for your comments.

As for your point #4, actually I did not find any materials, perhaps my fault and I think its very important – how price is coming to the actual supply zone.

Could you inform if I understood you correctly – your opinion is that market should go to the supply zone aggressively – with minimum quantities of candles..


As for post of #5847 with the original example… I found in message # 5821 issued by Ken an example where he mentioned about strategy on enter which is used by Sam. According to it he enter at the second low/high after the test. And I attached a picture in post of #5847 with ask if I understood the entrance strategy correctly. Did you hear about such strategy?

  • #5,865
  • Jul 10, 2013 6:39am Jul 10, 2013 6:39am
Quoting Gxp1
Hi Kenneth, Thanks for the chart ,just wondering why the prominant supply level as i have indicated on the chart was not considered? as we can see it was later breached when the price revisited, is there anyway we could have figured that out? Thanks {image}

Plus that was a move caused by NFP news release . I am always concerned around those types of moves, and it had been there a few times. Chart was basically just trying to show the different types of possible entries and how some might label them .
Good Trading To All ; Ken Lee
  • #5,866
  • Jul 10, 2013 6:43am Jul 10, 2013 6:43am
took a few off this FRESH 4 hr level this am . it doesn't seem to have the down momentum I would like so I bailed out . The next one around .9320 is a nicer retracement spot so will be on that as well
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Good Trading To All ; Ken Lee
  • #5,867
  • Jul 10, 2013 6:48am Jul 10, 2013 6:48am
50% fib
If the S/D ideas converge with classic trading thoughts that a volume of people may consider all the better . 50 and 61.8 fibs and supply and demand levels are like ice cream and chocolate syrup.
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Good Trading To All ; Ken Lee
  • #5,868
  • Jul 10, 2013 6:52am Jul 10, 2013 6:52am
chart
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Good Trading To All ; Ken Lee
  • #5,869
  • Jul 10, 2013 7:00am Jul 10, 2013 7:00am
I like the swap line for the reason a lot seem to thing. the other players see them as supply turned into resistance, Which is true in a since so that just adds more traders looking at this area and the more the merrier. Big money knows this as well. so it can be dicey. but it also means if they have orders to fill they can get them filled even closing longs so protect your trades at the first opposing level. protection is the key in trading. It isn't the winning that makes a great trader it is how they lose with style that does.
Good Trading To All ; Ken Lee
  • #5,870
  • Jul 10, 2013 7:19am Jul 10, 2013 7:19am
Hi Ken, I really enjoy the way you explain and demystify stuff that seem difficult at first glance. So far i think I'm making progress. just one question i want to ask. i observed the you mostly trade only the Aud/usd pair. Is there Any particular reason for making this pair your favorite? could it be that it responds better and more accurately to S/D ZONES. Dont mind my question, i'm just being curious..Thanks
As a man thinketh in his heart, so is he.
  • #5,871
  • Jul 10, 2013 7:54am Jul 10, 2013 7:54am
Quoting yemionline
Hi Ken, I really enjoy the way you explain and demystify stuff that seem difficult at first glance. So far i think I'm making progress. just one question i want to ask. i observed the you mostly trade only the Aud/usd pair. Is there Any particular reason for making this pair your favorite? could it be that it responds better and more accurately to S/D ZONES. Dont mind my question, i'm just being curious..Thanks

I trade the clearest charts I can find . I trade should almost jump off the screen at you . I do look around at times and do take many other pairs but focus on their majors I don't like the gbp much as it seems to have a bit of follow thru issues . Not right term but it will spike past your stop then turn . Not sure if this due to so much volume taking time to fill or planned actions but why use it if others are around. I do take a lot of yen cross pairs also , as they can be clearer when you want to drop the us dollar out of the picture. I took a nice e/u long yesterday that I closed this am . so I may post more oz charts because they are clear but in trading it pays to scan your charts before entering if you see a trade on one pair you may see it look even better on another
Good Trading To All ; Ken Lee
  • #5,872
  • Jul 10, 2013 8:54am Jul 10, 2013 8:54am
Quoting Kenneth Lee
{quote} I trade the clearest charts I can find . I trade should almost jump off the screen at you . I do look around at times and do take many other pairs but focus on their majors I don't like the gbp much as it seems to have a bit of follow thru issues . Not right term but it will spike past your stop then turn . Not sure if this due to so much volume taking time to fill or planned actions but why use it if others are around. I do take a lot of yen cross pairs also , as they can be clearer when you want to drop the us dollar out of the picture....

Ken, thanks for the information. I am very new to this :-) But was recently watching a Webinar by Sam Seiden in which he talked about the difference between Spot and Futures. In Spot he especially spoke about widening spreads at S/D zones. This occurs because the banks get paid no matter what, and because there is so much activity at these zones they widen spreads etc . To account for this he uses slightly wider stops when trading Spot. I was wondering if this phenomena explained the spiking you are talking about?

Regards,
  • #5,873
  • Jul 10, 2013 10:01am Jul 10, 2013 10:01am
Quoting bisecom
{quote} Hi TSD, Thanks a lot for your comments.As for your point #4, actually I did not find any materials, perhaps my fault and I think its very important – how price is coming to the actual supply zone.Could you inform if I understood you correctly – your opinion is that market should go to the supply zone aggressively – with minimum quantities of candles.. As for post of #5847 with the original example… I found in message # 5821 issued by Ken an example where he mentioned about strategy on enter which is used by Sam. According to it he enter...

Hi Bisecom,

I think you might be referring to:
" 3) The move back into the Supply level. Extremely strong starting on the 25th and going straight up into Supply. This is what we look for when price returns "

Answer .. Yes.. This gives us the best opportunity... Price moving aggressively back into our chosen level. Price meandering, taking its time.
e.g. small range candles, choppy...this not the sign of an aggressive more.

Now step back for a moment and look at the larger picture ( the whole chart ) See the pattern. Drop-Base-Rise. When price sets up this good you can see it coming ( IN ANY TIME FRAME ) Its just really hard to miss. Trading the larger TF's really gives you time to see this happening.

See how price left the level. Almost looks the same as it returned to the level. Now you are not always going to get such a perfect match but again .. Look at the overall pattern.

So we can break this down in 3 parts:

The Drop: When looking through charts in any TF this is what I look for first. From there I look at the origin of those moves to determine if there is a Supply or Demand set up that caused this aggressive move.

The Base: Is there a base forming? How long have the base been forming? or How long has price stayed away from our chosen S/D Level. ( the longer the better )

The Rise: Is price moving aggressively back into Supply? Wide range candles, almost straight up.. maybe a small stall or two along the way.. but aggressively ...NOT choppy, small range candles.. Price taken it sweet time to get back to the level.

The same in reverse for a long trade Rise-Base-Drop Remember your ODDS ENHANCERS ..

Opinions will vary on this on !!!
Where to set the buy or sell stop ( where do we get in ) at the first test, retest, etc. Look at it from this perspective. We already know the size of the level .. So we know our risk. Lets say 20 pips. We want to place our stop outside, ( in this case ) on top of the level. So let say we set up for 25 pip..3 pip room above max (top of level) and 2 more pips for the spread. Now.. do we know EXACTLY where price will turn at our level??? NOPE !!! There various methods than can help but nothing is really exact. BUT !!!!...it really not about that...Its about the RISK.. How much?? So if I risking 25 pips ( defined from the bottom of the Supply Level ) to my SL .. and it fit my equity profile.. Then if I enter really close to the bottom of the Supply Level..Next step: Proper Risk/Reward .. Do I have a proper R/R as it relates to my SL.. If I do I am good to go PERIOD !!

Perfect entries happen once in a while...WAIT !!! this is a perfect entry !!.. My entry is within my risk tolerance I have proper R/R. You can even be a little late ( you see many of my trade posted here are late ) Why?? because I think the level is good and it fits my Risk / Equity Profile.

Hope this help

TSD
  • #5,874
  • Jul 10, 2013 11:14am Jul 10, 2013 11:14am
Wonderful thought process Thinking through the move instead of just applying a system blindy.That in my opinion is one of the best odd enhancers
I want more brain power!
  • #5,875
  • Jul 10, 2013 11:34am Jul 10, 2013 11:34am
Quoting cfdtaleong
Wonderful thought process Thinking through the move instead of just applying a system blindy.That in my opinion is one of the best odd enhancers
Yes it is no different than looking for a entry, you are looking for the way price should move into your entry level, So in planning the trade you are thinking how it and where it is headed and the most likely spots that might just stall it or the ones where it may turn on you. If you apply this thought process every time you sit down at your computer it will not be long before you are seeing moves better than 1/2 the time.

Just as this morning a guy told me he shorted e/u . I shot back bit soon I think
and it was as the price went to that supply level then turned back.

It isn't allusive or magic it is just seeing the same Price Action time and again. But to many are just looking for entry signals or levels. Watch it all what is happening. Paste charts into paint and draw your expectations on them . this will give you something to look at and remember what you thought. Good Luck Ken
Good Trading To All ; Ken Lee
  • #5,876
  • Jul 11, 2013 8:34am Jul 11, 2013 8:34am
Quoting TraderinSD
{quote} Hi Bisecom, I think you might be referring to: " 3) The move back into the Supply level. Extremely strong starting on the 25th and going straight up into Supply. This is what we look for when price returns " Answer .. Yes.. This gives us the best opportunity... Price moving aggressively back into our chosen level. Price meandering, taking its time. e.g. small range candles, choppy...this not the sign of an aggressive more. Now step back for a moment and look at the larger picture ( the whole chart ) See the pattern. Drop-Base-Rise. When...

Hi TSD!


Thanks a lot for your explanations.

So, as I understood practice and practice.

And of cause proper RR.

Thank you again and good luck in trading!

  • #5,877
  • Jul 11, 2013 1:49pm Jul 11, 2013 1:49pm
Got home from work about 12:30 and scrolled thru the charts the OZ and this one N.Z./USD were the clearest and at the point for a entry I was late but the target was for enough for a try. Got 45 on New Zealand and 30 on OZ. so not bad for trading the wrong time of the day
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Good Trading To All ; Ken Lee
  • #5,878
  • Jul 11, 2013 2:22pm Jul 11, 2013 2:22pm
Quoting 4Xfactor
{quote} Ken, thanks for the information. I am very new to this :-) But was recently watching a Webinar by Sam Seiden in which he talked about the difference between Spot and Futures. In Spot he especially spoke about widening spreads at S/D zones. This occurs because the banks get paid no matter what, and because there is so much activity at these zones they widen spreads etc . To account for this he uses slightly wider stops when trading Spot. I was wondering if this phenomena explained the spiking you are talking about? Regards,

I'll assume spread widening is not a factor worth considering.
  • #5,879
  • Jul 12, 2013 4:48am Jul 12, 2013 4:48am
opportunity exists at all times..
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Good Trading To All ; Ken Lee
  • #5,880
  • Jul 12, 2013 5:05am Jul 12, 2013 5:05am
Quoting 4Xfactor
{quote} I'll assume spread widening is not a factor worth considering.

Personally I keep a eye on the spreads , at times they seem to have a mind of their own, But it is pretty common of when they jump so keep it in mind , hate to give away 10 or 20 pips to broker when waiting a second and it drops back to 1.8.
Good Trading To All ; Ken Lee
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