Snow Dog

2nd trade of the day.

First trade for today.

Mrs V and I had to renew our drivers licenses today. The queues are horrendous and after 3-4 days of pitching up to find they are closed due to strike action we were there at 6am local time. They open at 8. Filled in forms, eye test, finger prints, pay and out in 12 mins. Exited to see 100+ people in the now long line. You are going to queue for 2 hrs we just decided to get in and out early. Anyway normal service blog recap/days view will resume tomorrow.

13 Feb EUR - D positive close off the support level 1.3375/W M2. We stopped at the 1.3465 resistance level (highs from Feb '12)/W pivot. The 4hr lower high lower low flow broken. The 1hr showed divergence on move up to yesterdays high, it is at a tipping point and could go either way. A lower high after divergence at the resistance/W pivot a valid sell. Bias up with potential to sell. GU - D closed a big doji off the 1.5575 support level, divergence showing. We have RSI below 50 still but crossed up, still below 8lwma. With 1hr flow higher high higher low, bias up. EJ - The positive close on D 11th could not follow through higher. We are still below D RSI 50 level and below 8lwma. 4hr and 1hr now on lower high flow. Bias down.

Do we have an indicator or just see these things? I was asked the question do we have an indicator or just see these things. We do have a price action indicator based on 3 bar reversals. This gives an alert but on these trades the short answer is we see them. With set ups like this we will take these trades every day. We "see" them because we're looking. If we have done our assessment in the morning and it looks like flow will reverse we're expecting it. Or shall I say when it happens it certainly isn't a surprise. Arrow down left. The possibility of 1hr flipping over on 11th to reverse higher high higher low flow and give a lower high sell was discussed as a possible set up. So when we see that kind of shooting star, rejecting move up, after divergence at an identified resistance level and closing at the bottom of range we'll take it. Little/no lower wick on 1hr. It's easier to see when your daily analysis has already identified the possibility it will happen. Arrow down right. Attempt to go up stalls with a doji. Then 1hr closes negative, little/no lower wick at low of range. In trend this is a picture perfect set up. Literally cannot ask for more. The 3 bar reversal signals when the candle close is higher/lower than the previous 2 candle closes. For sells 1 of previous 2 candles must be green positive close. For buys 1 of the previous 2 candles must be negative close. So its doing a good job of capturing change in flow and resumption of trend. Its based on price action only not rsi/tdi etc etc.

Asian session so much to early for us. Just another example (been swopping pm's with someone on the close at end of range). After Y's wide range PA 126.92 to 125 the move up to 126 could have gone either way. This arrow down confirms where flow is a LH, negative engulfing close (below last 2 candle closes) right at the edge of immediate range.

Recap 12 Feb I'm most likely going to be tied up tomorrow early so I'll do the recap now. EUR - View was bias down but we can bounce from 1.3360 support level. We did bounce up from 1.3360. GU - View was bias down but with potential to bounce up from the support levels. It went down at London open as per bias. We then had a 6 hour higher low form and move up signaled with 1hr engulfing positive close. The low was the 1.5575 identified support level, see previous D charts. EJ - Bias was up. We went up after London open and had a big drop in US session.

Posted this yesterday. It is a repeat from a previous post but worth reminding. As luck would have it GU today quick move down 60-70 pips after LO. This is a 15 min chart, we wouldn't touch the 15 min lower high trade, see the x. This is exactly the scenario mentioned. We also would not be looking to buy weak pre/early US candles but wait for US to resume London direction (or give stronger reversal signal).

12 Feb EUR - D closed positive inside bar. 4hr flow undecided. All in all a weak D candle did not cross our 8lwma, RSI below 50. Bias down but we can bounce from 1.3360 support level. GU - D engulfing negative close. The flow is down but we have had 2 large D negative closes in this general area that could not follow through lower. Bias down but with potential to bounce up fro, the support levels. EJ - D positive close, bias up.

Recap 11 Feb EUR - View was a 1hr move lower that fails and then moves up would switch flow up. Bias down but looking for move up should W M2/1.3350 hold. 1.3350 did hold and we went up. GU - View was bias up but we have W M3 at 1.5822 and resistance level at 1.5843 could flip 1hr to sells. An early shooting star rejected the move up and 1hr did flip for sells. EJ - View was D neg close at the 123.30 support level. We have stalled here for 20 hours and there was buying during the previous days London and US sessions. Failure to go lower will set up buying opportunities. We did get move up.

Oooops chart added. Great set up.

This was a little early but if you were looking for 1hr to flip this shooting star is a great one to get. Not taken, nice set up though. Closes at the end of immediate range and follows through.

As mentioned EJ did not want to go lower with a solid base 123.57 the W M2. Out 60% at +67 and the balance at +84. A good day, Mrs V was right it seems and the nice 4hr close may take us higher.

The recap 8 Feb has already been posted. 11 Feb EUR - D did close marginally lower than 7 Feb at the support area 1.3375. 4hr lower high lower low in tact, just. A 1hr move lower that fails and then moves up would switch flow up. Bias down but looking for move up should W M2/1.3350 hold. GU - Same picture in reverse. Bias up but we have at W M3 at 1.5822 and resistance level at 1.5843 could flip 1hr to sells. EJ - D neg close at the 123.30 support level. We have stalled here for 20 hours and there was buying during London and US sessions. Failure to go lower will set up buying opportunities.

If we are considering counter trend we want over whelming additional information to consider, such as: - Proven support/resistance levels. - W pivots. - Divergence on higher time frames. - Price action proving it does not want to progress for hours, double tops/bottoms , higher lows/lower highs, evening/morning star patterns, engulfing closes. - Psych levels eg round numbers In addition to the right kind of price action on 15 min, double tops/bottoms , higher lows/lower highs, evening/morning star patterns, engulfing closes.

If you are inconsistent take a critical look at your winning and losing trades. What do the losing trades have in common? I was having many losing trades from 5 min on 3rd/4th move in London morning session. Guess what I cut that trade out. Now I couldn't care what that trade does as I know statistically its a high risk venture. I cut out 5 min higher low/lower high trades that were counter the London morning direction that were set up from weak 1hr candles pre/early US session. Again now I don't care what those trades do, for me they are a high risk bet (a solid engulfing post US news candle a different story). If we are not in already from London open we are waiting out pre/early US session CT moves and looking for London's direction to resume.

We look to follow the daily candles as much as possible. Trying to keep things as simple as possible we: 1) try and identify support and resistance levels 2) look for positive/negative closes to follow through the next day (as we believe this will hold true approx 70% of the time) 3) watch for divergence 4) Look for D chart higher lows/lower highs, double tops/bottoms, engulfing candles, hammers/shooting stars, morning/evening star patterns 5) rsi crossing its moving average or crossing the 50 line If we are confident that a confluence of the above exists then the next day we will look to trade in 1 direction only. This keeps us out of some head fake moves typically around London open and the US open (weak counter trend 1hr candles in and around US open just as big a fake move as LO).

When good candles/patterns fail that's an immediate warning sign. A solid D close should follow through. Failure to do so should be an alert to look for 1hr flow to switch.

In trend we look for flow to continue in particular on 1hr. Higher highs higher lows or lower highs lower lows. Counter trend we want flow to prove over many hours that price does not want to continue. We would be looking at higher lows/lower highs, double tops/bottoms and morning/evening star patterns. By their definition they are multiple 1hr candle patterns. Finishing off with an engulfing close would be good, price closing above/below the last 2 candle closes.

Price action must confirm the divergence. On any time frame the higher low or lower high that follows the divergence is normally a good set up.

Divergence on a bigger time frame, D or 4hr, is a great way to get an early warning of a potential counter trend move. When pa confirms the divergence with a good candle set up (such as a hammer or engulfing close), or you get a signal from indicators you have tested (RSI cross of its ma, RSI cross of 50 level, move through 8 lwma) a decent move will generally follow.

Several things we talk about: - smaller bounce from a key level = level likely to fail - ignore weak pre/early counter trend US candles - intra day higher low/lower high a decent signal

Wait 20 minutes and try again. Perhaps more appropriate on 5 min charts. When higher lows or lower highs are running nicely a move will be followed by a short period of consolidation before moving again, 20 minutes or so. There are exceptions of course. When price moves aggressively away from a moving average perhaps due to news etc a longer period of consolidation may be required.

Often when gu, eur are moving up through 85 level it will push through the round number to + - 15. The opposite is also true when falling through 15 it will push to 85. Whether it is big boys taking out some stops I don't know.

1. Poor self discipline is the quickest way to lose money. A good trader with a poor plan will outperform a bad trader with a good plan. 2. Discipline is the bridge between goals and accomplishment. 3. You are not gambling, you are trading, this is a business treat it like one. 4. Your job is to take calculated risk. Calculated is the key word, what does your research tell you your system will do? 5. Forgive yourself for making a mistake and move on. Don't repeat the same mistakes. 6. Reach a stage where you can control your emotions. You can do that by ensuring your plan works and if a trade does not go your way that's just one of those things. You will not always have winning trades. 7. Set achievable, measurable goals. Percentage winning trades and numbers of pips. Average wins and average losses will influence these numbers. If an average win is 150 and an average loss 15 you need far fewer winning trades than if your average win is 30 and your average loss 15. 8. Do not give yourself undue pressure trying to trade on a full time basis too early in the game. Act in your own best interests. 9. You cannot control the market, you can only control yourself and react to what the market gives. 10. The market will do what it wants to, not what you want.