Technical Templates

[jjay]

i have a question regarding "high probability pullbacks" vs. "low probability pullbacks".
The stochastic helps to point out when price is pulling back "sufficiently" compared to the price action in the lookback period.
So we look for the double 1H/15min OR 1h/5Min. Those are "high prob" pullbacks.

I would like to take an example of a "low prob" pullback from today on Cable.
I'm a little unsecure and feel like i'm taking below-average trades.
Any thoughts?

You're assuming just because it doesn't contain a hook its low probability.
If the example bet you've presented in your chart is one which generates a positive expectancy for you then it could just as easily register as a high probability entry.

Only you will know how effective that specific approach is by recording & documenting the evidence. In order to obtain a definitive analysis of it you'll need to determine a set of strict rules surrounding the entry & ensure the criteria is met prior to triggering it. But that should be the norm for any set up/trigger combo (including hooks or 1-2-3's etc at specific technical junctures).

As a bare minimum, I would suggest the background structure leading up to entry would need to be in place, which it appears to be in your example. So if you're prepping your bets with the first piece of the jigsaw intact you then need to determine what else needs to occur in order for you to confidently pull the trigger & get your bet away.

I presume risk (stop loss) placement will rank high on that list, as will forward profit potential.
There doesn't really need to be a long list of check boxes that require ticking in order to place a bet, just sufficient information that has held up to scrutiny & confirmed to you that it's a viable proposition.

The trigger is just one piece of the puzzle, it's not the be all & end all.
If the hook trigger or 1-2-3 isn't setting up at a particular level but everything else is in place that satisfies your set up profile, then take the bet.
They're not all going to play out. Even the best laid plans will turn to dust if the momentum evaporates.

The thing with set ups & triggers is you need to test them out over a sufficient length of time in very similar circumstances in order to conclude whether they're viable & profitable enough to retain.

All the guys here have gone through that type of exercise (or certainly should have).
Providing it fits with their style & risk profile, they can record & refine the criteria so that it matches up with the market conditions they're attempting to utilize it in.

Repetition & practice will offer you the opportunity to either accept or reject a particular set up/trigger combo. But you have to go through the testing phases to get to the end result.
No-one else (or their results & experiences) can help you with that part because you're all different in your outlooks, experience levels, risk appetites & objectives.

[jcpfx]

Thanks for that reply JJay!

Today I will be studying the situation better, and hopefully it won't take long to identify the key ingredients to this intraday setup.

I took for granted that being different than the main pullback setup discussed in here, I was stumbling across lower prob. setups because I learned about the probabilities here with you guys.

The intraday odds equation that I use is something like this: odds = trend + level + ADR...and now I'll explore with this little setup and see what I come up with.

So thanks for the eye-opener, i'll keep you posted on the progress.

[strobe]

The intraday odds equation that I use is something like this: odds = trend + level + ADR

That's pretty much the same criteria that most posters on here use to determine their odds jcp. The individual differences that dictate how & when folks establish their entries & exits are risk appetite, style & trade objectives.

Bear in mind that the interpretation of trend will also differ depending on which primary timeframe each trader is viewing it from.
And again, that will be based on the 3 criteria mentioned above.

That's why it's a huge advantage to have that key framework template nailed down before you begin to plan & establish your specific execution trigger(s) because it makes life so much easier when testing & working through those trigger options.

From my observations, most folks struggle in this game due to the fact they drift aimlessly from one system or method to another without formulating any kind of basic structure from which to measure their progress.
The minute they encounter a series of setbacks the first instinct is to abandon the framework & begin looking at something else, or tinkering by adding more layers of confirmation. The problems are also compounded if they're attempting to operate on a shoestring budget. That merely adds more pressure & anxiety.

Not a great combination at all in my book.

[jcpfx]

Bear in mind that the interpretation of trend will also differ depending on which primary timeframe each trader is viewing it from.
And again, that will be based on the 3 criteria mentioned above.

Agreed. My primary has been the 4H since october and with you guys I have gradually learned how to filter better looking pairs to leg into.
My experience prior to joining FSR had led me to understand the importance of levels & swing high/lows but it needed to be taken a step further.
I think what I also had to step back and watch, was the fact that before using multiple TFs, a trader should be able to profit by using only 1TF if he understands market dynamics. When I got here, I still diddn't even have consistency on the 4H frame alone...
I think that was a small breakthough for myself, because it helps to remind myself that i'm looking to play the 4H trend, therefore I'm looking for pullbacks at 4H relevant levels (which are clearly shown to me by 4H IB/OB/swing highs/lows).

That's why it's a huge advantage to have that key framework template nailed down before you begin to plan & establish your specific execution trigger(s)

I think I appreciate this statement to a certain degree now. It only took a few months

The minute they encounter a series of setbacks the first instinct is to abandon the framework & begin looking at something else, or tinkering by adding more layers of confirmation.

Fortunately I've outgrown the "additional layering" a while back...but the tinkering is still a big temptation at this point in my trading - and i feel that consistency will eliminate it.

The problems are also compounded if they're attempting to operate on a shoestring budget. That merely adds more pressure & anxiety.

Seems to be an appropriate comment given my personal situation, but my budget will be on a diet until some real consistency kicks in.

Wish you good luck with your trading & a relaxing weekend

[round number]

My primary has been the 4H since october
I'm looking for pullbacks at 4H relevant levels

And that is precisely what is continuing to keep me bullish on gbp/jpy & aud/jpy.
Until I see a close underneath the 4 hour higher low zones (shaded on the charts), I'm seeking long only continuation set ups/triggers on those pairs.
Once it violates those zones I will move to neutral on those 2 & await further developments.

I didn't like the IB that formed o/n and was broken to the downside. In my experience, if a big 4H IB is broken, especially at a recent high, it's a real coin flip to fight against it.
Given the structure now on the Jpy pairs, would you currently still be looking long?

I'm only concerned with the general background flavor & getting positioned on a decent value entry via my usual set up/trigger combo's.
I'm still comfortable with a long view on gbp/jpy & aud/jpy at current levels for now.

[jack mason]

There are little pockets of value still kicking around out there, including one or two of last week's highlighted candidates which have continued to offer high probability entries in line with their dominant trends.

I've added NZD/USD into the mix as it offered me a classic continuation bet last thursday morning during the european open when it broke out above a stiff two week long resistance zone at .8275-80 & pulled back triggering a 15 minute hook entry.
As long as it attracts support on any slip back towards the .8300 figure there should be more upside mileage in this pair to which I'll certainly leg into should it offer further opportunities.
Red lines on the charts represent trend/swing continuation violation levels.

[jcpfx]

Good Morning everyone,

is it just me or is anyone else thinking that the market isn't really moving "well" this morning? After the Cyprus resolution, EurUsd gave a leg up overnight which put it back into the higher slots of my watchlist. I got a long entry @ 1.2998 (1.2980s/wk open are the main focus in order for possible pushes higher) which has bust been stopped out @ 1.2980.

I also have been stopped out of a long GbpUsd which pushed off 1.5210s but came back down to challenge the 1.5170/90 support that was also highlighted by Jack Mason. I am again looking for a long setup off this area, and I would appreciate any thoughts on the 1.5210 level (i.e. if any would have had faith in it as a possible support).

I al also looking for a Long on GbpCad down here at 1.5500s (also highlighted by Jack Mason) as price has come down too far too fast...

Any thoughts?

Thanks!

[Se7en]

is it just me or is anyone else thinking that the market isn't really moving "well" this morning? After the Cyprus resolution, EurUsd gave a leg up overnight which put it back into the higher slots of my watchlist.
I also have been stopped out of a long GbpUsd which pushed off 1.5210s but came back down to challenge the 1.5170/90 support that was also highlighted by Jack Mason.

The European pairs are certainly skittish jcp, but then they have every reason to be really.
Thinking logically about the events over the weekend, it's perhaps not best day to get involved with them to be honest.
Usually whenever there's uncertainty or strained psychology playing out directly affecting & impacting on a particular currency or region such as the recent fiasco in Cyprus, I've found it better to step aside & allow the dust to settle, especially as the event was played out when the markets were snoozing over the weekend.

Europe was bound to react to the decision of the Cypriot/ECB decision, but it's not always apparent which way or how aggressive/passive the price action will be.
Of Jack's selection from the weekend, the Aussie & Kiwi pairings looked like offering the potentially higher probability set up/trigger options don't you think?

I am also looking for a Long on GbpCad down here at 1.5500s (also highlighted by Jack Mason) as price has come down too far too fast...
Any thoughts?

I agree. The price action on that pair isn't doing anything for me this morning.
Until it begins to establish a positive trending motion on the sub hourly charts above 1.5510 I'm stepping aside on that pair too.

[jcpfx]

Hey Se7en,

I'm not a big fan of Aussie & Kiwi to start with, and I wasn't feeling comfortable with the 4H structure on the Aussie this morning going into London.

I had the same selection of pairs as JM apart from EurUsd but GbpUsd & GbpCad had an easier structure to read for me.

I have also done much studying over the weekend regarding price levels & Ib/Ob/1-2-3 setups and it's just mind-boggling how you can study something that seems to work well...but then go live with it and find yourself stopped out using exatly the same criteria!

- End of Rant -

[spotfx]

I have also done much studying over the weekend regarding price levels & Ib/Ob/1-2-3 setups and it's just mind-boggling how you can study something that seems to work well...but then go live with it and find yourself stopped out using exatly the same criteria!
- End of Rant -

I think virtually everyone here can empathize with that, I know I can.
There isn't anyone who hasn't been there jcp, no-one escapes the frustrations or disappointments especially when either first starting out or attempting to find their way into a fresh approach.

I haven't played today. I'd have taken a nibble out nzd/usd if I'd been around at the time, but I'm happy to sit aside & wait to see if anything tasty develops over the course of this week. I spend far more time sidelined than I do active these days, but then I've become very choosy indeed about what I place my money on, which is a direct result of the market teaching me hard lessons about triggering lower probability opportunities & not paying sufficient (fundamental) attention to what's playing out around me & influencing the market momentum/volatility.

Each of us come armed with very different aspirations, objectives, goals & capital exposure & providing we're fortunate & lucky enough not to wipe-out in the early stages & get to establish our preferred style, risk profile & favorite approach, we might get to take a little profit out of this game. But there will be lots of brick walls & stumbling blocks along the way.
It's how we deal with them that dictate whether we'll still be around 12 months from now or not.
Providing of course we don't run out of money before we get to that point.