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thalestrader

Reading Charts in Real Time

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Thales,

 

When you say your daughter finds 1-3 trades per day - could you tell us how many pairs and over which hours she's watching?

 

Over the summer she would be watching during the first half of the NY session, and during the early Tokyo session in the evening. She watched the EURUSD, GBPUSD, and the three major Yen crosses (EURJ, GBPJ, USDJ).

 

At this time, unless she is off from school or it is one of her early dismissal days, she only watches early Tokyo.

 

Best Wishes,

 

Thales

 

She traded the EURJPY more than anything else.

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hmmmm ..... is this a message or is it just that gbp and usd are not Asia zone movers?

 

kw2.gif

 

The Yen pairs (EURJ, GBPJ, USDJ) tend to be the best movers during Tokyo morning session. But when the EURUSD and GBPUSD do get a mind to move during Tolyo's am, it is often an extended move.

 

Best Wishes,

 

Thales

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I have to trust myself - or what I see - more.

 

That is key for everyone of us. Price will point the way, but we have to be willing to follow.

 

Best Wishes,

 

Thales

Edited by thalestrader

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Hi Folks,

 

It looks like you all put in another good night. I am not sure how the winners and losers shok out, but MidK looks at the moment to be sitting on a decent profit with a stop asuring a no worse than break even effort. Gabe managed a profit 2x';s as large as his loss.

 

Keep it simple and keep it up. We need patience both to learn to recognize what price is telling us and also we need patience to wait for price to tell us what it is going to do.

 

Thank you all for participating - remember, posting your pre-trade analysis not only helps yourself but it help others as well. I do believe that good comes to those who do good.

 

Best Wishes,

 

Thales

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Couldn't control my fingures this morning.

Actually the first long trade (which turned into a loss of 66 pips) was in reaction to the big drop and the subsequant retracement and smaller bar.

I have this theory that after a large bar if there is a relatively small bar after it, price will move strongly in one of 2 directions and I bracket that bar.

As it happens I was wrong on the long so I reversed and went short.

Took a 10 pip FEEL GOOD profit on 1/3

Price started to go against my position so I closed another 1/3 for another 10 pip profit.

My target of 30 pips for the second 1/3 was mised by 2 pips and my Stop Loss (which was set to break even +1) was hit.

So total profit for this trade 21 pips and so far -45 loss for the day.

 

Gabe

GJ_Nov_11_2009_15min-4.thumb.png.c938db1de7718adba87d55346c9f6c28.png

Edited by Gabe2004

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Probably too early to look for something so specific, but G/J looks cleanest in line with S/R right at that horizontal line I drew.

 

We'll just have to wait and see:cool:

 

-----EDIT-----

Here's another look with the hour chart. Possibly Support slightly higher as well. Although I like the lower level a little better as it clearly shows a trading range above and below it.

RangeAndBounce.thumb.jpg.e5bfc09dd4db8b6a35371e078bd0afad.jpg

RangeAndBounce2.thumb.jpg.e5e93f7f4e36ee472129ae6e41b5c442.jpg

Edited by forrestang

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I wonder how often we have these fake BO's :shrug:

 

Gabe

 

I spent quite a bit of time looking at the chart trying to figure out which 'fake BO' to which you were referring?

 

I was thinking you meant 'fake BO' of the swings, i.e. HHs and LHs etc......

 

But it seems like you were referring to BOs from those hinges you constructed right? If so it seems like the chart pattern itself is rather arbitrary, in that the BO would be meaningful only if it coincided with price leaving a former S/R level, with some type of price action to confirm it? I.e. the breakout from the hinge/chart pattern is just a coincidence with something else.

 

  • Like in your first circle, I'm having a hard time seeing why you'd expect price to break to the short side, or looking for a BO at that point?
     
  • The second circle, I'm also wondering why you'd expect a long BO at that point?
     
    It seems like 'IF' you wanted to go long, you'd have to wait for price to break above the point on the picture, where price was in a decline, made a low, followed by a HIGH, then a HIGHER LOW Followed by the BO. This is the white lines.
     
    If you were looking short, It seems you'd see price was on the rise AFTER that big drop(big green up bar), then made a HIGH, followed by a LOW, then a LOWER HIGH, then the BO. This is the orange lines.

 

Of course it's easy for me to say the two above bullet points in hindsight, but I'm just not seeing why you'd expect price to BO where you pointed to on the chart, unless it was purely looking at a chart pattern?

 

I managed to confuse myself writing this, so if the above is unclear I fully understand.:hmmmm:

dontseeit.thumb.jpg.4ddb7c871dc2455b5614ce3c7dbcf34f.jpg

Edited by forrestang

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I spent quite a bit of time looking at the chart trying to figure out which 'fake BO' to which you were referring?

 

I was thinking you meant 'fake BO' of the swings, i.e. HHs and LHs etc......

 

But it seems like you were referring to BOs from those hinges you constructed right? If so it seems like the chart pattern itself is rather arbitrary, in that the BO would be meaningful only if it coincided with price leaving a former S/R level, with some type of price action to confirm it? I.e. the breakout from the hinge/chart pattern is just a coincidence with something else.

 

  • Like in your first circle, I'm having a hard time seeing why you'd expect price to break to the short side, or looking for a BO at that point?
     
  • The second circle, I'm also wondering why you'd expect a long BO at that point?
     
    It seems like 'IF' you wanted to go long, you'd have to wait for price to break above the point on the picture, where price was in a decline, made a low, followed by a HIGH, then a HIGHER LOW Followed by the BO. This is the white lines.
     
    If you were looking short, It seems you'd see price was on the rise AFTER that big drop(big green up bar), then made a HIGH, followed by a LOW, then a LOWER HIGH, then the BO. This is the orange lines.

 

Of course it's easy for me to say the two above bullet points in hindsight, but I'm just not seeing why you'd expect price to BO where you pointed to on the chart, unless it was purely looking at a chart pattern?

 

I managed to confuse myself writing this, so if the above is unclear I fully understand.:hmmmm:

 

 

I was thinking that maybe we can come up with a rule to the pattern in which price is converging in a symetrical (or non symetrical) triangle, price than pokes out of the boundaries of that triangle (flag) but than it really makes a big move into the opposit direction.

 

Gabe

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I have to run. Here's a current look at the EURUSD. I don't have time to post the EURJPY, but you can se something similar there as well.

 

eNQ saw the same breakdown, one swing lower:

 

a view on the EUR.USD

 

And price did all one could ask for it to do. It stood up, waved its hand, and said to anyone willing to listen that if it passed below 1.5027, it was likely heading lower.

 

First chart is the pre-breakdown pic I posted this morning, The Second pic shows the breakdown. Price reached both targets and extended further to the downside. The third picture is my view of the 4 hour EURUSD, showing that price had rallied into a resistance zone.

 

Please, folks, do not make this more difficult than it is. Just be patient, wait for price to work its way to a support or resistance level, watch how it behaves, and act accordingly.

 

Best Wishes,

 

Thales

5aa70f55de79e_11-11-09EURUSD1.thumb.jpg.4deeee612aeda1b869c2fecbe29b13d3.jpg

5aa70f55e492d_11-11-09EURUSD2.thumb.jpg.738cf6f1d7f0cfef0b767fea0904b5cf.jpg

5aa70f55e99ca_11-11-09EURUSD3.thumb.jpg.644f5768ef1bc1a9425b80f8f83e4029.jpg

Edited by thalestrader

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I would venture that better than half of all trading losses were preceded by just those words.

 

Best Wishes,

 

Thales

 

 

:crap: :rofl:

 

I love to think (it is a massage for the grey cells) but I guess in trading it is not a good idea.

 

Gabe

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2 charts here for GBP.USD.

 

240min indicating support area

 

15min indicating long that I am considering

 

What is nice here is that price indicated that it was considering a bounce, and so long as one were patient, and waited for price to confirm its intentions by printing a higher high, one would have been safely flat as price chose instead to notch a new session low.

 

Best Wishes,

 

Thales

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Gabe,

 

Commiserations on thinking. Thinking leads to experimental trades and thus to losses.

 

I am also prone to this error and when combined with boredom or frustration it is a powerful wallet emptier.

 

Trading should be based on things we have tested repeatedly and found to have a statistical edge. As suggested, there was no 123breakout up - in fact you can see that my system picked up two 123breakouts down while you were hunting the snark.

 

 

For the record I held my paper GU trade yesterday despite my 4 little indians and a later test of the bottom where it was forming higher highs and higher lows on the 15m timeframe. Lessons for me were: if trading against trend then take profits quickly; if I get 3 little indians look to get out even during asia ... wait for later proof of intent and reentry.

 

.

5aa70f5608b3e_GJ11-12-20096-45-25AM.thumb.png.f3b59382eea57741c81d287484e0725a.png

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Three little Indians needs to be googled but its basically 3 weak probes down in a row, each going a little further, before the market gives up its testing and moves back up. Your EU chart shows it with 3 pushes at 1.49600.

 

I think it is illustrative of the principle that "if the market doesn't make progress when it should then it will probably reverse and go the other way." I don't enter trades on it but I have always exited on it.

 

You didn't have a valid setup when you posted the chart. Since then you have had a very tight pullback giving a valid long 45 mins to 1 hour ago on break up.

5aa70f561ac54_eu11-12-20097-42-24AM.png.b042569181a679800f18f5c55e1b3c89.png

Edited by Kiwi

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Three little Indians needs to be googled but its basically 3 weak probes down in a row, each going a little further, before the market gives up its testing and moves back up. Your EU chart shows it with 3 pushes at 1.49600.

 

I think it is illustrative of the principle that "if the market doesn't make progress when it should then it will probably reverse and go the other way." I don't enter trades on it but I have always exited on it.

 

You didn't have a valid setup when you posted the chart. Since then you have had a very tight pullback giving a valid long 45 mins to 1 hour ago on break up.

 

Thanks for the explanation about the Indians.

The chart that I posted was refering to a long around the same time as Thales was suggesting a short. Not later in the afternoon after the drop but in the morning around 10:30.

 

Gabe

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