Higher Lows Lower Highs

[Snow Dog 10]

I will admit to the level of pooh in this world having me a little nervous.

 

Anyway 1hr closed as a large hammer right on its lows. Made this lh quite straight forward. Even if the 25 level was a small SR area it was there for 15 mins with no real bounce higher so we were happy to sell on the 5 min lh little/no lower wick move below 25 level.

 

Whilst we think the move up earlier was the LO head fake we were happy to exit with +20.

[Snow Dog 10]

I wasn't in front of computer for this one.

 

4hr closed red shooting star, 1hr a neg close (sort of an evening star pattern). 5 min chart shows a 60 odd pip bounce from 111.40 area, then a 30 pip bounce then 25 mins of virtually no bounce. 5 min lh little/no lower wick, 5 min emas nicely stacked.

[Snow Dog 10]

  Snow Dog said:

I wasn't in front of computer for this one.

 

4hr closed red shooting star, 1hr a neg close (sort of an evening star pattern). 5 min chart shows a 60 odd pip bounce from 111.40 area, then a 30 pip bounce then 25 mins of virtually no bounce. 5 min lh little/no lower wick, 5 min emas nicely stacked.

 

Just wanted to clarify the lower bounces couple with the 4hr and 1hr candles gave strong indication that the 111.40 level would fail.

[Snow Dog 10]

Missed out on the eurchf move up which was 100% in line with system, 4hr hammer 1hr positive close. Was fixated on selling ec, so that wasn't great trading sitting on the side.

 

With eur and gu all over the place still favour eurchf.

 

Left red line shows the neg 1hr close and arrow down the lh. Right red line shows the 4hr shooting star close little/no lower wick. 5 min lh closed right on the 1hr/4hr candle closes.

 

Much prefer focus there as eur and gu at the moment seems finding a trade is forcing things a little.

[Snow Dog 10]

Price pulled back to D pivot 1310. 2 doji's, hl break above doji tops, stall at 75 psych level out +40.

[Snow Dog 10]

It seems of late that Lon open has very little follow through, like this for some time now. The better trades definitely after 9.30 gmt than before.

 

I felt that I was trying to force a gu/eur trade at the time. Had a look at eurchf saw the clear general support area on 4hr. Bought this dble btm for +40 exiting when the Frnakie/Asian low got hit.

[Snow Dog 10]

I had to pop out to the shops and missed this perfect system trade. 4hr pos close, 1hr hammer with massive divergence, perfect hl.

[Snow Dog 10]

I was alerted by a trading friend well before this happened due to the pos 4hr. 1hr had a red SS so I thought it might come down first which it did. When the 1hr flipped around for a green hammer this hl followed playing catch up with the eur that had already moved 10 mins earlier.

[Snow Dog 10]

I know of many traders that either stay away from Fri trades or are very cautious. The London open head fake has been going full blast of late. I'm almost wondering if having a later morning snooze or getting the personal rubbish like shopping etc etc wouldn't better be done in the morning coming back say 10.30 local time (9.30 gmt) to see whats going on.

 

Anyway Freaky Fri lived up to its name earlier this am only giving decent trades when later Lon am/early US morning kicked in.

[dudleymuggins 10]

Guys, I am sure there are many traders who never have a losing trade, but they are the ones with unlimited resources. Retail traders have losses and always will, so dont worry when you do. Accept them as part of the business of trading, because until you do, you will never be a trader.

[Snow Dog 10]

  dudleymuggins said:

Retail traders have losses and always will, so dont worry when you do. Accept them as part of the business of trading, because until you do, you will never be a trader.

 

Totally agree losses are a part of doing business they will happen. Amending your plan to avoid losses when markets are jumping around is fine.

 

In and around London open can take higher lows/lower highs (1 2 3 tops bottoms) at the recent extremes of price but following the 1hr might well end in tears as the market chops back and forth so often. Perhaps only follow the 1hr after the 9am gmt candle has closed.

[Snow Dog 10]

  dudleymuggins said:

Retail traders have losses and always will, so dont worry when you do. Accept them as part of the business of trading, because until you do, you will never be a trader.

 

Another time frame I am extremely concerned about is pre US/US open. I try and avoid certain trades that painful experience has shown to likely be a problem.

 

Here is a classic early US head fake, a definite hl that fails, turns into a 2b type trade (ie the move up fails immediately) falling again into the post London open head fake direction.

 

So to avoid losses I do not trade US moves that are counter (the immediate 5 min) trend when (as in this case) the hl is a marginal one. I look for a 2b/lh entry to sell back into UK mornings direction.

 

If a 1hr candle was a large reversal i.e. hammer or SS/engulfing I might go counter UK session trend but marginal hl moves like this I avoid the buy.

 

So whilst accepting losses as part of business they can be avoided by choice. Does this mean I miss some trades sure, does that bother me, no.

[Snow Dog 10]

  Snow Dog said:

So whilst accepting losses as part of business they can be avoided by choice. Does this mean I miss some trades sure, does that bother me, no.

 

If you have looked back at charts and have some stats that suggest to you a certain move is unlikely then fine go with that and don't worry about those set ups that buck your knowledge.

 

Mrs V and I do not trade a 2nd move in FH i.e. Frankies hour (Frankfurt opens 1hr before London), why? Our stats show that FH 'generally' produces x pips and that a reversal 30 mins into the hour often occurs.

 

So lets say FH typically does say 50 pips for gu and 50% of the time it reverses direction around the half hour mark. OK would you sell 30 mins into FH if its done 40 pips down already. Stats show its a very low chance winner so why trade when the odds are against you.

 

So again you have to accept losses but you can do lots to bring the odds a little in your favour.

Edited August 21, 2011 by Snow Dog

[Snow Dog 10]

Here is another example.

 

Left arrow down. London open appears to have done its head fake likely suggesting a decent move down. Before the arrow left there is a clear hl counter the recent move down.

 

Arrow right. There is a hl in and around US open. See the above posts on small hl's before/around US open.

 

Another little tip, if you can get the LO head fake right and trade the likely trend of day you can do well at forex.

 

Days of big moves in 2 directions are not the norm. So you could easily wait for LO headfake, likely trade after 10am gmt, and then follow that direction. IF it does switch then that will be direction of day. Its unlikely to switch a 3rd time. So if you are caught out with a losing trade and it switches direction you should be able to make this up and more.

[Snow Dog 10]

There's years of watching charts set ups and losses etc etc that have gone into the above 3 or 4 posts. Is trading simple, well it is but its easy to make it hard.

 

Have a look at the above posts then have a real good look at the 1st post again. Follow the 1hr after 10 am gmt, are you above/below the 1hr 8 lwma.

[Snow Dog 10]

We have been trading eurchf more and more lately. Mrs V also missed the earlier trade but got this one.

 

Nice chf article here http://www.cashbackforex.com/articles/view/tabid/364/ID/356/Default.aspx?aid=112

Edited September 2, 2011 by Snow Dog

[Snow Dog 10]

1hr hammer, trend clearly up, 5 min hl little/no upper wick out +23.

[Snow Dog 10]

When this was happening Mrs V was already focused on her uc trade.

 

D chart prev day was a neg lower close and we are below 50 RSI/8 lwma, same applies to 4hr.

 

Anyway its a classic example of US fake out. 1hr has 2 very weak pos close candles. Nice 5 min lh little/no lower wick follows with an entry 3818 or so back into the trend which is clear.

 

If the 1hr was a nice large hammer or engulfing pos close the above sell opp would be viewed differently.

 

Divergence comments coming.

[Snow Dog 10]

Oh for fans of the fozzy, you'll see just before the 5 min arrow down sell there was divergence. Some divergences are better than others. Here there is a failed CT move up and the divergence is signalling a sell back into the strong down trend. Then the lh follows that signal, thats a beaut!

[Snow Dog 10]

Nice Ralph Shell article here articles euro crashes as no-one seems to be in charge.

[Snow Dog 10]

Eur D yesterday was a hammer closing near its highs, fozzy just crossed up. 4hr hl above rsi 50 level. Good chance that we will have a move up.

 

1hr had a strong move up then a doji. 5 min pull back to days open. With above and the reject of DO Mrs V felt confident to re-enter move up.

 

For us it was a 5 min lh but she felt with the above factors (good D candle, 4hr above 50 rsi + engulfing close) that trend is up.

 

So with 5 min ma's suggesting solid trend and a bigger pic hl she took this entry.

[Snow Dog 10]

  Snow Dog said:

Nice Ralph Shell article here articles euro crashes as no-one seems to be in charge.

 

Ralph Shell has posted several interesting articles in last few days, see link above.

[poortorich 10]

  Snow Dog said:

Eur D yesterday was a hammer closing near its highs, fozzy just crossed up. 4hr hl above rsi 50 level. Good chance that we will have a move up.

 

1hr had a strong move up then a doji. 5 min pull back to days open. With above and the reject of DO Mrs V felt confident to re-enter move up.

 

For us it was a 5 min lh but she felt with the above factors (good D candle, 4hr above 50 rsi + engulfing close) that trend is up.

 

So with 5 min ma's suggesting solid trend and a bigger pic hl she took this entry.

 

what is your sl? and how many pips?

[poortorich 10]

can you give me atleast one rule of your trade? how you calculate those.

[Snow Dog 10]

  poortorich said:

what is your sl? and how many pips?

 

Typically around 15-20 pips, just beyond the last swing high low, around 1% capital at risk.