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4 Hour Strategy (MACD)

  • #27,781
  • Jul 2, 2014 8:49pm Jul 2, 2014 8:49pm
Quoting nic73
I have posted questions on posts 27768 and 27774. Can someone help me please. Thank you.
Howdy Nic,
I have left Yvon to reply to your question on post 27768 as it deals with the post by him. Yvon - can you have a look at this for Nic please.

I included a reply to your query on the 27774 post and it is part of the one I made on 27777.

Have a read & see if that helps.

Cheers mate
  • #27,782
  • Jul 2, 2014 10:39pm Jul 2, 2014 10:39pm
Quoting binnie
{quote} Howdy Nic, I have left Yvon to reply to your question on post 27768 as it deals with the post by him. Yvon - can you have a look at this for Nic please. I included a reply to your query on the 27774 post and it is part of the one I made on 27777. Have a read & see if that helps. Cheers mate
that is for Nic,

Ok, here is my view on the BOZ subjectI remember having a post about that subject few months ago)
First I refer to Phillip Nel’s drawing…see…it just bounce on it then move away (TC). drawing from a pdf from page 1

Sometime price bounce on the 21ema, but sometime it breaks a little the 21ema then bounce back above the 21ema.
Do I trade the break of 21ema (or Zero on the macd)? Well the rules say that there should be a pull back to the 21 and a move away to consider a possible trade there…unless there is a RB which the number of candles are significant. But in the case you have mentioned (the first example) their number doesn’t cover the minimum, that should be around 5 candles, but in this case won’t apply.
The second example: this one has a decent number of bar so I could consider a trade here, but again it has the same effect of a TC! And more then that, look at the positive divergence the Mac is making, so it would certainly lead to a bullish trade there.
The third example would look to me a bounce or a TC.

The comments are importants in Phillip’s drawings. He mentioned that …are “normally a strong move”
Then look again at the chart, there are some strong candles right around those bounces.

For me, taking those expressions separately is like taking a picture of someone holding a door knob. Is he/she getting out or getting in or just checking if the door is locked or trying to steal that door knob?
Names are there to start recognizing what the market is trying to tell, what could happen. But at least he/she is holding a door knob! By looking at them like reading a book, to see a story, your own story based on the rules, you will see the motion in the macd as well as the candles themselves. You will have a clearer idea if it is a break of zero or a bounce…sometime in advance!

Here’s what Phillip Nel says in POST no. 3

Quoting MikeC
Thanks for posting your system. I am relatively new at this, so I will have to look it over a few times to be able to recognize entries. The conistent volume of pips is encouraging.
"That is what everyone should do. Go to history and look at the MACD till you see the motion and the setups."

It is pretty hard for me to explain what a move “is”, without observing the history. And my guess is that history could differ from one to another.

For sure, when the macd is around the Zero line for sometime , be carefull of what you are doing…
When it bounces, it is a continuity of the trend.(there’s maybe a strong candle around!)
When it diverge, expect that the pair could change direction or slowdown (from the 8 to the 21, from the 21 to the 89…etc).

Taken from post 17
Phillip Nel:
"The horizontal lines is just there to show overbought and or sold levels especially on the EurUsd. Sometimes the movement is close to the zero and within the fisrt MACD zone. I only use it as benchmarks as to where the MACD are at the moment. If one zooms in then you dont loose sight of the position of the MACD.
The MACD does not have to reach certain levels. It is only when it zig zag accross the zero that one must be carefull but it happens when the price is in a narrow channel waiting for a breakout"

For sure he wants to know where the macd is at the moment.
And when it zigzag price is in a narrow channel waiting for a breakout.( he knows that)

Taken from post 31
Phillip Nel:

Just want to add that the rule says that when the price goes through the 89SMA it tends to pull back to the 21EMA before proceeding the trend. We have a situation now where the price went down through the 89SMA and has pulled back to the 21 EMA. Be aware of that. I have set my stoploss at 1.2905(10 below entry) to combat the move should the price comes down. The MACD will show me when the trend is continued below the 89SMA and then I will enter short.

By using the rules, Phillip Nel has elaborated a story there!
From that story, he knows that the macd will show him “when” and later he knows “when” he will enter short. And all of this will be part of his history to go further.

Again, here I am not sure if I made it clearer for you or not! I just whish it won’t get to you as confusions,

Yvon
Yvon
  • #27,783
  • Jul 2, 2014 10:58pm Jul 2, 2014 10:58pm
Quoting nic73
Got killed on this one. Again. Can someone tell me what I have done wrong? {image}
Hi! I think it was bad moment for trade.
Yesterday came the really big news (ADP Non-Farm Employment Change). You shouldn't rely on indicators in this case. You can trade after the news when market calms down.

Best regards, Pavel.

P.S.: Sorry for my engish. I use google translate
  • #27,784
  • Jul 3, 2014 1:07am Jul 3, 2014 1:07am
Quoting binnie
KIWI causing problems: Hi Guys - I see some issues with the Kiwi trades. I too entered last nite and then headed for bed. I was aware of some USA employment news due overnite but was happy to trust what price had just shown me. The anticipation was for a break below the H & S neckline followed by a pullback then Move Away. The breakout & close under the neckline did happen BUT the next candle made a bullish return and actually closed above the 21ma ( back inside the H & S pattern ). To me this signalled - hey, just wait a minute. What is the rythym...
So did you strike lucky and close your sell without a loss or flip flopped and closed the sell with a loss and entered long?

It's not over yet, the bias is bullish for sure, all day yesterday watching the trade, i was thinking what the hell, everything is telling me to buy! .

The short trade is still open...it can still happen, the H1 is slowly moving bearish at the moment of typing..(in my dreams)
  • #27,785
  • Jul 3, 2014 2:19am Jul 3, 2014 2:19am
Quoting yaakruay
{quote} So did you strike lucky and close your sell without a loss or flip flopped and closed the sell with a loss and entered long? It's not over yet, the bias is bullish for sure, all day yesterday watching the trade, i was thinking what the hell, everything is telling me to buy! . The short trade is still open...it can still happen, the H1 is slowly moving bearish at the moment of typing..(in my dreams)
Hey there Richard,
When price moved back inside the H & S neckline and closed back above the 21, the macd gave me ZB to go long. My anticipation for a short was cancelled. I have been in my long for just on 6 candles. Like pulling teeth. Trade went ok for a while until the strong US news last nite pushed me down almost to my Stop. I recovered through today but then Shitty AUS news dragged the poor old Kiwi down again almost to my stop for a 2nd time. I have been watching all day for the recovery and was looking to be happy to get out at B/E after all these hours. Finally out a few minutes ago for -11pips when price moved back below the 21ma.
I made a decision now to cut the loss - I think Phillip even told us a few times that we should not get hooked into a trade that spreads across such a long period.
The chart shows the update shortly before my pulling the pin and getting out.
Market 1 Binnie 0

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  • #27,786
  • Jul 3, 2014 2:53am Jul 3, 2014 2:53am
Quiet Night - major news from USA is coming. Then the weekend is here again. Gees it comes round too quick.
Catch up later once the dust has settled.
  • #27,787
  • Edited 4:49pm Jul 3, 2014 10:20am | Edited 4:49pm
I just got short on this one , quite late, if not very late to get decent pips out of it.
free ticket now...
About 30 pips secured-----trade closed, hit by SL
Attached Image (click to enlarge)
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Yvon
  • #27,788
  • Jul 3, 2014 2:49pm Jul 3, 2014 2:49pm
Quoting trademin
I just got short on this one , quite late, if not very late to get decent pips out of it. free ticket now... About 30 pips secured {image}
Nice Play Yvon,
What a great example of how we anticipate a move using the rythym.
Hope you still going here??

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  • #27,789
  • Jul 3, 2014 4:50pm Jul 3, 2014 4:50pm
Quoting binnie
{quote} Nice Play Yvon, What a great example of how we anticipate a move using the rythym. Hope you still going here?? {image}
no , I'm out since I had to leave soon, but still glad for the profit there,

BTW: I 'm wearing the FF T-shirt
Yvon
  • #27,790
  • Jul 3, 2014 5:26pm Jul 3, 2014 5:26pm
Quoting trademin
{quote} no , I'm out since I had to leave soon, but still glad for the profit there, BTW: I 'm wearing the FF T-shirt
Mine hasn't arrived yet - long way to NZ or they got lost (LOL)
Weekend plans are out to a friends home for dinner tomorrow nite ( Sat here ).
Also walking everyday to help with the back recovery. Just done todays 4km. My better half will want to go with me tomorrow so expecting a 6km effort.
Also have some emails to answer so will be kept pretty busy.
Have a relaxing weekend everyone. I am looking forward to a few beers & perhaps a wee Bourbon tomorrow.
  • #27,791
  • Edited Jul 4, 2014 7:39am Jul 3, 2014 6:20pm | Edited Jul 4, 2014 7:39am
Quoting binnie
{quote} Mine hasn't arrived yet - long way to NZ or they got lost (LOL) Weekend plans are out to a friends home for dinner tomorrow nite ( Sat here ). Also walking everyday to help with the back recovery. Just done todays 4km. My better half will want to go with me tomorrow so expecting a 6km effort. Also have some emails to answer so will be kept pretty busy. Have a relaxing weekend everyone. I am looking forward to a few beers & perhaps a wee Bourbon tomorrow.
just a suggestion here. I have been going to a chiropractor for the last 30 years, he doing a great job on me... you should try one if you aren't already, it could help your back., but anyway, have a nice recovery, nice weekend,
Yvon
  • #27,792
  • Jul 3, 2014 8:26pm Jul 3, 2014 8:26pm
Hi Yvon,

Yes I have asked about BOZ before and one of you replied and I understood BOZ from then on.

I could not quite figure out the charts and examples you were referring.

On post 27782:
To trade 21ema break,

Either you look for a round bottom / top when price break the 21ema (which may also be break of the zero level on MACD);
Or you wait for BPM on 21ema (this is IF you don't see a RB/RT). Is that correct?

I need to once more refer to the chart you have posted and have these questions to about trading when market breaks the zero level:

Referring to the trades marked T1 and T2. Did you trade these ones? Did you enter trade when the candle (the one that went through the zero level on the MACD) closed?

When market breaks the zero MACD level and stayed above it at close, is this a continuous trend? And can be traded?

If you traded T1 and T2, there was no RB/RT. And did you wait for price to pull back to 21ema and move away before you took the trade?

Attached Image (click to enlarge)
Click to Enlarge Name: MACD_0_Level.png Size: 447 KB

Thanks. Nicholas
  • #27,793
  • Jul 3, 2014 8:36pm Jul 3, 2014 8:36pm
Hi Severn and Binnie,

Thanks for your input. You guys were right about the red news on employment and my SL. I disobeyed my analysis - I initially set my SL a few pips the previous low but decided against it adjusted that the few pips below 21ema instead. That killed me. I know where I have gone wrong now.

Nicholas.
  • #27,794
  • Jul 3, 2014 11:13pm Jul 3, 2014 11:13pm
Quoting nic73
Hi Yvon, Yes I have asked about BOZ before and one of you replied and I understood BOZ from then on. I could not quite figure out the charts and examples you were referring. On post 27782: To trade 21ema break, Either you look for a round bottom / top when price break the 21ema (which may also be break of the zero level on MACD); Or you wait for BPM on 21ema (this is IF you don't see a RB/RT). Is that correct? I need to once more refer to the chart you have posted and have these questions to about trading when market breaks the zero level: Referring...
I'll get back to you a bit later
-, time to write answers to your questions.
Yvon
  • #27,795
  • Edited 1:41am Jul 4, 2014 1:05am | Edited 1:41am
Any sHs gurus here (Yvon) (Binnie too)

Is this a sHs...i know its gone but i need to see them first before i can start anticipating that right shoulder and break of neckline.

Is the toot, toot, tooting Yvon so expertly described previously.....



Binnie, bourbon sure helps with any aches, they sure don't hurt while pissed!
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  • #27,796
  • Jul 4, 2014 1:07am Jul 4, 2014 1:07am
I'll be watching this next week...

That run up has come to an end, just waiting for a tail fake break out, stop loss hunt or what ever they are called.

Next week i will be looking to sell. 1.7800 BRN has to be a strong ceiling and will get rejected.

Have a good weekend all..

Football is great tonight...Brazil and Columbia...should be a terrific match....
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  • #27,797
  • Edited 2:41am Jul 4, 2014 2:24am | Edited 2:41am
Quoting yaakruay
Any sHs gurus here (Yvon) (Binnie too) Is this a sHs...i know its gone but i need to see them first before i can start anticipating that right shoulder and break of neckline. Is the toot, toot, tooting Yvon so expertly described previously..... Binnie, bourbon sure helps with any aches, they sure don't hurt while pissed! {image}
there is my humble view on it...
My guess to get familiar with HS Is to start looking for RT, But to find RT you have to find the rhythm of the market., so eventually it will help you “anticipate”
The example here is quite evident. This is the kind you should start looking first. Go through all chart, go to any time frame, the only reason is to get familiar with smooth rhythm of the market, not to trade yet, just to get familiar with the rhythm of the market. Observe the ma’s paving gently the way for the candles so they can dance , giving their expression freely.
Observe the price climbing above the 21ema, then pullback to the 21ema and again moving up above the ma then again… By doing so you will get familiar with nice ,smooth rhythm. Then start incorporate the RT, the break pull back, move away, but do that only on smooth rhythm that you will find.
Enjoy the ride the rhythm will provide you with,
observe the macd while there is the third RT, is there any divergence with the chart? you can then , after familiarisation look for RB and again look for smooth riding adventure...

...I just forgot to mention that sometime there is a Strong Candle at the breakout, since a lot of traders have "Anticipated" the direction of the market in advance...!
Attached Image (click to enlarge)
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Yvon
  • #27,798
  • Jul 4, 2014 10:23am Jul 4, 2014 10:23am
Quoting nic73
Hi Yvon, Yes I have asked about BOZ before and one of you replied and I understood BOZ from then on. I could not quite figure out the charts and examples you were referring. On post 27782: To trade 21ema break, Either you look for a round bottom / top when price break the 21ema (which may also be break of the zero level on MACD); Or you wait for BPM on 21ema (this is IF you don't see a RB/RT). Is that correct? I need to once more refer to the chart you have posted and have these questions to about trading when market breaks the zero level: Referring...
Hi Nic,
"To trade 21ema break,

Either you look for a round bottom / top when price break the 21ema (which may also be break of the zero level on MACD);
Or you wait for BPM on 21ema (this is IF you don't see a RB/RT). Is that correct?"

I look first for the rhythm and what the anticipation is, then the figures will confirm what the market is telling and I will act accordingly.

"Referring to the trades marked T1 and T2. Did you trade these ones? Did you enter trade when the candle (the one that went through the zero level on the MACD) closed?"
I know It Is a long story!
First I wasn’t trading forex at that time, that example is from before my time.
.
About T1:
“Shortly” knowing that the ma’s are in an up trend at that point, accepting that the dip below zero line is just for me a TC with too much weight, just starting learning the twist of “hit or miss” the water in order to get the flies there! I would certainly take that trade as shown… I agree with Phillip Nel!

between T2 and the little red circle on the left, the macd pulled back to zero, making a bullish divergence, I certainly would have taken that trade at T2 and I whish I would have stayed in it up to the last high 1.2330 aprox (the left top), with a SL climbing manually at about 60 pips behind, (because of ATR that I would suggest to be around that number) AS you can see I didn’t pay too much attention to the name I would give to that round bottom that made the divergence there. It is what it represented in this particular section of actions done by the pair that made the macd act that way.
And to a world more about that divergence: I do see the market very looking to make a bounce up, you certainly see that, that being part of the rhythm. So this is another reason why I would have been Very Anxious to get in right after the break of the 21ema, and completely agree with Phillip Nel!
Yvon
  • #27,799
  • Jul 4, 2014 6:44pm Jul 4, 2014 6:44pm
Quoting Phillip Nel
I think this should be enough prove that one can make money from Forex. It was high risk price action random trading which is the most difficult to do. There was no strategy trading this. This should prove to you that if you have a strategy trading the same setup constantly that has been proven by backtesting that it gives you the edge you will end up positive. Get yourself a setup like the TC or RT/RB etc and trade it constantly and you will make money. Choose a 4H candle closure time that is suitable for you that you can be in front of the computer...

Phillip I think you proved us that we can make money from Forex with GREAT Crash Course with 5 min Bounce of The Zone. Are still trading with this system ?
I'm using Google Translator.
  • #27,800
  • Jul 4, 2014 11:59pm Jul 4, 2014 11:59pm
Quoting trademin
{quote} Hi Nic, "To trade 21ema break, Either you look for a round bottom / top when price break the 21ema (which may also be break of the zero level on MACD); Or you wait for BPM on 21ema (this is IF you don't see a RB/RT). Is that correct?" I look first for the rhythm and what the anticipation is, then the figures will confirm what the market is telling and I will act accordingly. "Referring to the trades marked T1 and T2. Did you trade these ones? Did you enter trade when the candle (the one that went through the zero level on the MACD) closed?"...
Thank you very much for your reply, Yvon.

So can I conclude that not all MACD zero break can be traded. It all depends on the market rhythm. One got to study the market pattern to determine if price is going to move on. And When price break the MACD zero level, it is also when price has crossed the 21ema. It sometimes continues to move on and when it does so it moves away from 21ema. However, there are times when the market break the zero level on MACD, and it does not last thus, price turn around instead of moving on (forming BOZ). This has happened to me in many of my trades so I ended up being killed.

Am I correct?

Nicholas
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