Technical Templates

[strobe]

Just curious, what is the average win/loss % by using this method?

There is no average win/loss percentage Eidriel.
Each person will use the framework differently according to their own personal risk attitude, aims & trading objectives.
You'll have to plot & record your own stats based on your preferred style & tactics.

Did I draw the support/resistance zone wrongly?

Wrongly really isn't the correct term.
I wouldn't personally have plotted it right around that area, preferring to use that big spotlight swing low off the summer highs on the 7th & 10th September as the origin of the recent support/resistance area. It also houses a ROUND NUMBER (1.9700), which if you read the content on this thread, you'll note the consistency that these big levels appear so regularly in the analysis when compiling & identifying the higher probability contact zones.

It acted as reliable resistance twice on 12th Sept before containing the price action again yesterday & today.
If you were considering shorting this pair, then that area would offer the higher probability bet in my view.


But to be honest it's not exactly an A1 candidate in my book due to the current strength of both pairs as evidenced via the futures charts.
When you get a pair that are cancelling each other out like that you tend to experience a lot of indecisive or very erratic price action.

[Eidriel]

Thanks for the reply strobe!!

Is that to say that the peak/trough I used to draw that resistance/support is not "obvious" enough?

We have to pick the really OBVIOUS peaks and troughs?

Any other tips is appreciated. still very new to this! Thanks guys!

Best regards!

[Eidriel]

By the way, Strobe,

is that one of the requirement you stick to when choosing pairs to trade?

Both currencies have to have diverging trends (ie. one uptrend the other downtrend)? and you will judge that via the futures chart?


Thanks!

[kyle morgan]

Is that to say that the peak/trough I used to draw that resistance/support is not "obvious" enough?
We have to pick the really OBVIOUS peaks and troughs?

It's like any other aspect or approach Eidriel, there are low probability options & there are high probability options.
We'll always enjoy more (consistent) success when we lay our money down on the latter option as opposed to the former.

All the way through this thread the more experienced guys constantly remind everyone to work from the outside in when identifying & plotting the higher probability support & resistance zones & wherever possible focus on the big, obvious swing turns, reactions to key round numbers (where a lot of options traffic is located) & clear, identifiable previous reactions to where price has located solid support and/or resistance.
Those are the zones where you'll tip the odds more firmly in your favour.

Like anything else it takes time & practice to become familiar in identifying & filtering out the wheat from the chaff.

Any other tips is appreciated. still very new to this!

Read & re-read the content.
You won't find a better example of this type of technical approach anywhere else out there in forum land, I can assure you.
It's all top quality information & the beauty of it is it's not a "war & peace" thread, so you won't have to plough through endless reams of off-topic nonsense to get to the pertinent stuff.

[Eidriel]

Awesome reply Kyle

Alright I will continue to work hard!! and practise more.

Keep up the great thread!

Best regards

[strobe]

By the way, Strobe,
is that one of the requirement you stick to when choosing pairs to trade?
Both currencies have to have diverging trends (ie. one uptrend the other downtrend)? and you will judge that via the futures chart?

It is yes Eidriel.
It's certainly one of the key elements when preparing a bet & is a very important filter prior to identifying the likely higher probability candidates.
When you think about it, it makes perfect sense to focus attention on a currency that is exhibiting strength v/s one that is under performing.
If you take kyle's advice & read carefully back through the material you'll see this aspect mentioned on more than a few occasions.

It's quite clear that the US Dollar is exhibiting weakness & falling through an obvious area of prior support during mid August.

If you then identify those currencies displaying potential strength that are threatening their own respective s&r zones & match them up against the US Dollar, you've got yourself a pretty decent high probability menu of pairs from which to begin preparing a set up/trigger combination bet from.





So you can then pull up the relevant pairs: GBP/USD, USD/CAD, USD/CHF & EUR/USD & start filtering out the pair or pairs that offer up the clearest entry potential based on the criteria you set.
And that might be for instance an hourly hook or a 15 min hook in sync with the dominant trend that also kicks away from a pre-identified s&r zone etc...

Compare those hourly charts with your NZD/USD & see if you can spot an obvious technical behavioural difference.

[Eidriel]

That is great! Will incorporate as part of my strategy too! Thanks strobe

[shona123]

I see GBP/NZD banged it's head again yesterday & backed away from that upper resistance zone that strobe drew your attention to earlier this week Eidriel, further confirming the relevance of that area.


Talking of which, Cable has been flirting all week with it's own medium range resistance zone up here underneath the 1.63 handle.
Buying pullbacks into this strong uplift has continued to be the high probability play on this pair & if it finally does manage to break through & attracts support, 1.6450-6500 will be very much in it's sights.

[Eidriel]

Hello Guys!

Thanks Shona! im kinda getting the hang of it now hehe! so happy with this strategy! The round numbers really work wonders.

Ive got something to ask though, I got a little confuse with this trade. From what I know we should only be trading in the direction of the directional bias. Take a look at this chart.

It seems that the long term trend is bullish, while the midterm trend is bearish, but the short term trend is bullish?

Correct this newbie if I am wrong

1) What do we do in this case? should we look for buy on dips or sell on rallies?

AND also, I am not 100% certain on a good method to identify the bias.

2) What timeframe do you all use? I just use the 1H for bias identification and entry as well.

3) Is the 60 SMA on the 1HOUR the best method to identify this bias by looking at the direction in which the SMA points? So on this chart example that I give, I guess I will be buying on dips since the 60 SMA is pointing up?

Someone care to enlighten me on this hehe!


Thanks and Best regards guys! Have a great weekend!

[Carll]

Ive got something to ask.
From what I know we should only be trading in the direction of the directional bias.

Dominant directional bias, correct.

It seems that the long term trend is bullish, while the midterm trend is bearish, but the short term trend is bullish?
What do we do in this case?

Well it's covered on several occasions within the thread, but I'll recap it again
Firstly you need to establish exactly what it is that's going to determine your bias.

If it's the 60sma on your 1 hour chart then you can use the slope & positioning of the moving average to assist you in determining the primary bias in sync with the natural ebb & flow of the price action.
If it's a wave type visual, then as long as price is continuing to print higher highs & higher lows in an uptrend or lower lows & lower highs in a downtrend & the price action doesn't invalidate that stair-step process, you're ready to consider placing a bet via either a pullback or a breakout (depending on your preference).

Don't lose sight of the fact this is predominantly a dual or multi-timeframe approach.

If you can't quickly determine a clear & visible bias when opening up your primary timeframe then either move up a timeframe to see if it can offer assistance or leave it be & keep scrolling through your basket of pairs until you spot something that isn't so confusing.

There won't be opportunities to trade every day.
Don't force low probability trades. Use patience & keep your discipline to only get involved when the juiciest opportunities reveal themselves.

What timeframe do you all use? I just use the 1H for bias identification and entry as well.

It doesn't matter what anybody else uses, the structure is universal.
Each individual will accommodate it to suit their own styles, preferences & trading objectives.
The basic framework is the same.

1) Determine a primary timeframe from which to establish your bias & identify the key reaction levels &
2) Either use that timeframe to plot & place your bets, or utilize a (lower) secondary timeframe to trigger & assist with the trade management decision process.

Is the 60 SMA on the 1HOUR the best method to identify this bias by looking at the direction in which the SMA points?

If the 1 hour chart is your primary timeframe, yes.
But like I said, don't lose sight of the fact this approach works best when incorporating a small variety of equally effective measures such as a multi-timeframe view.

So on this chart example that I give, I guess I will be buying on dips since the 60 SMA is pointing up?

If that criteria is your primary reason for considering a long bet, then sure.

But you might also want to take into consideration other price action based prompts, such as the bullish divergence (& extreme stoch hook) on the 4 hour chart corresponding with a 1-2-3 continuation set up on your 1 hour (also hooking up off 20) through those 4 hour indecision bars off 1.0420 during the New York session?
That pair at that area isn't exactly what I'd term as a nailed on higher probability opportunity, but then my view & perspective is bound to conflict with yours & others due to different experience levels, trading objectives & risk attitude.