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Higher low, lower high system

  • #7,001
  • Apr 9, 2014 4:23am Apr 9, 2014 4:23am
Have been having a discussion with someone on the 3 bar reversal indi and the comment was it doesn't work. It seems they were looking at the numerous signals and thinking this was some kind of take every signal indi.

The same trading ideas apply, assess the D and when you get a high probability trend signal then stick with that until you get to major SR levels and decide if you want to risk CT once flow changed.

Heres some aud charts with a D hl, morning star 3 bar reversal on 21 Mar highlighted. Apart from the pa confirmation for indi lovers we are above the 8lwma and RSI crossed up above the 50 level. From there its focus on buys, certainly until end Mar when we had some upper wicks that struggled to closed below the 8lwma for a few days. I have attached the 1hr chart with all the 3 bar reversals and then one with buys and focus at Asian session, LO and US.The blue ma is the 192 lwma to = the D 8lwma and the purple ma is the 32lwma to = the 4hr 8lwma. When the end Mar move lower failed can look to again buy the hl's.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: audusddaily.png Size: 39 KB
Click to Enlarge Name: audusdh1.png Size: 36 KB
Click to Enlarge Name: audusdh1 2.png Size: 34 KB
  • #7,002
  • Apr 9, 2014 4:38am Apr 9, 2014 4:38am
Quoting Vantage
Mrs V phoned to confirm EURAUD sell after the last shooting star neg close (counts as a 3 bar reversal as it closed below the last 2 closes). Confirmed its a sell but stop to BE asap as we have a strong support area just below. Will post charts later if trade works out.
The support level goes back to 30 Oct 2013, a major clear D turn level. Whilst we are on a D lower high and would therefore expect this level to fail we are 850 odd pips into move down so have different expectations, that includes moving to BE quicker than would otherwise be the case.
  • #7,003
  • Apr 9, 2014 8:33am Apr 9, 2014 8:33am
Over 7000 posts now, in over 5 1/2 years. Well done.
Gosh time does fly by.
  • #7,004
  • Apr 9, 2014 9:13am Apr 9, 2014 9:13am
Quoting zola
Over 7000 posts now, in over 5 1/2 years. Well done. Gosh time does fly by.
Cheers Zola yes it does when you're having fun.

Exited the above euraud sell at BE when the major support level held.

I know others (better traders than I) had bought euraud and gbpaud a little earlier but bought euraud 1.4733. We have the proven D support level just below 4700, double bottom back to 4 April, move below W M2 4718 failed, positive divergences, 1 hr hl earlier, another going into US session. Currency meter showing aud as 2nd weakest at the moment.

We are currently at the 4766 area where there were sellers coming in Asian session then we have W pivot at 4801 a good target for a CT trade until D confirms change in trend. Mrs V sees a big run up coming, time will tell.

CT rules apply. Mainly around the fact that we are at a proven SR level in market, flow changed over many hours.

Will post charts if trade plays out.
  • #7,005
  • Apr 9, 2014 9:18am Apr 9, 2014 9:18am
Quoting zola
Over 7000 posts now, in over 5 1/2 years. Well done. Gosh time does fly by.
And 10 or 11 of them contained some useful info .
  • #7,006
  • Apr 9, 2014 11:57pm Apr 9, 2014 11:57pm
Quoting Vantage
Bought euraud 1.4733. We have the proven D support level just below 4700, double bottom back to 4 April, move below W M2 4718 failed, positive divergences, 1 hr hl earlier, another going into US session. Currency meter showing aud as 2nd weakest at the moment. We are currently at the 4766 area where there were sellers coming in Asian session then we have W pivot at 4801 a good target for a CT trade until D confirms change in trend. Mrs V sees a big run up coming, time will tell. CT rules apply. Mainly around the fact that we are at a proven SR level...

Didn't like those pre news candles, exited +26.
Attached Image (click to enlarge)
Click to Enlarge Name: euraudh1.png Size: 44 KB
  • #7,007
  • Edited 3:53am May 21, 2014 3:42am | Edited 3:53am
I have been asked to start posting again.

OK here's one that got away. Euraud comes down to an obvious SR level from Oct/Nov '13, makes no progress lower for 3 days then has a positive close 3 bar reversal on 19th (close higher than previous 2 candle closes), above the 8lwma and rsi cross. All the boxes on D chart trade rules ticked, suggesting good move up and we should focus on buys.

On the 20th the first trade opportunity (1st trade is the best trade) unfortunately started in Asian session on Aus news if I recall so we missed on the 1hr higher low 3 bar reversal (close higher than prev 2 candle closes) back into trend.

This one got away but a perfect example of what we look for, doesn't get better than this.

Currently up around 120 on gu and will give some info on that next post.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: eurauddaily.png Size: 35 KB
Click to Enlarge Name: euraudh1.png Size: 35 KB
  • #7,008
  • Edited 4:08am May 21, 2014 3:50am | Edited 4:08am
The gu trade we are in.

Price comes down to a SR level (Feb body high, Mar highs) in the area 1.6741. On 15 May 1hr has a clear higher low (after divergence at the lows) off the support level. So our counter trend rules apply.

We entered above 1.6770. We are at W R1/1.6900 and might well exit here for over 120 which is acceptable for a CT trade.

Will post charts when trade finalised.
  • #7,009
  • May 21, 2014 9:21am May 21, 2014 9:21am
Quoting Vantage
The gu trade we are in. Price comes down to a SR level (Feb body high, Mar highs) in the area 1.6741. On 15 May 1hr has a clear higher low (after divergence at the lows) off the support level. So our counter trend rules apply. We entered above 1.6770. We are at W R1/1.6900 and might well exit here for over 120 which is acceptable for a CT trade. Will post charts when trade finalised.
OK heres the charts for the trade.

D strongly neg close on 14th so bias would have been down for the 15th. But we have come into a SR area from Feb/Mar and we are at a W pivot 1.6726. We have in this case macd 4 6 4 divergence on 1hr (and 4hr which I haven't shown). So our CT rules are met. Price shows for hours it does not want to go lower then we have the 1 hr higher low, positive close (there was a 15 min entry a little earlier).

Exit is just below the RN/W R1 for +121.

If I was going to find some criticism it would be on the exit and the chance that we could have had an 85/15 move and a chance to exit 15-20 pips above the RN. That would be nit picking though and 120 on what was a CT entry has to be a good trade.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: gbpusddaily.png Size: 38 KB
Click to Enlarge Name: gbpusdh1.png Size: 40 KB
  • #7,010
  • May 22, 2014 2:31am May 22, 2014 2:31am
Quoting Vantage
I have been asked to start posting again. OK here's one that got away. Euraud comes down to an obvious SR level from Oct/Nov '13, makes no progress lower for 3 days then has a positive close 3 bar reversal on 19th (close higher than previous 2 candle closes), above the 8lwma and rsi cross. All the boxes on D chart trade rules ticked, suggesting good move up and we should focus on buys. On the 20th the first trade opportunity (1st trade is the best trade) unfortunately started in Asian session on Aus news if I recall so we missed on the 1hr higher...
Welcome back. Your insights are always appreciated.

Please critique my AU trade.

AU in down trend on daily as per RSI. Yesterday downward movement was halted with a small daily pin bar at resistance from the 3rd April and 2nd of May.

On hourly price has shown it does not want to go down, and there is also divergence on the RSI (no divergence on 4 Hr)

I entered after close of the large range bullish bar, which was also a reversal bar. I am aware that this is outside of LO, but done as Aus market was open.

Have set an order in case of a small retracement.

Regards
Attached Image (click to enlarge)
Click to Enlarge Name: audusdh1.png Size: 82 KB
  • #7,011
  • May 22, 2014 7:29am May 22, 2014 7:29am
Quoting mt2
{quote} Welcome back. Your insights are always appreciated. Please critique my AU trade. AU in down trend on daily as per RSI. Yesterday downward movement was halted with a small daily pin bar at resistance from the 3rd April and 2nd of May. On hourly price has shown it does not want to go down, and there is also divergence on the RSI (no divergence on 4 Hr) I entered after close of the large range bullish bar, which was also a reversal bar. I am aware that this is outside of LO, but done as Aus market was open. Have set an order in case of a small...
Its a fair enough trade, the move up caused by the Chinese news, with the D candle looking to reject the lows from end Apr/early May.

My only question would be its CT (I look to protect myself/position asap) and so what did you do when LO suggested the move up might not have legs, see the arrow down lower high?
Attached Image (click to enlarge)
Click to Enlarge Name: audusdh1.png Size: 37 KB
  • #7,012
  • May 22, 2014 8:26am May 22, 2014 8:26am
Hi Dave,

I cancelled the other order i had, but kept the initial trade to play out. Will give some consideration to exit rules on CT trades.

Thanks for your input.

EA looks promising for a short at close of last 1 hr candle.
  • #7,013
  • May 22, 2014 8:41am May 22, 2014 8:41am
Quoting mt2
Hi Dave, I cancelled the other order i had, but kept the initial trade to play out. Will give some consideration to exit rules on CT trades. Thanks for your input. EA looks promising for a short at close of last 1 hr candle.
Yes, euraud looks promising. I was away from desk will hear later if Mrs V saw it/liked it/entered.
  • #7,014
  • May 22, 2014 8:55am May 22, 2014 8:55am
Quoting Vantage
{quote} Yes, euraud looks promising. I was away from desk will hear later if Mrs V saw it/liked it/entered.
Mrs V sold euraud 1.4780. Charts to follow if trade plays out.

For what its worth euraud a decent set up. Yes D has a negative close shooting star and 1.4830 is a SR level from 27 Mar to 18 Apr but hasn't closed anywhere near the 8lwma, rsi above 50. So could still go either way I suppose. We have it seems rejected 62 fib retrace of the move 2 May - 15 May.

4hr on the other hand is below rsi 50 and last close I have a decent upper wick. So it might be an early entry before D confirms. So its a decent set up but in the absence of D confirmation not for me the best.
  • #7,015
  • May 23, 2014 1:42am May 23, 2014 1:42am
Quoting Vantage
{quote} Mrs V sold euraud 1.4780. Charts to follow if trade plays out. For what its worth euraud a decent set up. Yes D has a negative close shooting star and 1.4830 is a SR level from 27 Mar to 18 Apr but hasn't closed anywhere near the 8lwma, rsi above 50. So could still go either way I suppose. We have it seems rejected 62 fib retrace of the move 2 May - 15 May. 4hr on the other hand is below rsi 50 and last close I have a decent upper wick. So it might be an early entry before D confirms. So its a decent set up but in the absence of D confirmation...
At the moment currency meter is showing aud by far the strongest, 1hr is on a lower high also so that looks good. There is support around 1.4740 and if we can push below there should be a very nice trade. We'll see.
  • #7,016
  • May 23, 2014 3:03am May 23, 2014 3:03am
Quoting Vantage
{quote} At the moment currency meter is showing aud by far the strongest, 1hr is on a lower high also so that looks good. There is support around 1.4740 and if we can push below there should be a very nice trade. We'll see.
Playing with the Asian session lows 1.4755, stop to -5.
  • #7,017
  • May 23, 2014 3:41am May 23, 2014 3:41am
Hi Dave,

I have taken the following Usd/Jpy long.

Almost PB of the 21st pushed RSI above MA on daily. Looking for longs with trend. Missed opportunity yesterday. This morning price retraced before being stopped by a nice PB on hourly. Waited for the close of the next bar, which completed a 3 bar reversal to enter.
Attached Image (click to enlarge)
Click to Enlarge Name: usdjpyh1.png Size: 42 KB
  • #7,018
  • May 23, 2014 3:51am May 23, 2014 3:51am
Quoting mt2
Hi Dave, I have taken the following Usd/Jpy long. Almost PB of the 21st pushed RSI above MA on daily. Looking for longs with trend. Missed opportunity yesterday. This morning price retraced before being stopped by a nice PB on hourly. Waited for the close of the next bar, which completed a 3 bar reversal to enter. {image}
Nice, there were clear support levels from Feb - Apr 101.40 down to 100.70 and the pins on 19 and 21 May gave good signal that move lower was rejecting. We are in from 101.46, should we push through the 13 May high 102.30 ish and then perhaps the April double top 102.70 becomes target.
  • #7,019
  • Edited 4:15am May 23, 2014 4:08am | Edited 4:15am
Quoting Vantage
{quote} Nice, there were clear support levels from Feb - Apr 101.40 down to 100.70 and the pins on 19 and 21 May gave good signal that move lower was rejecting. We are in from 101.46, should we push through the 13 May high 102.30 ish and then perhaps the April double top 102.70 becomes target.
One of my kind of friends/unofficial mentorees asked me to look at eur and comment with the D lower wicks and ask about the possible sell on move down. Why would this be a sell and uj was a buy with lower wicks.

For me it comes down to flow. UJ after the D hammer/pin on 21st May had a hl in Asian session on 22nd, a 1hr positive close 3 bar reversal, the hl's continued going into US session.

EUR's D hammers on 15th and 21st were followed by a neg D close and 1hr flow down. See the 1hr chart what we are trying to suggest is a trade, why 'cherry pick' the move lower that works. Well the flow is still on LH, LL, its the only 1hr neg close 3 bar reversal (closes below previous 2 candles closes sorry had candles lows here a typo must be candle closes) where price moves below the candles low to trigger a trade. You'd have to ask yourself if you are comfortable with the gap between the low/w pivot and entry but if you were happy with that then its otherwise a system sell.

In summary then its the flow, uj D lower wick and flow that followed was up, eur D lower wick followed by D neg close and 1hr flow that followed still down.

I didn't take just my 2c in terms of how we look to trade.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: eurusddaily.png Size: 40 KB
Click to Enlarge Name: eurusdh1.png Size: 36 KB
  • #7,020
  • May 23, 2014 4:10am May 23, 2014 4:10am
Quoting Vantage
{quote} Playing with the Asian session lows 1.4755, stop to -5.
Stop at BE which should mean we take euraud trade off at whatever its giving us but decided to stretch this rule (stretch as in break but what the heck).
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