Technical Templates

[Ray_1]

Hey Guys Im new to the forum and thread, but was recommended to the thread by anothertrader that emailed me and told me to check it out. I understand that this thread is a continuation from the baby pips technical template thread.

I have a little understanding of whatthe method was , you guys identify the supply and demand levels on the daily time frames and go down to faster time frames for entries, am I correct?

Secondly has anything changed in the method and from which post should I start reading from to gain the prudent information on this thread to keep abreast of how you guys do thinsg?

I am still fussy on what to look for as far as intraday entries for trading daily levels? That is my big misunderstanding, its how you put it all together, know it may be simple for guys that have been doing this for a while but I just have not gotten my head around how to trade these levels successfully by using the lower time frame.

Can someone pointme in the right direction?

Hi Dappa

This is short thread compared to those at BP. I will suggest you to read the entire thread. What we are doing here is the same over at BP:

1) use primary timeframe to check the bias and directional flows.
2) choose pairs that are currently at our interest zones
2) zoom down to secondary timeframe to look for triggers.

The triggers presented here are still the good old 1-2-3 and stoch hooks. Things are as simple as that. Feel free to throw in any questions. The more you ask the more you will learn.

[Eidriel]

Hi all!

I would like to clarify something.

On the primary timeframe, say the Daily, price is currently at a zone of significance.

Will you all switch to the secondary timeframe, look for the trigger and enter straight away.

or will you guys wait for the price to GO IN YOUR PREDICTED DIRECTION for a bit, on the PRIMARY timeframe, to sort of confirm that your analysis is right, THEN switch to the secondary timeframe to leg into the momentum?

[shona123]

I would like to clarify something.
On the primary timeframe, say the Daily, price is currently at a zone of significance.
Will you all switch to the secondary timeframe, look for the trigger and enter straight away.
or will you guys wait for the price to GO IN YOUR PREDICTED DIRECTION for a bit, on the PRIMARY timeframe, to sort of confirm that your analysis is right, THEN switch to the secondary timeframe to leg into the momentum?

Firstly, what secondary timeframe are you intending to use in tandem with the daily chart Eidriel, & what are you considering using as your set up/trigger?
In other words, what are your aims & objectives for the potential trade?

Hey Guys Im new to the forum and thread, but was recommended to the thread by anothertrader that emailed me and told me to check it out.
I have a little understanding of whatthe method was, you guys identify the supply and demand levels on the daily time frames and go down to faster time frames for entries, am I correct?

I agree with Ray Dappa....read the info from the beginning, it's not a lengthy thread, it's very focused on the subject matter (no off-topic rambling) & covers the approach from a couple of different angles, attempting to appeal to a variety of risk/timeframe based appetites.

There is no real emphasis on specific timeframes because each persons risk attitude, trading objectives & time limitations will be different.
It focuses on directional bias, the identification of significant support & resistance zones to help with trade planning, + logical execution & trade management processes. And it's presented in an uncomplicated, efficient manner.

Before starting from the beginning, take a look at Joe's recent recap posts from 20th of this month (a couple pages back).
That will give you an accurate view of what we focus on.

[Eidriel]

Hello shona!

This is what I am thinking, I will use this AUDCHF example to illustrate it.

As you can see on the Daily, chart, its showing a downside bias. I am predicting that price will bounce off the low of September and then proceed to hit my target.

However, at this point, I was thinking of WAITING for price to show maybe 2 candles to the downside on the DAILY first, this will kind of act as a confirmation that my prediction is right. Upon seeing this 2 candles, I will then switch to the
1H which is my secondary timeframe, and leg in with the momentum towards my target via a Stoch hook above 80 OR a 123 on the 1H.

This is what I am confuse about, should I wait for that 2 bar confirmation on the Daily to show up first, or should I just go straight to my 1H chart NOW, wait for a stoch hook above 80 and enter the trade right when price is hanging around at this key level?

Unfortunately I dont have the time to watch the subhourly timeframes, because I agree with what castor say in that the 123 triggers are most noticeable on the subhourly timeframes, and may not be the case on the 1H.

But anyhow, this is what I plan, it may not be correct So I would love it if you can advice me on a trading style that uses timeframes on 1H and above? Which combos work best together? Daily-1H, Daily-4H, ,or 4H-1H?

I like all the examples posted here recently, but it seems like all of them involve a 123 trigger on 15M or 5M. I tried to replicate the exact style but on a longer timeframe (ie. using the Daily to judge directional bias instead of the 1H which I think most exmaples here are showing, then the 1H for 123 triggers instead of the 15M and 5M), but it seems that I cant just copy that 1H-15M combo trading style into a Daily-1H combo. the results are very different.

Would love some enlightenment

[shona123]

As you can see on the Daily, chart, its showing a downside bias.

I don't disagree with the general bias, however price is printing very clear higher lows off 0.9440 & if you compare this activity to the previous two pullbacks during September, currently it's a much more solid uptick.

However, at this point, I was thinking of WAITING for price to show maybe 2 candles to the downside on the DAILY first, this will kind of act as a confirmation that my prediction is right. Upon seeing this 2 candles, I will then switch to the 1H which is my secondary timeframe, and leg in with the momentum towards my target via a Stoch hook above 80 OR a 123 on the 1H.

The trigger & set up criteria is fine, but what I would want to see first is a determined effort for price to reject this 0.9640-60 area which represents the September lows.
All I see this week (via the 4H bars) is strength.

Just look at the visuals of the bullish activity bars v/s the bearish ones.
For a quick secondary opinion, price is trading above the 4 & 1 hour 60sma's - not usually a good sign to start considering shorts when the momentum on those charts is headed the other way.

What I'd personally be looking for on this pair before attempting to leg into a possible short would be for price to break down through 0.9640, which is the current higher low on the hourlies, & pullback offering up a potential lower high (1-2-3).
But that's just my view...........yours might be very different

I like all the examples posted here recently, but it seems like all of them involve a 123 trigger on 15M or 5M.
I tried to replicate the exact style but on a longer timeframe (ie. using the Daily to judge directional bias instead of the 1H which I think most exmaples here are showing, then the 1H for 123 triggers instead of the 15M and 5M), but it seems that I cant just copy that 1H-15M combo trading style into a Daily-1H combo.
the results are very different.

Yes, to a large degree they will be different.
Jack touched on it in his reply to castor. This approach is geared to, & designed around maximizing the opportunities provided by intraday momentum.
Once the generic bias is identified via the hourlies, target entries (wrapped around the stoch hook/1-2-3 triggers) can be taken which closely track the price action via LH's & LL's going down & HH's & HL's going up on the sub hourly timeframes.

If the opportunity exists (due to an aggressive intraday move into the average day's range extreme) to roll positions over & take advantage of another follow through leg, then this type of approach is the ideal vehicle for that objective.
If, on the other hand, the volatility dictates otherwise, the entry will get cashed on violations of that price cycle sequence.

Although it's possible in some cases to replicate that behavior on the higher timeframes you have to realise that when you're toggling up on those timeframes in search of positive risk/cost ratios, you're going to have to widen your margins for error & quite often adopt pretty large risk stop placements in order to check out your intentions.

Unfortunately, this year that approach isn't proving to be a very a positive tactic due in part to the contraction of intraday & weekly range boundaries & the increased range volatility which are the effect of all this global financial turmoil.
That's why it's extremely important to "cut your cloth accordingly" when conditions dictate, & adjust your exposure to suit the current market rhythm.

If a higher timeframe model isn't viable for whatever reason, & is out of kilter with the market pulse then you either have to stand aside & wait until it is conducive or use another approach.

[Dappa]

This is the first Time in my miserable trading life I have understood what was presented to me. This thread and forum rocks! This is probably the only thread on the net that has real traders showing newbies how to read Price action. I have a way better understanding now on how to approach trading and how to look for a trade.

The thread is dedicated to the method, everyone is willing to teach and brings the info across very well!

I cant believe that it took me so long to find the essence of trading. I now get it and it did not take long to catch on to what is being taught. Its so simple the way you guys teach this stuff.

I could never understand which way to trade the market and didn't understand how to get into a trend and ride it, but now I know! I always new that everything about trading was in front of my face but I just needed someone to explain it properly and logical to me so It made sense. once it made sense then you know why your doing what your doing and your mind is at ease.

The explanation of how to look for a trend reversal and the cycle change is what made the most sense and is the hart of trading, cause you know from the higher time frame where previous supply and demand levels where and you look for your higher lows and lower highs when price reaches those zones or levels. Its sweet simple and I watched it work from yesterday to today. You guys arebrilliant with your teachings. I will be able to buy my s550 in no time! lol.. haha!

[Dappa]

Hey Guys one thing I would like to understand about price movement, why does price move the way it does, higher highs and lows and so on when it is trending up or down? What's going on in the back ground to cause that?

[Eidriel]

Thanks shona, and the other great tutors on this thread

[castor]

It seems like most of the traders here are intraday traders that refer to the 1 hr and 15 or 5M charts?
Im going to be getting a job really soon, and wont have the time to watch the prices throughout the day.

It's a mix to be honest castor.
Virtually all of the trades that get rolled over into next day & longer start off as intraday entries.
That's the beauty & one of the major advantages of this type of approach.

By using the hourly charts as the background template (bias/trend indicator), it allows you to get aboard the current momentum via 5 & 15m triggers. The risk & objectives are then revised, determined & managed according to what the market is offering at the time.

If the price action is smooth & trendy, it allows you the opportunity of trailing the profit stop up or down behind the next swing level on the sub hourly charts. The decision can then be logically & calmy made at end of day or percentage of ADR covered, whether to roll the trade over or fully exit.

If the price action is choppy & volatile, the decision is usually made for you & therefore results in an intraday exposure.

from experience, is there another good entry trigger that you guys can recommend, that allows me to place stop orders, or allows me to just enter at a quick glance?

I wish there was. If so everyone would be in clover.
Unfortunately it doesn't quite work as perfectly as that in reality.

If you're unable to commit the required time to monitor & observe the market as it ebbs & flows through the various business sessions then you're going to have to get used to adjusting your risk tolerances & widening your margin for error in regards entries.

It seems like there are a lot of traders here using the Stochastics hook on the 1H to enter intraday trades?
I tried that out for a few weeks, and I personally found it not as accurate as the 123 triggers on the 15M, as it gave quite a few false signals especially when there is accumulation above 80 and below 20.

Everything with this style of approach revolves around location of price & momentum of the market.
Triggering random hooks or 1-2-3's will soon deplete your account.
You have to take into consideration the current bias/trend, the location & the risk to profit potential involved before pulling the trigger.

There is no guarantee to success even if it all lines up successfully.
And to be honest, I've found that I have to be available to actively manage my positions if I'm triggering via hourly based cycles, otherwise I'll be over extending my risk tolerances & my account will grossly underperform.

of course it would be a bonus if this entry strategy involves around placing STOP orders, so I can just set it, and go off

We'd all love that scenario
I could simply stick my orders in, go get on with all the nice stuff, come back at the end of the day & count my profits.

I'm not saying there aren't situations or approaches where that strategy is possible, but it's not the type of trading we're really involved in on this thread.

Great advice jack. I will continue to try out different stuff, and see how things go!

[jjay]

Hi Dappa & Eidriel,
Glad you're enjoying the content.
As long as you use your common sense & look at the daily price activity from a clear, straightforward perspective (such as is presented here), then you should quite quickly slip into a disciplined, logical routine of identifying the type of approach you want to progress with.

As you're discovering reading & plotting price action doesn't have to be a slog where you need to plough through mountains of complicated analysis.
Price moves in repetitive cycles most days of most weeks & it obeys big, obvious levels & zones very regularly too.
Once you begin to recognize the patterns & structure of those cycles you can better control your risk exposure & take advantage of open ended pricing.

Hey Guys one thing I would like to understand about price movement, why does price move the way it does, higher highs and lows and so on when it is trending up or down? What's going on in the back ground to cause that?

It's nothing other than straightforward order flow dappa.

Commercial firms, Central Banks, Hedge Funds, Investments firms, Brokers, individual traders etc, are all trading the spot market at their various tiers & levels (interbank & retail) for very different aims, objectives & intentions.

All those varied objectives get aggregated & priced into the market at fair value during each & every regional session & the strength (or weakness) of the traded volumes & liquidity available at each hour of the trading day will dictate & reflect how price behaves during those business cycles.

A lot of intraday price action pivots around stop hunting activity, especially when prices are moving around big (00) figures & large option related zones (again they tend to be located at key round numbers). The big firms use it a defence mechanism to protect their very large options activity.

You'll also see a lot of round number & big figure levels being defended into the various fixings (the London fix @ 16.00 gmt every day being the main one) because banks quote dealing prices to their clients based on the closing price of a currency at a particular fix & they move prices around to get the best quotes/deals for both themselves & their clients.

The other major fix windows during a typical business day are:
Tokyo @ 00.50gmt & the ECB (Frankfurt) @ 12.15gmt.

Those are some of the primary reasons you witness the regular, common price action footprints reflecting HH's & HL's & LH's & LL's, (most visibly via the smaller sub hourly timeframes) across any timeframe you choose to view it from.

It's nothing more scientific than traders of all denomination scaling in & scaling out of their various positions at specific levels & zones based on their business objectives at the time.