4 Hour Strategy (MACD)

The previous trade hit its TP at .77424 gaining my demo account its first $20!

-Reflection on first trade-

Poor Risk to reward ratio. (R:R? if i understand the terminology correctly?) Look for trades with bigger potential.
Need to do more history paper trading.
Check to see if I should have been looking for a retrace to the 21 EMA instead of the 8!

150115EURUSD

This one was a nice Trade : a nice HS
I saw the figure almost done so I opened a trade, set the target and went to sleep.
It is not always like that but it is a good example of RT and HS .

146 pips gain

150115EURUSD-2

A continuation of HS
Iti is a free trade now, but a zoom in of the last trade just above
The macd show the HS quite well.
-----you may also see the rectangle, or the horizontal channels

150115EURGBP
Trade closed: about 50 pips gain (look the last 4 candles)
Here the trade has been taken after a pull back to the 8ema as well as a new channel began and the close was when the pair reached the other border of the channel.

About the same thing happened for the earlier trades: starting from the first doted (reading from the left) vertical line, where the first trade closed a PB2 (Pull Back 2) while another trade started at PB2 and closed at PB3. they were pull back to the 8ema, as well as HS formation in there too.

150108EURUSD
This trade was taken from my other live account: again here are the channels and the trade has been taken at the border of trend line and after a possible third TC.
Anticipation: price would go down reaching eventually the other side of channel or making a little bounce not reaching higher than the 21 ema(blue) because macd was way down, so a bounce would not reach the zero line, as well as the 21ema, before falling again. This almost happened. Target would be 1.1600 (round number)
Trade closed 125 pips gain.

EURUSD:
my view:
I could be dreaming but the pair could technically 0.93400 !
but will see...

As far as I am aware the HS formation cannot cross over the zero line on the MACD from reading through all the lessons given by Phil?
There does seem to be a TC pattern and a ZC pattern through within the head an shoulder formation.

I am no expert please correct me if i'm wrong. Learning this all as of this week.

Also in regards to your trade - 150108EURUSD
125 pips gained,

Is the channel you speak of a TL that as the pair bounced off the 21 EMA you expected it to retrace to because of the bearish rhythm of the pair. Shown by a TC signal on the MACD?

​Is it wise to hold a position back through the zero position on the MACD and what was the SL involved in this trade.

Sorry if any of the questions seem stupid all quite new to me!

EURUSD/EURGBP about 20 pips secured on both pairs

150115EURUSD-3

Again here after a pull back another trade taken after hitting 21ema and closed hitting the lower range of rectangular.Some traders will go by the strategy, which I find ok, but for me reaching parts on the downtrend by opening and closing often, does secure me.

about 70 pips gain.

about the same with EURGBP:
About 23 pips gain, but what is remarkable,i this candle that cover the range of the channel (pink arrow)

Hi georgemoon,

About the HS:

The HS is 3 RT (round top) but there is something that differs must be added to this. Head and shoulders represent a possible change in trend while RT represent a possible counter trend trade The formation is not necessary horizontal or at angle, as well as how high/low on the macd.

Look at his example: the head is quite high above 45( I guess) which represents overbought, so since it is overbought, you could expect a move down. But what happened next, after the head is done, (still on Phillip Nell example), is another move up that makes another RT but lower than the head. It means that the traders just jumped out the boat there( the bulls), those are the late traders that were still on, hoping for another higher high. But since that last RT is lower it just means the momentum is gone!!!---and the macd should expresses it very well!
So this is his representation of his HS
What is not mentioned (in his strategy) is that a HS is a possible trend change and that wasn’t the goal here to mention in his strategy.What he wants is to show the figure, and the reason why the price fall is the overbought situation that he expressed by horizontal line crossing the HS.
If you look closely, the trigger on his example is on the right shoulder, on the fall of that shoulder with targets being at the lower low on the left (on a chart). Which is perfect!

But what I am trading also is to see the HS during his formation and expecting the range that would cover the pair on his fall, this being done by measuring the top of the head down to the neckline. So if the pair breaks the neckline, I should expect already what I should have as a possible profit target. Sure if the head(on the Macd) is just a bit higher than the zero line, I guess that the range in price would be also represented by the Macd, and when the macd is oversold, a correction could be in the card. and some shoulders could be below the zero line.

But a HS has his effect, and it is almost predictable, or if you prefer, almost anticipated. If you look again at HS, it could be contained in a rectangle, or in a channel, meaning that they cover a range, and since range from a HS could be predictable (by measuring top to neckline) so the channel. It only means that range tends to duplicate. And the last charts I put on the tread just express that.
But all that could be put aside and just go by the strategy, you will find that strategically where Phillip Nell suggest where to put your entry and Stop loss covers that very well.
Hoping that my way of seeing thing are understandable, but if there is some more questions I am open to answer,

Thank you for the explanation, Im not 100% confident yet but i will mull over your response tomorrow a bit longer Nightshift makes the brain fuzzy and I'm new to this!

Decided to take this practise trade on the USDJPY
Can see the pair moving back towards the 21 and top channel TL following a TC pattern on the MACD.
Am I looking at this correctly?
I feel like the price could stall mid channel and follow the bearish trend as we are below the 89?

[quote=georgemoon;........ Also in regards to your trade - 150108EURUSD 125 pips gained, Is the channel you speak of a TL that as the pair bounced off the 21 EMA you expected it to retrace to because of the bearish rhythm of the pair. Shown by a TC signal on the MACD? ​Is it wise to hold a position back through the zero position on the MACD and what was the SL involved in this trade. Sorry if any of the questions seem stupid all quite new to me![/quote]

About 150108EURUSD:
Where I took the trade is right at bottom of trend line. When I mentioned TC, it is the third TC, which is quite large, but look back, there are 2 larger TC before this third TC that looked like it was formed. Those 3 TC formations represented also for me another very large HS with the head formed by multiple smaller TC.
So from that view, I was expecting the macd would reach his neckline (before moving slowly up) while the price would fall (at the same time).

But I also expected another direction for the market to go, which is up. –Up but not expecting to go higher than the zero line. Well the pair went a bit higher than the zero as well as the 21 ema but still aimed at lower price for the pair.
This is why I took the trade with confidence while the anticipated market’s action would act almost as planned.
Comments welcome,

Thanks for the explanation. Makes sense to me now!

My TL seemed to be off on the USDJPY trade

stopped out - 116.486 for a loss of $46
Will study graph later tomorrow to see which direction it takes and see where I went wrong.
To me the MACD was showing a Lower High forming.
Now showing the forming of a Trend continuation pattern.

I have assed my trade I did last night on the USDJPY. I think my TL might have been a touch off.
If anyone could critique my placement of TL on the attached screenshot would be great.

I have drawn on the picture if we see bar A form on the close I could expect to see the path highlighted in green maybe finding resistance at both the 8, and 21 and top TL. I am expecting a RB to form on the MACD.
The hammer candle plus long tails suggests a change in emotion and the big guys maybe stop hunting before a jump in price.

If bar A doesn't form we could expect to see the trend continue and to hug the bottom TL until another indication on the MACD of a price turnaround.

Is this vaguely correct?

morning! I hope everyone is enjoying the nice , beautiful continuation of the ride down in many pairs

have a nice day,

Im riding the ride up in the USDJPY, the trade i screenshot before got me 140 pips. Only my practise account but still good learning

...keep doing the good work!

Hi Guys,

Started back trading again, nice to see trademin still ticking the thread over

Looks like a nice set up taking place on the Eur/Usd for a short down to around the 1.2400 before I think another leg up to the 89sma.

Same in Aus/Usd, looking to take it short around the 0.7950/60 level to the 0.7900 level

Same with the GBP/USD from the 1.521 level if possible down to 1.5090 level or just below.

Set up being break 21ema, pullback, move to 89 sma. Looks likely due to the large recent moves down, however always have to be careful. Especially counter trend trading the counter trend! If R:R is there I will take them otherwise just wait for the moves up to 89 not trading the pullback before hand

Any thoughts?