Reading Charts in Real Time

[TradeRunner 10]

1 Trade: BE

 

Even though I'm trading on replay and could trade the full 24hrs I have stopped taking any trades before 6:00GMT because I would never be awake at that time if I was trading real time.

[thalestrader 14]

Here is how the ES looks over the last hour or so ...

 

You can make it difficult, or you can make it easy. I prefer easy.

 

A very easy and forgiving way to trade, right?

 

 

 

Best Wishes,

 

Thales

[thalestrader 14]

Well this happened and stopped me out to the tic.

 

Did I leave out the part of re-entering on new lows?

 

Best Wishes,

 

Thales

[forrestang 10]

Did I leave out the part of re-entering on new lows?

I have heard you mention that before Thales, a ways ago in the thread, but I had yet to grasp the concept of how to 'pull the cord' quickly' when a trade just nics your entry.

 

I thought about it, I suppose that is part of being nimble. How do you decide wether or not it is a re-entry you want to take, or how often is your entry just barely "nic'd" more than once? By that I mean, if you are stopped in, and price immediately moves against you, and you exit. But then take another re-entry at a slightly worse price....... Do you get these types of entries often, where you have to enter twice?

Edited January 26, 2010 by forrestang

[thalestrader 14]

How do you decide whether or not it is a re-entry you want to take, or how often is your entry just barely "nic'd" more than once? By that I mean, if you are stopped in, and price immediately moves against you, and you exit. But then take another re-entry at a slightly worse price....... Do you get these types of entries often, where you have to enter twice?

 

I get "nic'd" as you put it, often enough for me to have figured out how to stop the bleeding quickly when it happens. So long as the initial H/LH is intact, I'll renter on a new lower low unless price starts really getting wide ranging and over lapping within the range of the sequence. In other words, if price starts zipping up and down between the H and the L (I think I posted an example of this last week on the 6B) I stand down. I rarely get "nic'd" twice on the same opportunity unless I am shorting at the lows of a larger range expecting a bigger break down. Learning to recognize ending diagonal/wedges will prevent most of those.

 

All of the above can be flipped around for long opportunites, of course.

 

Best Wishes,

 

Thales

Edited January 26, 2010 by thalestrader
typo

[thalestrader 14]

1 Trade: BE

 

Even though I'm trading on replay and could trade the full 24hrs I have stopped taking any trades before 6:00GMT because I would never be awake at that time if I was trading real time.

 

If you do not feel right about a trade you are in, getting flat is a good course of action. You can always get back in after you re-evaluate, but it is tough to be honest with yourself when you still have money on the line.

 

I also like that you were not looking to chased the downtrend. I would have been happy to enter short even after a 200 tick drop, but like you, I'd rather get short on a short sequence after a rally in the downtrend, rather than intiaqting a new short at the lows.

 

Keep them coming!

 

Best Wishes,

 

Thales

[thalestrader 14]

Current look at the dollar index shows the dollar printing a somewhat suspicious lower high on its most recent attempt to clear resistance. Lots of stuff tomorrow - hearings, the Fed, and the State of the Union According to Obama. The Buck may be stuck until everything is out.

 

Best Wishes,

 

Thales

[thalestrader 14]

This is a very useful observation ... "If it channels, it is most probably corrective."

 

Your hint, to short from the top, is great; thanks, that never came to me.

 

My daughter asked me what I thought about a short on a break of 126.03, and loking at the chart, I was reminded of Marko's post above. I drew the lower channel line, copied, pasted, and placed it along the highs. Not a perfect fit, but it sure looks as though the decline from the afternoon highs is corrective, and that a rally rather than new lows is more likely. For whatever reason, PA often gets "funky," (for lack of a better term) heading into fed announcements, so it could go either way. At any rate, price did break 126.03, dropped to the channel line, and has found at least momentary support there. It could be just the bounce before the storm of course.

 

Best Wishes,

 

Thales

Edited January 27, 2010 by thalestrader

[thalestrader 14]

My daughter asked me what I thought about a short on a break of 126.03...

 

She wishes she hadn't asked me.

 

Best Wishes,

 

Thales

[thalestrader 14]

Current look at the 6B (GBPUSD) ...

 

Best Wishes,

 

Thales

[thalestrader 14]

She wishes she hadn't asked me.

 

Suddenly she is very happy she had asked my opinion.

 

We'll see if she's so happy when the day comes to pick out her first car.

 

Best Wishes,

 

Thales

[forrestang 10]

I sometimes find looking at candlestick body only bars helpful for clarification of current direction and S/R.

 

Does it matter to you that your tcls be exactly parallel to the originating tl?

 

Are all of your trades initiated at either a TCL violation of some wort for reversals?

[Marko23 10]

Next attempt to turn up

 

 

Count to five at the end of a larger movement

Edited January 27, 2010 by Marko23

[Marko23 10]

EUR/USD really soon now

 

Long one degree smaller

 

3rd wave larger than 1st wave, there may be a 5th wave!

Edited January 27, 2010 by Marko23
Warning

[patrader 10]

Does it matter to you that your tcls be exactly parallel to the originating tl?

 

Are all of your trades initiated at either a TCL violation of some wort for reversals?

I prefer that the tcl not be parallel and instead converge with the tl.These wedges are also called rising and falling wedges.Trend channels with parallel tcl's tend to continue trending until a large tcl overshoot forms a wedge.The wedge is usually a sign of weakening momentum and possible reversal of trend.It's important that a major S/R level be at or near the completion of the wedge in order to increase confirmation of trend reversal.Basically its a dueling lines concept where the third push of price,tcl and horizontal S/R meet.If price reverses off the tcl and S/R level then a 123 will possibly form and it's success will confirm the trend reversal.Many of my trades are initiated at tcl's but since they are "early" its very important to have a major S/R level included in the setup.What price does at the dueling lines point is also very important.Price should reverse and show ct strength.Until signs of ct strength than no trade.Sometimes a slight overshoot will occur before ct strength which i like because it traps late trend traders who add fuel to the ct when their stops are hit.The best reversals are strong with little sideways price action allowing me to scale out of contracts,go to b/e and hold the rest for larger targets after completion of the 123.Reversals that go sideways usually mean that the current trend is not done and the wedge will fail so i scalp out and wait for another wedge to form.HTH

Edited January 27, 2010 by patrader

[patrader 10]

15m 6E chart

[Marko23 10]

Long ended as break even.

 

This was the better trade, but started to early for me.

 

[patrader 10]

6E Daily chart

[Marko23 10]

Long one degree smaller

 

Break even

 

At 1st target.

Edited January 27, 2010 by Marko23
At target

[patrader 10]

15m 6E chart

[Marko23 10]

15m 6E chart

 

A 3rd push down is still possible.

 

It's improbable now.

Edited January 27, 2010 by Marko23
Update

[Marko23 10]

At 2nd target

 

My last example for today.

[thalestrader 14]

I prefer that the tcl not be parallel and instead converge with the tl.These wedges are also called rising and falling wedges....

 

Excellent post!

 

Best Wishes,

 

Thales

[thalestrader 14]

Long one degree smaller... At 1st target.

 

You offer a very disciplined and accurate application of the approach - it is easy to keep your losses small and your profits large relative to the size of your losses when you take your cues from price as you do.

 

That is a great series of charts you posted this morning (for I would say last night!).

 

Thank you.

 

Best Wishes,

 

Thales

[thalestrader 14]

EURGBP Update ...

 

 

Best Wishes,

 

Thales