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Where can I learn more about Price Action like those in James16 charts? 9 replies

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james16 Chart Thread

  • #128,121
  • Oct 18, 2013 10:44am Oct 18, 2013 10:44am
Quoting patapouer
{quote} Hey Prasad, While waiting for more advanced traders to reply... I would doubt that old timers here ever said PA on LTF does not work. From my understanding, their message is a bit different. From what I could read here, and experiment at my computer (…), the idea to keep trading the HTF VS the lower ones, especially for people starting out and/or struggling through their journey to constant profitability is based on the following facts: - signal-to-noise ratio is better on HTF: the signal (price action bar) doesn't scream as you (a general...
Magnificent Patapouer!

Great post.

g.
I believe . . .
  • #128,122
  • Oct 18, 2013 11:25am Oct 18, 2013 11:25am
Quoting Martin600
Possible trade on equities. Continuation BUOB closing above marked boxes. Anyone who took it ? {image}
Check it out Martin.

Nice strong break here :-)
  • #128,123
  • Oct 18, 2013 11:53am Oct 18, 2013 11:53am
Quoting ghous
{quote} Hey P, I for one, always tend to keep my time frames separate. So if I see a daily setup it is extremely unlikely that I would want to drop down the time frame ladder provided that I enter on the daily. Of course if you choose to "fine tune" an entry by taking a trade on a lower TF based on a bias from the higher time frames then by all means the story on that lower TF will be important to you. A general rule for me is that the trade gets managed on the time frame that is executed on. Its rare for me to bypass this rule, but happens once...

"A general rule for me is that the trade gets managed on the time frame that is executed on" .....exactly that is what I wanted to hear from you. Because when we take a trade on a higher time frame it covers or masks the noise on the lower time frames. We cannot get out of the trade by looking at noise or some consolidation on lower time frames. If there is not much movement on the HTF I have a tendency to slip into LTF and start managing the trade from LTF. This will again result in some confusion and sometimes moving my stop loss on LTF which takes me out of the trade if there is some retracements.

I have to work on the discipline to stick to HTF because we took the trade based on the PA and location of that particular time frame. I have to work over this weakness.
  • #128,124
  • Oct 18, 2013 2:18pm Oct 18, 2013 2:18pm
Hi.

I don't think the problem with lower timeframes is that there is more noise there.

I take into account two facts:

a) Lower timeframes require faster thought.
b) Lower timeframes risk is higher because expected price movement vs spread ratio is higher -> Your potential gains are lower in relation to the spread.
  • #128,125
  • Oct 18, 2013 2:28pm Oct 18, 2013 2:28pm
Leverage, good for me, good for you.


I think that leverage is the best thing ever.

Leverage does not force you to open millionaire trades and get wipped out in one tick against you. Definitively.

So, what's wrong with opening the same kind of trades that would be opened with a i.e. 20 leverage level, but doing it using a leverage level of 400?

That means that you are limiting the amount risked the same you'd do if you would have only 20 leverage level, but you do not have to worry about margin (almost).

What happens, you want to risk 1% or whatever on each trade? Leverage does not change neither that nor the amount to be traded.

I write this because I am a little bored of reading arbitrary leverage level recommendations on books, articles and in my own dreams even.

Now I feel better. You know, altruism is a fallacy
  • #128,126
  • Oct 18, 2013 3:50pm Oct 18, 2013 3:50pm
Quoting str8
{quote} If you watch for PA on 1hr/4hr using daily levels you won't trade much more than if you trade only daily. (...). What I found works for me is to be super picky.
Agreed.... that's my point: I get trigger happy on LTF. Can't refrain myself. HTF allows me to get busy away from the charts. My account likes it
Slow & steady
  • #128,127
  • Oct 18, 2013 5:00pm Oct 18, 2013 5:00pm
Quoting ghous
{quote} Hey bro, Always great to be back to the good ol' basic stuff yeah? Nice trade there. Although I'd prefer a deeper pull back I can see you spotted a nice flip and some PA to hop on the trend. {image} g.

yes Ghous, true, that pull back was nothing deep but the BRN that the H4 PIN pierced and closed above was enough for me considering the previous strong up-move above the BRN. So as you commented, I jumped on. Now am trailing SL, let's see where this can go as AUDUSD went pretty parabolic today (as seen on D1) and price is entering area of significant PPZ (see Weekly)
Attached Image (click to enlarge)
Click to Enlarge Name: 2013-10-16 audusd- h4 PIN TSL.png Size: 64 KB
  • #128,128
  • Oct 18, 2013 5:08pm Oct 18, 2013 5:08pm
Quoting patapouer
{quote} Hey Prasad, While waiting for more advanced traders to reply... I would doubt that old timers here ever said PA on LTF does not work. From my understanding, their message is a bit different. From what I could read here, and experiment at my computer (…), the idea to keep trading the HTF VS the lower ones, especially for people starting out and/or struggling through their journey to constant profitability is based on the following facts: - signal-to-noise ratio is better on HTF: the signal (price action bar) doesn't scream as you (a general...
Hi there

Thanks for the extended reply. There is a lot to learn for me. From where I stand believe me you are an advanced trader. I have not got one great setup so far using PA signals. And trend trading has always tripped me , it seems like the trend changes just when I try to get on one. Now I have transitioned to trading based on PA.

I take the advice of seniors on this board quite seriously. Because you dont want to reinvent wheel and lose time and resources. We need to get confidence that trading can done successfully.

We need to wait for a high probability setup , and the watch the trade for FTA and get to break even. That is the first step. James has quoted that he considers break even as a win in his book and I totally agree with that.

Waiting for high probability setup I think becomes easy when we have something else to do like a job or school. When you trade full time or practice trading full time it can get really boring if there are no good trades to take. Of course with experience you may see more trades on charts..... but then that is what it is....it comes only with experience. Two different people may see different things on the same chart based on experience.

I have come to realize that my nature is more conducive to trading based on price action. I want to put in lot of screen time and demo trade while building my trading capital. There is no point rushing with this. I have come to a stage in life where I try to understand things completely from the root. No half baked stuff for me. I really wish that I have found this thread a few years back. I could not get to this in the rush of professional life in the United States. I could get access to the best of books and reading material but a lot of it is useless to trade profitably. Unfortunately there is so much hype associated with trading...one is simply lost in all of this.

I have found that they use Fibonacci to add more confluence to the story here but it seems like big boys use this a lot. It seems like this ratio is found in nature. I have even read that the price flow created by Fib is independent and objective. I am not sure if this ratio is inherent in the nature of the market itself or is it created by the participants in the market. I think it is inherent in the nature of market itself and that aspect is further enhanced by the participants in the market. I wonder if more knowledge of FIB can yield a greater degree of confluence.
  • #128,129
  • Oct 18, 2013 5:27pm Oct 18, 2013 5:27pm
Quoting ghous
{quote} PA should, and does, work on lower time frames. Higher time frames are "easier" because there is less noise inside your head and outside on your chart. Extending this to lower time frames, the lower you go the fewer the pip margins and hence more the noise on your chart. The time you have to make the decision also continues to reduce as you go down which amplifies the noise inside of your head too. Trading on the lower time frames thus becomes "tricky". You obviously have more space to a trade that has a 100 pip SL as compared to a trade...

Also it is much easier to make profit on higher time frame because on a daily chart it has to move just two bars in your favor. One bar will take you to break even and another bar will make you the profit. And if the market reverses after one bar you are still not losing any skin in the game.

Compared to that if that is an hourly chart ....it has to move considerable distance in your favor to make money. Two bars will not do. And that may give the impression of being inaccurate but it may not be so. But the problem with higher time frames is limited number of good setups. That is the challenge on higher time frames.
  • #128,130
  • Oct 18, 2013 11:35pm Oct 18, 2013 11:35pm
Who remember some of this words quoted by James few years Back.


''I also don't lose much on my trades, because I wait for the exact right moment. Most people will
not wait for the environment to tip itself off. They will walk into the forest when it is still dark,
while I wait until it gets light. Although the cheetah is the fastest animal in the world and can catch
any animal on the plains, it will wait until it is absolutely sure it can catch its prey. It may hide in
the bush for a week, waiting for just the right moment. It will wait for a baby antelope, and not just
any baby antelope, but preferably one that is also sick or lame. Only then, when there is no chance
it can lose its prey, does it attack. That, to me, is the epitome of professional trading''.

Words of Mark Weinstein in his interview with Jack D. Schwager in The Market wizard. Sure u should take a look at the book.


Jibson
Still trying to get to meet myself...
  • #128,131
  • Oct 19, 2013 12:46am Oct 19, 2013 12:46am
If you’re thinking about giving up i have one piece of advice for you .... Ask yourself the question "how many years would you go to college if you knew for a fact that there was a million dollars a year job at the end of it? Take care and good trading to you all.:nerd:


Jibson
Still trying to get to meet myself...
  • #128,132
  • Oct 19, 2013 3:41am Oct 19, 2013 3:41am
Only basics can be taught in college but I dont think the college can teach how to get the edge in the business of trading.

I just got these thoughts today and want to share on this forum. Confluence is a great thing and that is what delivers the edge in trading. It is the edge that gives you the success in trading business. Now confluence works in life the same way it works in trading. For example FIB levels have nothing to do PPZ levels or support and resistance points but when brought in together they create confluence that can result in high probability trade. IN the same way....let us say I am reading on diverse topics on trading and out of the blue some remote idea can give me the edge in trading. Even ideas out of trading domain such as my ability to quit smoking can help in trading. Because in either trading or smoking the rules have to sink in deep enough to become second nature and it also means unlearning all the action surrounding the habit.

This confluence and the process through which one gets the edge is hard..so this cannot be taught in schools. I for one beleive that goal oriented approach which is taught everywhere will make us overlook important things..as we dont look at diverse stuff and thus lose out on the edge. People quite often want everything at one place..packed in one book with a clear method to riches. And you dont get edge in this fashion. It is the randomness and openness to a rich variety of ideas that give you the edge in the long run.

I became a member of the James16 PF today. Right now I am reading trade price action by al brooks and Fib analysis by Constance Brown....both of them are experts in thier domains and have the capability to apply that in markets but the subject is as dry as it can get and hard to apply in the market for new comers. My point is when we study the stuff without expecting anything..just like that...and some of that stuff sinks in...at some point of time it can connect with other stuff and can give an edge....

probably it is hard to understand this post...i could not articulate this well enough...
  • #128,133
  • Oct 19, 2013 4:07am Oct 19, 2013 4:07am
Quoting prasad99
{quote} From where I stand believe me you are an advanced trader.
well I guess we all are someone's expert - and someone else's noob... just a matter of perspective.

Can't say much about fibs. I am highly pragmatic, and I tend to believe self-fulfilling prophecy mechanisms rather than magic numbers driving the nature and thus the market by extension. I'm pretty sure I could find a strong correlation between whatever planet movement and price rising or falling - I just have to search long enough, remove outliers and perform the statistical analysis I need to prove my point (did it in cell biology research, just not with planets though... )

Then, regarding the question of understanding things inside out... too lazy for that . If it works, it works, and that's pretty fine. If it doesn't, well, it doesn't and that"s ok too... then if "they" (seasoned traders) say it works but I can''t make it work, it's very likely I'm the one creating the situation. It won't be the market fault. hem... will it?
Slow & steady
  • #128,134
  • Edited 6:30am Oct 19, 2013 4:16am | Edited 6:30am
Quoting prasad99
Only basics can be taught in college but I dont think the college can teach how to get the edge in the business of trading.

Prasad99, I got your point well and they are articulate but i should assume you dont totally understand me because we are inferring the same point. You should read this PDF
Attached File(s)
File Type: pdf 5steps.pdf   42 KB | 1,178 downloads
its just 5 pages, from an old member here (Dial) then you will understand what i mean. will like to get your view after you read through. Take care.



Jibson
Still trying to get to meet myself...
  • #128,135
  • Oct 19, 2013 6:18am Oct 19, 2013 6:18am
Quoting prasad99
{quote} Also it is much easier to make profit on higher time frame because on a daily chart it has to move just two bars in your favor. One bar will take you to break even and another bar will make you the profit. And if the market reverses after one bar you are still not losing any skin in the game. Compared to that if that is an hourly chart ....it has to move considerable distance in your favor to make money. Two bars will not do. And that may give the impression of being inaccurate but it may not be so. But the problem with higher time frames...
Hey P,

It actually requires more or less the same number of bars to be making money on either time frames. The shorter time frames are just playing with fewer pip margins but the R:R exists in the same capacity. So on the daily you're looking for a 150 pip gain based on a 75 pip stop while on say the 1H you're trading with a 25 pip SL for a 50 pip gain or anything along those lines. Point being it doesn't take more "bars" to be making money on one time frame more than another generally speaking of course.

g.
I believe . . .
  • #128,136
  • Oct 19, 2013 6:38am Oct 19, 2013 6:38am
Quoting prasad99
Only basics can be taught in college but I dont think the college can teach how to get the edge in the business of trading. I just got these thoughts today and want to share on this forum. Confluence is a great thing and that is what delivers the edge in trading. It is the edge that gives you the success in trading business. Now confluence works in life the same way it works in trading. For example FIB levels have nothing to do PPZ levels or support and resistance points but when brought in together they create confluence that can result in high...
Actually it extends beyond just the concept of confluence.

Every skill that you need to eventually master this art is going to be the one that you will really be needing to find success in every other domain of your life. This is precisely why I find trading to be so much ahead of any other form of business. People can get very good at their business and be a total failure in bringing their life together in a meaningful picture by connecting all the aspects.

Sound trading requires you to be patient. It requires you to be healthy (physically and mentally), positive yet realistic. It teaches you to suppress emotions at critical decision making points and importantly back yourself regardless of the consequences of those decisions. It wants you to be disciplined, hard working and pro active. Successful trading, is to understand the sturdy relationship between risk and reward more explicitly than in any other domain of your life. It teaches you the value of time and money. It teaches you the importance of relationships as the first thing you want to do right after your trading session is to be with your loved ones and acknowledge life beyond your profession. You learn the art of crisis management and learn to believe and trust yourself. Importantly you know how everything wrong in your life is a result of your own decisions and that ONLY YOU posses the power to bring the change. It shows you how life doesn't have to be the way others want it to be, but be exactly how you would have thought and imagined as straight from a fairy tale back in the childhood years that got lost growing up because you were taught there is no way to your bread and butter except a 12 hour work routine doing things that you would absolutely hate to do day in day out. It teaches you how ego can be disastrous and how down to earth perseverance is essential to anything that you want to achieve.

This is literally from the top of my head only.

Funny as it may sound, if you seem to posses all these skills through an exposure of a different sort you're likely to succeed in life anyway.

This is why I believe mastering trading is not easy. Because to master trading is to master oneself. You have to bring yourself down to the original you. Be the best version of yourself. Line up to be successful in literally everything that you do even beyond your business and trading. It just means to have found the right combination, line and length of your heart, mind and soul. It is then that you get out of your own way and succeed at trading and in life.

g.
I believe . . .
  • #128,137
  • Oct 19, 2013 8:40am Oct 19, 2013 8:40am
Quoting Winston Reed
{quote} Hey Jimi, Even in the absence of the 200 ema the weekly resistance is impressive. A short may be possible but we must wait for PA to show the way. {image}
Hey Winston,

what do you think about it for next week?

thx
  • #128,138
  • Oct 19, 2013 8:41am Oct 19, 2013 8:41am
Quoting prasad99
{quote} There is valid PA setup that is forming on hourly chart. Do you indicate that we should take similar setups on higher time frame charts.??? Please look at the screenshot for USD /AUD {image}
I caught it and I'm in a few pip before the loss
  • #128,139
  • Oct 19, 2013 10:15am Oct 19, 2013 10:15am
Quoting ghous
{quote} This is why I believe mastering trading is not easy. Because to master trading is to master oneself. You have to bring yourself down to the original you. Be the best version of yourself. Line up to be successful in literally everything that you do even beyond your business and trading. It just means to have found the right combination, line and length of your heart, mind and soul. It is then that you get out of your own way and succeed at trading and in life. g.

Yes boss! You and Mike are always mind blowing. You always have something for the boys.



Jibson
Still trying to get to meet myself...
  • #128,140
  • Oct 19, 2013 10:26am Oct 19, 2013 10:26am
Quoting jimi
{quote} Hey Winston, what do you think about it for next week? thx
Hi Jimi. AU had a strong weekly close into resistance. We mustn't predict but we can look at possible scenarios. It is tempting to anticipate a bounce south but we should consider the possibility of a break through to the upside. In that case a a break above resistance then a retest of some support such as the TL, the big round number or other support and a move further up with good PA is one. A strong rejection candle here at resistance is another.
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