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Is strictly trading support and resistance profitable?

  • #81
  • Feb 26, 2017 7:19pm Feb 26, 2017 7:19pm
Seeing something open up on EUR/JPY, too early to call however
  • #82
  • Feb 26, 2017 8:32pm Feb 26, 2017 8:32pm
Quoting Redeflect
Also, yes, thank you... you showed us all a good setup. I just scored a few dozen pips going short on the USD/JPY after it bounced a little off the support line and resistance started to shove it back down. Basically, I profited off of the traders who saw what you saw and thought it was a good time to buy.
Yeah, feel free to post your own charts too
  • #83
  • Feb 26, 2017 11:02pm Feb 26, 2017 11:02pm
I am looking at the same charts you are. I trade by watching and 'feeling' the market move... and by what I know from the news calendar, time-zones, psychology, and by learning what methods everyone else is using. My strategy is to use my brain and adapt to what the market is doing. By the time I were finished making up a chart and indicating what I see the market has already shifted.
 
The only proper way to trade is to flow. I can't show someone how to enter their flow-state.

But, if I could give any advice for indicators to learn they would be an RSI(I have never used a CCI but it may be more useful) and Bollinger Bands with an exponential moving average and 2 standard deviations for the outer bands.
"The fun is in the hunt. Not the kill."
  • #84
  • Feb 26, 2017 11:58pm Feb 26, 2017 11:58pm
EURJPY bias is fundamentally down (Marie le Pen & Geert Wilders -> EUR down & general uncertainty -> JPY up... unfortunately you already missed many pips. I just wouldn't get long without changed fundamentals), I would open a short immediately or on an intraday pullback with a stop well protected by the next significant resistance line(s) and a pending short order right before the next resistance line. And before following MoneyZilla's advice regarding money management, take a look at this:
He's doomed sooner or later, it's mathematically inevitable. But hey, we all need somebody loosing to make a profit, so don't listen to some little unimportant trader who is Math teacher as well. Better listen to real pro traders (read "market wizzards").
There is no Broker SL hunting, if your broker is non-dealing-desk.
  • #85
  • Edited 1:06am Feb 27, 2017 12:13am | Edited 1:06am
I have to disagree with anyone that knocks down Martingale. It is an excellent money management strategy when used properly. Quantum Physics and Schrodinger's Cat confuses mathematicians because mathematicians don't understand reality. It's a good thing Wallstreet hires physicists rather than mathematicians ;-)
Â
To put things more clearly; Martingale only fails when you're repeatedly wrong. If you're wrong that many times then you shouldn't have gotten into the trade in the first place and you refused to admit defeat. However, if you got into a trade for the right reasons and your positioning was just off slightly or the tides are turning and you need to escape at the earliest signs of a pullback then Martingale provides a method of both capitalizing on an even better opportunity and escaping out of a trade that's become fundamentally inopportune. It's used to shift your positioning. Not to save you from failed trades(although you may get very lucky for a long time with it as a primary escape plan). It's like dynamite; an excellent tool when used properly by a deft individual but it can blow up the account of a trader who mishandles it.
Â
Mathematically we are all destined to go broke or become wealthy if we keep playing the game. Mathematically we all stand an equal chance. You could ask a mathematician to take a guess at what separates the winners from the losers. Better to ask a physicist.
"The fun is in the hunt. Not the kill."
  • #86
  • Feb 27, 2017 2:12am Feb 27, 2017 2:12am
Hi all
Dear friends,
The way you're talking about trade and trend is that some indicators or machines run the market but as a matter of fact this is human and it's better i say Banks are moving the markets up or down and during the day , they let market moves with brokers or very rich organizations.
Referring to this idea you have to be able to understand how they think and how they want the market's moving (if you will be very lucky your indicators, Strategies, Systems show the right directions) .
There are so many software programmers and genius students who can write valuable and expert software but none of them have been successful in this market with this way of trading for long term of trading, otherwise all the brokers and banks have been in red within a minute.
Now if you see some people here or there predict the market correctly it's not for their tools or indicators, it's the way they are thinking the same as managers who move the market today or next day that's all.
  • #87
  • Feb 27, 2017 2:31am Feb 27, 2017 2:31am
Quoting Redeflect
I have to disagree with anyone that knocks down Martingale.
I'm teaching physics as well btw! No, I'm not against Martingale, but you have to set a stop when you admit that you were wrong. Suppose you made the Trump trade like I did (being an idiot, I didn't lock in my initial profits and ended up with a loss, but at least I learned my lesson) when the initial movement was quickly reversed. Say you went USDJPY short because you followed the consensus, that the USD and US equities would crash if Trump wins. Now martingale a move from 101 to 118 on USDJPY against you! Or remember the SNB Bomb. Try to martingale that one out if you are on the wrong side! In hindsight, you are always wiser and you might be telling me "oh if you just open like 5 positions at 105, 110, 112, 115, 117 and 118, you'd be already back in profit". The problem however is, you really don't know for sure where the price pulls back in your favor (125 was on the cards and still is). In reality, when your account is down more than 50%, you will probably begin to worry and ask yourself if it's not better to puke (accepting any loss just to keep at least some of your money). THERE IS NO EDGE OVER THE MARKET IN MONEY MANAGEMENT. The sole purpose of MM is to survive another day (limit risk) and advising you in taking a reasonable (but limited!) risk, so your Edge (like technical or fundamental analysis) can play out for you via the law of large numbers in your favor in the long term. A goal of 30% return per month (MoneyZilla's goal) is so incredibly aggressive with Forex, you'd almost need a crystal ball if you want an acceptable shape ratio too. I have never seen a single Equity Curve on MyFxbook for instance with a strategy this profitable AND an acceptable shape (that kept it's shape several months after I first saw it). You always get these really nasty drawdowns of 50% or so. The law of large numbers will make that one of these drawdowns will kill your account sooner or later. You'd have to discover a technical loophole (like HFT Triangular Arbitrage in the early days of HFT trading). But the hurdle of exploiting such loopholes is incredibly high and always rising. I once discovered something like this. I traded Binary Options using low latency News Event clicker software (Forex News Gun). Using optimal risk with the Kelly Formula, it would return 200%++ per month. I alone would have made the whole industry broke if they had allowed me to continue. However Binary Options are only a Scam Scheme, you can't win as David against Goliath (the Broker). They stopped accepting my trades, so I rent a server in New York to bring my latency from 50ms to 1ms until even that wasn't enough. In the end, with server fees and not paid profits (Crooks!!!), I made a 4 digit loss. But hey, don't stop chasing your luck!
There is no Broker SL hunting, if your broker is non-dealing-desk.
  • #88
  • Feb 27, 2017 2:36am Feb 27, 2017 2:36am
Quoting FXMasterSK
{quote} And to answer this threads main question, no, strictly trading support and resistance is not profitable. They are tools designed to help you zone in on key areas where price could potentially turn. That alone by itself is not enough to make you money. Good luck!
I disagree, I trade the S/R levels and am profitable... hidden S/R levels... not only do I use them for potential market turns but the way my s/r levels work revolve around how PA moves. Where price stops, how price reacts at a certain level.. if price breaks a certain level there's a high chance it's going to test the level I have after it. I trade the break+retest of these levels no matter what any indicator is showing me and it works.. and I use tight stops. I've spent thousands of hours screen time and when I see how PA reacts at one of my levels most of the time I know what its going to do, therefore my drawdowns are always very minimal. I either get stopped out or I get 0% drawdown and my trade runs north for me. So yes you can strictly trade support and resistance, you just need to understand how they work. My S/R levels however are unusual and not the ordinary S/R levels any trader can pick out. For example look at this trade I have running atm...

This is the 5min chart I enter on hourly and use hourly only, I'm just showing the 5min chart to see the drawdown..

and by the time I wrote this TP was hit.
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  • #89
  • Feb 27, 2017 2:55am Feb 27, 2017 2:55am
Quoting Noors
{quote} I disagree, I trade the S/R levels and am profitable... hidden S/R levels... not only do I use them for potential market turns but the way my s/r levels work revolve around how PA moves. Where price stops, how price reacts at a certain level.. if price breaks a certain level there's a high chance it's going to test the level I have after it. I trade the break+retest of these levels no matter what any indicator is showing me and it works.. and I use tight stops. I've spent thousands of hours screen time and when I see how PA reacts at one...
What was reason for A and B S+R lines?
  • #90
  • Feb 27, 2017 3:08am Feb 27, 2017 3:08am
Quoting tradel13
{quote} What was reason for A and B S+R lines?
 
That's head and shoulders - the headband.
Get it? heAd Band

Good stuff Noors!!! 
 
Say, do you see breakout in E/A?? thinking 4000 target?
Beware of robber banks (RB), bad advisors.
  • #91
  • Feb 27, 2017 3:15am Feb 27, 2017 3:15am
Quoting tradel13
{quote} What was reason for A and B S+R lines?
Yes, you could have also shorted here - though this is a 5min chart which I don't use often but good to collect 5-10pips if you pick the right levels see once price hit C it bounced up.. these levels play some sort of role and all you need to do is figure that out.
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  • #92
  • Feb 27, 2017 3:20am Feb 27, 2017 3:20am
EURJPY 4 hr with SR and entries
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  • #93
  • Feb 27, 2017 3:23am Feb 27, 2017 3:23am
Quoting Not-KPMG
{quote} That's head and shoulders - the headband. Get it? heAd Band Good stuff Noors!!! Say, do you see breakout in E/A?? thinking 4000 target?
Hey kpmg!
E/A! what a pair it's been so far e/a is some what stuck below a critical level 1.3852 if we break that 1.4000 is possible. Atm I'll be playing with these levels see how we go.
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  • #94
  • Feb 27, 2017 3:50am Feb 27, 2017 3:50am
Quoting Redeflect
Yes, bouncing off a S&R level is a way of saying 'Get in now, you won't get a second invite to the party'. But are you certain that you're joining a party or are you getting trampled as everyone's rushing out the backdoor?
If I want to get trampled I pay for a dominatrix, I trade for a living, I can afford that. Trampled ... gosh some people here really take the market personally.

Seriously though, I mentioned that I'm short term and the chart tells me enough to distinguish a good from a bad entry. Of course one can complicate everything and add a dozen of new rules but will it make your trading better bottom line? Of course some trades don't work out, if you can't handle that mentally chose a different business. If you have too many bad trades at S/R levels it's perhaps just down to your price action reading skills - I mentioned that it's always a combination.

That said, I'm very short term - fast in, fast out. Bouncing off at a support does not necessarily mean it's going to reach the resistance as a minimum-target.
  • #95
  • Feb 27, 2017 5:23am Feb 27, 2017 5:23am
Quoting AgatheBauer
{quote} I'm teaching physics as well btw!
 
Teaching physics is not BEING a physicist. Teaching physics is being a mathematician. Just like being an english teacher isn't the same as being a poet. You need to actually be able to see the universe moving from the quantum up to the astronomical. Even with your eyelids drawn down. The math formulas are the closest approximation a physicist has to explain it to a mathematician. A physicist sees in more than just 3-dimensions. Why do you think they call the men on top "the masters of the universe"?
 
With that said; Martingaling a high-risk news event is not a proper use of the technique.
 
So, what's your guess as to what separates the winners from the losers? Because it isn't luck that decides the mechinations of the universe.
"The fun is in the hunt. Not the kill."
  • #96
  • Feb 27, 2017 5:26am Feb 27, 2017 5:26am
Quoting Redeflect
{quote} Â Teaching physics is not BEING a physicist. Teaching physics is being a mathematician.
Is teaching mathematics being a mathematician, or something else?
  • #97
  • Feb 27, 2017 5:42am Feb 27, 2017 5:42am
Quoting JensG
{quote} If I want to get trampled I pay for a dominatrix, I trade for a living, I can afford that. Trampled ... gosh some people here really take the market personally. Seriously though, I mentioned that I'm short term and the chart tells me enough to distinguish a good from a bad entry. Of course one can complicate everything and add a dozen of new rules but will it make your trading better bottom line? Of course some trades don't work out, if you can't handle that mentally chose a different business. If you have too many bad trades at S/R levels...
 
I was using 'trampled' as a metaphor to explain to him what it's going to feel like if he's blindly placing his order at a support/resistance level without actually witnessing the price movement. You may trade for a living. Many people don't. To them the S&R levels are magical zones where the price shifts. They are, of course, the traders that help make those zones 'magical' for the rest of us.
"The fun is in the hunt. Not the kill."
  • #98
  • Edited 6:07am Feb 27, 2017 5:49am | Edited 6:07am
Quoting medici
{quote} Is teaching mathematics being a mathematician, or something else?
ÂÂ
That depends on what you want to consider a 'mathematician'. Your question is like saying 'Does speaking english make you an english teacher, or something else?'. Yes. And No.
Â
A physicist(someone who understands physics and speaks the language of mathematics fluently) wouldn't be confused by this reference.
"The fun is in the hunt. Not the kill."
  • #99
  • Feb 27, 2017 8:47am Feb 27, 2017 8:47am
Quoting Noors
{quote} I disagree, I trade the S/R levels and am profitable... hidden S/R levels... not only do I use them for potential market turns but the way my s/r levels work revolve around how PA moves. Where price stops, how price reacts at a certain level.. if price breaks a certain level there's a high chance it's going to test the level I have after it. I trade the break+retest of these levels no matter what any indicator is showing me and it works.. and I use tight stops. I've spent thousands of hours screen time and when I see how PA reacts at one...
Congrats, but you're not strictly trading support/resistance as the question was asking. There seems to be price action and money management/probability techniques thrown in there.

So my opinion remains unaltered that strictly trading support/resistance on their own IE going long at every support and short at every resistance is not consistently profitable. However, that isn't to say support/resistance used as a tool with other concepts can't be profitable as I do the same.
  • #100
  • Feb 27, 2017 9:54am Feb 27, 2017 9:54am
Quoting Redeflect
{quote} Teaching physics is not BEING a physicist. Teaching physics is being a mathematician. Just like being an english teacher isn't the same as being a poet. You need to actually be able to see the universe moving from the quantum up to the astronomical. Even with your eyelids drawn down. The math formulas are the closest approximation a physicist has to explain it to a mathematician. A physicist sees in more than just 3-dimensions. Why do you think they call the men on top "the masters of the universe"? With that said; Martingaling a high-risk...
I never claimed to be a scientist, but I understand the basic mathematical principles that apply to trading very well, and this isn't about me after all. You either have an edge that you can exploit or the law of huge numbers will take care that your money is transferred to somebody who has an edge. One advantage of a retail trailer is, that he can open relatively (for him) big positions without moving the market, so if he can determine the direction that the big smart money is headed, he can ride the waves that banks and funds create from top to bottom if he wants. The edge is in knowing the bias of the market. I wouldn't go long EUR at the moment because Europe is screwed and fear is going around. That's my approach trough fundamental analysis at the moment. I have reason to expect more winning random EUR shorts than random Longs and this is my edge which is increased by technical analysis, preventing me from jumping in at the wrong price. You can do whatever you want, it's your money after all, and obviously when we talk about martingale we mean different things. I'm talking about pure indefinite Martingale without SL, when you are throwing good money after bad money just because you aren't willing to accept your loss. And if this guy MoneyZilla pushes his luck too much because everything other than 30% per month isn't giving him his thrill, I bet he's facing big bloody red nasty drawdowns. I think it's the wrong way to approach the market with a fixed monthly expectation. You first have to limit your risk to survive another day and after that, you can see how much profit you can squeeze out.
There is no Broker SL hunting, if your broker is non-dealing-desk.
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