COGS's Mental Forex Journey!!

"The Journey of the unknown begins in FOREX" COGs


The Journey of the unknown begins in forex, with high hopes and a direction to achieve. The greed, the commitment, the satisfaction, the highs and lows all bring together a journey that brings your true colours out in times of sorrow, happiness , frustration and ummm every other emotion that the human goes through when trying to succeed at something that they refuse to give up one.

The Journey begins with one step, even thou that first step could be over the cliff, its gotta be made to learn the ins and outs of each aspect of the Journey. Staying committed is the key, it is the only way to succeed. Pushing to the max, not letting anything get in your way, grinding out the tough times pushing for that level of achievement found within side yourself to be proud with yourself, gain the momentum to go higher, don't stop, keep going, don't back up, don't back down, straight ahead, digging a little deeper, you have no reason to stop, you have endless opportunity. Rome wasnt built over night so why is this going to be any different, when your planning on building ROME.

Rome is recognized has one of the greatest empires in human history, uniting, pillaging, bring together a society that created many great things. Trading is no different, traveling into the unknown, by creating a system that will bring a level of achievement that can be envied by one person........yourself.




It has been 2 years today that my first step was taken, into the journey of the unknown. I was promised the world, by the broker that convinced me everything. Living in fantasy land not knowing the first thing about the aspects of the markets. In comparison to performing surgery with 0 years of education. The journey, the first step was taken, right over the cliff falling to the bottom, for a second time. Considering in 2008 was in a way worse situation fighting for my life when a driver ran the stop sign T-boning the car I was in, on my way to work, to that new job after graduating only 3 months earlier. Being placed into a coma, losing my left eye, my lungs being collapsed after breaking 6 ribs and still being able to function with the fracture of 3 different bones in my neck. Of course I dont remember any of this, was it a dream ? Or did all my dreams just disappear ? I guess you could say I hit bottom, for the first time.

Which started the real journey to recovery.

This thread will discuss the lifes trails and tribulations on the journey to become to success trader. 90% mental and 10% commitment.

Judging a mans success by how high he climbs, is short sighted way of determining success. The real way is by how high he climbs after he has hit bottom.

I've falling down but I'll rise above this, before it gets me, I'll end this before it gets me, I'll rise above this, doubt. I'll mend myself before it gets me.



I'll Rise Above This



Thank You,

As the markets move, the perspective of change happens often. Looking for a place where price rejects, comfort. The idea of finding these areas with a short term move can provide comfort with sharp reversal. Playing tricks with the mind, of continuation breaking the zone with confirmation of the force behind it. Or will price come into these areas with weakness and waiting for the vultures to pounce.

The Hunters set the tone and the vultures pick up the remaining weakness. Jumping on the weakness allowing price to move easily and forcefully.

When there is no more sellers price can't go any lower, the buyers, the Hunters, come out in full force and price moves fast.

Patience Patience Patience

The name of the game, the discipline for patience to be formed, is key for a trader to succeed. Waiting for price to come in to key areas of high supply and demand. THe mental games the market will send before, during and after, price hits these key areas, need to be ignored. It is these areas which make traders, traders.

After the GDP news today, price was very excited many players hoping for the big score before the weekend, resulting in lots of action.

USDJPY: Hitting a morning high of 124.145, coming from a strong W-pattern (confirmed with volume) 3 hours prior. The strong reversal pushed price back into the area of the W-pattern of 123.690-123.770. The accumulation of volume, the accumulation of buyers out weighed the sellers.

No more sellers and that price cant go any lower.

Key things to look for:

Price in Demand Area
Descending Triangle
Divergence Volume accumulation

Congratulations your new thread, love your chart, it is so clean and easy to ready.
from your reply for other thread, you mention that you use on balance volume indicator, but i saw your chart has Cumulative Volume indicator too​, are you using both together to identify​? thank you

Thats a very good observation, and one I will do my best to explain. For a simple explanation, it is so they confirm each other.

As we know OBV is the accumulation of volume for the direction of the candle, OBV follows price very closely and very rarely do they diverge or converge especially in key Supply/Deman areas hence why I have it on the lower TF. As for CVI, determining bulls compared to bears it can lead to more areas of convergence and divergence, in all areas of the chart, due to the fact, of high consolidation areas, where the big market makers take positions to reduce risk, distorting the picture that CVI provides.

As we know on a 1 minute chart, price will be more volatile with a correlation to CVI because of its sensitivity. I have found CVI, on the 1 minute chart to provided signs of reversal before the reversal occurs. and leading to lost opportunities.

Well then why does it work on the 3 minute ?

It works on the 3 minute chart because it still looks at the same data that was provided on a 1 minute chart however on a 3 minute chart we get more confirmation from the formation of the 3 minute reversal candle. Which provides the picture equivalent of 3 candles on the 1 minute chart.

ANd yes another way to have the same perspective on a 1 minute chart is to wait for the first reversal candle in a S/D area, then ensure the 3rd candle closes above the open of the first reversal candle. But the one negative to this, is the reversal volume would need to be calculated by hand and in this type of trading seconds make the difference.



But remember price action and zones of S/D are the key principles to determine, before beginning to look for weakness in trend from either the OBV or CVI.

Wait for price to hit the zones before looking to take position, is key. I cant stress this enough. Many traders look at these same areas with Supply/Demand, Support and Resistance or even the Wide Range Bars. But either way your looking for areas where the big banks, stop taking positions allowing the speculators to jump on the movement of the market.

You might be wondering why I say big banks stop taking positions. I say this because they arent there to make millions of dollars trafing (although Im sure they), they are there to provide banking services for the big corporations, and limiting risk. Why do you think the markets always move in sync, from OIL, SPX, and currencies. Yes they will have good traders and such but as a bank, making billion dollar transactions.....Im sorry your limiting risk. SO your taking your positions when the market is in middle territory. Why do you think price hovers in these areas for such a long period ?

What does this have to do with short term day trading you ask ?......................everything.

The main idea is to identify the outer areas so you can understand where the market will finds comfort.

Look at USDJPY today:

Price developed a strong zone today between 124.650 and 124.50. Each time price moved closer to 124.500 price became weaker. So as price made its rally we wait. And guess what ? Price did exactly that touched the 124.500 for less then a minute.

Keys:

Price in high Supply Side
Weak Volume
Small- M Pattern
High Timeframe triple top


Monday: Didnt trade
Tuesday: Playing around with options
Wednesday: Made a nice trade but didnt capture the screens

EURUSD

The high came in at 1.12450 @ 9:15 EST, with a new high volume setting the tone for the next 2 hours.

With a morning low of 1.11823, giving us a morning range.


Price made its way back into the SUPPLY area of 1.12120-1.1250 and began to show weakness

Key Points:

Price moved into SUPPLY area
Weak volume accumulation
Descending Triangle form and price broke right @ the edge of supply

170 points in 22 minutes closed @ ITM top of the hour hitting 1.120000

Price Loses Momentum: USDJPY

The Low came in at 123.850 @ 7:42 EST, with the formation of the a falling wedge at the same time VOLUME accumulation giving strength for a push up.
Price made that push up to the previous lower high of 124.134, with a head fake broke out and pushed for the upper range of the previous DEMAND zone, but was weak. The accumulation of volume slowed and divergence of the CVI occured.


Shorted 124.260 - 9:02.34
Shorted 124.180 - 9:03.01

Closed 124.18 @ 9:10.21
Closed 124.260 @ 9:34.06

Back after the bachelor party last week and comes back with a bang. I was hesitant today to trade but this opportunity presented itself and I couldnt resist.

USDJPY:

USDJPY developed a good DEMAND area on the 1.2320-1.2360.

When price came into this area for the 3rd time and paused, the buyers out numbered the sellers. The big sellers wanted price lower but the buyers overcame this pressure. Price pausing at the DEMAND area, with HEAD+Shoulders (1 min) falling wedge (1 min) Triple bottom (3 min) dofi (3 min). Lots of confirmation.


Entered:
@ 123.370 time - 10:15.52
@123.370 time - 10:21.02

and some speculation for 123.450 @ 10:22:18 (closed 22 minutes later)

The definition of a textbook setup in the early morning hours, can really lead to nice setups. Especially when the big players come out to play. They want to take their positions for the day before FED rate policy comes out. A lot of people tihink banks and foreign transactions are for making money. But let me tell you right meow, these guys just want to limit risk. They arent going to try to make millions on the market, thats not their business. Dont get me wrong companies will have trading desks but the majority of the companies business is to limit risk. They are already exposed more then enough when it comes to there business.

A prime example of this is when price moves out side of the markets averages.

EURUSD: Price goes big thrust with nothing backing it up

Price broke 1.12800 with a big and sharp reversal, not being able to come within striking distance for 4 hours. When it did we strong Bear's coming into the market showing they are hungry for some berries

Keys:

Price tried to hit previous high with less momentum and volume
Sharp and strong reversal
Shooting Star and Dark Cloud cover

The BEARs were hungry!!!!


Earlier in the day, price made a low of 1.12908, with the bulls rejecting this area, making its way back to the short term SUPPLY zone of 1.332-1.1336.
Took my first position at 1.1336 @ 9:31 EST. Price hovered with some big thrusts up, volume confirmed this. The mind games start to play and this is the time when I closed the position. I took a lose on the trade.
But stayed firm.

Price broke the 1.3360 area and moved to the HTF SUPPLY zone of 1.13500. The BEARS were hungry after that 2 hour run. Price came to this zone making a high of 1.13518 with an immediate rejection. 9 minutes later another strong rejection, with volume higher but price lower. At the same time a Bearish rising wedge formed.


Keys:
HTF SUPPLY ZONE
Divergence with Volume - showing weakness
Bearish rising wedge
M-Pattern formation short time later

200 tick move!!

CoGS, When i fist replied your thread, I did not read the first post, I just simply look at the chart. my bad.

You are a very strong man, I can't imagine what you've been through, I guess you doing well now.

I just re read this thread, and found it contain lot of useful information. I try to read the chart in your way,

could you mind to share your OBV indicator?

Could you please look at my chart

A. Price holding around the same area

B.
1.Volume go up, but Price holding around the same area, what happen is seller can't push the price go deeper, time for buyer to jump in?
2. Volume go up. but price holding around the same area, need more seller to push the price go deeper?

C. Price drop, because B2, seller push the price go deeper? but if we look at the whole picture, this drop did not hold, back to the upper price area again

D&E divergence


are those right ideals ?

is the zone meaning the S&D zone? can it be S&R zone also?


thank you

hey Lazy thanks for the reply

OBV- I only use on the 1 minute TF, its the one that comes with MT4, I just modified the color hahaha but its also depends on what server you use. Im on FXCM-which gives high volume but the same idea still applies, because volume doesnt lag, you are still able to interrupt the chart with the same principle with divergence/ convergence in S/D zones or Resistance/Support Zones. Just to add when these zones are determined it is imperative to look at both sides of the channel.


- IMO pretty much the same thing S/D or S/R. I say that because the market is never perfect and zones I believe do a better job grouping it all together.

Im curious what server you use ?

I added to the chart you posted

I currently with thinkforex, I will open a demo account with fxcm and compare the differents, have you ever try order flow?

Order Flow, Im not sure if I have ever tried it but for some reason I think my trading can be defined as "order flow" or S/R or S/D or price action or zone trading hahaha. But I really like the idea of order flow.

I think they all have the same concept essentially ? What do you think ?

As said before when price comes into these areas looking for Volume, Patterns, Candles etc increases the probability of reversal. Or another piece
which happened today, was price hovered in a zone area (which I shorted) and I got a bullish falling wedge with price and a bullish falling wedge with volume, volume broke this area and then broke the zone and went higher, closed out with small lose. Waited for next area.

The power of order flow:


Price comes back into previous SUPPLY zone on 15 min chart and does exactly what it is suppose to do. DOJI formed on 15 min chart. Lower Volume on 15 min chart.

Looking at the 3 min chart: price in supply zone low volume divergence, 2 shooting stars, 3 line strike, hang man, doji

Looking at 1 min chart: Triple Top with confirmed volume divergence/weakness.

I like your first post, trading is really a battle with yourself more than anything so you should do very well, after what you've been through.

The markets aliment, pauses for causes, of the climate:

The battle within inside are selves is a challenge faced everyday, when facing the unknown markets. And when the markets dont even know what direction they want to go, it is time for pause and to reflect. Hence no trades yesterday due to the negotiations in debt riddled greece.

But after a time when the waves begin to smooth out, we find are key areas for consolidation, which of course is the prime principle for zone trading.

USDJPY high came in @ 124.362

With some very strong pushes into this area, I think these strong pushes happen because we dont have any sellers, resulting in price looking for orders to be filled. This new area of 124.350ish became the new SUPPLY zone result in 4 rejections, each with lower accumulation of volume. The last push had more then enough volume, resulting in the BUYERS running out of gas.

Keys to look for:

Price finds new SUPPLY zone
Volume accumulation continued higher but price wasnt moving (Sellers out bidding Buyers) ( 1min and 3 min chart)
Bearish Rising Wedge
M-Pattern - 3 minute chart
Triple top - 1 minute chart

Nice chart, 1M is too quick for me, do you think it will work at 1HR TF too? thx