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"Ratios & Harmonics: a Different Way to Trade." Summary 36 replies

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Ratios & Harmonics: a Different Way to Trade

Quoting Mr. Pip
{quote} It is the essence of price movement.
I since some days am having a problem: only see W's !

Just drew 5 W's in a 5 minute chart, some W's inside bigger W's .... its getting crazy ! weird thing is that they do follow the bearish harmonic behaviour, but their ratios are all wrong.
Quoting Masterrmind
{quote} EU Price is stuck around the blue colored demand zone (refer chart above) and PA is as slow as watching grass grow. So most likely no trades today for me. ps. there is some news coming out in just under 2 hours time so it might create a little PA ... keep a close watch if you are following the euro pair. Masterrmind.............
EUR price symmetry 5 min
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The things that we love tell us what we are Thanks Redsword11 and Tim Morge
Quoting pereiraalex
{quote} I since some days am having a problem: only see W's ! Just drew 5 W's in a 5 minute chart, some W's inside bigger W's .... its getting crazy ! weird thing is that they do follow the bearish harmonic behaviour, but their ratios are all wrong.
Post a chart I will help you make sense of it. Make sure you include the instrument and TF
If you fail to plan, you plan to fail.
Quoting eaglestar
{quote} EUR price symmetry 5 min {image}
Isn't it a beautiful thing?
If you fail to plan, you plan to fail.
Quoting Mr. Pip
{quote} Isn't it a beautiful thing?
Of course. The market is natural flows in symmetry. Waves within waves and so forth.
The things that we love tell us what we are Thanks Redsword11 and Tim Morge
Quoting Mr. Pip
{quote} Post a chart I will help you make sense of it. Make sure you include the instrument and TF
Thanks, but no need to lose your time with it. I am sure that its not real harmonic patterns, as the ratios are way off !

But my comment was more in a way of: "Seems latelly market moves in M's and W's, everytime! (at least the cfd instruments i follow)"

Example chart, but also alot of W's in Dow, Nasdaq and SPX500

PS: instrument is Ger30 / Dax, German index, 5 minutes chart
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Quoting vqtrader
{quote} What do I make of it? The overall structure is down with weak pitch/momentum creating NSL. Currently, the orderflow is out of alignment as it is moving up. Because of the weak pitch my expectation is a deep correction to the upside. What do you do? If I was aggressive I would trade order flow long, otherwise will wait for a breakdown in PA in an area of structure and realign myself with overall short bias.
Quoting x3m-PippiN
{quote} {image} Everybody, I wish you a well spent holiday time with your dearest friends and family. I hope there will be participation here before the end of the year because I really enjoy spending time in this wonderful thread. Best wishes to all and especially Damian without whom (like Jmezz) I'd probably given up on this hard but possible journey.
Quoting Mr. Pip
{quote} Thank you for the nice words. What would I do given this market? Go fishing, LOL just kidding. I will wait for more posts then I will give you my outlook. What instrument is it?
Quoting evocpr19
{quote} First short update on YM: On Friday I was looking for a long entry, since I thought that the "new" price drop which Mr. Pip traded was more a retest. I entered later long, but I was too optimistic on the determination of price to move up and I placed my SL too close. Hence, SL were hit (by a wick) and then price moved up to do a 1:1 harmonic completion of the previous up swing (then stock market closed). S--t happens. @jmezz: With respect to your quiz. A new NSL happened, but price took long time to produce it. Then a fight between sellers...
Quoting Masterrmind
{quote} Longer term order flow as per only the candles shown on your chart is clearly to the downside. I would want to get into a trade where the short term order flow and the longer term order flow are in harmony. Draw in your 1 to 1 from the most recent NSL and project it upwards. I would want to observe what PA does at the 1:1 zone in the first place followed by the 127.2 then the 161.8 however initially I would be mapping out areas of possible confluence where exhaustion Fibs meet with key chart structural levels/zones. The bulls are showing...
Quoting rocky
{quote} Great answer Mastermind, we're on the same page with Jmezz question. My answer would have simply been that I would not trade this chart. I would need to see what's to the left of this chart before any informed decisions could be made.
Quoting Mack2013
{quote} What would I do? This would be my thoughts for the current situation and what I would like to see. If price doesn't happen to get to these areas on my terms then I would sit on my hands and wait for order flow to align or re-evaluate when a favorable opportunity presents itself. Edit: Masterminds answer is pretty good. look forward to the answer I hope the writing is big enough to read. {image}
Quoting Masterrmind
{quote} A very quick annotated chart I have thrown together based on jmezz' supplied chart. {image} Note: Another trader could easily have a different take on this trade and some of the reasons will stem from what type of order flow you are following short or long term OF! The entry criteria will also be very different with respect to the PA based on whether a trader chooses to follow short, long term OF or to be in sync with both short AND long term OF. ps. I thoroughly enjoy chart analysis ... so thanks to jmezz for posting the initial chart ......
Quoting Maule
{quote} Here's my analysis. {image}
Quoting crixus
{quote} This is my take on your quiz... I see two areas of balance where the zone at the bottom was quickly rejected. We have not found selllers yet. Price could just as well reject the higher area of balance right at the bottom edge where it is right now or we might go deeper into this higher zone in search of sellers. Typical levels which might see the return of sellers is the middle of this zone or just above this zone in the upper part where the origin of the move down took place. Once price enter into an area of balance my expectation is for...
Ok first of all, major shout-out to everyone who gave their opinion on this price action! There was a ton of participation, that's awesome. I think I quoted everyone who replied, if I missed anyone then I apologize.

Looks like most people said that they'd be playing a long and a few said they'd then look for the short a little higher.

I saw Masterrmind say he wouldn't even be sniffing for a long, instead would be waiting for the short to go with long term expectation.

Rocky wouldn't do anything.

Damian would load up the poles and the tackle box then head out for some of those Florida Marlin.

Ok here's the ensuing PA and how I traded it:

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The reason I posted this quiz is because I was upset that I missed out on that large move down and I wanted to see how others would gauge it to see if I missed something.

When I first saw the PA that day I said that I'd be looking to long around the 70's or short around the 80's. In taking the long, I lost sight of the short and instead of flipping short when I saw price reject 77 for the 3rd time, I just sat there like an idiot trying to figure out what price was trying to do.

Essentially what this comes down to is playing the short vs long term order flow. I chose the short term and choked when it came to trying to take advantage of the long term. However, I feel much better after reading responses that acknowledged that the short term was up.

Quoting Mack2013
{quote} 1 second that. I too really enjoy these quizzes
I'm really glad to see the participation towards it. I know I've posted a couple of quizzes a while back and they've definitely helped me. I can see others benefiting from them as well as it's a way to apply critical thinking.

I might make these a regular thing if people don't mind some dissection every now and then. Maybe post 1 every Friday or every other Friday and give people the weekend to comment if they like.
Quoting x3m-PippiN
I was wondering ..do you guys keep a trading journal or something like that. I know that Jmezz has a blog which he uses as a journal and posts the same charts as here. I like to screenshot every trade I take.
I use Twitter and my blog however I haven't updated my blog in a couple months. I was solely using Twitter but then got annoyed when I wanted to go into detail about something as you're limited with characters there.

So then I'd use my blog but found that updating 3 sites (this thread, Twitter, my blog) was too much and redundant.

I post the most detail here in this thread as I consider this my home and keep copies of my charts on Twitter so I can go back to study.

I just wish there was a simple way to take all of my posts here and transfer them over to my own website for safe keeping should something happen to this thread or forexfactory in general lol.

To answer your question, I think you should be keeping track of your trades and notes 100%, you just need to figure out which way works best for you.
  • Post #23,169
  • Quote
  • Edited Dec 28, 2016 4:55pm Dec 27, 2016 10:51pm | Edited Dec 28, 2016 4:55pm
Quoting jmezz
{quote} {quote} {quote} {quote} {quote} {quote} {quote} {quote} {quote} {quote} Ok first of all, major shout-out to everyone who gave their opinion on this price action! There was a ton of participation, that's awesome. I think I quoted everyone who replied, if I missed anyone then I apologize. Looks like most people said that they'd be playing a long and a few said they'd then look for the short a little higher. I saw Masterrmind say he wouldn't even be sniffing for a long, instead would be waiting for the short to go with long term expectation....
I'm glad that I was sort of right to wait for a PB and I was sort of right with location but thought price would cleared to the 61.8 at least with such a violent reaction from the Bulls.

I wouldn't feel bad about missing this opportunity. You were right but price never really gave you a chance. On the retest at the 50% area. Just up to structure and down. And with the violent reaction and S/T strength from the Bulls, I personally would of like an indication to go lower like a broken trend line or S/T order flow switch.

But your also better with this type of price action then me so...

On a funny note: everytime I write S/T my phonw wants to auto correct "S/Tom Cruise" in . I know tom cruise is short but he's not really short term. He's more like an arm rest. Ba Dum Dum Tss

Edit: apparently a short turd is funnier
Quoting eaglestar
{quote} EUR price symmetry 5 min {image} {image} {image}
Fibonacci and Andrews Pitchfork working nicely. Hit 161.8 as well as had multiple touches on the APF. Also interesting is that the moves up were near the 23.6 fibonacci number. Also notice how the cycle line called the top on the first cycle marker.
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The things that we love tell us what we are Thanks Redsword11 and Tim Morge
Quoting jmezz
I'm really glad to see the participation towards it. I know I've posted a couple of quizzes a while back and they've definitely helped me. I can see others benefiting from them as well as it's a way to apply critical thinking. I might make these a regular thing if people don't mind some dissection every now and then. Maybe post 1 every Friday or every other Friday and give people the weekend to comment if they like.
I think this type of quizzes are a great way to get involved in different market situations. I'd suggest that if there are other people interested in this ...we can open another thread solely for this type of quizzes or if no one minds we can do it here. IMO it would be better to do it in a different thread because this one would get too scattered.
Quoting jmezz
{quote} {quote} {quote} {quote} {quote} {quote} {quote} {quote} {quote} {quote} Ok first of all, major shout-out to everyone who gave their opinion on this price action! There was a ton of participation, that's awesome. I think I quoted everyone who replied, if I missed anyone then I apologize. Looks like most people said that they'd be playing a long and a few said they'd then look for the short a little higher. I saw Masterrmind say he wouldn't even be sniffing for a long, instead would be waiting for the short to go with long term expectation....
Hey Mezz you have to be very aware of this......

'The reason I posted this quiz is because I was upset that I missed out on that large move down and I wanted to see how others would gauge it to see if I missed something.'

Changing this mindset will help....easier said then done lol
It's a dirty job but someone's gotta do it!
Quoting jmezz
...Ok first of all, major shout-out to everyone who gave their opinion on this price action! There was a ton of participation, that's awesome..
I have looked at the chart now that we know the instrument. Here is how i would have marked the chart using range analysis. The idea is to use the edge or boundaries of a range to stalk a trade where the RR is optimal.

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What followed and my structural framing:
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TF -.5, +2.9 = +2.4 total

Notes on chart

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Is it crazy to look for a long at point D ? EURUSD at 15 minutes chart

PS: I mean .. there seems to be support and structure, but that strong drop, there sure are sellers there.
If bulls are successfull, point D becomes a HL, and probably lookout for a AB=CD. Is it good thinking ?
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Quoting pereiraalex
Is it crazy to look for a long at point D ? EURUSD at 15 minutes chart PS: I mean .. there seems to be support and structure, but that strong drop, there sure are sellers there. If bulls are successfull, point D becomes a HL, and probably lookout for a AB=CD. Is it good thinking ? {image}
I personally wouldn't touch that with a 10 foot pole. I'm actually short EU Long UJ.

Too much selling strength i think. I personally think that support will be broken and EU will hit new lows.

But lets watch price action react with that support level and lets see what happens, because the one thing i do know is that i don't know. lol
Office is clean and ready for 2017!
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If you fail to plan, you plan to fail.
Notice the trade plan on my desk. It's always close by to keep me disciplined!
If you fail to plan, you plan to fail.
Quoting Mr. Pip
Office is clean and ready for 2017! {image}
Wow. I need to get my a $$ in gear. I'm ashamed to put up a picture of my desk. There's chocolate still on the keyboard. Lol
Quoting SteeP7
{quote} I personally wouldn't touch that with a 10 foot pole. I'm actually short EU Long UJ. Too much selling strength i think. I personally think that support will be broken and EU will hit new lows. But lets watch price action react with that support level and lets see what happens, because the one thing i do know is that i don't know. lol

Thanks.

Yeah, the selling pressure seems very strong for me, but because of the harmonic patterns i will look at support and see if there is buyers.

Anything can happen, that is for sure.
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