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Mastering the Art of Trading

  • #81
  • Aug 28, 2013 4:11am Aug 28, 2013 4:11am
Quoting ghous
{quote} I have a simple question for you. What do you think is the single most striking difference between setup A and setup B? {image} Don't stress yourself too much. It has to come to you straight away. If it doesn't you let me know. g.
bar type?
I want more brain power!
  • #82
  • Aug 28, 2013 4:21am Aug 28, 2013 4:21am
Quoting ghous
{quote} I have a simple question for you. What do you think is the single most striking difference between setup A and setup B? {image} Don't stress yourself too much. It has to come to you straight away. If it doesn't you let me know. g.

The magnitude of the sell-off that followed the previous HHR?
  • #83
  • Aug 28, 2013 4:23am Aug 28, 2013 4:23am
Quoting ghous
{quote} I am looking at it now. What do you want me to see? g.

does it look likea potential fakey?
Thanks in advance..
  • #84
  • Aug 28, 2013 4:40am Aug 28, 2013 4:40am
Quoting cfdtaleong
{quote} bar type?
yes and notice also the difference in space in the two trades. Setup A has comparatively more space to the FTA while setup B is running straight away into it as well as facing more contentious traffic.

Attached Image (click to enlarge)
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Always analyze your trades in 3 domains:

1) The location (Round numbers, MAs, depth of swing points and other confluence factors)

2) The bar (the longer the wick the better)

3) The space for the trade to move into (FTA not being too close to make trade management a pain)

g.
I believe . . .
  • #85
  • Aug 28, 2013 4:42am Aug 28, 2013 4:42am
Quoting Barbossa
{quote} The magnitude of the sell-off that followed the previous HHR?
That magnitude was at least partially supported by the initial free space that price flowed through easily. Can you see how such a trade would be easier to manage than say setup B where you have to literally baby sit every pip that the market moves in your direction?

g.
I believe . . .
  • #86
  • Aug 28, 2013 4:48am Aug 28, 2013 4:48am
Quoting cuchuflito
{quote} does it look likea potential fakey? Thanks in advance..
Well that's an extremely minor swing low that wouldn't catch my interest at all. I can see that LLS lines up with a former swing high further to the left but then you're really just looking at it as a PPZ (Price pivot zone or call it S/R) than an LLS really.

For a bullish fake out trade, you want a nice big bold LLS level to take the trade off.

Attached Image (click to enlarge)
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hope this is clear.

g.
I believe . . .
  • #87
  • Aug 28, 2013 4:49am Aug 28, 2013 4:49am
Quoting ghous
{quote} yes and notice also the difference in space in the two trades. Setup A has comparatively more space to the FTA while setup B is running straight away into it as well as facing more contentious traffic. {image} Always analyze your trades in 3 domains: 1) The location (Round numbers, MAs, depth of swing points and other confluence factors) 2) The bar (the longer the wick the better) 3) The space for the trade to move into (FTA not being too close to make trade management a pain) g.
lesson learned. Space to FTA, not too close.
Thanks
  • #88
  • Aug 28, 2013 5:02am Aug 28, 2013 5:02am
I guess this would qualify as a fakeout which happened on the Cable few days ago, also I would like you to share your opinions about pinbar because from my understanding of your method you may not take a trade if the wick doesnt actually pierce the HHR or LLR, this means if a nice pinbar forms just on the resistance as it happens sometimes without actually breaking it , you would not take the trade.
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10 pips a day keeps poverty away
  • #89
  • Aug 28, 2013 5:24am Aug 28, 2013 5:24am
Quoting Pinbar
{quote} Yeah, but it is not a very deep swing point and the FTA is close. You would also have to wait for the H4 bar to close before entering. Spend a couple of weeks just quickly scanning all the pairs on the Daily TF, it takes me about 10 mins to scan 80 pairs and find only pairs that price is currently in the vicinity of a setup. Like Ghous said though, it has been a weird month and we are in the last few days of this trading month so, perfect opportunity to look at the daily. {image}

Hi All,
Pinbar pls how did you do the scanning of 80 pairs in 10 minutes? Is it with an ea or manually ? Sorry for the question if it is too childish
  • #90
  • Aug 28, 2013 5:30am Aug 28, 2013 5:30am
Quoting aje6767
{quote} Hi All, Pinbar pls how did you do the scanning of 80 pairs in 10 minutes? Is it with an ea or manually ? Sorry for the question if it is too childish
I watch 30 pairs in like 3 minutes..... Pinbar is experienced trader, He can just glance at the pair and make conclusion, If you trade daily and draw the supp. and resistances you dont need much time to decide .....
  • #91
  • Aug 28, 2013 5:40am Aug 28, 2013 5:40am
Hello Ghous, Pinbar and others....what do you guys think about this potentional setup?

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  • #92
  • Aug 28, 2013 6:29am Aug 28, 2013 6:29am
Quoting realclick
I guess this would qualify as a fakeout which happened on the Cable few days ago, also I would like you to share your opinions about pinbar because from my understanding of your method you may not take a trade if the wick doesnt actually pierce the HHR or LLR, this means if a nice pinbar forms just on the resistance as it happens sometimes without actually breaking it , you would not take the trade. {image}
No, that is not a fake out setup.

See chart
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  • #93
  • Aug 28, 2013 6:35am Aug 28, 2013 6:35am
Hi Ghous,

I thought perhaps I can add something to your thread to contribute in some way.

To quote you


Quote
We know there are two types of traders participating in these markets. The novice trader that is under capitalized and is pretty naive when it comes to trading knowledge. And then there are the real big pros, the hedge funds, the banks and other institutions who know their stuff and have really big accounts. These 'cool' traders however suffer from a major problem that stems from the size of their account. The problem of liquidity. The FX markets are amongst the most liquid markets in the world yet...


Basically this is true. But to understand price quotes and HFT market makers would be a complicated thing. To put it simply, a false breakout can also occur when the person making the market at those prices pulls their quotes and the market flows until it finds a new quote. News spikes are generally caused by this and not a flood of new liquidity. Its the lack of liquidity at these points that create the spikiness of trading.

So whilst retail traders can be buying into this, a major market participant does not require to take the buy side first. Infact, all they have to do is remove all their major orders from the market on the sell side and the market will go through until they are ready to sell. Of course this is subject to market conditions.
Having some experience with liquidity hubs and dark pools has shown me that sometimes things are not so simple. However, trading can be simple, as you have so eloquently shown from this awesome thread.

I will try to contribute with my thoughts and charts when I see something interesting on my platforms.

EDIT: For some reason it didnt show the whole quote, but its from the first post
  • #94
  • Edited 11:17am Aug 28, 2013 6:35am | Edited 11:17am
Quoting aje6767
{quote} Hi All, Pinbar pls how did you do the scanning of 80 pairs in 10 minutes? Is it with an ea or manually ? Sorry for the question if it is too childish

I have eight charts on my platform, then I make the scanning chart a different background and from market watch, drag and drop each pair onto the white chart.
It changes to whatever chart you drop on it, I scan it quickly, if price is in the vicinity of a deep swing point, I will move the chart onto a position in the back eight pairs.
If not, I just move on to the next pair.

I almost never find 8 pairs in the vicinity of a good SP at a great location so, if some are exceptional but not yet on the cards, I will leave them on my screen and wait for price to get there. Then, price must create a SFP or I trash it and move on.

For example, the pair you can see in the white chart, has tons of traffic so, I look at it for 3 seconds then move on.
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  • #95
  • Aug 28, 2013 6:38am Aug 28, 2013 6:38am
Hi Ghous,

to be of some help I found this AUDJPY H1 example.....

a) order flow around BIG NUMBER ( BRN )

b) what Ghous mentioned about multiple attempts to fake around levels on lower timeframes such as H1, 30min, 5min ( or orders from big customers, which cannot be filled in 1 instance ).

c) first trouble areas ( FTA ) defined.

d) market structure ( compression into supply ), leading to the expectation that this might drop further than just the first FTA.

e) how it followed through is additionally worth looking at.

Hope it helps, good trading to all !

Mike

Attached Image (click to enlarge)
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Be like water.
  • #96
  • Edited 7:05am Aug 28, 2013 6:54am | Edited 7:05am
I just timed the scan.
119 pairs in 7.5 mins.

My charts are now setup.

Time does not matter though, just take your time but, if you have to really think about a chart for longer than 20 seconds, just pass on it.
But maybe take a little longer when you are learning to find these areas.

Removed the charts as, You guys want to learn how to fish.
  • #97
  • Aug 28, 2013 8:56am Aug 28, 2013 8:56am
Quoting dipie
Hello Ghous, Pinbar and others....what do you guys think about this potentional setup? {image}
Hey there,

We are still in a fairly strong down trend on the daily and the swing low is comparatively weaker. Also price has trickled down under the 9000 which would make me skeptical taking a long under it.

Attached Image (click to enlarge)
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g.
I believe . . .
  • #98
  • Aug 28, 2013 9:09am Aug 28, 2013 9:09am
Quoting Takisd
Hi Ghous, I thought perhaps I can add something to your thread to contribute in some way. To quote you {quote} Basically this is true. But to understand price quotes and HFT market makers would be a complicated thing. To put it simply, a false breakout can also occur when the person making the market at those prices pulls their quotes and the market flows until it finds a new quote. News spikes are generally caused by this and not a flood of new liquidity. Its the lack of liquidity at these points that create the spikiness of trading. So whilst...
Hey Takisd,

Very interesting indeed.

Reading through your post I recalled some of the stuff from the order flow threads I read.

Darkstar shared what he referred to as the liquidity equilibrium vs the liquidity vacuum. Pertaining to strong one sided moves in the market, I had the misconception that strong movements like these are situations where liquidity is on the high side. It turned out it was quite the opposite. He pointed out that these actually represented a liquidity vacuum where price just drifts through without any barriers at all in the hunt for a block of orders. I went back to charts and noticed how often price tended to reverse on these strong moves with equal and opposite force more like Newton's law of motion. It also explained why news spikes often were just that - spikes. Retail traders jumping in on news and price escalating to a set of waiting opposite order flow to consume all the retail trading.

I use the same concept for validating the trade setups too in that I always prefer price accelerating into the HHR/LLS levels instead of dragging to them as that puts the institutional trading more in line with executing the fading game.

And I am glad you pointed out that it also explains how price will sometimes move beyond an HHR/LLS smoothly before dropping back without the pros having to actually take part in making price move into the HHR/LLS. Its because there really isn't much institutional buying/selling going on until price reaches the block of big orders which is when price drops right back.

Wonderful stuff and thanks for sharing.

g.
I believe . . .
  • #99
  • Aug 28, 2013 9:12am Aug 28, 2013 9:12am
Quoting msmarple
Hi Ghous, to be of some help I found this AUDJPY H1 example..... a) order flow around BIG NUMBER ( BRN ) b) what Ghous mentioned about multiple attempts to fake around levels on lower timeframes such as H1, 30min, 5min ( or orders from big customers, which cannot be filled in 1 instance ). c) first trouble areas ( FTA ) defined. d) market structure ( compression into supply ), leading to the expectation that this might drop further than just the first FTA. e) how it followed through is additionally worth looking at. Hope it helps, good trading to...
Bravo!

Try deciphering the story like that on your lower/higher time frames all the time and you're well on your way. This is exactly the kind of thought process that I feel plays the biggest part in validating and invalidating trade setups.

Brilliant stuff for sure!

g.
I believe . . .
  • #100
  • Aug 28, 2013 9:22am Aug 28, 2013 9:22am
Quoting ghous
{quote} Hey there, We are still in a fairly strong down trend on the daily and the swing low is comparatively weaker. Also price has trickled down under the 9000 which would make me skeptical taking a long under it. {image} g.
makes sense, thx
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