(binned per thread starter’s request) Truth in Trading

Today I am adding a new entry method that is good on both 1.0 and 2.0. Common to longer term trading methodologies is the necessity to endure significant drawdown at times. This will help with that but it is not a panacea and I warn that it must be used with a great deal of caution and only in the context of the higher time frames as has already been taught here.

I have resisted adding shorter term trading methodologies because traders will usually resort to trading only the small time frame methodology where there will surely be more false signals and the requirement to use stricter money management.

In the examples below there was a signal on the H4 time frame with an engulfing H4 candle. It was large and as usual these large candles are often retraced. Rather than enter on an arbitrary retrace one can wait for an engulfing candle in the desired direction. The 15m, 30m and 1H time frames can be used. Review the charts and let me know what you think.

Hi Winston,

Was watching USDCAD this morning, primarily on the M15 TF. The engulfing method you describe is interesting but in my own analysis of this way of trading I found some pitfalls in the past. The main one for me is the question of what do we do when multiple TFs start to line up? There are definitely options for dealing with this on the lower TFs (too expansive to go into here) but I've found it more prudent to wait for the signal to set up in the highest TF that the original PA sets up (H4 in this case).

If we look at the H4 it had evidently printed a fresh demand zone but the issue for me here is that that demand zone did not break the prior structure to the left. Regardless of that, however, we now see that the H4 retested and printed a bullish engulfing candle. Again, the issue for me here is that that bullish engulfing candle did not breach any of the structure to the left, and this is something I treat with suspicion.

I wanted to raise this point because I think traders often get roped in to analysing ostensibly great looking PA (we're great as spotting "patterns" right?) while failing to factor in the context in which those patterns/PA set up. I had a lot of sleepless night doing this. And a lot of "stressy" trades.

Hello Simon,
I've been trading long enough that I've discarded most of the trash available here at FF and thus have developed trading methods that work for me. I do trade supply/demand and use engulfings as my primary signal to enter. I use almost exclusively m15 and m30 engulfings occurring in H4 zones or shortly after exiting H4 zones and I will take nearly every engulfing signal until the next H4 zone is encountered. I often use Andrew's Pitchfork with this type of trading and it is not one that I personally have a thread about although I have posted fairly frequently in Eaglestar's thread how I use this. This type of trading is not what I teach here in the "Truth in Trading" thread as it is very difficult to explain but it is actually MY primary trading method. I'm able to trade outside the zone that most supply/demand traders treat as sacrilege and to be honest is the reason why so many fail and/or are unprofitable.

Good or bad I am not too open to criticism of a method (and if you'd read the thread you would know that) that is working very well for me and others especially when it is apparent the criticizer does not fully understand the method nor trade the method described. I know you don't trade the method's here and judging by your comments and I doubt you've read and studied the PDFs and so your understanding of the methods here are rudimentary or poor. So your comments are really out of place.

The TiT method here primarily rely on the weekly time frame for trading direction with signals occurring in the daily and H4 time frames. The signals are reversal Japanese candles as taught by Nison and Morris of which an engulfing is only one albeit a powerful one. Only daily and H4 Japanese candles are used. So while different time frames are used they are defined and we do not flip back and forth between numerous time frames.

Today I am introducing the concept of using engulfings on lower time frames only after a proper daily or H4 signal occurs in the correct area. I will be going into more detail about it later. This will provide a shorter term entry signals although some signals will be false. Not unlike any other method.

This method is long term and often significant drawdown must be endured which most reject and therefore explains why few trade this method. But I'm not in a popularity contest. Just sharing a method that works for me and chatting with other's about it in my skype room.

One other thing. Most fail because they don't know how to manage their wins and more importantly their losses.

It wasn't a criticism Winston, it was an observation made in an attempt to possibly open a discussion.
Fair enough, however. Your thread, your rules. All the best

Up and down forks shown. Even though the upfork is dominant it doesn't mean we can't sell. The downfork has shown frequency and an H4 zone is placed perfectly. A 30 min engulf occurred and there you go. This is not a method I want to teach here as it is quite different. Just wanted to back up what I said in the previous post.

No problem Simon. I've been very clear in the beginning of this thread that I'm not open to interjections that detract from the method and so my reaction to you. I wish you the best also. Take care.

It's a bit early but if the daily closes with a shooting star then we will have a valid signal.

Same for the H4 engulfing. We can enter on the close of either signal or on a retracement of either candle.

Now just to take a look at the 30 min time frame. This is why I hesitate to post this because I don't want everyone looking for m30 signals in weekly and daily zones. We CAN look for m30 signals ONLY after a proper daily or H4 signal has occurred. So we'll follow this today to see if things line up in real time.

Similar situation with AUDUSD

I updated the first post so their is no confusion about the purpose of this thread.

"This thread exists for the purpose of trading only the methods taught and for traders interested in the methods to post their charts with set-ups, live or demo trades or questions about how to trade the method. I am not open to criticism of the methods as I am completely confident in their profit ability. Your inability to turn profit with the methods is not my problem and is not an indication that the methods don't work.

Losing or breakeven traders usually have a problem with risk management rather than trading a particular method properly. Learning how to manage trades and risk is something that is learned and takes time. Most traders are obsessed with winning more trades than they lose and this is why they are not profitable. A winning strategy is possible by winning less than 50% of trades and the fact is this is what most winning traders deal with in their own trading. Trade and risk management is not something that is easily taught and I make little or no effort to do so in this thread."

Valid H4 engulfing. One could enter on the close or a retrace. In this case I'll be looking for a bearish engulf on the m15 or m30 or H1. Let's see what happends.

AUDUSD H4 with a 2 bar engulf of many bars.

It's not the best time to enter trades but I'll give it a go for illustration. On m30 there is an engulf. I've entered a sell stop below the low of the bearish engulf. Price must come to me. SL is as shown. If I'm stopped out it's a small loss and I can wait for the next signal.

There was a m30 engulf on AUDUSD. I didn't see it but the problem with this is the fact that it occurred at a low rather than after retracing a bit. I prefer retracement trades rather than breakout but I'm not excluding them. They are more risky. You know what they say "buy low and sell high"

9 times out of 10 its best to consolidate the data

thanks for sharing

Daily EU

H4 engulfing still in play but retrace ongoing

30m. Red arrow shows ideal entry. I entered earlier. Currently down about 10 pips.

very easy trading ,actually on d1 theres a pattern far more reliable than an engulfing I have to ask why limit yourself

This is interesting. Some might find entry difficult with just this chart. If you wanted a retrace you might not have got it. Daily printed a shooting star/engulfing.

H4 with 2 bar engulfing.

30 min engulf speak for themselves.

also it confirmed the previous cross,on mine