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B.S. Trading with Kenneth Lee

  • #6,041
  • Edited 2:47pm Feb 4, 2014 2:02pm | Edited 2:47pm
Tryed to short this supply zone on nzl but stop above was hit.

Was that drop base drop a good supply zone or was crap? Tought it would have worked because at an important support/resistance level but didn't.

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  • #6,042
  • Feb 12, 2014 7:34pm Feb 12, 2014 7:34pm
Quoting optimusfx
I have a question, maybe somewhere here there is already the answer, so forgive me i'm reading this thread from start: If a level forms when reacting to another level and makes a good move with strong momentum from it, should we consider it as a new fresh level or a non-fresh level because it reacted to another? Look at this chart below: there were a few reaction to a supply on the left, then price dropped from a rally-base-drop formed in the level with good momentum and breaking support levels. Is it a new fresh level or only a reaction? I know...
One rarely written rule I use is that if it's too busy to the left, if price already spent some significant time there in the recent past, it's probably not much for lots of fresh orders. As far as them forming from other levels or looking like reactions...if you look closely enough often times you will find this is the case. Ignore it - if everything else fits the profile and you're picky with your entries, it's worth the risk.

Quoting optimusfx
Tryed to short this supply zone on nzl but stop above was hit. Was that drop base drop a good supply zone or was crap? Tought it would have worked because at an important support/resistance level but didn't. {image}
This wasn't a drop base drop. This was something else that *could* have worked out but just happened not too (perhaps a news event? stay far away from news when entering), but that's beyond the scope of this thread. What you should take a look at though are some of the lower frames - not the really small ones but maybe the M30 and M15 to see what was really going on there.
  • #6,043
  • Feb 12, 2014 7:44pm Feb 12, 2014 7:44pm
Quoting Kanzler
{quote} One rarely written rule I use is that if it's too busy to the left, if price already spent some significant time there in the recent past, it's probably not much for lots of fresh orders. As far as them forming from other levels or looking like reactions...if you look closely enough often times you will find this is the case. Ignore it - if everything else fits the profile and you're picky with your entries, it's worth the risk. {quote} This wasn't a drop base drop. This was something else that *could* have worked out but just happened not...

Couldnt agree more with kanzler. Time spent is often overlooked, chances are most orders have been filled, the more price remains n an area the more consumption is taking place

I only ever use non original fresh levels (reaction) in the beginning of a momentum play with trend.
Bye Bye FF
  • #6,044
  • Feb 12, 2014 7:54pm Feb 12, 2014 7:54pm
Quoting optimusfx
I have a question, maybe somewhere here there is already the answer, so forgive me i'm reading this thread from start: If a level forms when reacting to another level and makes a good move with strong momentum from it, should we consider it as a new fresh level or a non-fresh level because it reacted to another? Look at this chart below: there were a few reaction to a supply on the left, then price dropped from a rally-base-drop formed in the level with good momentum and breaking support levels. Is it a new fresh level or only a reaction? I know...
Also remember the level you have marked as original at the very left is also a reaction to a smaller dbd above just below pivot. (sorry can't mark chart at moment
Most of the time peaks and mini and major pullbacks are reactions
Bye Bye FF
  • #6,045
  • Feb 13, 2014 7:25pm Feb 13, 2014 7:25pm
Here is one on the AUD/USD that is getting close to my limit order. It could get hit any minute.

AUD/USD 1 HOUR CHART
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  • #6,046
  • Feb 13, 2014 7:42pm Feb 13, 2014 7:42pm
Quoting Jeff A.
Here is one on the AUD/USD that is getting close to my limit order. It could get hit any minute. AUD/USD 1 HOUR CHART {image}
Why are you trading that? I don't see it as very good odds.
  • #6,047
  • Feb 13, 2014 8:03pm Feb 13, 2014 8:03pm
Quoting Jeff A.
Here is one on the AUD/USD that is getting close to my limit order. It could get hit any minute. AUD/USD 1 HOUR CHART {image}
Hey Jeff A,
I'm looking for a short on this one too. Looks very good to me if the PA cooperates. Weekly trend down. Seems a lot of sellers should be lurking here. If not PA will tell. Made nice pips on this one already. Check out my threads.
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  • #6,048
  • Feb 13, 2014 8:06pm Feb 13, 2014 8:06pm
Quoting Kanzler
{quote} Why are you trading that? I don't see it as very good odds.
Hey Kanzler,
This looks good to me. Like to hear your cons though
  • #6,049
  • Feb 13, 2014 8:08pm Feb 13, 2014 8:08pm
Quoting Winston Reed
{quote} Hey Kanzler, This looks good to me. Like to hear your cons though
Just the lack of structure on my part...seems like a place a lot of support/resistance retail traders would sell at as well. I have a feeling they might try to jam through some move before it drops in order to hit stops.

To your and his credit though, the rejection from the area was pretty pronounced and a quick trader could have gotten a 1xRisk trade on his marked area. I guess we'll see if it makes a continuation or not.
  • #6,050
  • Feb 13, 2014 8:11pm Feb 13, 2014 8:11pm
Quoting Kanzler
{quote} Just the lack of structure on my part...seems like a place a lot of support/resistance retail traders would sell at as well. I have a feeling they might try to jam through some move before it drops in order to hit stops. To your and his credit though, the rejection from the area was pretty pronounced and a quick trader could have gotten a 1R on his marked area.
Can't disagree with you K. Very well could be the case. We'll see what PA has to say. I'm looking for an engulf south. If not then next pair.
  • #6,051
  • Feb 13, 2014 8:22pm Feb 13, 2014 8:22pm
Just FYI, when I refer to structure I mean something like this. Clean, pleasing to the eye, and high probability. Probably one of the biggest winning trades anybody could have taken today, although I missed it and wouldn't have held long enough to reap the profit you'd be holding right about now. Swissy has a habit of these kinds of opportunities....a couple months ago I made my single most profitable trade ever holding a setup like the one below, and ended up making something like 28x my risk.
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  • #6,052
  • Feb 15, 2014 8:37pm Feb 15, 2014 8:37pm
Quoting Jeff A.
Here is one on the AUD/USD that is getting close to my limit order. It could get hit any minute. AUD/USD 1 HOUR CHART {image}
Hope it worked out for yas (awayfrom pc so can't see)

The level had nice drop, and looked like a flip area but it's an immediate retest to the tiny one above left, which also could be a test of above left. I'm in theprocess of testing these type of areas by instead looking for confirmations on a lower tf via pa. Unless its a perfect level, in right location than happy with Limit order.
All the best with it
Bye Bye FF
  • #6,053
  • Edited Feb 21, 2014 2:48am Feb 20, 2014 3:34pm | Edited Feb 21, 2014 2:48am
Hi everyone!


Took this loss today

Went short on audusd at a level that I considered the origin of the downmove on M15 but price blowed it up, then i checked H1 and seemed that the level was wider and already gave his reaction.

When I go to lower time frame and select the level with tighter stop, if price have a reaction before hitting the deeper level should i consider the level already consumed or still can try to trade the reaction at the origin? If i select a tight level on LTF of a bigger level, the price should go straight deep in the level without have decent reaction at the HTF proximal line?

Also have some problem applying odd enhancers, I don't understand when i should worry about how price is approaching to the level and when not, if is good to see rejection before level is touched or not (is rejecting or consuming?) and the bigger picture odd enhancer, sam seiden say that when price is high we look for selling opportunities and when is low on chart we look for buying opportunities, even if price didn't already reacted and moving away from a HTF supply or demand level, and Ken say that if price is in the upper half of the screen we should look to buy and viceversa, but if price is in the higher half of the screen aren't we buying high?

The best tradable levels are at the extremes and are RBD/DBR? We don't have to trade levels in the middle of moves? How should we know exactly if a level is fresh or not? because I see in the chart that nearly every RBD/DBR is a reaction to something to the left (like it is reacting to previous RBD or at a swap level or at speedbumps during a trend) , the only fresh level that I can imagine are the swap levels (like RBR that forms after a supply is consumed and now that RBR is fresh demand).


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p.s. thanks for your answer Kanzler and Chica
  • #6,054
  • Feb 21, 2014 3:42am Feb 21, 2014 3:42am
[quote=optimusfx;7295333]Hi everyone! Took this loss today Went short on audusd at a level that I considered the origin of the down move on M15 but price blowed it up, then i checked H1 and seemed that the level was wider and already gave his reaction.
Here is how I would have played it based on 1 hour charts. As a general rule I always check multiple time frames to enter. Even if your entry was based on M15 and you saw reaction little lower from your original entry and a reasonable reaction down, the best option was to cancel order, as the expected reaction at the level was already played out and very likely price would go deeper into the level and might trigger stops above the level on second approach.
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The purpose of knowledge is action, not knowledge
  • #6,055
  • Feb 21, 2014 8:49am Feb 21, 2014 8:49am
Another loss, and it is not the only one. Lost many trades in a row. Seems that all my levels get blown up....can't figure out why.

This one seemed a nice RBD.


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and this yesterday

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  • #6,056
  • Feb 21, 2014 7:32pm Feb 21, 2014 7:32pm
Quoting optimusfx
Another loss, and it is not the only one. Lost many trades in a row. Seems that all my levels get blown up....can't figure out why. This one seemed a nice RBD. {image} and this yesterday {image}
Hello OptimusFX,
This is my AUDUSD chart. Trading on limit orders at "discrete levels" is tough. This is touch trading and IMHO few are able to do this successfully. If it were as easy as going short at supply and long at demand we would all be very rich. Watching PA as price enters or nears a level is crucial. Price was very bullish at it entered the first level but when it hit the next level it turned bearish. Personally I like a good engulf in the direction of my trading. Hope this helps a bit.

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  • #6,057
  • Feb 21, 2014 7:54pm Feb 21, 2014 7:54pm
Quoting alifari
Quoting optimusfx
Hi everyone! Took this loss today Went short on audusd at a level that I considered the origin of the down move on M15 but price blowed it up, then i checked H1 and seemed that the level was wider and already gave his reaction.{quote} Here is how I would have played it based on 1 hour charts. As a general rule I always check multiple time frames to enter. Even if your entry was based on M15 and you saw reaction little lower from your original entry and a reasonable reaction down, the best option was to cancel order, as the
...
Hey Alifari,,

Very good analysis on the Swaps.



TSD
  • #6,058
  • Feb 21, 2014 8:05pm Feb 21, 2014 8:05pm
Quoting optimusfx
Another loss, and it is not the only one. Lost many trades in a row. Seems that all my levels get blown up....can't figure out why. This one seemed a nice RBD. {image} and this yesterday {image}
Hi, optimusfx

Here is how I would look at that EA chart. The level you picked is what Sam would probably call a pivot, not a supply/demand level. The real supply is above, while the place you placed your order is a retracement for a second leg down.

I know it's easier to say with hindsight, one thing I find quite useful is to always look at those long big thrusty momentum bars. Those bars are areas without much back and forth price actions and so look like an empty space. These are areas that will most likely (in fact almost 100% if some would take a bit more time rather than immediately) get revisited. According to some other PA gurus, they call that 'liquidity gap' areas, which means areas without much liquidty/orders at the time of its occurrence because price moves too fast too quickly, and so there are orders waiting or trapped orders trying to get out break-even. And if you put on fib, price reversed at 76.4%. That fib level (76.4 or 78.6) is really a golden fib level that would most often produce some reaction.

On the chart you can see the red line, that is also a potential support level on the way down, it didn't hold because of strong down side momentum. Therefore, there were probably also some long orders there waiting to get out b/e, which also provided reaction to the down side, flipping from support to resistance.

Hope this can be of some use.

Best of luck
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  • #6,059
  • Feb 21, 2014 8:33pm Feb 21, 2014 8:33pm
Quoting Winston Reed
{quote} Hello OptimusFX, This is my AUDUSD chart. Trading on limit orders at "discrete levels" is tough. This is touch trading and IMHO few are able to do this successfully. If it were as easy as going short at supply and long at demand we would all be very rich. Watching PA as price enters or nears a level is crucial. Price was very bullish at it entered the first level but when it hit the next level it turned bearish. Personally I like a good engulf in the direction of my trading. Hope this helps a bit. {image}
Hi Winston,

If I may add ? These are excellent examples: Look at the structure of the Supply level you picked. Starting at the Feb @ 17:00.. See how price made a significant move up. Spent little time.. ( 1 candle in this example ) then went right back down .. A Rise Base Drop "Pattern" There you drew your level. Interesting how price made a VERY LARGE PIN inside this level on its first visit.
Now lets look at 20 Feb @ 17:00..We see a small Rise 1candle- a Base = 3 Candles - then a Drop= major...Price returns back this area..( I consider this to be a new Supply ) price then drops for a 20PIP short.
This supple pattern repeats itself over and over. This is one of the ways I define my levels
Go Back to 19 Feb @ 1:00.. See the small Drop-Base ( 1 candle ) -Rise. This created the Demand level 19 Feb @ 5:00.

Look at the 20Feb @ 9:00 Demand..Looking Right you can see how price PIN'd this Demand through the lower part of the Demand Level and may be forming a Base ( looking farther right ) for a potential return to the 8982 Swap. If broken we may see a possible push to 8987 Swap and if that is broken we may get back up to 9000.. BRN... Will see???? The key for me at any of the levels is how price approaches and what price does one it gets there.

I also will use the Drop-Base-Drop or Rise-Base-Rise to define S/D levels.. but that's for another discussion.

Just my 2 pips as this chart has alot going on. This chart offers examples to see these very supple ways of picking levels. I do not see a lot, if any, discussion very specific to this type/style of picking levels. Yet it is in keeping with S/D method and core principal..How price should spend very little time at a level that helps define the level. It is a more supple and defined structural view of the Drop-Base-Rise/Rise-Base-Drop pattern in determining levels. Picking levels can ne challenging for some. When trading in the lower TF's as I do, this really helps me define levels and TP's.

Hopefully this may help some others trying to pick better levels.

Thank you for letting me share.

Good trading to all

TSD
  • #6,060
  • Feb 21, 2014 8:44pm Feb 21, 2014 8:44pm
Quoting TraderinSD
{quote} Hi Winston, If I may add ? These are excellent examples: Look at the structure of the Supply level you picked. Starting at the Feb @ 17:00.. See how price made a significant move up. Spent little time.. ( 1 candle in this example ) then went right back down .. A Rise Base Drop "Pattern" There you drew your level. Interesting how price made a VERY LARGE PIN inside this level on its first visit. Now lets look at 20 Feb @ 17:00..We see a small Rise 1candle- a Base = 3 Candles - then a Drop= major...Price returns back this area..( I consider...
Hello TraderinSD,

I have gone to some lengths in my trading to discard the jargon associated with so-called suppy/demand trading. Not to say that what you are saying isn't valid. It absolutely is!!! I know many will only understand it in the terms you describe and I too will refer to it when helping others. Yet I dont talk about it in that way if possible because many relate to it as OptimusFX has done. "Trading short at supply and long at demand." Looking at it so simplistically will lead to consistent losses. I look at the market where price has move dramatically in one direction or the other and how price reacts to these areas when it comes back to them. The reaction to the so-called supply/demand is crucial.

Oh yes. I know Sam Sieden is viewed by many as the guru of supply and demand. Maybe he is. I wouldn't know because I can't afford the exorbitant sums he charges for his course/s. Hmmmm. A lot of money he's making on his website. Many rely on his "free" videos to underpin their trading methodology. I am still quite sceptical and will remain so as I will never pay for his OTA courses. Hehe!
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