Price Action in Day Trading by Dadas

As much as I do appreciate your gratitude and I am very glad to be of help,
I do not approve of any religious propaganda on my thread!

I, really do not care who or what anyone believes in!
In the end, it doesn't matter anyway!

In my private opinion our human minds are much too little to understand any concept of GOD,
except for some puny human-resemblance models, which can never be nowhere close to GOD.

So, believe what you want, just keep it to yourself or preach your propaganda elsewhere!

Just as you thought this thread couldn't go any further - surprise!

I have been studying the ICHIMOKU indicator.

What I have seen surpassed all my expectations, once I took time to understand what Ichimoku is about!

Combining Ichimoku with PTECZ, Price Action, Engulfing or Significant Break Out Candle, and
applying the Dadas_BO_Trade_Layout creates the Ultimate Trading Machine!


What the Ichimoku actually is, is the chart itself plotted in a number of different ways, and shifted.

At first I thought why would we need to see what already is there on the chart itself, recalculated
and replotted in a different position?

Then, I realised that it is a psychological trick!

Somehow, looking just at the chart we demand reconfirmation of what we see.

Ichimoku gives us the reconfirmation and the restrictions we need in order not to make many foolish decisions!

Add some knowledge of the Market and Price Action, and there you have it!

BTW: Ichimoku is allowed on my thread, since this moment.

So, as it is, I always must do it my way.

First:
Since I can read Price Action and the chart itself, I don't need the Tenkan Line (Blue on above image).
I will use the chart itself as it is for the actual Price Action.
So, I set the color for Tenkan Lines to None.

Second:
The Ichimoku Clouds (kumo) actually serve as Trend indications.
Thus, I am interested in Higher Tf Trend in relation to a Lower Tf for Day Trading.
My choice is the H4 Trend.
So, the default Kijun = 26 and Senkou = 52 in my case are appropriate to the H4 chart.
I want to see exactly those Clouds on all my charts from H4 down.
Thus, I must recalculate the input values accordingly or proportionally.
So, I must modify the indicator so that it automatically shows me what I want.

Third:
The same goes for the Kijun Line (Red on above image).
It will also represent the important H4 Resistance or Support Line.

Fourth:
The Senkou Line follows the same procedure and represents the H4 Levels.

In this way I have 1 boundry covered:
Resistance for Shorts,
Support for Longs.

What is now missing, is the other side:
Support for Shorts,
Resistance for Longs.

Here I must excuse one of the standard indicators, namely the Relative Strength Indicator (RSI).
I will apply it and use it to recognise the Overbought/Oversold Levels when Price travels away from Cloud and Kijun.

So, this gives me a complete system:

So, further modifications to Ichimoku followed today.
It's not pure Ichimoku any more.
But, it really helps me a lot!
It eliminates a lot of doubt and uncertainty, but most of all,
it helps me stick to my rules, my strategy, and not violate it!

One example of a trade I took today:

Hello been lurking on this thread for a while now. I have used ichi on and off (as dynamic support and resistance) for a few months now and I also trade supply and demand (similar to your style). Am I allowed to post charts here even if its not exactly your trading style? Thanks.

Dear Sir,

thanks for your thread, i wish i read this thread long time ago.

Hi thetrebel214,

Please post your charts.

I do not actually trade ichimoku, I just saw it working, now.
I guess, when one can read the charts, after a while all methods become "tradable".

I am only interested in the ichimoku cloud, and I use my own settings.
I'm not even sure if that can be called "ichimoku" any more.

For example, here you see the M15 chart with Senkou 18 proportionally to M30 as base trend period.
Thus, for M15 it is actually Senkou 36.
So, I see practically the same cloud from M30 to M1.

I modified the ichimoku indicator so that I can see the traditional ichi or other options, like the future shift 0.

Also, I have switched off the Tenkan, Kijun and Chinkou Lines.

I have rediscovered among all my old stuff something called SuperTrend.mq4

Having applied it with my own settings, I get very clear indications of Price Action.

Thus, I was able to create a checklist, which is actually the elements on the chart.

1. Trend,
2. Cloud (including width & slope),
3. Significant Break Out Candle in the area or at the level,
4. Dadas_BO_Trade_Layout_Script,
5. Check if Top or Bottom,
6. Check RSI(14) (divergence, overbought/oversold).


The whole idea is to create such a picture, that I can quickly go over the checklist without wasting time.
Even without having to memorize the checklist, just with a quick glimpse of the eye.

Thanks daddas. Here is a trade I am in live right now. Long from the 2nd retest off the demand level. The chiko shows where price reacted off the demand level, showing there is still some buyers here . The ma's are flat might signal a the bears have stopped for now. First target is the peak of chiko.

Here is the chart

Trading the D1 chart, here is what I see:

First of all, I would use the cloud from W1 (10080).
Even though we can see some Potential Support, it still means very little.
It is only Potential Support, and price can go through it without asking anybody's opinion.

Both, cloud and trend are down.
Kijun as Resistance is also above price.

There are 3 possible scenarios:
1. Price will consolidate for a while at this level,
2. Price will retrace towards the Kijun, so upwards,
3. Price will continue down.

For this moment, the Break Out is the PTECZ for December 13.
Thus, there are no signals to go Long.
There are no signals to go Short, either, because Price is at Bottom of the 2 Short Trend Candles.
Also, the RSI divergence is rather flat, so again no reason to enter any position.

Thus, the reasons to go Long are very fragile, based only on a hypothetical Support and Price being "Low".

My checklist would be so:
1. Cloud: Short - wide
2. Slope direction: Down, small reclining up
3. Trend Line: Short
4. Kijun: Resistance
5. RSI: Flat
6. Top or Bottom: Bottom
7. SBOC: None
8. Dadas_Bo_Trade_Layout: Can't be applied
(could have been applied to first BO Short Candle as in image below)

This doesn't look Long at all to me.

One little comment about the ichimoku:

The Chinkou Span is nothing more than the Line Chart representation.
The shift backwards is just a psychological trick giving 2 points of refference.

You can see that clearly if you apply shift 0, thus no shift.

Actually, you see the same Price Action on the Candlesticks themselves.
But, that is not any signal, and not a strong one at all, just a mere assumption.

Of course, one can trade any way one prefers, as long as the total sum goes into green!

However, we want to help the math as much as we can.
Thus, we should wait for strong signals, not jump in on assumptions.

Thanks for the feedback daddas. Seems you are right losing the trade now.Lets see what happens.

I am neither right or wrong.
The price is always right.

Well you were right daddas got stopped out for 50 pips oh well. Currently long on eur/cad

1. Cloud: Long
2. Slope direction: Up
3. Trend Line: Long
4. Kijun:Support
5. RSI: up
6. Top or Bottom: top

What do you say wise one ??

1. Cloud: Long - Agree (but also narrow on my chart)
2. Slope direction: Up - Don't agree (flat on my chart)
3. Trend Line: Long - Agree
4. Kijun: Support - Agree
5. RSI: up - W1 overbought, D1 overbought, H4 might still have some potential
6. Top or Bottom: top - Agree (this means don't go Long)

So, after you have done the analysis, why don't you stick to your rules?
If you have got any?

I have pointed out so many times:
Long at Bottom
Short at Top

It won't help you if you can't see the picture and jump in even though your checklist is not in full agreement.

If you see even a single doubt in your checklist, look for reasons in the opposite direction.

​If you see even a single possibility for the opposite direction, don't trade until situation is clear.

Agreed daddas. Apologies. I need to stick to my own methods of supply/demand and price actios. Closed out the trade for a few pips.

Merry Christmas Everyone!!!

Happy New Year!!!

Merry Christmas to all of you!

Merry Xmas in arrears and Happy New Year to everyone!!!!

Wishing good pips in year 2014.
Well done Dadas