Technical Templates

[Se7en]

Well, this week was pretty much a waste of time regards my potential set ups.
gbp/aud & eur/usd pullback long set ups never materialized, pushing straight through the pre-identified levels in early week trade & not giving them so much as a back glance!

That left eur/nzd to save me from a complete washout - but to be honest, had I been at my screens during today's Tokyo shift instead of tucked up in my bed I'd have probably exited yesterday's pullback long & called it an early weekend.
As it is, the only thing that's saving it from getting cashed out tonight is the fact it's printed another hourly higher low during New York's shift & is at least trying to print another higher high.

I'll give it a loose leash over the w/end & see where we're at come Monday.
The Spain/IMF see-saw doesn't appear to have impacted on euro too much, with eur/usd holding the 2950 fulcrum line into the week's close. It's traded off that level all week long again & I'd like to see if they can make another pitch for the stops beyond 1.30 before giving up the ghost completely.
Plus we get a look at the european inflation & (ZEW) economic sentiment numbers next Tuesday, so they'll hopefully position themselves positively for that offering.

Hope everyone else had a less frustrating week.

[Ray_1]

I'll give it a loose leash over the w/end & see where we're at come Monday.
The Spain/IMF see-saw doesn't appear to have impacted on euro too much, with eur/usd holding the 2950 fulcrum line into the week's close. It's traded off that level all week long again & I'd like to see if they can make another pitch for the stops beyond 1.30 before giving up the ghost completely.
Plus we get a look at the european inflation & (ZEW) economic sentiment numbers next Tuesday, so they'll hopefully position themselves positively for that offering.

Hope everyone else had a less frustrating week.

I also have a boring week. The 60SMA on H4 is also flat forcing me to sit on my hands. I wonder how does the professional deal with this market condition

[hawkmoon]

If you're using the 4 hour simple moving average as your primary gauge of direction & you can't obtain a clear read on the bias, then you're perfectly correct to wait until the conditions are more favorable. After all, that's the whole point of using guides or assistors to help with decision making.

This was always one of my frustrations when first starting out, but the guys covered it quite a lot over on the other threads & have re-iterated it many times since.
There will be periods in the calendar month/year where momentum, volatility & liquidity dry up for whatever reason, & only a fool will continue to press on regardless.
Just wait until those conditions begin to open out again & you receive the usual price action signals (higher highs & lows....lower highs & lows etc) that indicate a likely set up is beginning to take shape.

Ray......Tess, Andre & the guys also trade other instruments & asset classes which dictate they run a few different strategies & models.
However, if FX is your main or only trading vehicle & it's not playing ball then you have no choice but sit on your hands & patiently wait.

Remember, remaining flat is also a valid position in the market!

[strobe]

Hope everyone else had a less frustrating week.

I'd like to say different, but alas that wasn't the case for me either on my rollover bets.
I had to scratch 2 long attempts on eur/gbp (tuesday & thursday) attempting to string a line out as price pulled back into my entry zones.
Same annoying experience on aud/cad, where I also scratched on friday after shorting through 1.0070

The only minor successes last week were an intraday short monday on gbp/usd & another short tuesday on gbp/jpy.
Had it not been for those 2 opportunities (which weren't really anything to shout home about) it would have been a barren week.

Next week I'm sticking with eur/gbp to see if I can establish a firmer core stake from a likely set up, & I'm eyeing a possible long bet on aud/nzd towards 1.27 if i obtain a positive risk entry.

[goldtop]

Agreed, it's choppy out there of late & you have to be quite nimble or certainly more observant when trailing stops up or down against core stakes.
It's very reminiscent of early summer/xmas liquidity.
Maybe scale back a bit or drop down to a 60m & manage the cycles on a tighter rein until things open out a bit more.

I know one or two of you are still scaling in & out of this pair, but for those who aren't it's worth keeping a keen eye out for suitable (long) pullbacks.
It bounced back through that big 1.2520-40 swing high rejection from mid september last week & printed a higher low.
If you missed the 1st 1-2-3 entry, (& it generates support above 1.2570) watch for another higher low leg or 1-2-3 continuation to climb onboard.

[2Taps]

I know one or two of you are still scaling in & out of this pair, but for those who aren't it's worth keeping a keen eye out for suitable (long) pullbacks.
It bounced back through that big 1.2520-40 swing high rejection from mid september last week & printed a higher low.
If you missed the 1st 1-2-3 entry, (& it generates support above 1.2570) watch for another higher low leg or 1-2-3 continuation to climb onboard.

and if it's good enough for GS, it's surely good enough for us!!
http://blogs.wsj.com/dealjournalaustral ... e-century/

but then how many times have these 'big cigars' talked a pair up only to see it flush down the pipes in spectacular fashion.
better keep a tight watch on the profits guys before the trade-of-the-century turns into the "sale of the century"

[Eidriel]

Agreed, it's choppy out there of late & you have to be quite nimble or certainly more observant when trailing stops up or down against core stakes.
It's very reminiscent of early summer/xmas liquidity.
Maybe scale back a bit or drop down to a 60m & manage the cycles on a tighter rein until things open out a bit more.

In times like this, is it better to just hit and run all in all out, or is it still recommended to trail the profits?

These past days I found it slightly more profitable to just go in and get out once we are in around 50 pips profit, a few trades have been stopped out at breakeven despite an initial profit of 40-50pips

[JimmyMac]

and if it's good enough for GS, it's surely good enough for us!!
http://blogs.wsj.com/dealjournalaustral ... e-century/

but then how many times have these 'big cigars' talked a pair up only to see it flush down the pipes in spectacular fashion.
better keep a tight watch on the profits guys before the trade-of-the-century turns into the "sale of the century"

their (& by that i mean the firms in general) track record isn't what you'd call stellar when calling long range bets at specific junctures.
they're not bad in holding positions when the circumstances line up, but you really need to look outside of the "call" & structure their recommends in sync with the general market themes & influences.

this article just about sums it up.....although to be fair, the FX side of the coin isn't always a fair representation of the facts given a lot of business is primarily done for hedging purposes in the spot market, but essentially they're often late getting in & late getting out (of long range spot exposure)
http://pragcap.com/macro-hedge-funds-st ... ket-timing

In times like this, is it better to just hit and run all in all out, or is it still recommended to trail the profits?
These past days I found it slightly more profitable to just go in and get out once we are in around 50 pips profit, a few trades have been stopped out at breakeven despite an initial profit of 40-50pips

it's very much a judgement call Eidriel.
if you're operating a short range approach where you're using say a 60 minute chart as your primary information gathering template & a 5 or 15 minute chart as your trigger execution facility, then you'll notice any price contractions & chop quite early as it's being reflected in that hourly timeframe, especially over a short (1-2 week) period.

if that's the case, & you're experiencing a lot of breakeven/small loss exits, you need to either change your tactics or stand aside.
the one you've commented on will suffice in these types of environments.
in fact it's really the only practical & logical solution to adopt until the influencing factors driving the price action returns to a more trendy, longer swing type behavior model.

it's all about compromize.
you can't have everything all at once - unfortunately, where trading is concerned, you have to give a little ground in order to take a bit more!

[Joe Whitehorse]

I've had messages recently from non-posting members asking similar questions about bias identification & utilizing the appropriate trigger to enter and/or exit partial or full positions.
I don't really like posting hindsight charts but occasionally they're necessary to illustrate & focus attention on areas & points of relevance.

I would like to use this opportunity however to acknowledge those contributors doing a fabulous job of updating the thread with charts & comments ahead of time (& a new week), highlighting significant S&R zones, potential entry & profit levels + bias priorities.

Ok, so when assessing the market for potential entries we need to leg into price action exhibiting clearly identifiable bias behavior which is displayed by the natural supporting ledges of higher lows going up & lower highs going down.
When prices are in bid mode or demand based (trading from the long side) it will be supported on pullbacks which do not violate the prior higher low.
When prices are in offer mode or supply based (trading from the short side) it will be supported on pullbacks which do not violate the prior lower high.

That simple & logical sequence is all the background information you need in order to begin preparing to engage with the market either on an intraday basis or via a slightly more medium term objective.

To that end, we'll pull up this week’s EUR/USD chart from an hourly perspective & put that sequence into visual mode.
The action is pretty much self-explanatory & explains the practical behavior behind the theory of trading in sync with the dominant bias.

You can see that as soon as the cycle was briefly compromized, it re-aligned itself on the 15th, ably shouldered by the moving average & proceeded to remain bid ever since, thus offering us the logical option of seeking long only entry opportunities.

Not once since the 15th (including today's price action) has the momentum or price influences come remotely close to altering our bias or directional trade entry priority. And as I write, 1.3080 is now the current higher low ledge keeping this uplift valid.
It will take a break & hold below there to invalidate this bullish/long only entry bias.


So, given the fact we now know which way we're supposed to be looking regards entries, we need a trigger to actually get us seated into a move.
If you've read the material you'll know there are 2 common set ups/triggers consistently referred to as examples of entry criteria.

The 1-2-3 (higher low or lower high) & the stochastic hook, both of which can be utilized consistently across the complete timeframe spectrum.
The only other key criteria to be aware of when prepping an entry is the available average day's range & time of day, both very regularly referenced & explained in detail throughout the thread.

Lets take a look at an example of both options playing out on a 5 minute chart this week.
You can scroll through your own charts most days of every week & see these common sense, efficient & logical price action triggers setting up in sync with higher timeframe dominant bias confirmation scenarios.

Tomorrow when you open up your EUR/USD charts you will know how to quickly identify & locate the dominant bias/trend, when that bias will be violated & if it isn't, you'll also know what decision to take if & when the appropriate trigger opportunity sets up to offer a low risk/high probability entry.

If anyone has any questions or comments please feel free to post them up......the only silly question is the one you don't ask!

[Sarah Foster]

Thanks for the summary Joe, always nice to take a breath & reinforce the basics.
I've just stepped back in on a continuation long ahead of this 3080 higher low support.

Great risk + a high probability level from whch to test the continued bullish momentum.
Extra bonus being there's plenty of average range to go at if the move attracts support.

If it fades & dies, I've got time & space to scratch or pull the trade as it dips towards this crucial support level.
Win/win.