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Learning How to Spot the Correct Divergence... Beginner Inside

  • #21
  • Sep 13, 2013 12:46pm Sep 13, 2013 12:46pm
Quoting Muhammad Ezz
Well it's all in the title. I'm new to trading. Read about several ways during the last month and I feel that the divergence is the way to go.
Learn price action, forget everything else
  • #22
  • Sep 13, 2013 12:50pm Sep 13, 2013 12:50pm
i think GDR is mostly right. IMO, the only useful application of any indicator IS divergence, but it MUST be confirmed through price action. Muhammed, the NZD chart you posted might indeed indicate a slowing in upward momentum, but the lack of any definable swing points in the 4H is troubling. You might see a decent drop followed by a resurgence or perhaps consolidation for a while before trending south for a bit. THis, of course, is why you should NEVER simply sell in a market like that trying to pick a top. ALWAYS wait for price confirmation. and good luck!
There's always money in the banana stand.
  • #23
  • Sep 13, 2013 12:54pm Sep 13, 2013 12:54pm
Quoting GDR3k
{quote} Learn price action, forget everything else
All right buddy Can you suggest a resource to start with ?
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  • #24
  • Sep 13, 2013 12:55pm Sep 13, 2013 12:55pm
Quoting LizardGizzard
i think GDR is mostly right. IMO, the only useful application of any indicator IS divergence, but it MUST be confirmed through price action. Muhammed, the NZD chart you posted might indeed indicate a slowing in upward momentum, but the lack of any definable swing points in the 4H is troubling. You might see a decent drop followed by a resurgence or perhaps consolidation for a while before trending south for a bit. THis, of course, is why you should NEVER simply sell in a market like that trying to pick a top. ALWAYS wait for price confirmation....
Let's see what will happen in the next few days
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  • #25
  • Edited 1:55pm Sep 13, 2013 1:36pm | Edited 1:55pm
Quoting Muhammad Ezz
{quote} All right buddy Can you suggest a resource to start with ?
Best thing I can suggest is to do exactly what I did, watch the charts on their own with out any indicators. Look at past price movement, look at certain areas; the opening price of certain candles, look at the charts and you will see what I mean and more importantly, certain candlesticks where price will hit and immediately bounce back from. This is where the big orders are (again, look at past price history to be able to spot them for future price movement), the candles or areas when hit, most likely will make a pair change direction. Re look, observe, apply the theory to future price movement, "price will hit this candle or the opening price of this candle and then bounce back", add your position accordingly with a good stop loss order and profit target. Rinse, repeat. Profit.

That is how I trade the Forex market.

  • #26
  • Sep 13, 2013 2:52pm Sep 13, 2013 2:52pm
Speaking of divergence ....looks like a terrific short opp in GBPCHF.
Attached Image (click to enlarge)
Click to Enlarge Name: Screen Shot 2013-09-13 at 3.52.04 PM.PNG Size: 206 KB
There's always money in the banana stand.
  • #27
  • Sep 13, 2013 3:07pm Sep 13, 2013 3:07pm
Quoting GDR3k
{quote} Best thing I can suggest is to do exactly what I did, watch the charts on their own with out any indicators. Look at past price movement, look at certain areas; the opening price of certain candles, look at the charts and you will see what I mean and more importantly, certain candlesticks where price will hit and immediately bounce back from. This is where the big orders are (again, look at past price history to be able to spot them for future price movement), the candles or areas when hit, most likely will make a pair change direction....
I like your approach, it's like that guy Mr. Ive the vice president of apple you just had to add at the end " you gonna love your price action" .... and this sounds like trading the support and resistance levels right ?
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  • #28
  • Sep 13, 2013 3:20pm Sep 13, 2013 3:20pm
Quoting LizardGizzard
Speaking of divergence ....looks like a terrific short opp in GBPCHF. {image}
stabbing bars hmmm I'll research that
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  • #29
  • Sep 13, 2013 3:21pm Sep 13, 2013 3:21pm
I actually just made that up. I think people around here call them PIN bars.
There's always money in the banana stand.
  • #30
  • Sep 13, 2013 3:28pm Sep 13, 2013 3:28pm
Quoting LizardGizzard
I actually just made that up. I think people around here call them PIN bars.

They look stabbing anyway so what do you think about these lines a tp areas in lime green and the SL 20 pips above the red line ?
Attached Image (click to enlarge)
Click to Enlarge Name: gbpchfh4.png Size: 34 KB
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  • #31
  • Sep 13, 2013 3:29pm Sep 13, 2013 3:29pm
Quoting LizardGizzard
Speaking of divergence ....looks like a terrific short opp in GBPCHF. {image}
I'm going to stick my neck out and disagree with you GBP is in a strong uptrend. This is what I think will happen...
Attached Image (click to enlarge)
Click to Enlarge Name: gbpchf.PNG Size: 60 KB
  • #32
  • Sep 13, 2013 3:43pm Sep 13, 2013 3:43pm
Quoting jen101
{quote} I'm going to stick my neck out and disagree with you GBP is in a strong uptrend. This is what I think will happen... {image}

The price is under a very strong resistance area buddy, look at it ... this is no joke
Attached Image (click to enlarge)
Click to Enlarge Name: gbpchfh4.png Size: 50 KB
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  • #33
  • Sep 13, 2013 3:47pm Sep 13, 2013 3:47pm
GBP will get good news on Tuesday and blast through your resistance
  • #34
  • Sep 13, 2013 3:49pm Sep 13, 2013 3:49pm
Quoting jen101
GBP will get good news on Tuesday and blast through your resistance

Poor resistance well, I still have monday to take my pips and run before Tuesday
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  • #35
  • Sep 14, 2013 2:55am Sep 14, 2013 2:55am
Here are some more indicators for you to study/play with:

Attached File(s)
File Type: ex4 MACD_Divergence_V1.0.ex4   12 KB | 387 downloads
Attached File(s)
File Type: mq4 MACD_Divergence_V1.0.mq4   13 KB | 423 downloads
Attached File(s)
File Type: ex4 OSMA_Divergence_V2_2.ex4   11 KB | 360 downloads
Attached File(s)
File Type: mq4 OSMA_Divergence_V2_2.mq4   12 KB | 418 downloads
Attached File(s)
File Type: ex4 RSI_Divergence_v2.ex4   12 KB | 395 downloads
Attached File(s)
File Type: mq4 RSI_Divergence_v2.mq4   12 KB | 408 downloads
Attached File(s)
File Type: ex4 Stochastic_Divergence.ex4   12 KB | 356 downloads
Attached File(s)
File Type: mq4 Stochastic_Divergence.mq4   13 KB | 394 downloads
Gone to a better place
  • #36
  • Sep 14, 2013 3:00am Sep 14, 2013 3:00am
Quoting smikester
Here are some more indicators for you to study/play with: {file}{file}{file}{file}{file}{file}{file}{file}
Smikester .... Maaaaaa Maaaaan Thanks
So sorry for always replying late! But I got 2 Jobs!!
  • #37
  • Sep 14, 2013 4:51am Sep 14, 2013 4:51am
Really its a good post from a newbie,Muhammad Ezz.I feel better to see your post and i think its really helpful for everybody.
  • #38
  • Edited 6:22am Sep 14, 2013 5:20am | Edited 6:22am
You probably know by now through your research that the indicator MACD was created by Gerald Appel in the 1970s. Do you think Gerald Appel himself knew how to use this indicator better than the "experts" in forex forums?
http://www.amazon.com/Understanding-.../dp/0934380929

You should also Google search for J Welles Wilder Jr who created the indicator RSI, and introduced the concept of bullish and bearish divergences. Then his disciple Andrew E Cardwell Jr discovered positive and negative divergences, or what people called "hidden" divergences. Sounds academic to know there are 4 types of divergences, but probably a good place to start before getting 1001 explanations from 101 forum members.
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  • #39
  • Sep 14, 2013 6:06am Sep 14, 2013 6:06am
Quoting Michael C. F
Really its a good post from a newbie,Muhammad Ezz.I feel better to see your post and i think its really helpful for everybody.

Thanks
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  • #40
  • Sep 14, 2013 6:06am Sep 14, 2013 6:06am
Quoting mmaker
You probably know by now through your research that the indicator MACD was created by Gerald Appel in the 1970s. Do you think Gerald Appel himself know how to use this indicator better than the "experts" in forex forums? http://www.amazon.com/Understanding-.../dp/0934380929 You should also Google search for J Welles Wilder Jr who created the indicator RSI, and introduced the concept of bullish and bearish divergences. Then his disciple Andrew E Cardwell Jr added positive and negative divergences, or...

this is interesting gonna check it out ..
So sorry for always replying late! But I got 2 Jobs!!
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