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"Ratios & Harmonics: a Different Way to Trade." Summary 37 replies

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Ratios & Harmonics: a Different Way to Trade

  • #5,921
  • Edited 1:44am Dec 13, 2013 12:49am | Edited 1:44am
Alright, let's exercise a little!

Potential Gartley in GBPUSD.

The process started by looking for bullish harmonic projections, ab=cd, to get a valid PRZ and continue with the bearish orderflow. But since we always have to look back for whatever we could have missed in the path I found out we already had a 618-786 retracement from XA.

The process has given X, A, B and C. Price has to reach the 127.2% extension of AB to complete the pattern.

Price has been doing higher highs and lows, so the expectation is still to the upside. However the bearish orderflow was heavy the day before. An agressive C in "C" is dangerous. It would had been better taking it in B. Let's wait. It's wise to keep both expectations for now.

Some nice supply and demand areas have been identified. Price has respected so far the ratios in these areas.

To validate this pattern price has to break the high formed at B and don't close passed AB 78.6%. In other words, price has to go up from C. If not, I will be looking for an ABCD with a PRZ down below.

GBPUSD 6-pips range bars chart:

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Zoom in (3-pips constant range bars):

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Edit: Plan B

If price doesn't get to the PRZ in case the bearish order flow is heavy, I need to be prepared to react down below. An extension from the dominant swing of 161.8% represents fibonacci exhaustion. That along with harmonic projections from recent swings give me confluence in the blue box. Price will either react when it get there bouncing or giving a big fight between our friends the little bulls and the teddy bears.

Attached Image (click to enlarge)
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Best time to plant a tree was 20 years ago, second best is now
  • #5,922
  • Dec 13, 2013 1:06am Dec 13, 2013 1:06am
Quoting Mr. Pip
Here is the video I promised you. I hope it helps you see how easy it is to stay ahead of price. It also shows you how there is no such thing as noise like all the experts say and how there is nothing random about price action. Keep it simple, learn order flow and price action. forget the patterns right now they will not make you a better trader. Post your questions or comments and stay ahead of price. Make decisions based on expectations this was all done on a time frame many experts say cannot be traded on. Remove emotions be decisive and engage....
wise words and great vid as usual
Never said I was Batman,all I'm saying is you'll never see us together.
  • #5,923
  • Edited 2:46am Dec 13, 2013 1:53am | Edited 2:46am
Quoting Mr. Pip
Here is the video I promised you. I hope it helps you see how easy it is to stay ahead of price. It also shows you how there is no such thing as noise like all the experts say and how there is nothing random about price action. Keep it simple, learn order flow and price action. forget the patterns right now they will not make you a better trader. Post your questions or comments and stay ahead of price. Make decisions based on expectations this was all done on a time frame many experts say cannot be traded on. Remove emotions be decisive and engage....
Very nice video Mr. Pip. Thanks. Currently due to focusing a lot on PA. I forget little bit about harmonics. I mean it is becoming difficult me to find patterns as I focused on PA. I request you if you put image with confluence daily, I can notice the repeated thing done by you each time. As per example of my Finance Account teacher, he was giving us question to write in notebook. Then, he was started solving it with telling us which item to put in which column ( debit or credit) and why to put it. So, daily he and we were solving the questions together and finally after 20-25 question we could observe the repentance of items in each question, where do he put it in each answer, why do he put it (As he told us each time why do he put it while solving it) we were able to solve answers without his help. So, if the same thing happens here that, you put daily trade example here with comments about why to take the trade, confluence etc. we can notice and it would be like trading with you so it can more help us to learn and understand what are the repeated things done by you for every trade, what are the repeated thoughts came in you mind to enter trade. Because watching videos and reading threads and after that directly doing practical and homework it is becoming difficult to me. But if we do things together it would be more helpful. So, I am posting my ideas here, but the same thing I want from you too to observe it if you get time to post a single post for it each day.
Thanks

-Amit.
-milkeyway
  • #5,924
  • Dec 13, 2013 2:44am Dec 13, 2013 2:44am
Wow, everywhere is harmonics, I haven't seen this earlier.
The hard thing is order flow. In this moment, does order flow go down or up? What I think, in short term it is down, because of lower lows, but in longer term it is 38.2% of Fibonacci.
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What about video, it is awesome, you need to have lots of experience to analyze market like this.
This was the video, when your expectations was right. It would be interesting, how to manage trade, when expectations becomes wrong.
  • #5,925
  • Dec 13, 2013 3:44am Dec 13, 2013 3:44am
Hello Mr. Damian.
I hope this is right.
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-milkeyway
  • #5,926
  • Dec 13, 2013 3:51am Dec 13, 2013 3:51am
This is one more. GBPUSD 4 HR.
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-milkeyway
  • #5,927
  • Dec 13, 2013 4:08am Dec 13, 2013 4:08am
Quoting kumaramy
This is one more. GBPUSD 4 HR. {image}
What pattern is that? If you are looking for an ABCD this is 100% retracement what you are showing so not a pattern.

There is a possible one there but your AB leg is measured wrong, :hint: that is not the low that you have measured. Plus it does not look like it is validating as there is no sign of a reversal at the moment with the last 4 candles on my chart showing for the bears.
  • #5,928
  • Edited 5:47am Dec 13, 2013 4:18am | Edited 5:47am
Hello Mr. Damian. Please find my mistakes and give comments. Thanks
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-milkeyway
  • #5,929
  • Dec 13, 2013 4:22am Dec 13, 2013 4:22am
Okay, so I thought I would show you how not to trade, my emotions got in the way with some indecision!!

Firstly I noted an ABCD with agro C moving down which was with some short term order flow. And although there was a steep climb before entry at 1 I entered the trade and then drew the second pink box as a point that it may struggle, bounce before retracing down.

It then bounced quite hard and the bulls hit back, I then panicked a little and got out of the trade for a 1 pip gain (YEAH!) lol!!

I had then noticed another possible AB=CD (mistake) and then entered the trade on a long (mistake!!) at the end of the first bull candle, 2. This was against my rule of never going in for an aggressive C against order flow which as you can see resulted in a swift turn and a loss of 25 pips.

Let that be a lesson to others as not to panic into trades and make sure you are confident and not to break your rules. If I had stuck with my original plan I would have made just over 30 pips with that trade, and following on from Mr Pips video yesterday, I may have extended the TP as it was gaining momentum on the down side and the current price is over 50 pips profit from my first trade entry!!

Feel free to provide feedback or even abuse, lol!!

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  • #5,930
  • Dec 13, 2013 4:26am Dec 13, 2013 4:26am
Quoting PipTrendz
{quote} What pattern is that? If you are looking for an ABCD this is 100% retracement what you are showing so not a pattern. There is a possible one there but your AB leg is measured wrong, :hint: that is not the low that you have measured. Plus it does not look like it is validating as there is no sign of a reversal at the moment with the last 4 candles on my chart showing for the bears.
Do you mean it seems like this ?
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-milkeyway
  • #5,931
  • Dec 13, 2013 4:33am Dec 13, 2013 4:33am
Quoting kumaramy
{quote} Do you mean it seems like this ? {image}
It is a possible but 2 questions for you.

1) What pattern is it?
2) Are you sure your second leg/line is drawn from the correct place?
  • #5,932
  • Dec 13, 2013 4:42am Dec 13, 2013 4:42am
Quoting PipTrendz
{quote} It is a possible but 2 questions for you. 1) What pattern is it? 2) Are you sure your second leg/line is drawn from the correct place?
.
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-milkeyway
  • #5,933
  • Dec 13, 2013 4:57am Dec 13, 2013 4:57am
Quoting kumaramy
{quote} . {image} {image}
Okay so the first image is corrected but what pattern is it?

I have no idea about the second pattern. Why have you started it from there? Is that really the low and start of the XA leg?
  • #5,934
  • Dec 13, 2013 5:00am Dec 13, 2013 5:00am
Quoting PipTrendz
{quote} Okay so the first image is corrected but what pattern is it? I have no idea about the second pattern. Why have you started it from there? Is that really the low and start of the XA leg?
I am currently out of ideas. I need someone expert to share examples with me. How would you find pattern in 1hr timeframe for GBPUSD at this stage of price action?
-milkeyway
  • #5,935
  • Dec 13, 2013 5:17am Dec 13, 2013 5:17am
How about this aggressive C with order flow and previous structure?
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  • #5,936
  • Dec 13, 2013 5:45am Dec 13, 2013 5:45am
Quoting kumaramy
{quote} I am currently out of ideas. I need someone expert to share examples with me. How would you find pattern in 1hr timeframe for GBPUSD at this stage of price action?
I am finding that sometimes there is nothing going on that is strong enough to want to trade and I am just sitting tight waiting for the market to come to me and give me some signs.

Sorry I don't know your experience or how long you have been trading this strategy but I would read the thread again, watch the videos, make notes and always have the pattern reference guide open to refer to.


Quoting IenDzi
How about this aggressive C with order flow and previous structure? {image}
Yep, I have this one marked out at the moment and waiting to see what price does. Looking like it is about to turn but we shall see.
  • #5,937
  • Dec 13, 2013 5:49am Dec 13, 2013 5:49am
Quoting PipTrendz
{quote} I am finding that sometimes there is nothing going on that is strong enough to want to trade and I am just sitting tight waiting for the market to come to me and give me some signs. Sorry I don't know your experience or how long you have been trading this strategy but I would read the thread again, watch the videos, make notes and always have the pattern reference guide open to refer to. {quote} Yep, I have this one marked out at the moment and waiting to see what price does. Looking like it is about to turn but we shall see.
I have 3 years of experience. And I am learning harmonics since 30-20 days.
-milkeyway
  • #5,938
  • Edited Dec 14, 2013 2:48am Dec 13, 2013 6:55am | Edited Dec 14, 2013 2:48am
Quoting gbmcgee
Mr. Pip, I am a rather private person, always have been, and I very seldom make my personal feelings made public. I consider myself an accurate judge of character, based on many years of administration in the fields of hospital/public school administration, and owner of a small business. You, no doubt, are a very intelligent/analytical/hard-working individual that have perfected a personal method of currency trading, based on your rules of engagement, that produces a lucrative source of revenue each and every month. I personally want to thank you...
I can really relate to Gary's word. Thanks Gary for saying this out. It had to be said. On my side, no words to express my appreciation for your work Mr. Pip. It feels like finally someone is really decent in Forex world. I followed the thread in the beginning, then became too busy with my new job, and now after a year I came back to the thread, and about to finish reading it, mostly Mr. Pip's posts. Sometimes I read till 3 am at night until too tired to continue. Thank you!

Julius
  • #5,939
  • Dec 13, 2013 7:32am Dec 13, 2013 7:32am
Quoting kumaramy
{quote} . {image} {image}
I think you may be falling into the trap of making the chart fit a pattern, rather than a pattern fitting the chart.

It is always subjective, but I wouldn't have selected your swing points. I've circles what I personally think are more suitable swings.

Hope that helps.
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  • #5,940
  • Dec 13, 2013 7:41am Dec 13, 2013 7:41am
Hello Traders,

Two entries taken a bit ago
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If you fail to plan, you plan to fail.
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