Snow Dog

Lower high following divergence, higher low following divergence. EUR 1 Mar Probably not that often that you see sell divergence followed by a lower high and buy divergence followed by a higher low in the same day. London open move higher does not follow through. 1hr big upper wick on the doji. 15 min divergence, lower high for move back into trend. At London close time slot we have 2 x 1hr hammers/dojis. 15 min higher low following divergence at W S2. Whilst its a great tool to give advance warning of a potential move, you never know when divergence will play out. In the higher low/lower high following divergence price action is giving confirmation of the divergence to validate the trade.

4hr chart and W pivots. Showing again to highlight the importance of the W pivots and support/resistance levels.

Recap 1 Mar EUR - View was: D negative close as 3 bar reversal, the previous morning star pattern did not play out, the upper resistance level 1.3166 held. 1hr flow now lower high lower low. Bias down. 1hr long legged doji set up move down in line with bias. GU - View was: D closed a narrow range shooting star. No bias. EJ - View was: D closed also a very narrow range. 4hr and 1hr look sideways no bias.

Did not trade at all on Fri due to health issues. Just posting what we would have been looking for in a trade. LO has move up CT as the bias was down. That failed at the RN. 1hr long legged doji and 15 min lower high entry likely around 1.3061. The simple fact that a move out of the immediate range failed, in this case up, means that the move down below that immediate range is a high % trade. Add that onto the normal trade rules i.e. the down bias, 1hr set up candle, 15 min lh little/no lower wick and thats a trade thats 100% consistent with methods.

And heres to post number 400, better make it a good 'un.:doh: Blew it!!:crap:

1 Mar EUR GU EJ EUR - D negative close as 3 bar reversal, the previous morning star pattern did not play out, the upper resistance level 1.3166 held. 1hr flow now lower high lower low. Bias down. GU - D closed a narrow range shooting star. No bias. EJ - D closed also a very narrow range. 4hr and 1hr look sideways no bias. It appears the fiscal cliff that was pushed back until today has been holding the markets back somewhat.

Recap 28 Feb EUR - View was: D closed positive for a morning star 3 bar reversal pattern. 4hr had a higher close yesterday following divergence. Price stalled at previous support/resistance level/W M2 1.3166. Bias up with potential to move lower from 1.3166. We did move lower from 1.3166. GU - View was: Similar picture to EUR. GU was a bit of a mess only had a D range of 70 pips. EJ - View was: Similar picture to EUR. A mess, small range, little follow through.

Not a classic set up from 1hr, dojis/inside bars. It didn't want to go up and was a get in near extreme of upper range trade, which is fine on ranging days. Exit +53.

EUR GU EJ 28 Feb EUR - D closed positive for a morning star 3 bar reversal pattern. 4hr had a higher close yesterday following divergence. Price stalled at previous support/resistance level/W M2 1.3166. Bias up with potential to move lower from 1.3166. GU - Similar picture to EUR. EJ - Similar picture to EUR.

Recap 27 Feb EUR - View was: D closed a doji, contained by previously identified support/resistance levels. Whilst we can go either way today the bias remains down until price confirms otherwise. We have a base now at 1.3040, the move below that yesterday was strongly rejected. Price did prove otherwise, 4hr higher low following divergence, cross of RSI and 8lwma setting up the move. Even if regarded as counter trend our trade rules applied. Price rejecting previously identified support level 1.3014/W M1, 4hr divergence, flow changed to higher low following divergence. GU - View was: D negative close lower high 3 bar reversal. It seems a struggle to go lower in this 2 month down trend, bias remains down until proved otherwise. The down bias did not play out, what seemed like a struggle to go lower won the day. EJ - View was: D closed a doji. 4hr showing a clear base despite that there have been no strong moves higher. Bias remains down. There was a move down in line with bias but the clear base held and then moved up strongly from there.

I saw this at work and said to myself I'm going to be very, very impressed if Mrs V catches this one. Why you might ask, well firstly her back has been giving her some issues lately and second she sat through a day of mind numbingly boring nothing, as you know when its happening or not happening actually, how difficult it is to keep yourself occupied and then still get the trade when it happens. OK why that trade, there is an obvious level forming during the day 120.30 area. 1hr closed a shooting star, 15 min genuine lower high, 3 bar reversal, little/no lower wick (a classic example of how that rule avoided half a dozen losing trades today). Entry is close to the upper extreme of pa i.e. 120.31 and far enough away from the lower range119.75 to get to BE if it does not follow through lower. Exit +45. Re-entry below 119.50 exit at small loss when it never followed through lower and she had a BE trade also.

EUR GU EJ 27 Feb EUR - D closed a doji, contained by previously identified support/resistance levels. Whilst we can go either way today the bias remains down until price confirms otherwise. We have a base now at 1.3040, the move below that yesterday was strongly rejected. GU - D negative close lower high 3 bar reversal. It seems a struggle to go lower in this 2 month down trend, bias remains down until proved otherwise. EJ - D closed a doji. 4hr showing a clear base despite that there have been no strong moves higher. Bias remains down.

Recap 26 Feb EUR - View was: Engulfing D neg close. 4hr and 1hr flow down, both showing divergence. Whilst there can be a reaction up after the over sized negative close bias down until flow confirms otherwise. We had an early move down before London open. Price moved higher reacting to the W M1 pivot/1.3015 support level previously identified on D charts. GU - View was: Positive D close still below 8lwma, no trend line breaks. Flow on 4hr higher low and 1hr is on higher high higher low. This can be a buy or sell day. Overall moved lower but difficult to trade off 1hr as the negative close candles were all large. EJ - View was: Bias down until positive flow proves otherwise. Overall there were good selling opportunities but the low from the 25th/W M0 held.

EJ did not want to go up after news released. An intra day resistance level around 120.70. Shooting star treble top, little/no lower wick. the move below days open 119.89 earlier in the day was rejected. Happy to exit +43 for 100 pip day when it held again.

An early trade this morning +57. D bias was down, 1hr closed as a 3 bar reversal, 15 min lower high little/no lower wick.

26 Feb EUR - Engulfing D neg close. 4hr and 1hr flow down, both showing divergence. Whilst there can be a reaction up after the over sized negative close bias down until flow confirms otherwise. GU - Positive D close still below 8lwma, no trend line breaks. Flow on 4hr higher low and 1hr is on higher high higher low. This can be a buy or sell day. EJ - Bias down until positive flow proves otherwise.

Recap 25 Feb 25 Feb EUR - View was: D closed a doji, in itself not a strong signal. 4hr still clinging to the lower high lower low flow, divergence is showing and RSI has crossed above its signal line. Until flow properly moves higher bias down. The 4hr that was still open at the time of posting did close as a higher low to change flow, moving up from the Sep '12 high/W M2 support. Price moved up to the Dec high/W M3 resistance level and fell after 2 x 1hr hammers. GU - View was: GBP was down graded late Friday night, it remains to be seen whether this bad news will follow through. Had a gap down which is likely to be closed, so a possible move up to 1.5160 area. Still no reason to believe its anything other than a rally in downtrend. Bias down. Attempt to move lower failed and gave a 4hr higher low in US session. EJ - View was: Rejected another attempt to go below 123.00. D closed an inside bar, still just on a lower high lower low. 4hr had a higher low positive close hammer. The gap up will need to be closed suggesting a move down to 123.20 area. Looking for a move lower to close the gap there were 2 x 1 hr shooting stars at W R1. It closed the gap and then just carried on falling over 600 pips.

Mrs V was very distracted today with the fridge repair guys in and out a few times. Was away from the computer for the exit at RN but got +21. Bias for GU was down, lots of upper wicks on 1hr, 15 min lh little/no lower wick.

25 Feb EUR - D closed a doji, in itself not a strong signal. 4hr still clinging to the lower high lower low flow, divergence is showing and RSI has crossed above its signal line. Until flow properly moves higher bias down. GU - GBP was down graded late Friday night, it remains to be seen whether this bad news will follow through. Had a gap down which is likely to be closed, so a possible move up to 1.5160 area. Still no reason to believe its anything other than a rally in downtrend. Bias down. EJ - Rejected another attempt to go below 123.00. D closed an inside bar, still just on a lower high lower low. 4hr had a higher low positive close hammer. The gap up will need to be closed suggesting a move down to 123.20 area.

Recap 21 Feb EUR - View was: There is nothing to suggest that this is anything other than a rally in down trend. We could fall today or in two days. Short term counter trend buy (but that ship may already have sailed), looking for return to down trend, bias down. Lots of upper wicks around London open, fell nice after LO. At US open another upper wick with a shooting star and we fell nicely as per bias. GU - View was: Would normally consider a day like to day as opportunity to buy and sell should good set ups arrive. Like EUR the counter trend move up may have gone too much to enter safely. We had hit 50% retrace of last leg down. So now the bias would be to wait for sells. There was a double top and then a negative close in US session started move down as per bias. The big drop only happened very late in session with GBP getting a rating down grade. EJ - View was: D suggests down but for now the move below the 123.00 support level has been rejected. 4hr has not yet closed above RSI signal line/8lwma. Should that happen then a move up attempt might be made. Upper wicks after London open and a negative close hammer signaled move down. Friday mornings are often volatile around London open and we do not generally trade that session (often very good trades in the hours preceding).

W pivots, 4hr charts Posting to show yet again how important the W pivots are and that there are normally 2-4 trades a week from the crossings (RSI/8lwma) and price action including divergence.

Was asked if we traded yesterday. We missed the move down for a couple of reasons but got a CT buy on a different method for +40, didn't post here for that reason - not this system.

EUR GU EJ 22 Feb EUR - D negative close stopped at the next identified resistance level 1.3166/W S2 1.3181. 4hr showing lower wicks and divergence, RSI crossed above signal line on an open candle. 1hr showing divergence and the higher low following the divergence played out nicely in Asian session. 1hr still on lower high lower low flow. There is nothing to suggest that this is anything other than a rally in down trend. We could fall today or in two days. Short term counter trend buy (but that ship may already have sailed), looking for return to down trend, bias down. GU - D closed a hammer and with Asian move up already up 200 pips from yesterdays lows. 1hr on higher high higher low flow. Unless there has been a fundamental shift caused by news would expect some multiple day reversal pattern to play out. Would normally consider a day like to day as opportunity to buy and sell should good set ups arrive. Like EUR the counter trend move up may have gone too much to enter safely. We had hit 50% retrace of last leg down. So now the bias would be to wait for sells. EJ - D suggests down but for now the move below the 123.00 support level has been rejected. 4hr has not yet closed above RSI signal line/8lwma. Should that happen then a move up attempt might be made. Friday mornings are often volatile around London open and we don not generally trade that session (often very good trades in the hours preceding).

Recap 21 Feb EUR - View was: D lower high, engulfing negative close. 13260 gave support for about a week in Jan. The D close should follow through lower, bias down. We did fall. GU - Bias down. We fell into Frankfurt open but from there a strong push up. EJ - D lower high, engulfing negative close. 1hr lower high lower low flow. Bias down, support level 123.00. Fell 80 pips below the 123.00 support.

EUR GU EJ 21 Feb EUR - D lower high, engulfing negative close. 13260 gave support for about a week in Jan. The D close should follow through lower, bias down. GU - Bias down. EJ - D lower high, engulfing negative close. 1hr lower high lower low flow. Bias down, support level 123.00. I wonder when the JPY authorities will work to push yen up again?