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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

  • #129,201
  • Dec 15, 2013 6:22am Dec 15, 2013 6:22am
Quoting TamRoofer
very noob question but what is the program, indicator or whatever it's named that is used to draw lined arrows and boxes on the chart videos of the guest area
Videos are made with Camtasia http://www.techsmith.com/camtasia.html that has that pencil option to draw shapes and lines.

If you didn't join yet the Priv. James16 forum I encourage you to join it. James and Mike's webminars are a treasure. http://www.james16group.us/

I am still watching Mike's videos and learning while I practice demo trading. Trading has several cycles: Entering the trade, managing an open trade and closing the trade.

Mike's and James' videos are unvaluable in my opinion. And there is a bunch of additional material. That material teaches how to deal with all these aspects of trading and many more like psychological training, risk management and more.
  • #129,202
  • Dec 15, 2013 6:26am Dec 15, 2013 6:26am
Quoting TamRoofer
{quote} Here is the method explained... Maybe there's something I don't apply correctly... {image}
hey T,

You got some good responses there. Lenrod hit the nail on the head.

Jarroo's method is real simple and straight forward but just as it is quite easy to mistake a good pin bar "anywhere on the chart" as an A+ trade its also very easy to get carried away with your "PBT Trades". Like with our traditional James16 stuff, its extremely important to build a story around your setups regardless of what the trigger is. I get so many questions from people pointing out random swing points and minor fake outs off of them and my response is always emphasizing on the importance of analyzing the overall story going on at the time.

Price breaking through an HCR/LCS level and the anticipation for it to hold on the pull back is basically asking for a typical "breakout scenario" in many ways. It makes a lot of sense (and helps filter out a lot of mediocre, some times dangerous setups) to look for these PBT trades as triggers to breakouts of wedges, consolidation boxes etc.

As most pointed out, going long dead at the top of a long term up trend is a very dangerous thing to do even when you have the trigger. The trigger executes the trade but should never be the reason for the execution. Regardless of which method you choose to trade with you will find that this is going to be real hard to do at first but eases out over time and with practice.

Hope this helps.

g.
I believe . . .
  • #129,203
  • Dec 15, 2013 6:30am Dec 15, 2013 6:30am
Quoting raitchev
{quote} Well bud, to be honest with you, I am not sure what method are you talking about. I took a glimpse at the PDF that you posted, and yeah it's a sound method. In fact, if you go back several pages you will see my post about this trade Heres where I entered. http://www.forexfactory.com/attachme...9&d=1386788577 The thing, my friend, is that these are zones, not exact levels. And having in mind that this is a level(zone) not being touched for several years... I don't think close above ~10ish pips is considered...
Yup. Our S/R zones are zones and not exact price levels. Jarroo I think came as close as one could ever come, to nailing these down to a single price level. Of course price doesn't respond to HCR/LCS levels all the time, perhaps even most of the times, but with the jarroo method, you're really on the lookout for to the pip stuff. This means you can take some small hits and then hit that 1 jackpot trade that gets you running to your bank.

There are goods and bads to every method. Again all depends on which package appeals more to you.

g.
I believe . . .
  • #129,204
  • Dec 15, 2013 6:32am Dec 15, 2013 6:32am
Quoting Xhale
What happened to Jarroo. Where'd that lil homie go
We haven't heard from him for a while. The last time he was around he did have some family issues he said needed to be taken care of. Let's just hope all's good and that he'll be back soon.

g.
I believe . . .
  • #129,205
  • Dec 15, 2013 6:47am Dec 15, 2013 6:47am
Thanks M.
Yeah im allso watching both A/U & E/A and Gpb/Aud that allso started to loose its momentum and showing some bearish divergence .
tough i was hoping Eur/Aud would hit 1.5500 before reversing it was 60 pip short ...maybe it will test it again next week we will have to wayt for some PA .

------------------------------------
TamRoofer taking 1h a day to read James posts and 1h to study charts can get you prety far in a week or two .
Then when you will see apealing set ups instead of trading them blindly you could draw some levels S/R ,PPZ , HCR and so on ... write your idea how you would trade it and why and post it here asking for a review . Im shure there will be allways some one who will point out the good and the bad so you will see what you are doing corect and what not .
  • #129,206
  • Dec 15, 2013 9:32am Dec 15, 2013 9:32am
Can someone recommend me a MT4 broker that has the correct daily and 4hr close times.
What is any ocean but a multitude of drops?
  • #129,207
  • Dec 15, 2013 9:41am Dec 15, 2013 9:41am
Attached Image
  • #129,208
  • Dec 15, 2013 9:47am Dec 15, 2013 9:47am
Quoting Xhale
Can someone recommend me a MT4 broker that has the correct daily and 4hr close times.
Not sure what you mean by "correct close time" but if you mean a broker with close times lining up with the NY markets close time, you might want to look at Fxpro as a lot of traders here use it for their analyses.

g.
I believe . . .
  • #129,209
  • Dec 15, 2013 10:29am Dec 15, 2013 10:29am
Quoting Xhale
Can someone recommend me a MT4 broker that has the correct daily and 4hr close times.
Alpari and probably FXCM and Oanda.
  • #129,210
  • Dec 15, 2013 11:22am Dec 15, 2013 11:22am
Quoting DaGrizlyBull
{quote} Hey Mike, Do you actually place the SL order there or you use a mental SL? I am asking because I noticed nasty Daily gaps in most equities. Thanks and GL !
Hey DGB

I put physical stops in always. But this is one reason why I trade equities from a weekly standpoint. It smooths out those gaps and they don't play as huge of a role. If the chart starts looking like your average FX chart it generally behaves that way and gaps don't become a huge issue. Still is possible but same way in FX that most times my hard stop over the weekend is never in jeopardy. But if you look at the equity and you can't spot many substantial gaps that to me is a tradeable equity where as many on the daily are just too gappy that it becomes too risky for me


Hope that helps
Mike
  • #129,211
  • Dec 15, 2013 11:25am Dec 15, 2013 11:25am
Quoting scherzi
{quote} Alpari and probably FXCM and Oanda.

Oanda has a midnight NY Time closing on their daily charts.....so they have 6 candles per week....you need a five candle week beginning at the end of the NY session (4:00) eastern.....FXDD is one of those brokers and have a good demo account to start....also most ECN Brokers worldwide use the same closing times so any of them are good.
  • #129,212
  • Dec 15, 2013 11:44am Dec 15, 2013 11:44am
Mike, speaking of stop loss, if I may ask...

Do you put a physical stop literally at the last bar high/low, maybe plus a few pips? (i.e. a physical stop driven by the patten, e.g. you trade BUOB and your SL is a pip below the last bar low?)

or would you see this as a viable idea to put a physical emergency stop (e.g. 3 times wider than you would normally place, e.g. 300 pips), use a position size so that emergency stop equals 2-5% of account loss (it should be very rare), and have a planned mental stop , e.g. on close below the BEOB bar? (you manually close the trade if it closes below the level).

With this, it seems we can avoid many situations where a single spike takes us out. The average loss will be slightly higher (assuming a discipline to follow the plan), but win ratio should go up a lot.

Please, let me know... I know most books advise against it. I think they do becasue many traders fail to execute the mental stop and hit the big emergency one (or wait till the margin call). Well, I think I will execute. I am tempted to give it a try, use emergency + mental SL, on a micro account anyway, but I wonder if there are other reasons against it. I guess I am tired of seeing my trades reach my TP level after hitting my SL with a 1 pip precision. Almost as if I "wanted" to lose (I am not blaming a broker).
Michal9
  • #129,213
  • Dec 15, 2013 12:00pm Dec 15, 2013 12:00pm
Quoting michal9
Mike, speaking of stop loss, if I may ask... Do you put a physical stop literally at the last bar high/low, maybe plus a few pips? (i.e. a physical stop driven by the patten, e.g. you trade BUOB and your SL is a pip below the last bar low?) or would you see this as a viable idea to put a physical emergency stop (e.g. 3 times wider than you would normally place, e.g. 300 pips), use a position size so that emergency stop equals 2-5% of account loss (it should be very rare), and have a planned mental stop , e.g. on close below the BEOB bar? (you manually...
Hey Michal

I think mental stops are a horrible idea for many reasons

1. A trade should have a defined risk that you can not do with a mental stop. That becomes a catastrophe and is no longer really a stop, but an "idea". When I determine my stop loss it is based on where I believe my trade is no longer logical or no longer a valid idea. Part of my money mgmt strategy is to define my risk and position size and this is done with a stop loss. Ie risking 3% per trade based on entry to stop loss point

2. Trying to protect yourself against a "spike" is a bit misguided for a few reasons. Firstly I think people think that if they had their stop a few extra pips that it would miss their stop and turn around. This really isn't true. If your method isn't working a few pips isn't going to save you. Because in my view that just means your trade idea was wrong and/or the trade is over. Generally new traders remember the few times price just clips them out and then turns around. Does it happen? Absolutely, but it is definitely not worth having a mental stop that you will many more times end up taking a larger loss(or not being able to define a consistent risk per trade like #1).

This is a common error from new traders and where many go wrong by not using a stop loss. ALWAYS have a stop loss. ALWAYS know your risk per trade. I always know what I have on the table. It is the most important thing to me. It's how I can sleep at night. But really once you have a solid method this becomes irrelevant. You will see it ALL . You will see your stop loss hit by a pip, missed by a pip. Same with take profit. Trying to come up with a solution that solves this every time can't occur. So it's sort of like chasing a piece of the grail and I think it's a waste of mental energy.

hope that helps!
Mike
  • #129,214
  • Dec 15, 2013 12:49pm Dec 15, 2013 12:49pm
Quoting Swede
{quote} Oanda has a midnight NY Time closing on their daily charts.....so they have 6 candles per week....you need a five candle week beginning at the end of the NY session (4:00) eastern.....FXDD is one of those brokers and have a good demo account to start....also most ECN Brokers worldwide use the same closing times so any of them are good.

Yea I've been with Oanda for a while and I still use them for all of my spot FX trades. But like you mentioned, they don't have the correct time format.

FXPRO seems to have the daily chart setup correctly, but their 4hr charts are running on the wrong timeframe.
What is any ocean but a multitude of drops?
  • #129,215
  • Dec 15, 2013 1:24pm Dec 15, 2013 1:24pm
Quoting Xhale
Can someone recommend me a MT4 broker that has the correct daily and 4hr close times.
Hey Xhale,

FXPRO has the NY close which is the one you may consider 'proper' I have always used their demo charts for analysis but I trade live with FXCM through their tradestation platform

Take care
Dan
  • #129,216
  • Dec 15, 2013 2:20pm Dec 15, 2013 2:20pm
Quoting scherzi
{quote}If you didn't join yet the Priv. James16 forum I encourage you to join it. James and Mike's webminars are a treasure.
I certainly will someday and I'm thinking about it everytime I come to this thread but the thing is that wouln't be smart of me budget wise. My financial situation right now isn't good enough to spend that kind of money on my trade studies...

I live in Quebec, Canada and own a very recent (1 year in january) and small roofs renovations company, winter time is real dead. Me and my wife owns a small farm with 4 horses, chickens, dogs and cats to feed and plenty of renovations to do and to add to it I'll be dad for the first time in about 5-6 weeks so gotta put the priority elsewhere.

So until my situation is more stable and spring is back, I'll just learn from here and hope the group is still active when I'm ready to join.
  • #129,217
  • Dec 15, 2013 3:28pm Dec 15, 2013 3:28pm

hello i want to ask about the risk:reward ratio for this trading method?

and what's the best method to study this huge thread?

  • #129,218
  • Dec 15, 2013 3:34pm Dec 15, 2013 3:34pm
Quoting TamRoofer
Me and my wife owns a small farm with 4 horses, chickens, dogs and cats to feed and plenty of renovations to do and to add to it I'll be dad for the first time in about 5-6 weeks so gotta put the priority elsewhere. So until my situation is more stable and spring is back, I'll just learn from here and hope the group is still active when I'm ready to join.
Hehe I just got my second daughter 3 days ago

If I may give you not an advice but more the way I deal with that (being a bit short in cash and a lot in time )...
The best thing I've done is simply waiting. Waiting and watching.
After testing several ideas and ways to play s&r, including Jarroo stuff, I came back to the very basics: clear set up at obvious location. Period.
The great advantage you have when you're short in time is that you don't even have time to go to lower time frames, or to enter soso setups.
You are just forced to develop patience - which is a very important thing I'm not very familiar with...

Take care
Slow & steady
  • #129,219
  • Dec 15, 2013 3:59pm Dec 15, 2013 3:59pm
Thanks a lot Mike for your reply re: the stop loss.

I absolutely AGREE you need to ALWAYS have a stop loss. There was NO question about this.

Only thing I am still "debating" is whether to do example A or B.

A. hard stop loss 1 pip below the pinbar low, 50 pips away from entry, and position size so that 50 pips = 1% loss, take profit 100 pips (bare with me, please assume 100 pips is a logical target, not just pre-defined R ratio). Our losses distribution will be, if trades executed OK, each loss equals 1% capital.

B. hard stop loss 4 times wider, i.e. 200 pips, position size so that 200 pips = 2% loss, and a mental stop on close below pinbar low.
I believe that, on on a large sample, of trades we will have a distribution like this:
- 200 pips loss - eqivalent of 2% account loss - very rare, in case of big volatility breakouts
- avg loss: 70-90 pips (we don't know, it will be bigger than 50 pips from option A, but should not be a lot bigger as rarely market closes FAR below last pinbar low)
- % winners - significantly higher (eliminate spikes) (in spite of 2+ years , as I review my journal, I see LOTS of cases where a stop is hit and reverses).

In option B. we STILL have stop loss in the market, we do KNOW the MAX risk per trade, and we USUALLY get much smaller than max loss per trade, and many more winners.

With this clarification, would you consider option B as a valid one OR do you strictly recommend placing the hard stop 1 pip below last pinbar low?
("pinbar low" is just an example in this case of course). (or if you recommend a different stop placement, would you share what it is?)

Thanks a lot, and please do not consider my question as a challenge, it is just a learning and options analysis. Again, this idea is fact-based on my journal review and I really do understand risk management rules. And, to be clear, I agree with you that once I am more experienced, I will likely trade best setups only, where this will not matter anymore ... but it seems to matter today.
Michal9
  • #129,220
  • Dec 15, 2013 4:19pm Dec 15, 2013 4:19pm
I believe that Ghous has a similar approach where the trade is only invalid if price closes below a certain point, so has a hard stop further away that that, as does Wizard with his SFPs (which is a 20 period ATR away from the tip of the fake out bar). This reduces the chance of further fake outs taking us out before price takes off.
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