How would YOU analyse this chart? | Forex Factory

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How would YOU analyse this chart?

  • #1
  • First Post: May 31, 2015 12:51pm May 31, 2015 12:51pm
The following chart shows the H4 EURUSD:

Attached Image (click to enlarge)
Click to Enlarge Name: Capture.PNG Size: 96 KB


As you can see, there is a fairly consistent resistance level at 1.08188. Recently, a doji candlestick has formed at this level and price seems to be bouncing off of it. In addition to this. price appears to have just crossed the SMA14, which may be used as an entry constraint by some traders. What other analysis might you draw from this chart? Would you see this as an opportunity to go long? If so, when? If not, Why not?

Any analysis of this chart would be appreciated, as I hope it will give me useful insight into the thinking of traders.

Thanks in advance
  • #2
  • May 31, 2015 1:32pm May 31, 2015 1:32pm
I would have taken that nice pin/doji with 0.25% of my max position. Stop loss is at the bottom of the bar plus a few pips. Second entry comes when price breaks out of the bollinger squeeze that was recently on this pair. This time with 0.66% of my full position or a fixed dollar amount of my account. Stop is at the stop of the initial campaign. Initial position is moved to breakeven plus a few pips. That is how I would manage that pair if I traded it, but this pair is currently ranging on this timeframe, so I would look for rougher seas elsewhere.
If you are good at something, never do it for free--Joker
  • #3
  • May 31, 2015 3:06pm May 31, 2015 3:06pm
Quoting jmn5611
I would have taken that nice pin/doji with 0.25% of my max position. Stop loss is at the bottom of the bar plus a few pips. Second entry comes when price breaks out of the bollinger squeeze that was recently on this pair. This time with 0.66% of my full position or a fixed dollar amount of my account. Stop is at the stop of the initial campaign. Initial position is moved to breakeven plus a few pips. That is how I would manage that pair if I traded it, but this pair is currently ranging on this timeframe, so I would look for rougher seas elsewhere....
So you're saying that the doji alone would be enough confirmation for you? Would you not have waited a few bars to check that price would move in your favor? I've seen many instances where price has lingered around price points like that, only to break through after a few bars... Also, by '0.25% of your max position', do you mean to say that if you'd never risk more than Ģ1000 on a trade, you'd only risk Ģ2.50 on that one? Thanks for your input.
  • #4
  • May 31, 2015 5:50pm May 31, 2015 5:50pm
Quoting Ponzi Jr
{quote} So you're saying that the doji alone would be enough confirmation for you? Would you not have waited a few bars to check that price would move in your favor? I've seen many instances where price has lingered around price points like that, only to break through after a few bars... Also, by '0.25% of your max position', do you mean to say that if you'd never risk more than 1000 on a trade, you'd only risk 2.50 on that one? Thanks for your input.
No, on a 1000$ trade I would risk 250 starting out. Remember that markets are fractal, so waiting for bars to confirm is paralysis by analysis. A bar like that is a short term change in price action that you are hoping will turn into a long term change in price action. We really don't know, so my minimum entry is 25% of my max entry, or 250 dollars, in this case. Yes, price does often resume, after a price pattern like that. So that signals continuation. Go with it.
If you are good at something, never do it for free--Joker
  • #5
  • May 31, 2015 7:16pm May 31, 2015 7:16pm
I would start by labeling that - support - not resistance. Because price was above the line at the time.

On my H4 chart candle is nowhere close to being a doji, even still it is bullish and body is about 2/3 the size of the prior bearish one.

Anyway I had levels projected down near that low but otherwise not much else I see to judge taking a trade or not. Maybe an oversold indicator reading but that by itself is not much to risk money on.
  • #6
  • May 31, 2015 7:39pm May 31, 2015 7:39pm
donīt see any pinbar here

When you look at an Candlestick chart you already applied the first indicator to your chart.
the Candle indicator is dependent to the open time of the 4h candle, and this timeframe is very sensitive.
As you can see i have a different 4h open i see no pinbar here.

I made a long time ago a few pictures about dojis, they fail so often you cannot even imagine, there is no edge in using dojis or even pinbars.
Look at your chart you will find a few good pinbars which have already failed.
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just do it
  • #7
  • May 31, 2015 8:07pm May 31, 2015 8:07pm
I find it hard to comment on how I would read this chart, because reading a single 4hr chart and asking for comments misses the point of how the market works in general.

Think bigger.
  • #8
  • May 31, 2015 8:24pm May 31, 2015 8:24pm
Quoting Ponzi Jr
The following chart shows the H4 EURUSD: {image} As you can see, there is a fairly consistent resistance level at 1.08188. Recently, a doji candlestick has formed at this level and price seems to be bouncing off of it. In addition to this. price appears to have just crossed the SMA14, which may be used as an entry constraint by some traders. What other analysis might you draw from this chart? Would you see this as an opportunity to go long? If so, when? If not, Why not? Any analysis of this chart would be appreciated, as I hope it will give me useful...

Prominent downtrend....but reaching a support point and trying to re-trace....

BUY for the next 4-6 bars at half or a third of the size you would SELL at 50-61.8% retracement of the downtrend..
  • #9
  • Jun 1, 2015 8:32am Jun 1, 2015 8:32am
Quoting scottik187
I find it hard to comment on how I would read this chart, because reading a single 4hr chart and asking for comments misses the point of how the market works in general. Think bigger.
I disagree. I've heard many broad theories on how the market in general works, but I've seen few examples of it applied to real life charts. To understand the theory, I need application.
  • #10
  • Jun 1, 2015 6:48pm Jun 1, 2015 6:48pm
just based on support lines only I would move my support line further down. since this level is more active than the 1.08 level then trade the break or bounce.

Attached Image (click to enlarge)
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  • #11
  • Jun 1, 2015 9:51pm Jun 1, 2015 9:51pm
Quoting thodie
dont see any pinbar here When you look at an Candlestick chart you already applied the first indicator to your chart. the Candle indicator is dependent to the open time of the 4h candle, and this timeframe is very sensitive. As you can see i have a different 4h open i see no pinbar here. I made a long time ago a few pictures about dojis, they fail so often you cannot even imagine, there is no edge in using dojis or even pinbars. Look at your chart you will find a few good pinbars which have already failed. {image}
definitely right about that one. That why i would use a minimum position size. It could very well be a continuation bar.
If you are good at something, never do it for free--Joker
  • #12
  • Jun 1, 2015 9:56pm Jun 1, 2015 9:56pm
Quoting Ponzi Jr
{quote} I disagree. I've heard many broad theories on how the market in general works, but I've seen few examples of it applied to real life charts. To understand the theory, I need application.
Cool.

Well, for me, I'm selling this pair on retraces ... so I was looking to sell at 1.092-30 and then again at 1.0990 areas. Happy to give it up above the weekly resistance at 1.1060 area.

Why sell the retraces? Seems to be a bit of a split between opinions on where this is heading, but I think we will see a softer Euro. Just watching how the price collapses is the signal to me that any retrace is a chance to short.

currently short multiple positions since 1.1290.
  • #13
  • Jun 2, 2015 1:04am Jun 2, 2015 1:04am
Quoting jmn5611
{quote} definitely right about that one. That why i would use a minimum position size. It could very well be a continuation bar.
you are right, it could not only be a continuation it could be "everything" just depending on the start time of the displaying candle.
1H Large Timeframe on the 1min chart. Stops already at BE
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just do it
  • #14
  • Last Post: Jun 2, 2015 3:29am Jun 2, 2015 3:29am
touch the support it can be time to buy or at least stop to sell
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