Divergence Pip Range Trading

Hi all,

EDIT: No idea why this is in commercial as I'm not selling anything.

My first foray into posting a new topic. I've been using piprange charts for 7 years and via the contributions of @Rockypoint using the Ichimoku indicator, I've been able to combine my use of divergence and Ichimoku.

I thought I'd share some examples and try and generate some discussion on the much neglected method of using pip range charts. To me they provide a much clearer picture of the market and provide a different perspective on charting. I am very much a technical trader and firm believer that patterns repeat themselves. Hopefully this will be evidenced by examples posted.

A few things to note:

 

1. I will not be posting EAs, indicators etc. There are dozens of EAs designed for MT4 to construct offline charts to create pip range charts.
2. I am not interested in an EA being developed, I much prefer manual trading.
3. Please take the effort of researching an answer before asking a question, should you not find it, feel free to ask.

I use a 5 pip range chart, I avoid any CHF pairs and JPY pairs for the simple reason I do not want to be in a trade when they manipulate the market. What the SNB did with the Franc and the Euro was absolutely ridiculous. My main pairs are GBPAUD, GBPUSD, EURUSD, EURAUD. I am a firm believer in mastering a few pairs rather than trying to trade too many pairs. I do not trade positively correlated pairs at the same time....to do so is to simply double your risk on the same outcome.

You can download CRB EA here.

I have a lot of examples on my Instagram page. My username is @Flipfloptrader.

Today's trade so far:

EURAUD. Very strong AUD vs most pairs and EURAUD can trend very well when in these phases. Price made a lower high, oscillator made higher highs to complete hidden divergence.



Any questions are welcomed.

FlipFlop.

https://flipfloptrader.com

A late trade from last night with EURAUD. It had been on the run down all day and infact all week but I felt with the FED decision coming later and price hitting support it was a good chance for a little bounce upwards. I don't always like to counter trend trade but when certain factors line up, it felt a low risk opportunity.

Even after I entered, you'll see price again confirmed a chance of rising with another regular divergence with the AO.

+20 pips.

I was wondering what indicators are you using for the divergence?

Also could you tell me a little about how you are using divergence in your trading.

Thank you in advance

3 indicators in total being the Awesome Oscillator (AO), CCI and Ichimoku indicator, all 3 are standard in MT4.

I use both types of divergence being hidden and regular. I prefer to use hidden to stay within a trend. I will use support/resistance to confirm a trade also on time based charts, predominately on the M15.

I look for small bits, often. +15/20/25 pips 2 or 3 times a day is all I'm after.

I trade from 5pm-11pm local time which is 8am-4pm London time.

Missed this setup as I was late in from work but a good example to post showing how I combine time based support/resistance with pip range trading and divergence.

First chart is a 4HR chart showing a fine area of resistance with plenty of wicks.



This chart is the pip range chart. Price shows clear divergence with the AO and with the candle showing rejection off of the resistance area, perfect entry.



Hopefully find an entry this evening I can get into.

EURAUD trade with price dropping to support around the 1.4640-50 area and a lovely pinbar forming off the descending trendline. Combine this with divergence and a solid setup was presented.

+16 pips.

My 2 other trades from last night (local time) and the first one being EURAUD and almost a carbon copy of the first setup. Price showed no sign of not respecting previous support and with a good setup, it seemed a logical trade.



The other trade was GBPUSD and these trades ran concurrently but importantly they are not correlated and can move independently of each other and allow me to not double my risk on the same move that I see so many traders do.

I originally set my TP at 1.3080 which was just below the daily highs. However, as time progressed and no retracement came, I felt there was a good chance the daily range could extend as it was very low at 58 pips. I extended the target to the BRN of 1.3100 and price eventually zoomed right past it but a pleasing result as I doubled my original target and it capped off a great day.

Hopefully more of the same today to end a good week.

where is your SL and TP on these trades.

I don't have any predefined SL/TP. I have a hard stop of 100 pips but I use trade management to cut a trade usually long before that if it's going wrong. Avg is around 25 pips. My TP again varies, I don't like to use defined targets, I'll take what I believe is available. Can be 15, 25 or 50.

First trade of the day. GBPAUD. Broke one of my own rules by beginning 45 minutes too early. As I was off work I had ample time to eyeball some charts and potential setups. GBPAUD grabbed my eye and on reflection I was way too keen to get involved as I didn't want to miss out. It's amazing that even after 8 years of trading I still have to remind myself that there always and always stronger/better setups. This proved 100% true as the 2nd trade I entered should have been the one and only trade on this setup.

Look at the level of support on GBPAUD on the 15 minute chart:



Entered originally at 1.7057 and then again at 1.7043 which turned out to be a good, solid entry. Targeted 1.7065 which was just below previous support. I left to walk the dog and turned out someone shot the Aussie dollar and it rallied hard past it.



Currently in a short EURAUD and around 2 pips from TP.

Here is the EURAUD trade, after coming back from walking the dog, I noticed that the Aussie dollar had been shot and EURAUD and GBPAUD had rallied strongly. I love to fade a quick move and the setup looked strong when looking at all the variables. Firstly, look at this 1 HR chart of EURAUD. Clear downtrend since the beginning of the week and you can see price struggling to gain any further around 1.4720 area. Add in a perfect area of resistance with the 85 EMA and I felt a short would be ideal if divergence confirmed it on the pip range charts.



Going to the pip range chart, divergence occurred and after a slight confirmation with a rejection off of 1.4720 I took my entry. Target was at the last recent low giving me 20 pips. Will most likely have a break until NY open unless something stands out.

Currently long GBPAUD, watching closely given massive GBP weakness.

Here is the chart for the above. Price dived sharply lower and I was watching GBPUSD and GBPAUD for a possible trade. I missed an ideal trade on GBPUSD and had to remain patient for the setup. Once in the trade, I followed it closely and allowed the trendline to guide me in terms of possible reversals or targets. Set my target at 1.7083 for +30 pips and was very happy to end the day and week on a positive. It's been a great week and hopefully can continue into next week.

Back on Monday.

yes, nice system, watched late friday EURAUD trade. After the pair reached 1.476 res. I changed to the 5 pip range chart and seeing
a small div. on CCI opened a sell trade for about 15 pips. Divergence never lies.

...(I thought I'd share some examples and try and generate some discussion on the much neglected method of using pip range charts. To me they provide a much clearer picture of the market and provide a different perspective on charting.)....

the same meanrenko charts provide a clean picture I use.

Nice trade. Never got on with renko bars but whatever works for you.

I use renko to detect supp.-res. like that eur - usd chart on friday

after that my best range bars divergence setup:

my first trade shortly after London open on monday.
I saw a support at 1.471 euraud for a quick 15 pips.

First trade of the week, GBPUSD. First note the great bounce on Friday at this level on the time based chart, add in the cam level and we have a good chance of a bounce.



Looking a the pip range chart, clear divergence and once price had a 5 pip candle to the upside, confirmed an entry for me. Took an exit at the previous high point for +16 pips. Nice way to start the week.



If you also look, hidden bearish divergence has appeared also and I'm currently short with a reasonably tight stop incase price wants to keep moving upwards, if price can go lower, I'll monitor reaction to the 1.2915 area and try and get a good exit.