|submitted by JoJax312 to Forex [link] [comments]|
Due to popular demand I've decided to bring this series back for a week 2 and I'll continue to release 3-5 trading ideas every Saturday. How do you guys feel about the name of this series? Would you like me to change the name to something like "Setup Saturdays" or are you guys cool with the current naming scheme?submitted by AD3133 to Forex [link] [comments]
So this week I wanted to be a lot more in depth in my analysis and setups since I didn't think I was super clear last week with my reasoning on some the setups. I want these posts to be as beginner friendly as possible because there's a lot more beginners in this Subreddit than I had realized. I want you to use this as an educational tool and not as a signal service as a result I'm going to give you possible trade setups and I want you to be the judge of whether you should enter once/if price gets to that point since I feel like that will benefit beginners in the long run. I got a couple questions about top down time frame analysis so that'll be a focus of today's post. Scroll down to NZDJPY if you really want an in-depth look at how I perform top down time frame analysis.
I'll include a picture of a chart and my TradingView chart so if you want to zoom in and out of the chart you'll have that ability to do so.
Quick Disclaimer: Some of the charts pricing might be off by a bit since I started working on this during the New York session on Friday. If any of the charts are impacted in a way that alters the setup I'll be sure to update the charts before I post this on Saturday. Just gotta hope that hope that Powell doesn't break the market or else I might have to redo this entire post.
TradingView Link For Daily: https://www.tradingview.com/chart/AUDUSD/Wb5K2bS8-AUDUSD-Daily-For-Reddit-Post-6-20-U-AD3133/
Analysis: Which way is the trend pointing? It looks like it's pointing up which we can see with the green trend line but how about we zoom in to the 4 hour char to see if that's actually the case.
Tip: When drawing a trend line, especially on the daily and higher time frames, remember to hit as many wicks as possible since they are relevant and not just some anomaly you can ignore.
AUDUSD 4 Hour
TradingView Link For 4 Hour: https://www.tradingview.com/chart/AUDUSD/aah8294z-AUDUSD-4-Hour-For-Reddit-Post-6-20-U-AD3133/
Analysis: When we got close to where we are with price and we draw a Fibonacci Retracement from the point where price took off to the point where price peaked we can see that price came down to .5 Fibonacci level where it then started going up again. Coincidence? Possibly. As a result I believe that price could continue higher and it would be justified if it did. However, if we look at the trend lines we can see that price appears to have broke put of of our major trend line (Green) which means that price could fall to the downside if it's actually a breakout. Price then appears like it would then adhere to the new minor trend line (Red). There's also the possibility that this was just a fake breakout and price could go up and adhere to green trend line. I'm going to have a selling bias on this trade since price looks like it double topped at the highs of this year and it looks like we could see price fall. I'm leaning towards the drop of price due to the symmetrical triangle pattern created by the major and minor trend line and looks like price is going to get pushed down which we should get an idea of soon.
Tip: Every time price makes a large move and falls/rises after making a peak/valley always pull out the Fibonacci retracement tool to see if price will bounce from the .382, .5, or .618 levels as they are the most significant levels. This can tell you if you're going to likely get a trend continuation.
AUDUSD 1 Hour
TradingView Link For 1 Hour: https://www.tradingview.com/chart/AUDUSD/IHgrnfYs-AUDUSD-1-Hour-For-Reddit-Post-6-20-U-AD3133/
Analysis: I drew out multiple different scenarios which I think can play out since like I said before we're not trying to predict a single movement but we're preparing to be reactive to an ideal condition which may be thrown at us. Remember that major trend line we drew in on the daily chart well it's going to play a large role here. This trend line has been in the making since March so we're not just going to brush it off. The trend line appears to have been broken and we seem to be sticking that minor trend line after the break of the symmetrical triangle pattern. After the break of the symmetrical triangle pattern price usually gets pushed heavily to one side and it looks like price is wanting to get pushed to the downside. As a result, I'm going to really keep on eyes on scenario the blue arrows display since I think it's the most probable. Looking at the scenario there are going to be two potentially good entry points for a sell. The first being when price goes up to retest the green trend line which would also serve as a bounce from our red trend line. Once we get that bounce we could enter in for a sell with a take profit hopefully somewhere around the .66 area. Another good entry would be when price breaks the zone of support of .68 and after it retests it. Wait for a confirmation candlestick pattern showing price will fall when retesting (i.e. railroad track, bullish engulfment candle, evening star, shooting star, etc.). Look for these candlestick patterns on the 15 minute chart. Once you got the confirmation take the sell and ride price down to the .66 zone. The other scenario that could occur is we could see price go back into the green trend line by breaking the red trend line (Orange Arrows). If this occurs we want to catch the retest bounce of the red trend line and ride price up to the high of the year which is at .702. At that point price could break the resistance at which point we could catch the retest of the zone and ride price up. Or it could go up to .702 create a triple top and fall. If you get a candlestick confirmation saying it'll fall then take a sell at the high of the year.
If there's something I really like in Forex it's definitely got to be harmonic patterns due to their high accuracy. NZDUSD just recently completed one of them and this is a really good indicator of what price is going to do.
TradingView Chart For Daily: https://www.tradingview.com/chart/NZDUSD/zQpHzUcK-NZDUSD-Daily-For-Reddit-Post-6-20-U-AD3133/
Analysis: Yes, we have trend line that says that price is going up however I make exceptions for Harmonic patterns since they are accurate about 80%-90% of the time. The pattern you see above is know as a Bearish Bat Pattern. Like the name says it's an indicator that price is going to go Bearish so although the trend line is going up I'm going to have a bearish bias on this trade.
NZDUSD 4 Hour
TradingView Chart For 4 Hour: https://www.tradingview.com/chart/NZDUSD/C29kpCyO-NZDUSD-4-Hour-For-Reddit-Post-6-20-U-AD3133/
Analysis: Not really much to add here just tossed on a Fibonacci retracement tool from where price took off to the peak just to check for any potential support from any of the major levels which we don't appear to have. We'll go a lot more in-depth on this pair on the 1 hour chart since that's where things get interesting.
NZDUSD 1 Hour
TradingView Link For 1 Hour: https://www.tradingview.com/chart/NZDUSD/dKJatcM7-NZDUSD-1-Hour-For-Reddit-Post-6-20-U-AD3133/
Analysis: Looking at price we can see that since June 11th price has been trading in a boxed consolidation range. Again I drew out the possibilities I believe could be ideal for us. Remember that I said Harmonics work 80%-90%. Well that means that they fail 10%-20% of the time which is definitely not something we can neglect. We can see that there's a descending triangle which price is reaching the end of. This means that price is getting ready to move to one direction since big moves always come after consolidation. If it moves to upside wait for price to close above the the spot marked D then you can enter for a buy and ride price up to the .67525 zone where price could break to upside or bounce back down (Orange Arrow). Remember to wait for it to actually close above point D since it could create a triple top and drive price back down. It's the same procedure as AUDUSD here if it makes this move where if it breaks it then catch the retest and if it looks like it's wanting to fall down wait for a confirmation pattern. If it breaks the box to the downside and breaks the support zone then take a sell and ride price down to the trend line at which point you should close the trade as there's a chance price could move against you and it's best to secure profits while you can. Once at the trend line it could bounce and if it does you should be able to ride price up to that .67525 zone (Green Arrow). If price breaks the trend line then wait for the retest and you should be able to ride price down pretty far (Red Arrows). I think you should be able to ride it down to .5918 zone but you'll have to keep your on it.
TradingView Link For Daily: https://www.tradingview.com/chart/EURNZD/jzgmGcRe-EURNZD-Daily-For-Reddit-Post-6-20-U-AD3133/
Analysis: Well we got a pretty clear descending channel and price looks like it's at the top part of the channel currently so we're going to want to look for some optimal selling conditions due to the down trend.
EURNZD 4 Hour
TradingView Link For 4 Hour: https://www.tradingview.com/chart/EURNZD/YzOpvcH7-EURNZD-4-Hour-For-Reddit-Post-6-20-U-AD3133/
Analysis: Looking at the 4 hour chart we can see that there appears to be a symmetrical triangle coming to it's end meaning price is getting ready to get pushed to a side. I believe it'll break the triangle and fall to the downside so once you see it break it would be a good idea to take a sell and ride price down to that support zone at 1.7187. Price could also briefly break to the upside then bounce off the top of the channel and it does take a trade from the bounce and ride price down to the same support zone. At that point, I'll leave it up to you to determine how you think price will go and what you should be looking for. Consider it to be a little quiz if you want to think of it like that. You've got my charts so use them as a reference since I've already marked some crucial support/resistance zones which we should keep our on for the next couple weeks.
EURNZD 1 Hour
TradingView Link For 1 Hour: https://www.tradingview.com/chart/EURNZD/ICWvgEsg-EURNZD-1-Hour-For-Reddit-Post-6-20-U-AD3133/
Analysis: There's nothing that special on the one hour chart that I have to point out since I think we pretty much got all the big stuff out of the way on our analysis of the 4 hour chart. Be sure to get a good sell in there since there are two potentially good setups which I've outlined for you. Also be sure to be careful and wait for the bounce of the channel if price goes that way since there's a chance price could break the channel and I don't want you to take a loss because you were impatient.
This pair is going to be really fun since we're going to be looking through a lot of time frames so if you really want to learn about a top down approach to analyzing time frames and trends then pay very close attention to how I break down this trade.
TradingView Link For Monthly: https://www.tradingview.com/chart/NZDJPY/jZh4F2Jv-NZDJPY-Monthly-For-Reddit-Post-6-20-U-AD3133/
Analysis: Yes, we're actually going to be looking at the monthly chart. I bet you guys don't do that very often. Looking at it we can see that price has been following a clear down trend line since late 2014. If you look at the wick of this month's candle you can see that it appears to have touched the trend line meaning we could see a good opportunity to catch a sell since it had just recently bounced off. Let's take a look at lower time frames to see if this continues to be true.
TradingView Link For Weekly: https://www.tradingview.com/chart/NZDJPY/dpvI29BB-NZDJPY-Weekly-For-Reddit-Post-6-20-U-AD3133/
Analysis: When zooming into the weekly we can see that using the wicks of the candles we can actually draw a channel for the low portion that runs pretty much in parallel to the trend line we drew on the monthly chart. We can see that price clearly bounced from the trend line and I think this gives us good reason to believe in the coming weeks we could see the price drop. Also looking at the Bollinger Bands we can see that price also bounced from the top band which also supports a drop of price. Let's go into the daily to see if we can get a better idea.
TradingView Link For Daily: https://www.tradingview.com/chart/NZDJPY/NbWLURkU-NZDJPY-Daily-For-Reddit-Post-6-20-U-AD3133/
Analysis: Looking at the daily time frame we can see that price is currently consolidated and remember big moves always come after consolidation. If you look closely however you can see that price looks like it's about to break the 200 day EMA (Orange line). If it breaks the EMA we could see price drop pretty far at an accelerated rate. Besides those couple observations there's not much else going on with the daily chart.
NZDJPY 4 Hour
TradingView Link For 4 Hour: https://www.tradingview.com/chart/NZDJPY/d1kaogH5-NZDJPY-4-Hour-For-Reddit-Post-6-20-U-AD3133/
Analysis: Would you look at that, it looks like we got a descending triangle on the 4 hour chart which looks like it's coming to an end. Looking at price it looks like it's wanting to push to the downside. Once you get a break below the lows of the day of June 11th I think it would be a safe bet to take a sell trade and ride it down for 66.825 for this week. If it breaks the 66.825 support zone then I'll definitely take a sell and try to ride price down to the bottom of the channel which we drew on the weekly chart. There's also the possibility that price could take support at any of these support zones and then head back up to test the top of the channel. At which point I'll be looking to get into a sell at the top of the channel but I won't ride price up to the channel since at this current point in time I feel like there's a large amount of risk in that.
NZDJPY 1 Hour
TradingView Link For 1 Hour: https://www.tradingview.com/chart/NZDJPY/83b47mFS-NZDJPY-1-Hour-For-Reddit-Post-6-20-U-AD3133/
Analysis: Not much more to add here since I think by this point we got the entire story so I'm not going to say much more about the 1 hour chart since I think the analysis for the 4 hour chart also sums this up pretty well.
Well that was a lot of information to go through and I hope you found some value in this since it took me quite a few hours to put this together for you guys. Truth be told, I spent most of Friday working on this so I hope at least one person finds some value in which case I'll consider it a win.
So you guys tired of me yet or do you want me to continue this series for a week 3? It takes a lot of time and effort to put this together so I'll only do it if people want it or else I'll pretty much feel like I wasted my time. I might put together a little lesson on how to use the COT in order to catch some big reversal moves in the market since the COT pretty much tells you what the hedge funds are doing and you also want to trade with the hedge funds and institutions. It'll probably take a couple weeks since I'll have to compile some data together and wait for a setup before putting that out but I'll be working on it. Are there any other things you may want explained? Let me know and I'll try to find setups which contain the topic you may want more details on. I hope you have a great trading week!
Great to see such an amazing forex community here!submitted by ryan_irani to Forex [link] [comments]
Here is my EURUSD short from yesterday with my analysis - 4.5% RR
Confluences for the trade:
4h chart - rough forecast the night before
Let me know if you guys have any questions!
My analysis for GBPJPY and EURUSD for the week.submitted by ryan_irani to Forex [link] [comments]
M: Bearish momentum. However, previous candle had long wick rejection of monthly structure support
W: Weak bearish candle.
D: Bearish break of daily structure support. Multiple wick rejections of the break and retest area
4H: Break of 4h structure support and multiple retest and rejections. Commencement of a downtrend LL and LH
GBPJPY - D & 4H
M: Strong bearish momentum. However, coming into monthly structure.
W: Bearish close
D: Bearish momentum. Close beyond daily structure support and re-test and rejection of this area
4H: Bearish momentum with retest of structure resistance. A new LL and LH indicating a downtrend.
EURUSD - D & 4H
DM / comment for any questions with the above analysis or any forex related questions.
Part      submitted by whatthefx to Forex [link] [comments]
In preparation for the possibility of GBPUSD (et al) making some major spike out moves on large charts and potentially entering into sharp corrective moves, I've been honing in on another area of trend trading mistakes. Up to now, the main focus has been on the 50/61 trap  . This has been largely effective. Some pretty wild swings, but it's ultimately swinging in the right direction. This is to be expected. Markets have made this sort of pattern for decades. I've no idea why people think it's not there or is going away any time soon. For the time being, betting on it has great odds.
I've said in previous posts the 61.8 trap formation is one of the areas where most of the money is made and lost in Forex. This is the other one. Between these two points, it would be my guess this is where most retail traders lose their money. It's where I've lost most of mine, I am sure of that. They are cunning traps, and these traps snap down hard. In the 50/61 trap section we've covered how to enter into the start of trend legs, and now we'll cover how to exit at the optimum profit level (and reverse).
We'll start looking at what I've explained previously while alluding to this mistake. This is the first selling mistake, indicated in the chart here with a 3 as we switch from black to blue.
The mistake is explained as "breakout trading rushing in", and also as an area people are stopped out using H/L rules.
I've explain many times in many ways how news events can carry what essentially amounts to misinformation in terms of what you do in trading, and how these events are often found marking out the extremes in trend moves. I've mainly focused on entering in line with the trend to this point, but the same is true for the end of a trend/start of correction.
I've also explained how I design my trade plans ignoring any news there may be in the sense that I do not do analysis on it (or try to guess it). While doing this I've explained that I do think it's very possible news events will feature during the moves. They usually do. I do not need to know about them. All I need to do is make a trade plan that understands it might have volatile moves in it, and how a person would give themselves the best chance to profit from that.
This news stuff is very important. You need to understand that when I think about news events, I think of them in terms of the sort of price moves they create ... because nothing else matters!
I know in some parts of the cycles price moves fast. Sometimes it moves in ways that abnormal, seeming. I also know that when there are news events, these are the things that happen. So when we are trading in areas where I know price can move aggressively, I also know there may be news triggers for this. Here are the areas I'd expect news triggers. Red circles are sell news and green buy news.
Of course, the way the market actually moves does not have to make any sense at all relative to the news. Let's face it, it rarely does. Not without some mental gymnastics anyway. This is why I'm not paying attention to that. There are points at which I actually expect the news move to make no sense at all. One of these is in the rally to retest the high, notice the circle for the news event is before the spike up.
So when I make winning trades that take profit in some news event, it's entirely correct to say I did not know that was going to happen. However, it's entirely incorrect to assume I did not calculate there being "some event". It is wrong to think yourself mere cannon fodder to these sorts of events, you can do better (Test! I'd like you to come to understand this, and it must be learned, there's only so much I can teach).
Now, I had been setting this up to trade the possible swing from GBPUSD making a spike out low, and this would have been some time from now (at least days, I'd expect) but we've got a chance to test out this feature early using social indicators. Social indicators are a thing. They are really useful for spotting these.
Main sorts of indicators. "What just happened?", "HUGE breakout on XXXXXX", "Game changing news .... XXXXXX breaks the highs ... to the moon". Any of this stuff, when you see it and go look on a chart for counter signals of whatever it is that is implying. Look and see if we've had the conditions that predict this kind of breakout - then fade the public chatter.
Look out for flash in the pan news events. Do not follow these, they are nonsense. I promise you, when there's someone who tells you otherwise talking about what they think happened, I am executing on my positions. When they first found out something was happening, I may well have been hitting my take profits.
These "market movers" tend to be over and done with in an hour. Unless you followed them ... then you're stuck in a shitty trade for as long as that takes.
Bringing us to our social trigger. Someone posts a Trump tweet. Apparently these are important. I've not noticed. I am in trading positions most of the time he tweets, usually a few days later I find out that was "why it happened". The thought of using this for real time indicators to follow is madness to me, now. There's a time I'd have thought that perfectly logical. When you do the charting hours, it does not make sense. So should be ignored.
Maybe not entirely ignored. When I seen this, I went and checked for counter trading signals on USDJPY. Seen one instantly (social indicators are fucking accurate, I'm being serious).
This was the position I took. I also suggested the poster stopped following this bullshit.
I explained the mistake.
Here is what that looks like on a chart. Blue circle is where the breakout alert comes, green circle is where I bought.
We can see this is probably not something we want to be basing our trading decision on. Quite evidently.
After taking my position, I took some time to explain the situation to someone who commented saying they'd bailed out on a sell after reading through my posts (good things happen when you read my posts with an open mind). Price spiked 100 pips from the price they escaped on.
So our strategy to trade from here is simple. We buy into the sharp drops on USDJPY. We watch for short term drops and mini false breakouts - then we buy for the "swish" up move. The same strategy I said could be used on GBPUSD early last week, you know ... before the news made it happen.
We do have to be cautious, price can re-test the lows (and it can do it in one big fast candle). It can even make a further breakout (which could be stronger). For as long as USDJPY trades above the lows it's made in the start of the week, though we should see all drops in price as opportunities to buy with great risk:reward.
With this in mind, I've activated my trend traders on USDJPY, they should start to sell the false sell offs for me, and be putting me in nicely near the end of the bear traps. We might be on the way to seller mistake #2. Where the break/retest trade fails, and if we this should be very profitable betting against those who get slaughtered in the quick correction.
This has done really well, as would be expected. This really is a deadly part of the market for trend followers.
I feel a lot of times people can over think and try to over engineer making moderate annual gains in the Forex markets. Simple and low maintenance strategies can be devised to do this.submitted by whatthefx to Forex [link] [comments]
If someone said to me, "Hey, I've got $10 million and want 15% a year . I don't want to be in the market more than 3 hours a week". I'd say, "I got this. Give me close of New York session on Friday to 2 hours before the market close. Easy gig."
In this post I will teach you how.
I will also post setups and track results from strategy on Friday's that qualify. Since I am not doing this for a pedantic millionaire investor, I'll use the whole of Friday for my trades. With this I think I should be able to beat 50% on 1% risk per position.
There are specific qualifiers needed going into Friday to trigger this strategy. It will not trade every week. Only when there is a trend present and we are either in a trending week or near the end of a corrective week.
Here is what a corrective week tends to look like.
You can sync up this with real price action in what has been (and still is) a corrective week in GBPUSD.
Approaching Final High
When we see this, we have a really easy trade looking to buy London open area at a 61.8% retracement. There are multiple reasons this trade could work. Lots of different ways a strategy can pick up this trade (I won't cover these here, if you look through my post history I cover them extensively).
Here is the area on this chart I will be looking to trade.
Let's look closer at the trades when we have this set up. I said buy 61.8, but that is too arbitrary. Working one day a week here, should pretend to look busy, huh.
So we're looking for the 61.8 retracement for around London. This is where the strategy can potentially come active. This trade may or may not be taken, it depends on a few things. Honestly, one of them is I might sleep in. Others are more professional ... promise.
When there has been this failed new high move, it's on. I always want the following trade. Here we're looking for a 61.8 retrace from the failed new high swing. A bounce from there, and then pending order can be placed to enter on a retest of there. This is what I consider to be a strong signal. I can use tight stops here and get good RR. I expect a strong move from this area.
When it breaks out of the high and runs a little, I'll close half my profit and trail stops to protect running profits. I will wait and watch for the market contracting and starting to make a messy range. I'll then look for it to start to pull back and look like it's going to start to correct the move of the day. I will look to buy into this move and expect to see price spiking. Not trying to "time the market" or anything, but it's probably going to be 90 to 120 minutes before the market closes this happens.
For trending weeks, I'll be using the same sort of execution rules and trading patterns. he prerequisite price action I want to see will be there having been a new high/low in the trend made by Thursday. I'll then be looking for a retrace of that and the market running out the end of the week with a final trend move.
Part 2 https://www.reddit.com/Forex/comments/cufic1/strat_for_50_100_a_year_more_details_first_trade/
Part    submitted by whatthefx to Forex [link] [comments]
So in the first week of this an account initially funded with $10,000 got to around $40,000 / $45,000, but it was wild. The drawdown swings were large. Equity swings were what I would describe as problematic. My broker agreed. I got a call from them and it went a bit like this;
"Hi, Whatthefx (yes, me and the broker are on first name terms). One of your new accounts has done a lot volume this week. I was wondering if you're going to continue to trade so aggressively? Can we expect the same volume this week?"
I replied; "Of course not. I started last week with $10,000 and now there is $40,000. It would be fair to assume I will trade four times as much volume this week".
They advised me if I did this, in the near future we'd be having a discussion about re-evaluating how much leverage the broker would offer me. I told them I could not believe they'd speak to me like this after all we'd been through. "You've changed, man" I ruefully muttered into the phone. He told me risk compliance was getting edgy, and they felt the best solution would be to reduce my leverage. I told them to a hammer everything looks like a nail. They told me this hammer was about to come down.
Long story short, compromises has to be made.
I decided to split accounts and reduce risk acceptance on both of them (dramatically on the larger of the two accounts). I started an account with $25,000 running a very similar but slightly watered down version of the initial strategy. I then started another account with $50,000 and used this to trade against people who consistently bet against trending moves.
Vrs scalpers results:
As a recovered "Trend doubter", I understand the mindset of people who fade the trend too aggressively. There is a fine line between being an effective contrarian and just being dumb enough to think you're smarter than the entire market. When you're the latter, you come to learn the infallible truth in the saying "A fool and his money are soon separated".
I take a bit of time to snoop on those I am reverse copying from. Through some statistical analysis and good old fashioned reading through their feeds on platforms they promote themselves I seek out the ones who have die hard doubt on the existence of strong trends and also with some ingrained belief that the fib levels are irrelevant.
I find the ones most die hard against these things. It's easier to find committed doubters of fibs than it is of trends. I find those who are the most extreme on this bell curve. Some of them are practically evangelical about how sceptical they are of fibs. I take these people and pay particular attention to their trades. Most specifically I run analysis to see how the trades they make at important fib levels perform. I have a few I look at but the most important one for basic trend following is the 61.8% fib (explained in previous post).
I find an extremely high correlation between the people who know so much better than us who like to use fibs and them consistently making losing trades at important fib levels.
This is all I need to feel confident sticking some money on this. I make some filters to allow me to copy their mistakes and dodge the times they are more likely to be correct. I add some other ways to identify strong trends. I include some aspects of ATR, ADX and MAs. I also do some lot sizes rules to prevent them from martingaling against me. I do not want to let them accumulate larger and larger positions against me on the slight breakouts of the 61.8% level, because there is a high chance of there being a retest of that level. If they close all their positions there, this will give me a net loss.
Vrs trend faders results:
A prerequisite post to this post can be read here; https://www.reddit.com/Forex/comments/clx0v9/profiting_in_trends_planning_for_the_impulsive/submitted by whatthefx to Forex [link] [comments]
It will also be beneficial to read this;
Before getting into the meat of things, you need to understand the 'elastic band' effect of large moves in the market. What this means is most of the time before a market starts to make a big move in the direction it is ultimately going, it will make a strong and usually fast counter move. You know this already in a way. You've been taught from early on (I assume) that pin bars (hammers etc) are indications the market is reversing. You're told the wicks are formed by price pushing into an area and being rejected from it.
In a trend formation, this is what the intra-week price action would tend to look like when there is the formation of reversal candles at the close of the weekly timeframe.
Here we would have been in a down trend and then for a week or two seen bullish momentum. The blue swing is the "elastic band" move. Or what I like to call the "ping swing".
The formation I have drawn here is not arbitrary. A lot of specific things are going on in this chart. Here I've highlighted the relevant ones. When we've seen all of these, we know there is a good chance we have reached the end of a C leg correction (read up on basic Elliot wave theory if you do not understand this terminology).
There can be variance in the 4 and 5 area. I am being polite, I should be honest. This area is often a bitch to trade in. Sometimes there are deep retracements and sometimes they are really shallow. Personally I've not been able to find ways to get strong ideas of how to forecast which is more likely. It tends to be an area I lose money and one I continue to work on trying to develop better ways of dealing with.
Here are examples of each type from trades I've taken recently.
This is explained in more context at https://www.reddit.com/Forex/comments/cks8q1/shorting_noobs_problems_proofs_and_fine_tuning/
This chart is messy because a lot of positions are being taken rather than a specific strategy being followed, but as I've explained in the 'Shorting Noobs' series of posts, I am mot interested in trading off the 61.8% fib.
Here is one with EURUSD that had very shallow sell-off then made the ping swing.
You maybe thinking at this point, "But the range bit looks like it should be the 5". I know! I told you it's a bitch. As you can see here regardless of this I have still sold the best price. I am doing this by having a clear SR level I am forecasting in this sort of move. (Explained in more detail in the shorting noob series   )
Note, it is still entirely possible that this can make another ping swing and slightly spike out this high. If it does, we have a great opportunity. At this point, we are wiser to look for the better RR trade with trend continuation by considering we are possibly in this part of the move and we have the next (usually stronger than previous) sell off coming.
Which actually fits inside another cycle for a ping swing.
Here is a real time forecast of a ping swing we can watch for and set pending orders (or define areas to watch for reversal patterns)
(Ignore the buy trades on this, they are from a different type of strategy)
This is a lot of information, and to intrinsically understand this you'd have to go over a lot of trending charts and watch how they have developed. I have spent a hell of a lot of time on this. I will round up with leaving you just a few simple rules we can take from understanding this general pattern that recurs in trends. Some of them will help you win, others will help to prevent you losing.
1 - When it starts to chop, it's time to stop.
When a trend that has been in a free flowing form starts to get choppy, it's time to stop following the trend for the time being. You should be aware the next breakout(s) can be false ones, and the next shallow correction for a "Retest & continue" type trade is likely a trap.
2 - Big corrections rarely feature only one leg.
When you see a really big move against the trend it gets really tempting to rejoin the trend once it starts to form price action reversal candles. Any time you're entering without the market having previously faked and then spiked out early sellers at least a couple of times, you have a more risky trade.
3 - Forecast where early sellers will lose.
Quite simply, if you see a downtrend and then a spike up and what looks like the continuation of a downtrend you can assume there are sellers into what they think will be the new downtrend move. It's also quite likely these sellers have it very wrong on their stop area. It will be just above the previous highs and the consolation range. This is the very area we'd expect the ping swing to spike into and then make the proper trend move after whipsawing those who sold too early.
Where they are getting stopped out, you want to be entering. Not sure where this is? Look in Forex forums, they'll tell you.
4 - Velocity does not mean victory!
As price comes into the reversal area it will usually be carrying a lot of short term momentum and moving fast. Moving quickly into an area is not in any way an indication of a break of that area or a reversal. In fact, once you've identified where you think the ping swing will end, the more parabolic that move is into that area the better for the reversal trade. Plan ahead, do not be caught up in the moment. The moment will be deceptive.
5 - Have excellent exit plans on both sides of this sort of move.
If the move fails, the counter move running against you can be persistent. Stop losses should be around 78% of the swing. Small spike outs of the 61.8% level are to be expected. Breaks of the 76% level are not. Similarly, profits can come lightening quickly. Which can actually be a problem if you've not planned the areas you want to exit or how to trail your stops. So be well prepared to exit before you enter.
The things I have explained in this post have validity on all timeframes. I scalp with it, and I swing with it. It transfers readily to any market with trending properties. If you were to master this (especially at an intraday level - which is harder) , it would be highly likely you significantly beat what most people would think are "good returns" when the markets are trending.
It would be possible for someone who has sufficient skill in doing this to make themselves substantial profits even starting from a small amount of money and using moderate risk over the course of just trading 4 - 5 major trend moves on daily and weekly charts. This is quite an easy setup in my opinion (once it's been highlighted at least) and for as long as you can find trends to use it, it will outperform most strategies I see on public display.
(All bets are off in ranges. This will make a mockery of you if you try to do it in ranges)
Happy trend following :)
No push through move, but this is still a valid high going into the Asia session. Here can trade classic top sort of patterns. We can sell 106.50 and stop 106.80 . We target 106.20.submitted by whatthefx to u/whatthefx [link] [comments]
We look forr price meeting this area in the hours of the EU open. 106.15 is our support. We look for price to meet there and make bottoming patterns (we expect a spike out of this level, not a big one, just enough to make buyers jumpy. We do not jump).
I've circled the area of the move I think we're in in blue on the right.
Sell into the 61.8 (feature spike out)
Retest the highs (usually not break)
Fall quickly (often one or two candles move, can be news related)
Strong bull run in last 6 hours of market.
Stall in the last few hours.
Spike in the couple hours before close (we take profit when this happens if targets have not hit).
Read about this move we're setting up to trade in detail here.
Part   submitted by whatthefx to Forex [link] [comments]
Not much in terms of adjustments to add from previous post. I'm going to implement all risk adjustments at the weekend. In the meantime I've used some manual hedging to prevent from over exposure.
In this post I'll talk more about the ideal trades I am looking for. The mistakes people make at these areas, and how to build forward looking trade plans so you are less likely to find yourself caught in one of these market traps. I do consider these to be traps. I think price routinely moves in ways that induce market participants to take losing positions. I think this is done in algorithmic fashion and this means it leaves clues in forms of recurring ways laying traps.
This is just an opinion. I don't know.
First we will examine the classic structure of a trend. All examples will use a downtrend.
Basic Recurring Trend Structure:
Basic Trend Structure
Most of you will have seen this before, and probably recognise it as Elliot Wave theory (EWT). Whether or not you think EWT is valid or not, there are some things I think all of us can agree on. That is for the market to be in a downtrend, it has to keep making new lows. If it doesn't, it's not in a downtrend anymore. You'll also probably agree there are retraces in moves. That not often are new lows consistently made without any retrace. In a broad sense, this is all EWT is describing, which makes it noteworthy in good trending conditions.
Here are the points where most mistakes are made by traders in EWT cycles.
Trend Best/Worst Entries
All areas marked off in orange are places where it's easy to make mistakes.
Looking closer, this is what the more detailed price action on these sorts of moves tend to look like on lower timeframes.
Detailed Best/Worst Entries
Brown boxes are where buying mistakes are made. Purple circles are where selling mistakes are made.
We'll look a bit closer at what the specific mistakes are usually based on (conventional technical analysis theories) soon. First here is an example of this on a real AUDUSD chart.
AUDUSD Example Chart
This is a 45 minute chart, so the swings are not as detailed as the ones I've drawn (mine are more like 15 min), but you should be able to see how this concept can be transferred over onto a real chart. All of us who have been trading for a while know there are times we have made these mistakes. Everyone has ended up selling the bottom pip, or getting stopped out right before it reversed. Many of these times (in a trending market) fit into these areas.
This is not just curve fitting. Using rules to help to describe these conditions to pick the best trades and trading against the trades strategy providers offer, I picked up these trades. This was not perfect, what I'm doing needs a lot of work.
Here we can see a couple few of the mistakes. The green lines are profits and orange lines are losses. Here shorting these mistakes has done quite well on the spike out low. It's hard to see, but it also got a lot of good buys at the low. There are some losses at the high, but there is a far larger position accumulated around the mistake level.
See previous analysis on these trades in  
A big trend leg followed this build up of positions and hit take profits where stops were set under the low. This is where people start to sell, but this is also usually a mistake to sell immediately after this breakout.
The types of mistakes made are due to a handful of concepts. Here I've numbered them.
Rules/Rational people have in mind making these mistakes.
1 - Breakout/new high relative to recent leg / stops above previous high on sell/ previous low on buy.
2 - Single candle price action mistake.
3 - Breakout trading rushing in / stops go under recent supports/ over recent resistance.
4 - Break and retest.
5 - Deep correction.
Everything listed above has the potential to be very useful and valid in a technical analysis based strategy. However, in some contexts they are literally the very worst thing you can do. That's the thing about trading, you can do the same thing at different times and get wildly different results. What I'm trying to do here is not find people who lose every trade (I want them to win overall, actually. So I can keep copying them). I just want to work out ways to bet against mistakes they are likely to make. I think people will make these mistakes more reliably than an automated system will pick up trades.
I should add that most of these areas the mistakes happen at will be hit with a lot of velocity. This I think is what triggers the mistakes from so many impulsive traders. The market will amble along in a slow non-threatening / uninteresting sort of way, then suddenly all in a rush make these moves that imply something BIG is happening in a certain direction, when actually it's just about to move against these very positions if you take them. Velocity is one of my key filters.
Let's talk about the end of the two leg correction, this is one of the places I think most of the money is made and lost. At this point in an EWT cycle, the market is gearing up to enter it's strongest move. The best move to trade, and the smart market is going to need to get people on the wrong side. This is usually achieved with three things. One, the market makes it's first false reversal from a 50% retrace, and then moves with a lot of velocity into the 61.8% fib (briefly described in ). Then there's a second false breakout with price trading a little over the 61.8%, followed by a price crash into new lows.
The interesting thing about this move is if you speak to anyone with any sort of interest in EWT, they will tell you this move often completes with a news spike. There is positive news, the market moves quickly in the direction it "should" and then quickly makes a rapid reversal. Sometimes the move on the news makes absolutely no sense what-so-ever fundamentally. but does strike these areas.
Here is the Brexit chart.
Brexit trend continuation from 61.8% spike out pattern
Let's go further back.
Scotland Vote High
Here is where GBP made it's high point. This was after the fantastic fundamental news (apparently) that Scotland was staying in the UK. Price shot up, then began to heavily downtrend. I've marked in the start to the previous swing with a line, if you check these fibs you'll see it fits with the mistake. We are now in the part of cycle where GBP is aggressive pulling away from the range where the false reversals happened. This is punishing those who bought in this range, and we should expect to see it end in a violent spike down. Remember the people who thought buying Sterling after Brexit was free money? Nah uh.
This happens a lot. When it happens I see people trying to explain it with all sorts of theories. Usually involving the saying "priced in already". People often refer to these in aloof and vague ways, as if there was no way we could have ever known, and it's certainly not worth trying to forecast these sorts of things ... but next time you see this, have a quick check and see if we happened to be in a correction that spiked out a 50% high and reversed around 61.8%. It is wiser to look at what happened than take wild guesses as to why. I am not saying that it always it, nor am I saying it works like magic. I'm just saying it can be quantified. When someone says, "Well you see it was not what was said, or the number, but what was inferred ...", really means nothing. It's an opinion. We're better to look for things we can test, in my view at least.
So, let me talk you through the mental mindset of people when they're making these mistakes. I'm going to use this big Sterling chart, so this will also be a bit of a price forecast.
Mistakes Thinking Patterns.
1 - Price has been going up strongly, it's retraced and there is a single candle PA buy signal. Sets people up to take a horrible trade.
2 - Price has been falling hard and made yet another breakout, it's an easy sell ...
3 - This has fell too far, it's a reversal now. Look how strong it is.
4 - This is a strong breakout and this must be the start of a bigger move.
5 - Wow, it's broke the lows and look how hard it's falling, big sell time.
I think we will see stage 5 complete around 1.190. I think we may be due a fast move into this. Maybe in the coming week or two. It would be typical of the spike nature of end of this sort of move that this will be a single candle of over 150 pips that fills this. Being and holding GBPUSD shorts targeting 1.196 seems a great idea to me.
These five mistakes, made at these handful of areas are the ones I wanting to trade against, and if you'd like to be a profitable trader, are the places you should be looking for entries.
At the start of the week I made posts saying I thought USDJPY was heading to 110 - 111 this week. I later revised that.submitted by whatthefx to Forex [link] [comments]
At the start of today I said I thought USDJPY would be up, with a low of 105.40 (it'd been at 105.30 already, actually. I was buying 105.40). This had a 7 pip stop and I'd posted another pending order to buy 105.15. This filled, but later in the day I posted I was exiting all USDJPY. Furthermore, I went short.
I have some questions about this (and some accusations), and I think what it boils down to really is, "What's with the random flip flopping?" I'd be happy to explain.
First we'll chart up the trade themselves. Let's map out clearly the events and outcomes we're talking about here. Here I'll only use the actionable entries and exits. By which I mean, the times I specifically said XXX price enter, XXX price stop. These are the only times I've been engaging the market. The rest has been discussing plans, not executing them.
Signals I gave;
USDJPY buy 104.60. Stop 104.20
USDJPY buy take profit 106.06
USDJPY buy 105.75 stop 104.20
USDJPY buy updates, tight stop entry 105.75 - 105.80. Stop 105.60
USDJPY take profit 106.50
USDJPY sell 106.50. Stop 106.80
USDJPY take profit 105.35
USDJPY buy 105.35. Stop 105.27
USDJPY stop hits. 8 pips loss.
USDJPY sell 105.35. Stop 105.48
USDJPY take profit 105.20
(There was one more trade planned and possibly executed on by some people. I've not included it since there was no exits given. Just a price action condition to enter. I'll touch on that trade too a little)
I can't be bothered getting all the stuff together to show this, but it is in my weeks posting history. Those of you who followed closely what I was posting this week and had these trade plan discussion with me where we defined the actual entry and exits, please confirm in the comments this is at least reasonable accurate.
White, green winning buys.
Yellow winning sell.
Red Losing buy.
(The final scalp I've not added because it's too small. It was from about the last high to last low, though. You can check)
I think these are good trades. Throughout my posts talking about these trade setups I think I've presented solid reasoning, and good information on risk awareness and control. I think that, but we all have perspectives. Here's an exchange with someone with another perspective thinking my way of trading (I don't think they read 1/4 of my posts to know what I am doing) is harmful to explain. Only to those who do not consume the full explanation., would be my thought.
The entries that are being criticised here are the white buy, the green buy and the yellow sell. When we look at these on a chart, it is clear this was not teaching people to reverse because price was not going there way. It was teaching them to take profits at good places, and enter into new trades with good probabilities. There was only one time the market moved against the direction I'd given in trading signals, it was the buy today. It was from 135.27, and it hit a 8 pip stop.
After the stop hit, price retested the entry level and then continued to head lower into the close of the week (we sold, profiting from this and covering the loss on the buy). Everyone has their own ideas about how things can and can not be done, but the raw facts here are none of my signals exposed to large risks, and the trades entered and exited at excellent prices. Whether or not this is gambling depends on how often I can do it. I done exactly the same trade pattern last week.
Before I executed the trade plan last week, I explained every aspect of it. I even drew the chart. Literally. I covered all my forecasts in the close of this post.. Through this week, I've explained the exact same thing step by step, and again entered precisely at the start and end of swings. If you think this is gamblers luck, I don't fancy your odds. They odds will get longer. I'll keep posting forecasts, execution and reports. I may win or lose, can never know ... but I know the long term trend.
After getting stopped out, I reversed. This was not a great trade because it was late in the week, but is part of an established trading pattern I use. I don't know why you guys stop loss, but I do it because the market has proved me wrong. Usually I have reasons I'd be wrong and why they'd change my view on the market. Here was the specs I wanted to see to keep this trade active.
When the London low broke, the entire strategy this trade was based upon failed. Signals from it became invalid. The stop loss this strategy used is placed purposefully. When it hits, price very often will retest the entry but never go back into profit before gathering a far larger loss than the 8 pips would be. So this is the kill point, and also the point at which the market shows counter momentum.
When it does this, I then deploy a contingency strategy where I look for small chart trend and corrective patterns to reverse on the position. I've practised this a lot, and tested many variant of stops, re-entries and reversal. What I do is highly efficient at getting out of the market and covering the loss in the following trading pattern.
All of the trades I posted this week won (even the losing one was dealt with in a winning way). Even though my overall forecast was incorrect, I used strategies and designed trading patterns to adapt my thoughts to profit from what the market was actually doing. Where price really goes is where we really make money. Not in all the reasons we think things about what price can do. I spend a lot of time on what I do. I've been posting here for a month now, and objective review of my entries and exits shows they have done well.
Please .... please, can people stop telling me in absolute terms what "can't be done". You have to start to do one of two things;
1 - Relate the real analysis and entries and exits of what I do to your opinion of what I do.
2 - Start to use the words, "I think ..." if you're making speculations that do not relate to current facts.
Dear Traders,submitted by Horizon_Trading to u/Horizon_Trading [link] [comments]
My name is Ludovico and I am an associate of Horizon Trading team. Today, I would like to share with you a scalping technique that will give you an advantage in following price action fluctuations. Most importantly, this article will focus on fast timeframes trading tactics, how to spot important key levels and trigger your positions.
So, do scalping and price action go well together?
Considering that price action aims to predict what price is doing right now and where is heading, fast mindset and quick analysis become crucial; scalp trading is about the same thing. A scalp trade will take approximately 1 to 30 minutes, so to be effective and consistent in this discipline one must be reacting rapidly to price movements. Therefore, scalp requires quick analysis, quick responses and quick decisions, and at its core there is price action, which as well is all about speed and efficiency.
Now let s move on today’s topic on how to steadily understand fast trading potential earning set ups and to become a killer scalper.
What is scalping trading?Scalping is a trading style that specialize in profiting off small price changes. It requires high level of concentration, because, due to its speed, a trader must have a strict entry exit strategy, otherwise one large loss could cancel all the many small gains in a blink of an eye.
The main features of scalping are:
Less exposure, lesser risk: A smaller exposure to price fluctuation will reduce the odds to run into adverse events.
Smaller moves are easier to forecast: Because like every market forex works on principles of supply and demands, a higher imbalance is needed to generate bigger price changes.
Smaller fluctuations are more regular than wider ones: Even in days when markets tend to less volatile, working with smaller timeframes such as (M1, M5, M15 & M30) will still grant chance of earning more frequently.
While swing trading relies on big price moves, therefore aiming for long trend following a scalper will trade that fluctuation continuously. Price action comes into play here, a solid scalp trader must be very aware of level of support and resistance and when the price could bounce off.
See image Below:
Figure 1: Support & Resistance, XAUUSD, M1, (23rd July 2019
In order to better find these areas a comparison between timeframes is necessary considering that is always advantageous to highlights the most recent zones of support & resistance (2 to 5 previous days)
Once understanding levels strategy become easier to follow, let’s find out.
Simple scalping and Horizon X scalping patternWhen trading trends continuously, important is to gauge market signals which indicate the trend is strong, opening to new potential earning scenarios for investors. When noticing price is coming back to retest important key levels forming pullbacks, a trader should always look out for entry-points.
Scalping pullbacksScalp traders must focus on key resistance and support level to find entry point while trading pullbacks. Here at Trading Academy we developed a system, based on fast moving price action that will enable traders to have successful daily session.
We based our method on understanding where big money players come into action and by following their liquidity volume open winning positions. Horizon X is based on several scalping price patterns which find their fundamentals in risk and money management, key levels and entry points.
See image below:
Figure 2:Scalp trading pullbacks, XAUUSD, M1, (23rd July 2019)
In the picture above I highlight the principle of trading pullbacks in M1 timeframe, this method relies on entering the market in specific hot spot key levels. Even though many traders globally do not take into consideration risk management, our vision is that while scalp trade, investors should follow clear objective rules to be effective, here is one of our coral patterns and its trade management rules.
Horizon X Pattern #3This pattern aims to gauge momentums, big money players moves, consisting in fast formation of large body candle sticks (black bearish/white bullish)
Figure3: Pattern #3 configuration
To be formed Pattern #3 require several steps to be accomplished by the market before we can enter our position with confidence:
Entering the marketPattern #3 can be traded by entering the market within the retesting price area at consolidation level, however the tactics would be based more on aggressivity of trader personality and behaviour. In this booklet we will describe the most commonly used one.
Entering in consolidation structure
Market needs more liquidity for further movement and is going deeper toward the structure taking stop losses of weak traders. Smarter investors, however, use these stop losses for their position gaining, entering the market when a fractal is formed.
See image below:
Figure 4: Pattern #3, entering market at consolidation structure, USDCHF H1 (22nd July 2019)
Entering at consolidation boarder
Price touches edges of consolidation and starts to reverse. We would like to open position when fractal is formed.
See image below:
Figure 5: Pattern #3, market entry at consolidation border, GBPUSD M1 (14th Mar 2019)
See image below:
Figure 6: Pattern #3, market entry after false break out, GBPUSD M1 (6th June 2019)
Trade ManagementSimilarly, we can use 4 elementary exit strategies of our Horizon X Pattern #3.
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