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Ratios & Harmonics: a Different Way to Trade

  • #14,501
  • Oct 13, 2015 2:53pm Oct 13, 2015 2:53pm
Quoting honestknave
{quote} Hi Wolves77, A couple of conflicting adages: 'nobody ever went broke taking a profit' -and- 'run your winners'. I don't trade UJ (or time based charts), so please bear that in mind but a few thoughts spring to mind... all with the benefit of 20:20 hindsight :nerd: On the scale of charts I trade, I find that price rarely makes one clean move then reverses direction. It is actually a personal rule of mine that I don't trade single swing moves (if that makes sense). I want to see some form of AB=CD before I look for price to properly change...

Hey honest, man i feel a bit guilty about the help/time i'm getting here, as that was just a lazy post from me not really explaining the trade and why i was letting off steam. when i trade now i use a hard stop but no profit target, i just wait to see what pa tells me on a bar by bar basis and close out my trades manually, both for loss and profit. You were spot on about the blue(purple) line just below my exit. That was my new mental line in the sand, if the bears closed below that line i was out. at least that was until my inner chimp took over. damn that chimp.

So, yep, all i had in my mind at that exact point in the trade was 1. if the bears close below the purple line, get out. 2. until that happens stay in the trade.
and yet in the heat of the moment (just for a few seconds) logic went out the window. as i say, damn that chimp lol.

btw, i had been slipping into a bad habit of trying to trade every leg of a move (on a 2 min chart), its easy to go a little stir crazy when its just you and a chart for hours on end, but seeing your charts and the fact your trading the bigger picture constantly helps remind me to snap out of it. so a big thanks on that front, i think seeing others trade, (even if its a slighlty different way to oneself) is a massive help in developing as a trader.
  • #14,502
  • Oct 14, 2015 8:10am Oct 14, 2015 8:10am
Quoting Wolves77
{quote} Hey honest, man i feel a bit guilty about the help/time i'm getting here, as that was just a lazy post from me not really explaining the trade and why i was letting off steam. when i trade now i use a hard stop but no profit target, i just wait to see what pa tells me on a bar by bar basis and close out my trades manually, both for loss and profit. You were spot on about the blue(purple) line just below my exit. That was my new mental line in the sand, if the bears closed below that line i was out. at least that was until my inner chimp...
You're absolutely right that it helps to see how other people trade.

I think this thread is fairly strange for FF in so much as none of the frequent posters trade in quite the same way - we all have our little nuances.

I do understand your frustrations sat in front of a chart all day. To combat the frustration (often leading to taking mediocre entries through impatience or boredom) I broadened out to 2 pairs.

I'm currently in a long on EU. I'll annotate up my trade management more thoroughly and post it up.
  • #14,503
  • Oct 14, 2015 8:14am Oct 14, 2015 8:14am
Quoting honestknave
I'm currently in a long on EU. I'll annotate up my trade management more thoroughly and post it up.
So here was the entry:
Attached Image (click to enlarge)
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And here is where I'm at with the trade management so far:
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  • #14,504
  • Oct 14, 2015 8:27am Oct 14, 2015 8:27am
Quoting honestknave
{quote} So here was the entry: {image} And here is where I'm at with the trade management so far: {image}
The initial target has been hit.
There are a lot of barriers ahead (nested pivots and a RN) so it'll be kept on a very tight leash.
I expect to close this out shortly.
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  • #14,505
  • Oct 14, 2015 8:32am Oct 14, 2015 8:32am
Quoting honestknave
I expect to close this out shortly.
That's me out for +26.5 pips, giving back 4 pips from the initial target.
Let's see where it goes from here.
  • #14,506
  • Oct 14, 2015 9:35am Oct 14, 2015 9:35am
Quoting honestknave
{quote} That's me out for +26.5 pips, giving back 4 pips from the initial target. Let's see where it goes from here.
Attached Image (click to enlarge)
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  • #14,507
  • Oct 14, 2015 1:30pm Oct 14, 2015 1:30pm
Quoting honestknave
{quote} {image}
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  • #14,508
  • Oct 15, 2015 12:31am Oct 15, 2015 12:31am
Good morning everyone

Short on GU.

Counter trend but with the benefit of a tight stop (just above the round number).

2 over-extensions into a major round number. Europe not showing much interest in blasting through.

Entry was on the second test of the RN

Target is a little open-ended at this point. I'd like to see 1.545 but it will depend on whether this turns out to be a proper reversal of sorts... just need to watch price unfold
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  • #14,509
  • Oct 15, 2015 5:44am Oct 15, 2015 5:44am
Quoting honestknave
Good morning everyone Short on GU. Counter trend but with the benefit of a tight stop (just above the round number). 2 over-extensions into a major round number. Europe not showing much interest in blasting through. Entry was on the second test of the RN Target is a little open-ended at this point. I'd like to see 1.545 but it will depend on whether this turns out to be a proper reversal of sorts... just need to watch price unfold {image}
Bravo! that thing looks like it will drop all the way to 1.54. hopefully you held thru the 3rd retest
  • #14,510
  • Oct 15, 2015 5:49am Oct 15, 2015 5:49am
Quoting Mack2013
{quote} Bravo! that thing looks like it will drop all the way to 1.54. hopefully you held thru the 3rd retest
Thanks Mack, I got out at +55 pips... it fell a fair way more after that but hey ho

I'm looking for a re-entry on either EU or GU if there is a safe retrace.
  • #14,511
  • Oct 15, 2015 5:59am Oct 15, 2015 5:59am
Quoting honestknave
{quote} Thanks Mack, I got out at +55 pips... it fell a fair way more after that but hey ho I'm looking for a re-entry on either EU or GU if there is a safe retrace.
Dido, I missed out on the initial move myself. But 55 pips, that's a nice day
  • #14,512
  • Oct 15, 2015 6:10am Oct 15, 2015 6:10am
Quoting Mack2013
{quote} Dido, I missed out on the initial move myself. But 55 pips, that's a nice day
Any day in the green with some lessons learned is a nice day - I'm not happy with my management of that last trade, but I've learned something from it so all is good

Got my eye on 1.5443 GU and/or a retest of 1.14 on EU.

Preferring the GU option, but I'm not fussy
  • #14,513
  • Oct 15, 2015 6:43am Oct 15, 2015 6:43am
Quoting honestknave
Got my eye on 1.5443 GU and/or a retest of 1.14 on EU. Preferring the GU option, but I'm not fussy
All aboard!
  • #14,514
  • Oct 15, 2015 7:13am Oct 15, 2015 7:13am
Quoting honestknave
{quote} All aboard!
I kind of played that one like crap

Took the second rejection and got burned but made it up on the fallow up. I was thinking of exiting at the small rejection of the retest at 1.5420 but thought that it was too small and price would continue down. well the USD data came out and helped the bulls

Like I said, I don't really like how I played that. any comments or observations are welcomed

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  • #14,515
  • Oct 15, 2015 11:08am Oct 15, 2015 11:08am
Quoting Mack2013
Like I said, I don't really like how I played that. any comments or observations are welcomed {image}
Do you have any specific rules regarding minimum retracement? Personally, I'm always very wary of anything that doesn't make at least a 38.2 retracement (23.6 on a wild move). That introduces another problem: where to draw the fib from on a news generated swing. But the principle remains: I don't like direction changes "in mid air", so to speak.

My minimum retracement was 1.5443. As it turns out, I still got suckered into drawdown and the safer (and cleaner) option would have been 8-10 pips later, at what I should have seen as a big magnet for price

My screenshot at entry.
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The better assessment:
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I think your second trade was a good outcome for one being held through high impact news. Yer pays yer monies, yer takes yer chances... news went against the trade, simple as that But you came out in profit overall
  • #14,516
  • Oct 15, 2015 4:27pm Oct 15, 2015 4:27pm
hey mack, i would have been looking to go short in exactly the same area as your first trade based on expectations but ultimately wouldn't have entered due to the price action, the second trade i would have been identical but would have waited for the candle to close, so would have ended up break even rather than profit. So, basically i would have ended that situation at break even where as you came out at a profit, so not sure how helpful it is for me to offer advice, but for what it's worth here's my take on how i read the candles.

please bear in mind that these may just be the ramblings of a mad man lol.

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1. the bears had clearly shown a lot of strength in the last three candles, my expectation would have been for the next candle to be at least a bear candle within the wick of candle 1.

2. not only did the bears not manage to close at all within the wick of candle 1, the bulls immediately stepped in and took out 2/3 rds of the previous candle. this is my first inclination that the bulls may want to push higher than expected.

3. the bulls take the candle again, albeit with small volume.

4. the bulls lead the charge, showing a desire to push higher, but are pegged back as the bears step back in to the market.

5. this is the crucial candle, the bears have pushed back the bulls and now is their opportunity to take and hold the market lower. the bears push but crucially could not hold hardly any of the candle. this is my second clue that the bears aren't ready to push lower.

6. the bulls come back and again lead the charge, even stronger than before. they are pushed back by the bears but no more.

7. the bears have now literally nothing to offer, and the bulls manage to take and hold the ground that they have been pushing for.

8. now, sorry to confuse here but i can change my bias in the blink of an eye, even tho my short term expectation is for the market to go higher, i need to be aware that the bears just took out the previous bull candle, therefore if the bears broke and closed below the purple line i would have gone short, as it happens short term expectations played out and the bulls came back. i would now have to sit back and re-assess for another opportunity to go short.


mmmm, i'm not quite getting across what i'm trying to say here in full, but hopefully what i have put makes sense.
  • #14,517
  • Edited 5:24pm Oct 15, 2015 5:01pm | Edited 5:24pm
Quoting honestknave
{quote} Do you have any specific rules regarding minimum retracement? Personally, I'm always very wary of anything that doesn't make at least a 38.2 retracement (23.6 on a wild move). That introduces another problem: where to draw the fib from on a news generated swing. But the principle remains: I don't like direction changes "in mid air", so to speak. My minimum retracement was 1.5443. As it turns out, I still got suckered into drawdown and the safer (and cleaner) option would have been 8-10 pips later, at what I should have seen as a big magnet...
Hello

"Do you have any specific rules regarding minimum retracement?"

Most of my strategies have some subjunctivnes to the rules. So I try to understand the principal around them rather then following the rules blindly. With that being said, your right. I didn't follow my rules. I'm looking for a well established pullback that shows weakness. A 38.6 retrace, a 1 to 1 complex pullback or a retrace to structure would filled that rule. I was to eager to jump and got burned. Its okay, I'll just try not to make that mistake again.

Maybe its time review my rules.

On review, the second trade was okay even if I had the feeling to exit before the turn. I rolled the dice with the houses money and lost a little so......

Thanks for the review. It actually helped a lot.
  • #14,518
  • Edited 7:53pm Oct 15, 2015 5:21pm | Edited 7:53pm
Quoting Wolves77
hey mack, i would have been looking to go short in exactly the same area as your first trade based on expectations but ultimately wouldn't have entered due to the price action, the second trade i would have been identical but would have waited for the candle to close, so would have ended up break even rather than profit. So, basically i would have ended that situation at break even where as you came out at a profit, so not sure how helpful it is for me to offer advice, but for what it's worth here's my take on how i read the candles. please bear...
No mad man here and it makes sense. I too believe that the 5 candle was critical. With that much strength Bears should of easy taken it lower unless.....

Looking back , I think I jumped the gun and I should of waited. It didn't help that I didn't follow my rules on engaging on pullbacks.

Thank you for your comments. Your analysis is very valuable especially your bar by bar perspective.

One of the things I've been trying to fix is my stubbornness to hold on to my bias. Looking at price action vs. order flow
  • #14,519
  • Oct 16, 2015 3:31am Oct 16, 2015 3:31am
Quoting Wolves77
hey mack, i would have been looking to go short in exactly the same area as your first trade based on expectations but ultimately wouldn't have entered due to the price action, the second trade i would have been identical but would have waited for the candle to close, so would have ended up break even rather than profit. So, basically i would have ended that situation at break even where as you came out at a profit, so not sure how helpful it is for me to offer advice, but for what it's worth here's my take on how i read the candles. please bear...
Very nice analysis Wolves77
I've kind of got out of the habit of doing detailed bar-by-bar analysis, partially because my tick chart redraws bars but that really isn't any excuse. Thanks for reminding me to stop being lazy!
  • #14,520
  • Edited 6:30am Oct 16, 2015 5:55am | Edited 6:30am
good morning

took this small 1 to 1 on L/T order flows PB to structure. Initial target is a retest of lows but if momentum increases i'll be extending targets too around 1.1315.

I'm a little worried about the strength in some of the bull bars but the swing overall looks weak (Edited: a little stronger then previous bull swing tho uhmmmm. Maybe I didn't think this one all the way through)

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Edit: Damn, Stopped out for -10 pips. Initial stops were -14 but choked them up a bit. Reason being, if it made a new short term high and the bull strength then it would probable continue.
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