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"Ratios & Harmonics: a Different Way to Trade." Summary 37 replies

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Ratios & Harmonics: a Different Way to Trade

  • #10,861
  • Nov 14, 2014 4:14pm Nov 14, 2014 4:14pm
Quoting Mr. Pip
What a beauty! Missed this! {image}
A beauty indeed! On the CD leg, it retraced back into the 1.9960 area after hitting a support area and prior to making a NSL. What kind of clues or PA would you want to see in order for you to stick with this trade? Being at BE? Knowing that order flow was to the downside? I'm sure that I would have bailed on this trade early just from thinking it hit a support area and failed to make the NSL.
Damn The Torpedoes, Full Speed Ahead!
  • #10,862
  • Nov 14, 2014 4:47pm Nov 14, 2014 4:47pm
Quoting Mr. Pip
Well Traders, Looks like I caught up and also looks like your trading is improving. Does it feel like the market is not in control of you anymore? Are those crystal balls better polished? I was hoping to see more rotation examples to let me know you got the concept and are practicing it well but seeing the overall comments and trades I can see that it helped you find some confidence on pulling that trigger. I am very happy and pleased with the progress and contribution all of you make. We are all and will forever be students of this business. One...
I think a side bar on expectation failures is well worth the effort. I could have benefited from that this morning. In hindsight, the fact that I was against the main order flow and the formation of a lower high should have been my confirmation to bail out of the trade. As I recall, I felt a check about staying in the trade, but was unsure. I watched price descend to my SL.
  • #10,863
  • Nov 14, 2014 5:55pm Nov 14, 2014 5:55pm
Quoting Mr. Pip
What a beauty! Missed this! {image}
Hi Mr. Pip,

It is my favorite chart at the moment. I have included some levels she has respected very nicely if one zooms in. Without getting into patterns, they are harmonic.
Attached Image (click to enlarge)
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The world you desire can be won. It exists.. it is real.. it is possible..
  • #10,864
  • Nov 14, 2014 6:49pm Nov 14, 2014 6:49pm
Quoting DizzleFX
{quote} A beauty indeed! On the CD leg, it retraced back into the 1.9960 area after hitting a support area and prior to making a NSL. What kind of clues or PA would you want to see in order for you to stick with this trade? Being at BE? Knowing that order flow was to the downside? I'm sure that I would have bailed on this trade early just from thinking it hit a support area and failed to make the NSL.
The fact that price found support did did not surprise me since it had found strong support there. If I was in that trade and short from the 960-970 area I would have made sure I was at a BE point. I would not have bailed on the trade because there was no technical reason to. These are the specific reasons why:

We are in a very bearish market.
Price corrected initially to the 50% confirming it's bearish bias.
Expectation is a NSL

This is how I handle this situation, price found support at point B and started to correct with some momentum. This is expected as price found good support the prior test of the area.

I immediately protect my my trade by moving my stop to BE You can also choose to close half of your trade so that you walk away with something. I would not have done that because of it's very bearish bias.

Point C must hold or I know I am wrong on this I draw a fib from the high to low of the swing in question and expect the golden zone to hold. In this case it did testing the 78.6 and closing at the 61.8.

This swing must hold if price is going to continue on. You can add to your position there if you want or move your stop to this level to lock some in or both.

Now you have order flow confirming your expectation of the NSL as you now have a second LH.

Your expectations were under attack but still valid but you must always protect your trade.
Attached Image (click to enlarge)
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If you fail to plan, you plan to fail.
  • #10,865
  • Nov 14, 2014 6:51pm Nov 14, 2014 6:51pm
Quoting jpnavigate
{quote} I think a side bar on expectation failures is well worth the effort. I could have benefited from that this morning. In hindsight, the fact that I was against the main order flow and the formation of a lower high should have been my confirmation to bail out of the trade. As I recall, I felt a check about staying in the trade, but was unsure. I watched price descend to my SL.
Ok we will discuss this
If you fail to plan, you plan to fail.
  • #10,866
  • Nov 14, 2014 6:52pm Nov 14, 2014 6:52pm
Quoting Mr. Scott
{quote} Hi Mr. Pip, It is my favorite chart at the moment. I have included some levels she has respected very nicely if one zooms in. Without getting into patterns, they are harmonic. {image}
Beautiful!
If you fail to plan, you plan to fail.
  • #10,867
  • Nov 14, 2014 6:55pm Nov 14, 2014 6:55pm
Been away working but here are some long term goodies. My main focus is Euro for a few months to the bull side. EU is not ready yet for bullish intent, but EJ has been ready and tradable about 3 weeks. total target 159.00. (When it does get there look left at 1998 resistance which runs into 78.6) In and out untill I get there. Watch out for pull back to 144.50 level on 1hr Next week. then it might be ready to move up. Cheers

Remember to do your homework don't take my advice. I am not a GURU YET
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Empower Your Mind
  • #10,868
  • Nov 14, 2014 7:19pm Nov 14, 2014 7:19pm
Quoting Mr. Pip
{quote} The fact that price found support did did not surprise me since it had found strong support there. Your expectations were under attack but still valid but you must always protect your trade. {image}

Copy all! Thanks for the break down.
Damn The Torpedoes, Full Speed Ahead!
  • #10,869
  • Nov 14, 2014 9:54pm Nov 14, 2014 9:54pm
Quoting DeepakJ
{quote} Just apply for an demo Ninjatrader account on the FXCM website. You will not be able to execute orders or see orders on the chart. I execute everything through FXCM trading station and analyse with Ninjatrader.

Hello Deepak,

I tried this already but for some reason when I open a chart window on ninja trader I cant see anything. My scale on the right hand side is from 0.000 to 0.001. Its possible I'm not using ninja trader correctly
  • #10,870
  • Nov 15, 2014 4:56am Nov 15, 2014 4:56am
Quoting amfx
{quote} Hello Deepak, I tried this already but for some reason when I open a chart window on ninja trader I cant see anything. My scale on the right hand side is from 0.000 to 0.001. Its possible I'm not using ninja trader correctly
It's going to take a while to load but once it does there is an F I side a square on the top right hand side of the screen click on that it will scale the chart for you. Remember to also create the connection. In the tool tab first.
If you fail to plan, you plan to fail.
  • #10,871
  • Nov 15, 2014 7:04am Nov 15, 2014 7:04am
Hi Mr. Pip

Looking at your latest teachings - would my drawings be correct if one would have taken a long at 61/79 AB leg ?

Thanks for any comment my friend.

Regards

Hans
Attached Image (click to enlarge)
Click to Enlarge Name: EURNZDH1.png Size: 52 KB
"The future is already written in the past"
  • #10,872
  • Nov 15, 2014 8:29am Nov 15, 2014 8:29am
Good morning Mr Pip and traders

Good morning Hansma, Its funny how great minds think alike. I too was doing some analysis & rotational homework on the EURNZD - 1 hr. Here is where I'm at so far. I hope the writing is visible once the chart is double clicked. I hope this helps

I was looking to practice my depiction of rotation. So if Mr.Pip or any other trader see a mistake on my anaylsis please do not hesitate to comment.

Rotation:

step 1 - personaly though I would have started by looking for weakness in the bears by analyzing long term and short term order flow. Weaker momentum, deeper retracements, weaker projection
step 2 - then I would look for a change in order flow. In this case we had a deeper retracement in short term order flow to a HH then a 50 % retrace for a HL.
step 3 - I would look at the bar by bar price action for strength and weakness

Expectation: - At this point, my bias is still long term bearish and in my chart I show an are where I look to hope on for a further push south. I just dont see the strength needed from the Bulls to switch my long term bias for now, but hey, I'm often wrong

I'm looking for a pullback to the break out area from consolidation but I expect price to push down so price might not make it there

https://www.tradingview.com/x/ITsbkzJL/
  • #10,873
  • Nov 15, 2014 8:31am Nov 15, 2014 8:31am
Quoting Mr. Pip
Well Traders, Looks like I caught up and also looks like your trading is improving. Does it feel like the market is not in control of you anymore? Are those crystal balls better polished? I was hoping to see more rotation examples to let me know you got the concept and are practicing it well but seeing the overall comments and trades I can see that it helped you find some confidence on pulling that trigger. I am very happy and pleased with the progress and contribution all of you make. We are all and will forever be students of this business. One...


Mr Pip

Expectation failures, that would be great.
Can't wait.
One of my weaknesses.

Aj1
  • #10,874
  • Nov 15, 2014 9:20am Nov 15, 2014 9:20am
Quoting Mack2013
Good morning Mr Pip and traders Good morning Hansma, Its funny how great minds think alike. I too was doing some analysis & rotational homework on the EURNZD - 1 hr. Here is where I'm at so far. I hope the writing is visible once the chart is double clicked. I hope this helps I was looking to practice my depiction of rotation. So if Mr.Pip or any other trader see a mistake on my anaylsis please do not hesitate to comment. Rotation: step 1 - personaly though I would have started by looking for weakness in the bears by analyzing long term and short...
Good Morning Mack.

Love your chart as always. Was also looking at these areas in my chart.

Lets see how price moves.

Regards,

Hans
Attached Image (click to enlarge)
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"The future is already written in the past"
  • #10,875
  • Nov 15, 2014 9:29am Nov 15, 2014 9:29am
Another trade I'm looking at this week is on the GBPNZD - Daily

Set Up: Theres a gartley parttern that lines up with the harmonic move
Order Flow: Long term price has been in an upward moment since Nov 2013 after establishing NSL. Currently, Price made a complex pullback after breaching structure with significant strength but failed to continue on the retest making a LH and pircing C. There was zero reaction at this level and strength seems to be with the Bears. This has me thinking that any reaction will be shallow and current order flow is Bearish. So i'm against order flow as of now but with the long term trend
Bar by bar: Strength with Bears. No reaction as of yet.

Daily chart:
https://www.tradingview.com/x/AxnbhozL/

Hourly chart: I dont really like flipping through timew frames but believe its necessary for this one
*** on the 4 hour short term order flow has been losing projection strength but still has momentum so I'll be monitoring. No position yet
https://www.tradingview.com/x/XkVrHien/
  • #10,876
  • Nov 15, 2014 1:38pm Nov 15, 2014 1:38pm
Quoting hansma
Hi Mr. Pip Looking at your latest teachings - would my drawings be correct if one would have taken a long at 61/79 AB leg ? Thanks for any comment my friend. Regards Hans {image}
Price has made a NSH on the short term order flow indications a deeper correction. I is a nice trading opportunity but manage aggressive as you are against longer term order flow.

It's nice to see traders identifying trading opportunities and not trying to force patterns or trade things they don't understand.
If you fail to plan, you plan to fail.
  • #10,877
  • Nov 15, 2014 1:49pm Nov 15, 2014 1:49pm
Quoting Mack2013
Good morning Mr Pip and traders Good morning Hansma, Its funny how great minds think alike. I too was doing some analysis & rotational homework on the EURNZD - 1 hr. Here is where I'm at so far. I hope the writing is visible once the chart is double clicked. I hope this helps I was looking to practice my depiction of rotation. So if Mr.Pip or any other trader see a mistake on my anaylsis please do not hesitate to comment. Rotation: step 1 - personaly though I would have started by looking for weakness in the bears by analyzing long term and short...
Good work Mack very thorough! Your identified area should hold. If momentum increases into that zone we may be in for a surprise.
If you fail to plan, you plan to fail.
  • #10,878
  • Nov 15, 2014 1:51pm Nov 15, 2014 1:51pm
Love what I'm seeing, Traders actually reading a chart. It's empowering and enlightening!
If you fail to plan, you plan to fail.
  • #10,879
  • Nov 15, 2014 6:20pm Nov 15, 2014 6:20pm
Hello Traders,

Expectations, expectations, expectations, we live and die by them. Well, not really, but it is important to have them and equally important to know when they are no longer valid.

This topic can be a bit challenging at first but becomes easier with screen-time. The good news is that whether you are looking at short term order flow or longer term the out come will be the same. You will arrive at the same place. Longer term order flow can be seen in the main swings and clear highs and lows while the shorter term order flow in the smaller corrections all will end at the same place.

The short term order flow helps you confirm the longer term order flow by giving you smaller harmonic moves to help you confirm your expectations.

I will show you this on a chart tomorrow or Monday at some point. It really is not difficult yo see. The confusion comes in when you get short term and longe term order flow mixed up.
If you fail to plan, you plan to fail.
  • #10,880
  • Nov 15, 2014 8:18pm Nov 15, 2014 8:18pm
Quoting Mr. Pip
{quote} This takes some time and hard work a simple book only provides you with examples and theory. Now you have to get intimate with the chart and the information. Forget the patterns for now learn to read the chart and become intimate with ratios and how to properly draw them. soon the harmonics will start to jump out and say hello. Time frame does not matter. Look at how many opportunities would have been missed waiting for the animals to complete. I know Mr. Carney and others have their idea about harmonics but I have mine and it's about creating...
Remember this chart? Look what happened. Nothing is random my fellow traders. Learn to reads the markets. all the information is on the chart. Read my comments on the first chart and look at the harmonics in the oval. Now there is way to much momentum heading into that supply area but as you can see this is just beautiful.
Attached Image(s) (click to enlarge)
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Click to Enlarge Name: $EURUSD (60 Min) 11_14_2014.jpg Size: 145 KB
If you fail to plan, you plan to fail.
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