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Cable Update (GBPUSD)

  • #448,261
  • Jan 28, 2017 7:34pm Jan 28, 2017 7:34pm
Quoting srt
GBPUSDDaily.png;2161048 {image}
Hi,

So you think the cable will touch the support line you drew and then go up, if I understand you correctly, yes?

Here is the same chart and the same time frame again. But look, this time we have an entirely different and very bearish scenario, see chart below.

See how easy it is for our brain to find patterns that only "confirm" our belief, while ignoring other possibilities ?
Attached Image (click to enlarge)
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  • #448,262
  • Jan 28, 2017 7:51pm Jan 28, 2017 7:51pm
Quoting Nala66
This is so funny, lessons on drawing straight lines.
It is always very interesting to see how other traders draw (and react to) common chart patterns like trendlines.
  • #448,263
  • Jan 28, 2017 8:07pm Jan 28, 2017 8:07pm
Quoting Mr Breakout
{quote} Hi, So you think the cable will touch the support line you drew and then go up, if I understand you correctly, yes? Here is the same chart and the same time frame again. But look, this time we have an entirely different and very bearish scenario, see chart below. See how easy it is for our brain to find patterns that only "confirm" our belief, while ignoring other possibilities ? {image}
Yes, a close below the "flip" line I drew will be bearish.
I was only referring to the "short-term" view as I mentioned in previous post.
"Flip" line is still support. Below will be bearish :-)
Not disagreeing with your view or anyone's view :-)
I could draw 5 bullish views & 5 bearish views all using horizontal S/R lines :-)
***I prefer to keep view "horizontal" rather than angled TL. I think "BIG" $$$ is concerned with "price" & not a TL.
  • #448,264
  • Jan 28, 2017 8:25pm Jan 28, 2017 8:25pm
Quoting srt
I could draw 5 bullish views & 5 bearish views all using horizontal S/R lines :-)
Hahahaha, yes, that's the main problem with technical analysis
On time frame X the market is saying : "Look, buy me, I am way oversold!"
On time frame Y the market is saying : "Hey, listen to me, I am bearish, short me!"
On time frame Z the market is screaming: "No no, what are you doing, I am in range mode, buy at the lower range line and short at the upper resistance line, trust me!"
  • #448,265
  • Edited 8:58pm Jan 28, 2017 8:38pm | Edited 8:58pm
Quoting Mr Breakout
{quote} Hahahaha, yes, that's the main problem with technical analysis On time frame X the market is saying : "Look, buy me, I am way oversold!" On time frame Y the market is saying : "Hey, listen to me, I am bearish, short me!" On time frame Z the market is screaming: "No no, what are you doing, I am in range mode, buy at the lower range line and short at the upper resistance line, trust me!"




***Then I used the wrong broker with the wrong "close" time(NY close is important) so proper level is 1.2530 :-) (No wonder it's confusing :-))
Attached Image(s) (click to enlarge)
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Click to Enlarge Name: GBPUSDH4.png Size: 30 KB
  • #448,266
  • Jan 28, 2017 9:17pm Jan 28, 2017 9:17pm
Quoting Mr Breakout
{quote} Hahahaha, yes, that's the main problem with technical analysis On time frame X the market is saying : "Look, buy me, I am way oversold!" On time frame Y the market is saying : "Hey, listen to me, I am bearish, short me!" On time frame Z the market is screaming: "No no, what are you doing, I am in range mode, buy at the lower range line and short at the upper resistance line, trust me!"
This has nothing whatsoever to do with technical analysis, it is simply drawing a line in the sand where you are going to take action one way or the other.
  • #448,267
  • Edited 10:13pm Jan 28, 2017 10:02pm | Edited 10:13pm
Quoting Nala66
{quote} This has nothing whatsoever to do with technical analysis, it is simply drawing a line in the sand where you are going to take action one way or the other.
Not really, trendlines are not random "lines in a sand" that we can draw anywhere as we see fit, because the concept of trendlines itself is based on a primordial technical analysis idea : markets trend.

At any given time, there is only one correct trendline, all the others are fake.
  • #448,268
  • Jan 28, 2017 10:14pm Jan 28, 2017 10:14pm
Quoting Mr Breakout
{quote} Not really, trendlines are not random "lines in a sand" that we can draw anywhere as we see fit, because the concept of trendlines itself is based on a primordial technical analysis idea : markets trend.
Think about what you are saying. If this were the case then every man and his dog would be making a ton of money and clearly they do not.
  • #448,269
  • Jan 28, 2017 10:41pm Jan 28, 2017 10:41pm
Quoting Nala66
If this were the case then every man and his dog would be making a ton of money and clearly they do not.
They clearly don't because drawing the correct trendline and support and resistance line is not an easy task, far from it.
And even if they find the correct trendline (or S&R) they usually lack the discipline and money management skill needed to profit from the trend (or reversal of the trend).

You can publish the best trading system on the front page of the Wall Street Journal and traders will ALWAYS find a way to screw things up and blow up their account.
  • #448,270
  • Jan 28, 2017 11:07pm Jan 28, 2017 11:07pm
So now you are saying that 95% of the so called Wall Street Journal readers get it wrong and only 5% get it right.

This suggests to me that the 5% are doing something entirely different and probably don't read this Journal or any other bible of trading.
  • #448,271
  • Jan 28, 2017 11:17pm Jan 28, 2017 11:17pm
Quoting Nala66
This suggests to me that the 5% are doing something entirely different and probably don't read this Journal or any other bible of trading.

True 1000%.

The winning traders (the 5%) have a system with a built-in mathematical edge, use proper management and trade with total discipline.

The others just make random calls (no edge), let their losses run, cut their profits short and usually blow up their account with just one or two bad trades.
  • #448,272
  • Jan 28, 2017 11:21pm Jan 28, 2017 11:21pm
Quoting Mr Breakout
{quote} True 1000%. The winning traders (the 5%) have a system with a built-in mathematical edge, use proper management and trade with total discipline.
So now we have come full circle. A trend line is a line drawn in the sand.
  • #448,273
  • Jan 28, 2017 11:39pm Jan 28, 2017 11:39pm
Quoting Nala66
{quote} So now we have come full circle. A trend line is a line drawn in the sand.
A trendline is only a tool (based on the assumption that markets trend), how you use it to trade is what separates the 5% winners from the wannabes, assuming the trader can draw it correctly in the first place.
  • #448,274
  • Jan 28, 2017 11:53pm Jan 28, 2017 11:53pm
Quoting Mr Breakout
{quote} A trendline is only a tool (based on the assumption that markets trend), how you use it to trade is what separates the 5% winners from the wannabes.
Exactly, just a line in the sand. It tells you nothing more than price has or has not crossed a particular point.

This is like reading the first page of a book and predicting the ending. Not enough information.

It is only a line, nothing more and nothing less.

A five year old child can tell you price crossed the line. Where is the analysis in this, we can all see this with one eye shut.

Price will tell you where it is going and if it exceeds this then the market will grumble and react accordingly.
  • #448,275
  • Jan 28, 2017 11:54pm Jan 28, 2017 11:54pm
From the daily chart, on the 25th the pound had a large bullish candle followed by two inside candles.
Will two more inside bars follow to close out the month or will we get a breakout before month's end?
It's a wait and see scenario.
  • #448,276
  • Jan 29, 2017 12:05am Jan 29, 2017 12:05am
Quoting Nala66
{quote} Exactly, just a line in the sand. It tells you nothing more than price has or has not crossed a particular point.
Absolutely not.

If the trendline has been drawn correctly, then each time the price goes above that trendline (let's say it's an uptrend) and then touches the trendline again, the smart money buys again.

A trendline is not some "line in the sand", it represents real non-random trading opportunities and gives you a real mathematical edge, whether you use it as a continuation pattern (trend following systems) or as a reversal pattern (breakout systems).

Same thing for support and resistance levels, if drawn correctly they are worth gold, assuming you found a way to profit from these levels.
  • #448,277
  • Jan 29, 2017 12:08am Jan 29, 2017 12:08am
What is a trend line break? which trend? at what time frame? and so on. Which ones bounce?
Attached Image (click to enlarge)
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  • #448,278
  • Jan 29, 2017 12:21am Jan 29, 2017 12:21am
Quoting Nala66
What is a trend line break? which trend? at what time frame? and so on. Which ones bounce? {image}
Markets spend 70% of their time NOT trending, so most of the time there is no trend, like in your example.

Like I said earlier, drawing a real trendline is not an easy task, it takes years and years of experience, you cannot just pick 2 points on a chart, draw a line and call it a trendline, the market will NEVER let you make money that easily, you can count on that.
  • #448,279
  • Jan 29, 2017 12:30am Jan 29, 2017 12:30am
Quoting Mr Breakout
{quote} Markets spend 70% of their time NOT trending, so most of the time there is no trend, like in your example. Like I said earlier, drawing a real trendline is not an easy task, it takes years and years of experience, you cannot just pick 2 points on a chart, draw a line and call it a trendline.
That is my question. Where do I get this years and years of experience if no one can answer in plain language.
  • #448,280
  • Jan 29, 2017 12:33am Jan 29, 2017 12:33am
Personally, I don't use trendlines in the least.
Look Sharp/Trade Tight
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