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4 Hour Strategy (MACD)

  • #28,081
  • Aug 6, 2014 1:41am Aug 6, 2014 1:41am
Attached Image (click to enlarge)
Click to Enlarge Name: EURUSD_H4_5_Aug_2014.png Size: 22 KB
Took this EURUSD on 5th August, Tuesday. It was a late entry as I was all focused on GBPUSD which took me out at a loss. I took it after it has moved about 17pips, so SL was about 30pip. Since it was a late entry, I tested it with a very small lot.

It moved away from 21ema
89sma above market, thus bearish (on both H4 and Daily)
TP was at the diagonal TL about 80pips

Comments?

Another question her is about taking profit and adjusting stoploss. I have in the chart SL1 and SL2.
SL1 = Initial SL at the time of entry
SL2 = Adjust SL1 to SL2 when the trade was making 12pips or so and for the sake that I could go to sleep in peace.

My TP is about 80pips. And it is at present at a profit of about 30pips. A problem I face here, as always, is where to put the SL. At present at SL2, I would make about 8pips should the trade be taken out. So I need your advice how should I set the SL here so that should my trade be taken out, I would not lose everything. There is a tendency that price will pull back to 21ema and if I set my SL there, I would be taken without gaining any pips.

Thanks.

Nicholas
  • #28,082
  • Aug 6, 2014 3:45am Aug 6, 2014 3:45am
Quoting JonnyPip
Hi Binnie, Absolutely you are right, I would say the 89sma on the 4h will be the support before it moves higher, so technically it will be entry on 4h or 1h but the trade itself would be a daily counter trend trade, trading the c wave of the pullback essentially. Therefore as per rules target will be 21ema (daily) - more or less the 89 sma 4h, which could be a good chance to get back in long. Any further short than the 89sma on 4h I would say is highly unlikely unless some serious news comes out. But who knows. In regards the gbp/usd it looks a...
Hello Jonny,

Can you share more about the zig zag retracement that you mentioned here, please. Thanks

Nicholas
  • #28,083
  • Aug 6, 2014 6:31am Aug 6, 2014 6:31am
Hi Nic,

Essentially retracement waves, moves back towards the 21ema, should happen in three waves which make up the overall retracement. When I zoomed down into the 1h I could see that the had only been one wave which had gone up to the 21 ema therefore it suggested (but not guaranteed) there was going to be a retracement and another wave up to complete the three waves of the overall pullback. Which is why I though it would be risky.

Everyone has there own techniques and I am cautious not to turn this into a thread about wave counts or anything which starts to extend out from the 4h macd system as it is an awesome thread and should be respected. But I find using the principle of the three wave pullback helps me to time my trades better still in line with the 4h macd rhythm. I have posted two of the trades I have on in Gbp/Usd and Cad/jpy so you can see my entries on both. They are essentially the same set up entering on the end of the "third wave" if you like. I have also put up the 30 min chart as well so you can see the entry at the end of the c wave. Usually what can happen is wave A pulls back, people jump in, wave B goes down and people start to see a profit (or worse people fear they have missed the trade and jump in here), wave C goes up and shakes them all out of the trade, wave 1 of the new down move then starts but those who have lost money are too scared to re-enter and end up watching it ride all the way down. That's usually when the computer is sent spinning out of the nearest window.

I hope this helps Binnie as well as this is simply describing a basic flag formation
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 6.9.14 Cad Jpy 4h.png Size: 80 KB
Click to Enlarge Name: Cad Jpy 6.8.14 30 min.png Size: 83 KB
Click to Enlarge Name: 6.8.14 GBP USD 4h.png Size: 71 KB
  • #28,084
  • Aug 6, 2014 7:25am Aug 6, 2014 7:25am
Quoting JonnyPip
Hi Nic, Essentially retracement waves, moves back towards the 21ema, should happen in three waves which make up the overall retracement. When I zoomed down into the 1h I could see that the had only been one wave which had gone up to the 21 ema therefore it suggested (but not guaranteed) there was going to be a retracement and another wave up to complete the three waves of the overall pullback. Which is why I though it would be risky. Everyone has there own techniques and I am cautious not to turn this into a thread about wave counts or anything...
Thanks Jonny.

But how do we determine / decide at which point to start drawing the wave?
  • #28,085
  • Aug 6, 2014 5:59pm Aug 6, 2014 5:59pm
Hi Nic,

Wave is drawn from the initial turn around. You can see the pattern seems to be repeating here in the cad/jpy, in the 4h it looks like 1 wave but zoom to the 30 min and you can see it playing out in 3 waves.

I will be looking for it to now extend to the 100% mark and possibly making some kind of double top or something before adding to the short position. On the 4h chart this equates to a classic 4h macd set. So as you can see, this is still classic market rhythm. It just allows me to time my entry better I find, and therefore I usually have a smaller risk this way and so also a better r:r:r.

That's the plan anyway, whether it plays out or not is another question!
Attached Image(s) (click to enlarge)
Click to Enlarge Name: Cad Jpy 6.8.14 4h.png Size: 74 KB
Click to Enlarge Name: Cad Jpy 6.8.14 30min.png Size: 78 KB
  • #28,086
  • Aug 6, 2014 10:14pm Aug 6, 2014 10:14pm
Jonny,

I have drawn it on NZDUSD chart, 1 Hour. Is this what it is suppose to look like? There might be a move down to south on the 3rd wave?
Attached Image (click to enlarge)
Click to Enlarge Name: NZDUSD_H1_(Wave)_7_August_2014.png Size: 34 KB
  • #28,087
  • Aug 7, 2014 12:22am Aug 7, 2014 12:22am
Quoting trademin
EURUSD: SOLD on a pull back to the 21ema(in blue) {image}
closed trade +25 pips
Yvon
  • #28,088
  • Aug 7, 2014 12:25am Aug 7, 2014 12:25am
Quoting trademin
SOLD after the pull back to the bunch of moving averages above. but still not quite sure of a move down to the 365 acting as the speed of the market. So ,in a sense, the pair has slowed down, the real move would be below the 365, which would be very interesting. Very short SL on this trade. binnie, you fizzled my curiosity on that pair! {image}
closed trade:+15 pips
Yvon
  • #28,089
  • Aug 7, 2014 12:35am Aug 7, 2014 12:35am
Quoting trademin
{quote} good morning Binnie, even if it is 10 minutes to 6 PM here! about the EURUSD: as I mentionned earlier, I am doing something different this time . I just let it run down, having SL just a bit over the 21ema! Sure that if there is a very nice big red apple available that I wouldn't take a bite ( bottom T/L), but mainly I want to stay focus on keeping that beast going down.

the GBPUSD, finally it seems that strength is weakening, I want to keep that one short for a bit longer than just a while!
closed trade + 84 pips


the NZDUSD:...
closed trade: +92 pips

I have been away from active trading for a week. So I closed the trades I was involved in:I lost and win in some trades since I didn’t have assiduity in trading, but trades have been doing fine for me
But I managed to gain 216 pips total.

in eurusd,gbpusd, audusd,nzdusd.
best were nzd usd and gbpusd
Yvon
  • #28,090
  • Aug 7, 2014 12:43am Aug 7, 2014 12:43am
Quoting trademin
{quote} closed trade: +92 pips I have been away from active trading for a week. So I closed the trades I was involved in:I lost and win in some trades since I didn’t have assiduity in trading, but trades have been doing fine for me But I managed to gain 216 pips total. in eurusd,gbpusd, audusd,nzdusd. best were nzd usd and gbpusd
Hope you had a nice break with your guests. It is great when you can take time to share with others. Nice results Yvon - that was almost SET & FORGET style.
I haven't seen anything that I was confident with this past week - so much news now that I must be careful of entering a trade at London Open because I then head to bed and cannot pay attention to it nearing Red News events. Obviously there is not too much movement during the day here so I just gotta be patient.
(which I am ). Good to have you back my friend.
  • #28,091
  • Edited 1:24am Aug 7, 2014 12:46am | Edited 1:24am
AUDUSD: SOLD
triple pullback to lower channel.

32 pips secured
Attached Image (click to enlarge)
Click to Enlarge Name: 140807AUDUSD.png Size: 130 KB
Yvon
  • #28,092
  • Aug 7, 2014 12:50am Aug 7, 2014 12:50am
Trademin,

I have posted a chart a questions on post 28,081. Can I trouble to help me with that. It's about stop losses that I have asked before and I said I will post a chart later. Thanks.
  • #28,093
  • Aug 7, 2014 12:59am Aug 7, 2014 12:59am
NZDUSD SOLD

the pair broke the 21ema (in blue), pulled back, then started to move away, but kind to stick to the pull back(?) for now
Attached Image (click to enlarge)
Click to Enlarge Name: 140807NZDUSD.png Size: 111 KB
Yvon
  • #28,094
  • Aug 7, 2014 1:10am Aug 7, 2014 1:10am
GBPUSD SOLD
break, pull back, move away...I know I am soon to trigger
Attached Image (click to enlarge)
Click to Enlarge Name: 140807GBPUSD.png Size: 109 KB
Yvon
  • #28,095
  • Aug 7, 2014 1:20am Aug 7, 2014 1:20am
EURUSD SOLD
Attached Image (click to enlarge)
Click to Enlarge Name: 140807EURUSD.png Size: 111 KB
Yvon
  • #28,096
  • Edited 2:20am Aug 7, 2014 2:02am | Edited 2:20am
Quoting nic73
Trademin, I have posted a chart a questions on post 28,081. Can I trouble to help me with that. It's about stop losses that I have asked before and I said I will post a chart later. Thanks.

hi nick,
I am still away from trading this week, I am just dipping in! You just caught me here! But I’ll do my best to answer you,

The rules mentions about the SL: initial it should be above the last peak, ( on your chart should be above 1.3450 aprox) then
it should be above the 21ema if it is a bearish trend. But sometime, the widening range get a larger SL, almost the range down covered by the pair. So, this is what I did on the EURUSD last week (was it?) I could have grabbed more than what the trade gave me at that time. But I made the trade just to see the result.

What I came up as solution, it depends on you!-but you could be help by the ATR set to 1

It could be an alternative to set the SL.

Example: if ATR set to 1 gives you an average of 60 pips on the daily chart, which is not bad as a small SL on the 4hrs chart. Then don’t expect the pair to make a 100 pips jump if there is no fundamental new that could make such a spike in price into a 4 hrs chart, then you are ok.

Another point is this:
Your entry was late…where? Wasn’t it below the 8ema there? If it is the case, then you should expect the price to get back up to it or to the 21ema. Then you should not lower your SL is a pull back is eminent.
Yvon
  • #28,097
  • Aug 7, 2014 2:29am Aug 7, 2014 2:29am
Quoting trademin
AUDUSD: SOLD triple pullback to lower channel. 32 pips secured {image}
Did you use the lower TF to enter? A look from the chart, you entered like half way when candle was forming on H4 TF, while it was moving away from 21ema.
  • #28,098
  • Edited 2:46am Aug 7, 2014 2:33am | Edited 2:46am
Quoting nic73
{quote} Did you use the lower TF to enter? A look from the chart, you entered like half way when candle was forming on H4 TF, while it was moving away from 21ema.
no lower TF- entered earlier! not as by the rules, too soon,
but using the 4hrs chart
I saw a triple rejection of the channel (consolidation)
Attached Image (click to enlarge)
Click to Enlarge Name: 140807AUDUSD.png Size: 133 KB
Yvon
  • #28,099
  • Aug 7, 2014 3:14am Aug 7, 2014 3:14am
Quoting trademin
EURUSD SOLD {image}
Hi Trademin,

I am also short EURUSD from 1.3377. What would be your target (targets) here. I always get out too soon.

Thanks
  • #28,100
  • Aug 7, 2014 5:21am Aug 7, 2014 5:21am
Quoting nic73
Jonny, I have drawn it on NZDUSD chart, 1 Hour. Is this what it is suppose to look like? There might be a move down to south on the 3rd wave?{image}
Hi Nic,

Not quite, the A wave you have drawn is WITH the trend, the B wave you did is AGAINST the trend, that is the retracement wave and the one which you can zoom down onto a lower chart to see if it is breaking into 3 waves back towards the 21 ema. A move towards the 21ema in the 4h chart is usually a break of 21ema, pullback, move to 89/200 sma in a smaller chart. Look at the 4h and 1h chart of euro/usd atm. You can see where I am waiting to try and get into this in a short position with a break of the 21, pullback and move to 89sma in the 1h (possibly 60% retracement here instead of 100%). It might not get all the way there and we have the unemployment claims coming out later for usd.

My plan b will likely be a break below the 33638 low if I cant get entry higher up.

Did you catch the cad/jpy this morning? Turned around right in the circle I put up on the 30 min chart yesterday. If you zoom back out into the 4h chart you see it gives the entry really nicely on a pullback to the 21ema. Perfect market rhythm as per rules.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: Eur Usd 7.8.14 4h.png Size: 72 KB
Click to Enlarge Name: Eur Usd 7.8.14 1h.png Size: 70 KB
Click to Enlarge Name: Cad Jpy 7.8.14 30min.png Size: 76 KB
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