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Attachments: The SETUP and the Chuvashova Fork
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The SETUP and the Chuvashova Fork

  • #121
  • May 19, 2017 11:27pm May 19, 2017 11:27pm
Looks similar to mine Rea.

I have pending orders at H4 E and H4 U on the H4 and I am trying to get in near H4 P if the M5 E, which is the same M15 E (so far anyway) triggers the M5/M15 E.

Just relaxing and letting a pending order at H4 E and H4 U take you in is a good strategy as well. Nice to get in near P but a tad stressful.

(There is another way to get in at P that we will cover a bit later. That involves the CF stuff that we haven't touched yet.)

Now, consider the 161.8 Fib target for the H4 T U P fib retrace expansion is about 600 pips. That sort of trade takes many H4 bars, maybe 50 or so, but it is a nice reward, for as long as it takes, maybe a week or a bit more. How often does anyone get to say I made 600 pips in one trade? Oh of course, there is the U trade too for another 525 pips or so.

You would have to really beat up the M5 trades to achieve that sort of result in the same time period, with a whole lot more effort and hours and hours of screen time.

Trading a daily or a weekly SETUP is more like long term investing. Much better than a GIC though.

Anytime you have a SETUP like this, with a second pass from P coming back through E, you have a chance to enter a nice trade without the draw-down as price goes back looking for P.

Pending orders at E and U are the safe ones and on H4 you have lots of time to check and check again.

Once P back to E is under way, you can also look at the LTF structure of that wave and see if it is good. (making nice LL LH in this case.)

It will be great if this one works out. A week or more to do it but lots of things along the way.
  • #122
  • May 20, 2017 7:03am May 20, 2017 7:03am
Hello Wab,
Thank you so much for all the valuable information. This is a great thread. May I ask what's the use of the accelerator oscillator?
  • #123
  • Edited 8:51pm May 20, 2017 1:57pm | Edited 8:51pm
Technically, accelerator is the histogram showing the difference between the AO and its moving average. Bill Williams is the best to ask that question to as he introduces both of them in his books.

The analogy that I like, is if you roll a ball up a sloped roof it starts to lose acceleration before it loses momentum. It can actually be considered to be accelerating against its momentum as it slows. So acceleration leads momentum, it changes direction before the (AO) momentum runs out.

Another analogy is a rocket taking off, it accelerates while its fuel is burning then begins to slow (Negative acceleration) however it still moves upward with momentum until momentum hits zero, at which point it starts to fall.

Simple answer: AC Three bars in a new direction (color change) or two bars and a cross on the acceleration zero line can be seen as a buy or sell signal. Of course indicators lag but I use them as a confirmation of what I am thinking. If they are wildly different, I pause and check to see why there is a difference.

AO is a very powerful indicator in that it tells you if the chart is impulsive or corrective and also which side of the market long short you are looking at - not that we really need that information.

AO, AC, the Alligator and fractals are all carefully designed to work together. AO can help you read the Elliott Wave structure and that is a useful, but it requires a lot of study.

My suggestion is to read Bill Williams books. Nothing else come close in my opinion. My efforts with SETUP are an attempt to get inside of the fractal. Bill Williams trades fractal breakouts, buying or selling when price moves past a fractal.

I like to think of myself as trading fractal break ins.

At this point we have really hammered SETUP and not mentioned the indicators that much. If you have SETUP and the Alligator you really can get by nicely. The rest becomes useful only when you really understand those first.

I will soon mention then Bill Williams Fractal which can be used to confirm a SETUP is under way.
  • #124
  • May 22, 2017 11:07am May 22, 2017 11:07am
Hi Wab,

Interesting approach to detect reversals,
One question, lets say actually on USDCAD H4 chart.
I understand that if price retrace over the green line, you will look on lower timeframe for contination short entry.

What are the clues or price action that will make you start looking for a reversal setup?

Thank you
  • #125
  • Edited 6:20pm May 22, 2017 12:19pm | Edited 6:20pm
There are several clues that I use:

Behavior of the AO (Divergence)
Alligator relationship with the price.
My interpretation of Chuvashova (I have not idea what Chuvashova actually says because his site is unavailable and I have not been able to locate his seven rules.)
Fibonacci Retracement levels combined with LTF SETUP.

A break of the E Line and the U Fractal are good but if you can get in as close to P as possible that is a big dividend. Stalking P, as I think of it, is tricky as you are looking for LTF SETUP patterns on the U - P leg of the HTF SETUP. Get that right and you are well in the money before the E and U entries even happen, or you can just avoid that stress and trade E and U.
  • #126
  • May 23, 2017 2:18pm May 23, 2017 2:18pm
So, what's next?


Best regards,
Dragos
  • #127
  • May 23, 2017 5:50pm May 23, 2017 5:50pm
HI Dragos.

I have been trying to condense my think on the C Fork. I am also getting some other stuff vetted by a thread member, before I add it here.
Just to make sure that it is not too confusing. More material coming soon.

Meanwhile here is the USDJPY H4 in action.

Attached Image (click to enlarge)
Click to Enlarge Name: USDJPYH4 Tuesday.jpg Size: 170 KB


Orders filled at E and U with a couple added early between U and P. Stop is well out of the way. I will move it to lock in some pips soon. For practice, look for a trailing stop along the Green Alligator line or fractal by fractal.

A slow boat carrying a big cargo.
  • #128
  • May 23, 2017 6:18pm May 23, 2017 6:18pm
I tidied up that USDJPY chart a bit. I don't need all the labels and the SETUP shown but it is a good habit to add them.

I will use this chart to add in another signal that we can use. IN Bill Williams method, he enters at the point where the last fractal level is exceeded and that fractal is above the red Alligator moving average line. (Opposite for a Bullish entry ... the last fractal level must be belwo the Red Alligator line.)

I didn't add on a trade there, missed it. Any student of Bill Williams knows this a very reliable entry.

Attached Image (click to enlarge)
Click to Enlarge Name: USDJPYH4 BW Fractal entry.jpg Size: 174 KB


You can see how using SETUP here, gets you in ahead of the BW entry, which in itself is an excellent entry.

Anything that increase your edge and any signal that arrives in the reversal area is great.

So also keep an eye out for that BW Fractal Entry around a SETUP.
  • #129
  • May 24, 2017 3:07am May 24, 2017 3:07am
Yeah, sure, why not add more stuff
I'll be watching that fractal, as well, thanks.

I have a few questions but they can all wait pending this one.
I, usually, don't trade ugly charts. Not well trained to understand them yet. How would you apply SETUP to such a chart? I think NZDJPY on H4 is one of those, can't upload anything as I'm at work and my memory plays hide and never seek with me so I might refer to the wrong pair.



This is making money but more than that, it's making Me, better.
Thanks.
  • #130
  • May 24, 2017 4:43am May 24, 2017 4:43am
Quoting Wab
I tidied up that USDJPY chart a bit. I don't need all the labels and the SETUP shown but it is a good habit to add them. I will use this chart to add in another signal that we can use. IN Bill Williams method, he enters at the point where the last fractal level is exceeded and that fractal is above the red Alligator moving average line. (Opposite for a Bullish entry ... the last fractal level must be belwo the Red Alligator line.) I didn't add on a trade there, missed it. Any student of Bill Williams knows this a very reliable entry. {image} You...
If H4 is our HTF and the alligator is wide open down, why are you trading long against it?
Shouldn't we trade short in a LTF in this situation?
  • #131
  • May 24, 2017 10:36am May 24, 2017 10:36am
SETUP trumps the Alligator because the Alligator is a lagging set of moving averages. It turns after the market turns and SETUP identifies those turns in real time. The Alligator then follows after the trend change.

The Alligator is great for identifying trends at a glance and for picking off CT trade entries. I would not trade without it, but you have to study how it reacts to a reversal or in a sideways market.
  • #132
  • May 24, 2017 11:55am May 24, 2017 11:55am
Rea here is how I would count the H4 NZDJPY.

Attached Image (click to enlarge)
Click to Enlarge Name: NZDJPYH4 Confusion.jpg Size: 287 KB


It may help you to look at it in daily and H1 as well. I also found it tricky and had to change from H4 to D1 and H1 to figure it out.

The last HH at 79.361needs price to go higher to confirm the suspected LH at the bottom fractal where I have drawn the red trend line.

Sometimes you get one like this that is difficult to figure out. Just look for another pair with one that jumps out at you.
  • #133
  • May 24, 2017 12:18pm May 24, 2017 12:18pm
Quoting Wab
Rea here is how I would count the H4 NZDJPY. {image} It may help you to look at it in daily and H1 as well. I also found it tricky and had to change from H4 to D1 and H1 to figure it out. The last HH at 79.361needs price to go higher to confirm the suspected LH at the bottom fractal where I have drawn the red trend line. Sometimes you get one like this that is difficult to figure out. Just look for another pair with one that jumps out at you.
Thanks Wab,

As I've said before, I don't trade ugly charts, we had an E/U breakup and a nice P only to have it crash back to the P area and probably take the SL out (I don't use SL myself so it figures I would have cursed and closed the trade(s) only to have the price reverse on me. As usual ).

How can I avoid raping my charts? IF there's an E tens or hundreds of pips away from the T, should I nip at the U forming or is it too risky?
  • #134
  • May 24, 2017 12:37pm May 24, 2017 12:37pm
I think I am ready to start adding the C Fork (my interpretation of it) into the mix.

Again, I have looked at everything that I can find in regards the Chuvashova Fork and that has not been easy as it is all in Russian. So if I am stepping on anyone's shoes I apologize in advance.


So, to start out I am going to give you an exercise. Pick any chart and go through it and identify several T points. Then, go ahead and locate the E of the next SETUP. Draw a line from the T through the next E and extend it a bit. Do this on several charts and pairs and time frames to master the concept. (Practice. Practice. Practice. )

Here is an example for you to look at to get the idea.

Attached Image (click to enlarge)
Click to Enlarge Name: AUDUSDM15 T E lines.jpg Size: 76 KB


Apart from training your eye to look for SETUP and identifying the E of a SETUP, this teaches you how to draw an important indicator. So go practice ...
  • #135
  • Edited 2:16pm May 24, 2017 1:29pm | Edited 2:16pm
Hi Rea. Trying to catch an entry at U is arriving late to the game but it is a breakout from a FIB and confirms the new wave is actually happening. The Fib target at 161.8 can be a long way away and maybe that will help you decide (temptation) if you want to go for it.
  • #136
  • May 24, 2017 1:46pm May 24, 2017 1:46pm
Quoting Wab
i Rea. Trying to catch an entry at U is arriving late to the game but it is a breakout from a FIB and confirms the new wave is actually happening. The Fib target at 161.8 can be a long way away and maybe that will help you decide (temptation) if you want to go for it.
Let's see if I get what you're saying.

Is the E in position 1 or 2? I would say it's at 2, so we're missing all the move from 1 to 2, right? why? Price can reverse on us, I understand that but the temptation..... how do you fight it?
Attached Image (click to enlarge)
Click to Enlarge Name: EURAUDH4.png Size: 52 KB
  • #137
  • May 24, 2017 2:42pm May 24, 2017 2:42pm
Quoting Wab
I think I am ready to start adding the C Fork (my interpretation of it) into the mix. Again, I have looked at everything that I can find in regards the Chuvashova Fork and that has not been easy as it is all in Russian. So if I am stepping on anyone's shoes I apologize in advance. So, to start out I am going to give you an exercise. Pick any chart and go through it and identify several T points. Then, go ahead and locate the E of the next SETUP. Draw a line from the T through the next E and extend it a bit. Do this on several charts and pairs and...
Done!
Attached Image (click to enlarge)
Click to Enlarge Name: EURJPY-ProH4 24May.png Size: 114 KB
  • #138
  • May 24, 2017 3:48pm May 24, 2017 3:48pm
Here is my take on the H4 EURAUD.

Attached Image (click to enlarge)
Click to Enlarge Name: EURAUDH4.jpg Size: 266 KB


I have the H4 T E line in blue and the last H4 HL as a potential H4 E. Price has to break below that potential H4 E to form a H4 LL to confirm it as an H4 E.

Meanwhile, we have a new high and we can go to the LTF H1 chart and see a H1 SETUP in place with the H1 E Line broken.

So how useful is this H1 SETUP? Check the Fibonacci on H1 T U P. The pullback to P was more than 88.6, so I don't have a lot of hope that price will move all the way down to the 161.8 level (which is just above the last H4 HL where our H4 structure would verify an H4 SETUP.

The very overlapping structure of the H1 Chart since H1 P, is also evidence of price moving against the overall trend. A counter trend on H4.

I would be interested in a possible bullish SETUP forming around the trend line and a Fib level at 38% turning this this back in phase with the H4. A CT entry back in phase with the main H4 trend.

As for your question in regards to the move that we miss part of ...

My wrestling with SETUP came about in my search to get an earlier entry than a fractal breakout.

The analogy I think of is how do we measure the high tide mark? You can only know the tide has turned after waves no longer reach the highest mark on the beach. A rogue wave can move even higher, so you have to be patient and let the water go down quite a bit before you know it has turned for sure. We will never be able to consistently get all the pips but if we can get from E to 161.8 of T U P Fib that is really good.

As we explore the T E line I will show you where we can get in earlier than E quite often without having to go to the LTF.

Practice those T E trend lines. Own them.
.
Attached Image (click to enlarge)
Click to Enlarge Name: EURAUDH1 SETUP.jpg Size: 301 KB
  • #139
  • May 24, 2017 4:35pm May 24, 2017 4:35pm
Quoting Wab
I think I am ready to start adding the C Fork (my interpretation of it) into the mix. Again, I have looked at everything that I can find in regards the Chuvashova Fork and that has not been easy as it is all in Russian. So if I am stepping on anyone's shoes I apologize in advance. So, to start out I am going to give you an exercise. Pick any chart and go through it and identify several T points. Then, go ahead and locate the E of the next SETUP. Draw a line from the T through the next E and extend it a bit. Do this on several charts and pairs and time frames to master the concept. (Practice. Practice. Practice. ) Here is an example for you to look at to get the idea. {image} Apart from training your eye to look for SETUP and identifying the E of a SETUP, this teaches you how to draw an important indicator. So go practice ...
It looks like a SETUP to me Also it seems to be a bearish trend.
Attached Image (click to enlarge)
Click to Enlarge Name: AUDUSDM15 T E lines_rev.jpg Size: 95 KB
  • #140
  • May 24, 2017 5:20pm May 24, 2017 5:20pm
Quoting Wab
I think I am ready to start adding the C Fork (my interpretation of it) into the mix. Again, I have looked at everything that I can find in regards the Chuvashova Fork and that has not been easy as it is all in Russian. So if I am stepping on anyone's shoes I apologize in advance. So, to start out I am going to give you an exercise. Pick any chart and go through it and identify several T points. Then, go ahead and locate the E of the next SETUP. Draw a line from the T through the next E and extend it a bit. Do this on several charts and pairs and...
Wab, kindly please put horizontal lines in your E the way you do in previous charts. I have difficulty finding the exact E points in your chart with Cfork. Thanks!
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