Attachments: The One: Price Action and Reaction

The One: Price Action and Reaction

#621
Dec 9, 2015 3:16pm Dec 9, 2015 3:16pm

Winston Reed
Joined Mar 2009 | Status: Hobby Trader | 4,477 Posts

Quoting brianv

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For me, entries have always been the issue. Whenever I try to enter on a touch of the fork before the center line is hit, I get creamed. When I try to enter after the center line has been touched, I get creamed. When I try to enter on an "energy point", it never reaches there. When price starts taking out small swings and I believe the trend has turned and I draw a ML set, I wait for a pullback and it never gets there. Then if it does get there on the pullback, it keeps going in the opposite direction and turns into a loss. Entries are the hardest...

Ignored

Again, you are zoomed out on a small time frame. On this H4 I used a modified Schiff to capture PA. The white slider provided some nice opportunities but right now I don't have time to elucidate. I will later. In the meantime study the chart and see if you can find the trades. Take care.

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#622
Dec 9, 2015 3:19pm Dec 9, 2015 3:19pm

Winston Reed
Joined Mar 2009 | Status: Hobby Trader | 4,477 Posts

Quoting Winston Reed

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{image}

Ignored

Closed it. Target nearly reached for 2:1. +80

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#623
Dec 9, 2015 6:46pm Dec 9, 2015 6:46pm

Winston Reed
Joined Mar 2009 | Status: Hobby Trader | 4,477 Posts

Quoting Winston Reed

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{image}

Ignored

Closed. +95

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#624
Dec 9, 2015 7:10pm Dec 9, 2015 7:10pm

Winston Reed
Joined Mar 2009 | Status: Hobby Trader | 4,477 Posts

Quoting Winston Reed

Disliked

{quote} Again, you are zoomed out on a small time frame. On this H4 I used a modified Schiff to capture PA. The white slider provided some nice opportunities but right now I don't have time to elucidate. I will later. In the meantime study the chart and see if you can find the trades. Take care. {image}

Ignored

After reviewing I was able to go back a bit further and envelope price with this modified Schiff. The upper median line shows good frequency with price and it is here that the trades were concentrated. However this view is really a bit zoomed out and price is difficult to see. This can actually be seen very well on the daily time frame and would have been equally tradeable.

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Zooming in a bit to show the PA.
1 price engages a parallel I drew from further back. It pierces the parallel and closes below indicating sellers are here.
2 entry on the retest of the parallel
3 again price pierces the parallel and the upper median line closing strongly down indicating sellers are still here.
4 price doesn't quite retest the parallel so missing this one was quite possible
5 again great separation
6 entry at the retest. But I think depending on how you managed this one you would get stopped out with 7
7 closes above the upper median line so no trade
8 closes strongly below
9 retest of the upper median line although entry could have been earlier
10 and 11 are more possible entries but you would have need to keep your stop loss out of the way.

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#625
Dec 9, 2015 7:28pm Dec 9, 2015 7:28pm

Winston Reed
Joined Mar 2009 | Status: Hobby Trader | 4,477 Posts

If you draw a fork on a certain time frame you should be able to see the price action easily. In other words the open, close, high and low. if you draw a fork on an H4 then drop down to a 15m or 30m time frame you will unlikely be able to see the price action.

#626
Dec 9, 2015 8:58pm Dec 9, 2015 8:58pm

Winston Reed
Joined Mar 2009 | Status: Hobby Trader | 4,477 Posts

Money Management

Your convinced you have a winning strategy. So now what? Well probably the most important thing you can do next is come up with a plan for money management. Without it even your winning trading strategy will likely cause you to lose your brand new trading account. How is this possible? Let’s take a look at some very simplistic scenarios that I hope will clearly illustrate.

1:1

If you trade strictly with a 10 pip TP and a 10 pip SL you would need to win 5 out of 10 trades to break even, 6 out of 10 to make 20 pips, 7 out of 10 to make 40 pips, 8 out of 10 to make 60 pips and 9 out of 10 to make 80 pips.
You will need to be correct 60% of the time to be minimally profitable. Can you make correct calls 60% of the time or more? The statistics say you can’t. Another thing…Can you make sure you keep that 10 pip SL? Maybe you let it go to 15 or 20 pips here and there. If you do this and keep you TP at 10 pips then things get real ugly real fast. You’ll be making deposits to your trading account from your checking account instead of vice a versa.
So 1:1 risk to reward sucks!. If you don’t see this right now then please stop trading. You are doomed.

2:1

Let’s look at 2:1 risk to reward.
If you increase the TP to 20 pips but keep your SL at 10 pips then:
With 5 wins you have 100 pips but your 5 losses were kept to 10 pips each so your 5 losses amounted to 50 pips lost so you have a 50 pip win with 5 wins out of 10 trades. With 6 wins you have 120 pips – 4 losses at 40 pips for a net 80 pips. You can do the math and see for yourself.

3:1

Let’s play along some more and say you go for 3:1 risk to reward which would be a TP of 30 pips with a SL of 10 pips.
So now if you win 5 out of 10 trades your 5 winners would get you 150 pips and your 5 losers would take away 50 pips for a net gain of 100 pips!!!
So that means even if I win only 4 trades I will get 120 pips and my 6 losses would take away 60 pips for a net gain of 60 pips.
If I win 3 trades I get 90 pips and my 7 loses would take away 70 pips for net gain of 20 pips.

Trading in the real world will not allow for a 30 pip TP and a 10 pip SL on every trade as market structure will dictate the TP and the SL. But you can structure EVERY trade so that you do have a minimum of 2:1 or 3:1. If you do this consistently then you will come out ahead. If the trade doesn’t have this minimum requirement then what should you do? That’s right. Pass on the trade and wait for the next one.

#627
Dec 9, 2015 9:51pm Dec 9, 2015 9:51pm

eaglestar
Joined Mar 2008 | Status: He who believes has eternal life. | 3,764 Posts

Quoting Winston Reed

Disliked

Money Management Your convinced you have a winning strategy. So now what? Well probably the most important thing you can do next is come up with a plan for money management. Without it even your winning trading strategy will likely cause you to lose your brand new trading account. How is this possible? Lets take a look at some very simplistic scenarios that I hope will clearly illustrate. 1:1 If you trade strictly with a 10 pip TP and a 10 pip SL you would need to win 5 out of 10 trades to break even, 6 out of 10 to make 20 pips, 7 out of...

Ignored

Excellent. Here are some free worksheets

http://www.medianline.com/whats-new/...orksheets.html

more free
http://marketgeometry.com/free-resources#worksheets

The things that we love tell us what we are Thanks Redsword11 and Tim Morge

#628
Edited 1:39am Dec 10, 2015 1:25am | Edited 1:39am

eaglestar
Joined Mar 2008 | Status: He who believes has eternal life. | 3,764 Posts

Some charts that told in advance some recent moves in SandP Nasdaq and Crude ---will add updated crude chart.

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The things that we love tell us what we are Thanks Redsword11 and Tim Morge

#629
Dec 10, 2015 1:45am Dec 10, 2015 1:45am

eaglestar
Joined Mar 2008 | Status: He who believes has eternal life. | 3,764 Posts

TREND FOLLOWING PODCAST WORTH LOOKING AT AND LISTENING TO
https://itunes.apple.com/us/podcast/...to/id151217747

Wrote a book about Richard Dennis, a long time friend of Timothy Morge.

I will add this to first post.

The things that we love tell us what we are Thanks Redsword11 and Tim Morge

#630
Dec 10, 2015 2:10am Dec 10, 2015 2:10am

eaglestar
Joined Mar 2008 | Status: He who believes has eternal life. | 3,764 Posts

New Poll posted

The things that we love tell us what we are Thanks Redsword11 and Tim Morge

#631
Dec 10, 2015 3:06am Dec 10, 2015 3:06am

lugoffohio
| Joined Apr 2013 | Status: Trader | 10 Posts

@ eaglestar. I don't get it,are u looking at where pivot points and high and lows of the dat coincide, that's where u draw the horizontal lines?

#632
Dec 10, 2015 3:31am Dec 10, 2015 3:31am

juriFX
Joined Jul 2014 | Status: Think in terms of frequency | 341 Posts

Quoting juriFX

Disliked

Posted this AR set of USDJPY few days ago {image} Nice to see frequency at work {image} Possible entry would have been on retest, also good spot because of multiple confluence factors.

Ignored

... and frequency strikes again

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the 3rd wave is the crowd's wave

#633
Dec 10, 2015 5:11am Dec 10, 2015 5:11am

juriFX
Joined Jul 2014 | Status: Think in terms of frequency | 341 Posts

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the 3rd wave is the crowd's wave

#634
Dec 10, 2015 7:16am Dec 10, 2015 7:16am

Hpt
Joined Jun 2015 | Status: everybody trade at one`s own risk | 648 Posts

Quoting Winston Reed

Disliked

Good article on entries and defining "separation". http://marketgeometry.com/free-resou...es/articles/-3

Ignored

thanks for sharing

from level to level - you need mental strength to reach the summit

#635
Dec 10, 2015 10:52am Dec 10, 2015 10:52am

Winston Reed
Joined Mar 2009 | Status: Hobby Trader | 4,477 Posts

I like the setups on EURUSD and USDCAD. However I'll probably sit out as tomorrow is Friday.
Tempting buy

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Tempting sell

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#636
Dec 10, 2015 7:25pm Dec 10, 2015 7:25pm

Winston Reed
Joined Mar 2009 | Status: Hobby Trader | 4,477 Posts

The up-sloping fork is still in play but no doubt price dipped significantly below the lower median line. It found support/buyers and after news yesterday buyers came in strongly. Yet it failed to make a new high and today price did not surpass yesterday's high. The down-sloping fork is shown as it is showing signs of validity. Price tested the upper median line and looks like it will close significantly lower (separation). If it does a sell of a retest is not out of the question.

But....tomorrow is Friday and I don't trust Friday's for trading. It would be nice if price waits until next week to retest.

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