Advanced strategy #10(Trend Line Trading Strategy) - ENJOY !

[cpr]

also make sure there's confirmation of trade by trend bounce.

What do you mean by trend bounce ? Does it mean we should wait until the price bar closes and starts reversing ?

[wirrison]

also make sure there's confirmation of trade by trend bounce.

What do you mean by trend bounce ? Does it mean we should wait until the price bar closes and starts reversing ?

Like it says in the strategy... The price hits the trendline, and by placing your trade 5 pips abovein an uptrend (or below in a downtrend) the closing bar that intersects/touches the trendline, you are actually giving space for confirmation for the trend-bounce. By the time your order goes live on the market you would have made sure that the confirmation of resistance/support on the trendline is ATLEAST valid, and ATMOST going your direction of the trade. Maybe I am explaining in a complicated manner. here's a link to make things short and simple.
http://www.trendlinebook.com/

[cpr]

Thank you for the explanation. I think I got this.. Though I am still struggling to identify possible trades..

[wirrison]

Thank you for the explanation. I think I got this.. Though I am still struggling to identify possible trades..

audusd D1 --- possible trade - short
eurusd H1 --- possible trade - long
usdchd H1 --- possible trade - short
eurjpy D1 --- possible trade - short
eurcad MONTHLY - possible trade - long

Once a line has made 2 swing lows (with the 2nd being a higher low) then draw a up-trendline straight away to wait and see if the 3rd bounce confirms the trendline.
Once a line has made 2 swing highs (with the 2nd being a lower-high) then draw a down-trendline on the 2 points and see if the trend holds on the 3rd time for confirmation. im sure u will find trades. Just keep looking.

It's like setting a trap in the jungle early,..... and then wait....... patiently, for the trap to catch your meal.

[cpr]

I greatly appreciate your response. Now let me match my setup with the pairs you have mentioned. I hope you don't mind if I post all the charts to ensure I am on the right track.. I guess I do need some help to ensure I am on the track. I would greatly appreciate your help.

[cpr]

Thank you for the explanation. I think I got this.. Though I am still struggling to identify possible trades..

audusd D1 --- possible trade - short
eurusd H1 --- possible trade - long
usdchd H1 --- possible trade - short
eurjpy D1 --- possible trade - short
eurcad MONTHLY - possible trade - long

Once a line has made 2 swing lows (with the 2nd being a higher low) then draw a up-trendline straight away to wait and see if the 3rd bounce confirms the trendline.
Once a line has made 2 swing highs (with the 2nd being a lower-high) then draw a down-trendline on the 2 points and see if the trend holds on the 3rd time for confirmation. im sure u will find trades. Just keep looking.

It's like setting a trap in the jungle early,..... and then wait....... patiently, for the trap to catch your meal.

So do you enter when the price touches/intersects on the third time ?

[cpr]

I greatly appreciate your response. Now let me match my setup with the pairs you have mentioned. I hope you don't mind if I post all the charts to ensure I am on the right track.. I guess I do need some help to ensure I am on the track. I would greatly appreciate your help.

Here are my charts. I did see setup in all the pairs you have mentioned except USDCAD.

1)On EURUSD, long is there on H1 but it is against the daily trend which is still down
2)On EUJPY, I can see a short from the daily trend line but SL can't be previous swing high.. does not fit to money management prospective.. should be kept at 50 to 60 pips.. may be worh trying

[wirrison]

The 3rd (or 4th, 5th, 6th ...) bounce confirms the trendline, BUT IT DOES NOT CONFIRM THAT THE TRADE WILL COME BACK TO A NEW PEAK OR TROUGH. the most important confirmation is the price coming back in the direction of your trade. that's why the strategy the discoverer says he puts an order 5 pips above/below (depending on buy or sell) the closing candle that touches the line so that he knows when the direction is likely to change.

[cpr]

The 3rd (or 4th, 5th, 6th ...) bounce confirms the trendline, BUT IT DOES NOT CONFIRM THAT THE TRADE WILL COME BACK TO A NEW PEAK OR TROUGH. the most important confirmation is the price coming back in the direction of your trade. that's why the strategy the discoverer says he puts an order 5 pips above/below (depending on buy or sell) the closing candle that touches the line so that he knows when the direction is likely to change.

Thank you for your continued support.

Ok. I did not quite get this statement - "BUT IT DOES NOT CONFIRM THAT THE TRADE WILL COME BACK TO A NEW PEAK OR TROUGH." - you mean to say it does not confirm whether or not reach the previous swinh high or low if the price respected the trend line.. ?

Next, I mis read a key entry point and I re-read the strategy rules. My entry order is NOT 5 pips below the trend line when the candle touched or intersected the trendline.. BUT my entry is below the closing candle that touched or intersected the trendline.. I slap my self on the face for mis reading this statement. This is a VERY key point.. Though it does increase the SL limit but it does also increases the probability of the trade.. Am I right ???

[Sdot]

Good call on the EUR/JPY WIRRISON! Im currently up 130 pips but I would have missed that one if you didnt point it out....thanks!