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Support and Resistance Method - Pharley

  • #201
  • Aug 11, 2015 2:53am Aug 11, 2015 2:53am
Pharley, can you take a quick look at my chart below, please? I want to make sure that I got the Fibo right - it's still confusing me.
I considered 1.08 to be the support line. So based on your idea, a buy order could have been opened some time on 30 July this would have been the first and the SL would be right below the 1.08... right? or...
Attached Image (click to enlarge)
Click to Enlarge Name: eurusd-h4-hf-markets-ltd.png Size: 50 KB
Using the RobotFX EAs for a while https://www.robotfx.org/
  • #202
  • Aug 11, 2015 2:56am Aug 11, 2015 2:56am
Quoting pharley
Just thought I'd post a quick update. I've moved SL from it's original position to BE plus a few pips as price has moved 176 pips in my favour. I've placed a limit order to buy at 50% of the last big 4hr move up. But what I'm interested in currently is price is at a minor S/R area. Ideally I want to see price break through the resistance, then come back to test it, which would be a good entry. {image}
Hi pharley

Did you change your mind and enter for the second trade on the close of the big up bar rather than a pull back?
  • #203
  • Aug 11, 2015 2:59am Aug 11, 2015 2:59am
Quoting wattaman
Pharley, can you take a quick look at my chart below, please? I want to make sure that I got the Fibo right - it's still confusing me. I considered 1.08 to be the support line. So based on your idea, a buy order could have been opened some time on 30 July this would have been the first and the SL would be right below the 1.08... right? or... {image}
HI mate,

Yes spot on - don't forget to consider where the weekly/daily support is and resistance for targets (I haven't looked at this pair yet). But yes that's right.
  • #204
  • Aug 11, 2015 3:03am Aug 11, 2015 3:03am
Quoting rover99x
{quote} Hi pharley Did you change your mind and enter for the second trade on the close of the big up bar rather than a pull back?
Hi Rover,

Yes - I was waiting to see if price went up and then retraced back to that minor support. It sort of happened, but not as clearly as I would have liked. So based on my normal entries, I entered at the close of the 4hr which had a good push up. As I write this, price is hanging around that minor S/R area - that's fine and somewhat expected. If it goes down now I'll win on T1 and lose on T2 - but that's the game. Never know what's going to happen - I only try to put the odds in my favour by looking at larger time frames.

Cheers
  • #205
  • Aug 11, 2015 3:43am Aug 11, 2015 3:43am
Hi - an update.

As price has moved in my favour by 218 pips on T1 and 50 pips on T2, I've moved up the SL on both trades. Note where I've put them - the current run is a fast push up without retracing yet, so I've looked left at previous PA and put them below an important swing low in the circle. It's also below the minor S/R area that price has just gone through.

If price comes back to hit SL now I still make a profit which is great - the total positions are positive and locked in. Looking for the next entry point now - probably a retrace.

Cheers
Attached Image (click to enlarge)
Click to Enlarge Name: Moved SL euraud 20150811 4hr entry.PNG Size: 54 KB
  • #206
  • Aug 11, 2015 4:15am Aug 11, 2015 4:15am
Quoting pharley
{quote} HI mate, Yes spot on - don't forget to consider where the weekly/daily support is and resistance for targets (I haven't looked at this pair yet). But yes that's right.
OK, thanks again. Will do
Using the RobotFX EAs for a while https://www.robotfx.org/
  • #207
  • Aug 11, 2015 4:18am Aug 11, 2015 4:18am
Quoting pharley
Hi - an update. As price has moved in my favour by 218 pips on T1 and 50 pips on T2, I've moved up the SL on both trades. Note where I've put them - the current run is a fast push up without retracing yet, so I've looked left at previous PA and put them below an important swing low in the circle. It's also below the minor S/R area that price has just gone through. If price comes back to hit SL now I still make a profit which is great - the total positions are positive and locked in. Looking for the next entry point now - probably a retrace. Cheers...
Yep nice one pharley. I guessed that you'd put your stops there. You're giving me some confidence here, thank you.

Your thread's getting some big hits by the way
  • #208
  • Aug 11, 2015 4:24am Aug 11, 2015 4:24am
Quoting rover99x
{quote} Yep nice one pharley. I guessed that you'd put your stops there. You're giving me some confidence here, thank you. Your thread's getting some big hits by the way

Hi Rover,

Thanks for the comments mate. Well hopefully people can see that things don't have to be complex - in fact the simpler the better (we're always hearing that!).

Good that it's giving confidence mate - go for it! Patience and discipline are the keys on the personal side, S/R with sensible set ups plus risk mgt are the keys on the tech analysis side. That's how I view it so far.

Cheers
  • #209
  • Aug 11, 2015 4:35am Aug 11, 2015 4:35am
Just another quick note about luck as well - I'll well aware luck plays a part in all this.

I could have the best looking set ups, entries, risk mgt etc etc, but there's something I just can't control at all and that's bad news.

For example, when the CHF was pegged to the euro then de-pegged (not sure if that's the right term!), some people lost big time or gained.

You never know - good long runs can be squashed by such news, or another 9/11 (God forbid), or anything. So the risk mgt side of things keeps you safe (hopefully). If you can get on a good run with good set ups, and there's no bad news to reverse the trend, that's some good luck. At the moment there doesn't seem to be bad news affecting the euraud trades, but that doesn't mean it's not hiding around the corner.

Manage trades and risk and of the worst should happen, you only lose what you're happy to risk. If you've locked in profit and bad news hits, at least you can normally get out with something. There's ALWAYS more trades to be had - don't chase them, but let set ups show themselves to you, then hop on board.

Cheers
  • #210
  • Aug 11, 2015 4:47am Aug 11, 2015 4:47am
Great thread ! Thanks for sharing this Pharley. I am subscribed

I think what you are trading is the core of any real trading system. Levels of support and resistance on longer time frames should be included in all systems and I'm currently trying to master this myself. I'm looking forward to follow your trades and posts !

I enjoyed the article you shared on S/R levels. Is there any reason you don't start with Monthly levels before going to the Weekly TF? Right now I'm always moving from monthly to lower TF's to draw important levels. However, I used to draw too many levels (like the article mentioned).

Is there a max number of pairs you trade at once? i.e. Do you max your portfolio risk % or $ at any given time? Or do you trade all setups you find? I imagine that beginning traders like me should really only keep 1 to 2 trades ongoing so we can manage them properly. This is another issue I'm having sometimes that I end up with too many pairs to watch. (The fact that I demo trade makes this a lot worse pbb)

Do you only trade second / third bounces of Weekly S/R levels? Or do you consider PA setups on first rejections also? How do you handle the measured moves if the answer is yes (i.e. There is not always a previous move from S to R i think)

Thanks again for sharing your system and Thanks in advance !
  • #211
  • Aug 11, 2015 4:55am Aug 11, 2015 4:55am
I had anticipated some shorts on EURNZD on the MC / WRB + pin bar formations (Weekly chart - see below). These went against me today. Are you looking at this pair?

Best,
Attached Image (click to enlarge)
Click to Enlarge Name: EURNZD.png Size: 70 KB
  • #212
  • Aug 11, 2015 5:14am Aug 11, 2015 5:14am
Quoting tibovwh
Great thread ! Thanks for sharing this Pharley. I am subscribed I think what you are trading is the core of any real trading system. Levels of support and resistance on longer time frames should be included in all systems and I'm currently trying to master this myself. I'm looking forward to follow your trades and posts ! I enjoyed the article you shared on S/R levels. Is there any reason you don't start with Monthly levels before going to the Weekly TF? Right now I'm always moving from monthly to lower TF's to draw important levels. However,...
Hi Tibovwh,

Thanks for your questions. Let's try and answer them;

I mention weekly levels as that's just my preference - I zoom out a long way to see all the relevant SR areas. I do however look at the monthly charts, but draw SR areas from the weekly charts. The reason is that I can see some major SR areas on the weekly that sometimes are hidden in the monthly charts.

Max number of pairs I trade at once - once I'm on a run, I tend to just trade that one pair. I mentioned somewhere earlier I had another trade I had entered when I started trading this euraud, but I've actually closed that other trade now so I can focus on euraud and mange my risk with just these trades.

I have a $ figure for total risk that I keep to. If I'm maxed out on the risk side and a retrace occurs that looks good to take, I'll try to see if I can move up any stops to reduce the $ risk I'm facing. If I can, I'll take the trade at reduced lot size thereby maintaining my overall risk. If I can't then no - I'll leave the trade aloe until I can enter again. As I say, there are always other opportunities, so I don't chase them or risk more than I should.

Yes I think watching too many pairs can be a problem, especially at first. Even now I miss some good set ups because although I try and watch quite a few pairs, I still miss them - usually forget them, haven't set an alarm, forget them etc. But don't worry about it - there will be others. What works for me (and I must get better at this) is to open the charts on a Sunday, draw the monthly/weekly SR areas and look where price is for each one. Do that on 6 to 8 pairs - pick the good 'uns and not exotics. Be disciplined for each one - study one chart at a time and don't go to the next one until you've finished. Only a few minutes is required. Draw SR areas, see where price is in relation to those. If close, set up and alarm for it, or put an alarm in your mobile phone for it - anything! Then you only need to check them once per day and when trading, once per 4hrs or so. I must admit, I don't really look at any other pair when I'm actively trading 1 pair. If 6 to 8 is too much, take 4 to 6, or 2 to 4. Keep doing it though because you'll get good at it - spotting major SR areas and channels. Also look for those keep breakout and retest areas. They're almost no brainer trades to get in on (along with post weekend gaps).

Re Bounces - If a previous support (for example) are has been established and price comes to that point again, I wait. I don't enter on a first rejection. I want to see what price does - it may bounce, it may break through. If it bounces then I look for a 50% retrace. Sometimes price will come all the way back and I'll lose - this is the reason why my first trade of a run is entered at half my risk. If I see a breakthrough, I wait for a retrace and retest. Normally with a bounce you can see some sort of retrace occur - it happens time and time again, so look for those. (check on past charts to train your eyes on all these things).

I think I've answered them all - let me know if I've missed something!

Cheers
  • #213
  • Aug 11, 2015 5:26am Aug 11, 2015 5:26am
Quoting tibovwh
I had anticipated some shorts on EURNZD on the MC / WRB + pin bar formations (Weekly chart - see below). These went against me today. Are you looking at this pair? Best, {image}
Hi again,

No I wasn't looking at this one, but see my pic below which is the daily chart. I see what you mean about resistance at 1.70 area, but I have another a bit higher at 1.7115 - not too much difference really. For me, it hasn't got up to resistance yet. Plus when it gets there, then I wait to see what will happen.

About removing the 1.5067 level - this would be 1.5000 level and no, I wouldn't remove it. If you look on the daily chart at the price action there, you can see price stalled at it both on the way down and on the way up, so it's a significant level. In fact you can see the breaks and retest of the S/R areas where entries could be taken. Breaks and retests are terrific, and everywhere!
Attached Image(s) (click to enlarge)
Click to Enlarge Name: eurnzd 1day.PNG Size: 50 KB
Click to Enlarge Name: eurnzd 1day close.PNG Size: 30 KB
  • #214
  • Aug 11, 2015 5:33am Aug 11, 2015 5:33am
Quoting pharley
{quote} Hi Tibovwh, Thanks for your questions. Let's try and answer them; I mention weekly levels as that's just my preference - I zoom out a long way to see all the relevant SR areas. I do however look at the monthly charts, but draw SR areas from the weekly charts. The reason is that I can see some major SR areas on the weekly that sometimes are hidden in the monthly charts. Max number of pairs I trade at once - once I'm on a run, I tend to just trade that one pair. I mentioned somewhere earlier I had another trade I had entered when I started...

Just to add sometime on time frames. I was once told by a successful trader that the Weekly time frame is quite unique, in that it's the only one that has a definite stop i.e. all markets are closed the world over on a Saturday!
Daily charts can vary from broker to broker as does 4hr
  • #215
  • Aug 11, 2015 5:45am Aug 11, 2015 5:45am
Quoting wattaman
Pharley, can you take a quick look at my chart below, please? I want to make sure that I got the Fibo right - it's still confusing me. I considered 1.08 to be the support line. So based on your idea, a buy order could have been opened some time on 30 July this would have been the first and the SL would be right below the 1.08... right? or... {image}
Another way to look at this which would allow for multiple entries........

There is a pin bar which invalidates some of what I have done here but please if you ignore it I think this is a good example.

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Indentify > Plan > Accept > Execute
  • #216
  • Aug 11, 2015 6:03am Aug 11, 2015 6:03am
nice and simple subscribing
Bulls are stupid Animals!especially when Im short!
  • #217
  • Aug 11, 2015 6:04am Aug 11, 2015 6:04am
Quoting wizlon32
{quote} Another way to look at this which would allow for multiple entries........ There is a pin bar which invalidates some of what I have done here but please if you ignore it I think this is a good example. {image}{image}{image} {image}
Wizlon! I like it !

Great - starting to see those entry possibilities! You've got it right in terms of entries and moving up stops to minimise losses and risk. Good way to really boost some profits. It's terrific to have your earlier trades safe and not at risk as it allows you to take further entries.

Remember also, when trades 1, 2, 3 SL are moved up, if you take the same risk (say 5%) on the 4th trade, your gains from T1, T2 and T3 may be more than the 5% you're riskingon T4, so you're actually not risking anything in terms of the overall account for that day or run. You're only risking on the last trade.

Cheers
  • #218
  • Aug 11, 2015 6:06am Aug 11, 2015 6:06am
Quoting roughtrader
nice and simple subscribing
Welcome Roughtrader! Feel free to analyse, post and comment.

Cheers
  • #219
  • Aug 11, 2015 6:07am Aug 11, 2015 6:07am
Quoting rover99x
{quote} Just to add sometime on time frames. I was once told by a successful trader that the Weekly time frame is quite unique, in that it's the only one that has a definite stop i.e. all markets are closed the world over on a Saturday! Daily charts can vary from broker to broker as does 4hr
Hi Rover99x.

I'm really enjoying your posts keep'em coming.

Just wanted to clarify that most people think that the currency market (forex) is closed during the weekend, but this is not true. It is only closed to retails traders, but it is always open for the central banks and the related organizations. Currency transactions are always done electronically and can not be stopped even for one second. When the market is open and buying and selling are ongoing, then the price also goes up and down, because the price changes based on the supply and demand, and when there is supply and demand, the price changes also.

That is why when the market opens to the retails traders on Sunday afternoon at 5pm EST, the price has a visible difference compared to the level it was closed on Friday afternoon. If the price opens higher than the Friday afternoon price, we will have a gap up. If it opens lower than the Friday afternoon price, we will have a gap down.

Had this copied in my files from an Internet site I came across a few years ago.
Healthy, Wealthy & Steady!!
  • #220
  • Aug 11, 2015 6:12am Aug 11, 2015 6:12am
Quoting SunnyFx2002
{quote} Hi Rover99x. I'm really enjoying your posts keep'em coming. Just wanted to clarify that most people think that the currency market (forex) is closed during the weekend, but this is not true. It is only closed to retails traders, but it is always open for the central banks and the related organizations. Currency transactions are always done electronically and can not be stopped even for one second. When the market is open and buying and selling are ongoing, then the price...
Thanks Rover and Sunny for the explanation. That's why I see those pesky gaps! Mind you, I do like to trade them sometimes.
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