Technical Templates

[Dappa]

I understand the higher low and lower highs yada yada.
I still don't understand the answers given, its as though oh well this happens sometimes and answers like that.
So the concept is flawed
trading this way is no different than trading using indicators or what ever else one decides to use to rationalize a trade. To me it seems as though a logical approach is no different from letting an indicator tell you to buy or sell. Someone correct me?

???
You've changed your tune pretty quickly haven't you?
It was barely 2 weeks ago you were convinced you'd found the pot of gold at the bottom of your bed.
Are you the same person that posted this back on the 25th Oct??!!

What's with all the mild hostility & sudden personality switch?

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!

lol.. very good. No , no hostility bro. Just want a clear concise answer. Appologize if I came off abrupt.

[Eidriel]

Nice post visualxray!

Just wanted to clarify something. Dont mind me borrowing your chart

I have edited your chart a little and circled a region that showed a cyclical change to the upside by printing a higher high and higher low.

I want to ask if you guys will actually go long on this cyclical change? or will you all at least wait for a change in the Directional Bias to the upside?

If you all will wait for the change in Directional Bias, is it via the the direction of the 60 SMA or via a break of previous resistance as what visualxray have shown?

Thanks.

[JimmyMac]

Guys,
Let me just amplify one thing before this gets pullled out of shape.

Each person will come wired with very different skill/experience levels, risk profiles & trading objectives.
The information & material presented is based on nothing more than logical common sense which mirrors the various diverse objectives of the market participants exhibited by the footprints they leave every step of the way from Monday open thru Friday close.

You as an individual & miniscule cog in that massive wheel need to be very, very clear on exactly where you stand in relation to that wheel.
Bias & cycles are & will be dependant on your own outlook & preferences.

Support & resistance zones & levels are there for a reason.
They help to establish axis or major decision points on the technical chart.
The institutional community who run this show observe & react to these important inflection zones because they know that the majority of algo's, option defense & large speculative capital exist on & around them.

Once you know where those high probability levels & zones are at, you have the choice to either trade into them (via the shorter term cycles), or wait for a reaction at them & trade away (via the shorter term cycles) until a dominant flow is established on your primary timeframe.
That's the reason we suggest utilizing a combination timeframe approach.

Just wanted to clarify something.
I have edited your chart a little and circled a region that showed a cyclical change to the upside by printing a higher high and higher low.
I want to ask if you guys will actually go long on this cyclical change?

I didn't (& wouldn't) Eidriel no, because i couldn't/wouldn't see any value in it.
But that's not to say you or anyone shouldn't trade it.

You have a clearly identified & actively traded level at 1.2900 (a round number).
You have clearly identifiable upside & another really big important options related zone in the sights (1.30).
There will definitely be opportunities to trade a lower timeframe cycle away from both of those levels & if your risk profile & trading objectives are in tune with the unfolding price action & you get an appropriate trigger to climb aboard, then fill your boots.

But for me (& most of the colleagues i work with) the bias is still down until at the very least 1.2800 is hurdles & begins printing a higher low on the hourlies & then 1.2900 follows suit.
That will constiture a solid bias change at current levels for me.

or will you all at least wait for a change in the Directional Bias to the upside?
If you all will wait for the change in Directional Bias, is it via the the direction of the 60 SMA or via a break of previous resistance as what visualxray have shown?

For me, yes.
I like to open my technical charts & not strain my eyes to see a clearly identifiable bias in play with big, bold S&R zones in reasonably close proximity.
And since the middle of October when euro failed to print higher swing highs & lows beyond 3150 all i see is downside pressure & very, very clear rejections of big figures/round numbers.
That to me constitutes a currently bearish tone & bias.

Do you see anything different?
Because if you do, please enlighten me

[Se7en]

And so to that end, & for those with a somewhat spicier risk profile, the opportunity exists to consider executing shorter-timeframe cycle bets to the long side on a violation move through this latest hourly lower high area at 1.2730.

That is the initial ceiling on this latest leg down, with corresponding area's of short range resistance in view, the first being Jimmy's noted level at 1.28
For those with other objectives, fading upside moves towards 1.28 is still the higher probability play until the technical picture begins to flip from a "sell rallies" to a "buy dips" view.

Be aware that tomorrow is a Canadian & US holiday, so volumes will once again be on the thin side, as they have been through much of the recent US election period.

[speedbump]

Same deal on the popular yen pairs.
Bias is bearish on AUD/JPY underneath 83.0, but the hourly lower high cycle will get violated on a break through 82.70 which can be traded via micro timeframe long cycles back towards stiffer s&r @ that round number to test for follow through if appropriate risk can be obtained.
If not, the same set up can be traded back down off any rejection into the current bearish flows.

USD/JPY is highlighting a similar potential hourly lower high cycle violation through 7950-60.
Long cyclical bets are available via any potential moves back into key s&r @ the 80.0 figure.
If price pulls back towards that level & sufficient momentum exists, the decision can be made to continue betting the micro timeframe long cycles, or simply wait to see the reaction first & upon the first signs of fading, shorts can be re-engaged on micro timeframe cycles back into the current bearish flows.

As has been suggested, once you've identified the significant & potentially reactive zones, it offers you options to trade into or away from from those zones based purely on your risk attitude & short or medium term trading objectives.
I will on occasion take contra-trend cycle bets, but only usually when they violate hourly swings away from key levels such as prior day/week high-lows or well established support & resistance zones.
But my risk stops are always tighter than when trading in sync with a dominant bias & my targets are always shorter too unless the momentum is such that it allows a more flexible stance.

[Eidriel]

Guys,
Let me just amplify one thing before this gets pullled out of shape.

Each person will come wired with very different skill/experience levels, risk profiles & trading objectives.
The information & material presented is based on nothing more than logical common sense which mirrors the various diverse objectives of the market participants exhibited by the footprints they leave every step of the way from Monday open thru Friday close.

You as an individual & miniscule cog in that massive wheel need to be very, very clear on exactly where you stand in relation to that wheel.
Bias & cycles are & will be dependant on your own outlook & preferences.

Support & resistance zones & levels are there for a reason.
They help to establish axis or major decision points on the technical chart.
The institutional community who run this show observe & react to these important inflection zones because they know that the majority of algo's, option defense & large speculative capital exist on & around them.

Once you know where those high probability levels & zones are at, you have the choice to either trade into them (via the shorter term cycles), or wait for a reaction at them & trade away (via the shorter term cycles) until a dominant flow is established on your primary timeframe.
That's the reason we suggest utilizing a combination timeframe approach.

Just wanted to clarify something.
I have edited your chart a little and circled a region that showed a cyclical change to the upside by printing a higher high and higher low.
I want to ask if you guys will actually go long on this cyclical change?

I didn't (& wouldn't) Eidriel no, because i couldn't/wouldn't see any value in it.
But that's not to say you or anyone shouldn't trade it.

You have a clearly identified & actively traded level at 1.2900 (a round number).
You have clearly identifiable upside & another really big important options related zone in the sights (1.30).
There will definitely be opportunities to trade a lower timeframe cycle away from both of those levels & if your risk profile & trading objectives are in tune with the unfolding price action & you get an appropriate trigger to climb aboard, then fill your boots.

But for me (& most of the colleagues i work with) the bias is still down until at the very least 1.2800 is hurdles & begins printing a higher low on the hourlies & then 1.2900 follows suit.
That will constiture a solid bias change at current levels for me.

or will you all at least wait for a change in the Directional Bias to the upside?
If you all will wait for the change in Directional Bias, is it via the the direction of the 60 SMA or via a break of previous resistance as what visualxray have shown?

For me, yes.
I like to open my technical charts & not strain my eyes to see a clearly identifiable bias in play with big, bold S&R zones in reasonably close proximity.
And since the middle of October when euro failed to print higher swing highs & lows beyond 3150 all i see is downside pressure & very, very clear rejections of big figures/round numbers.
That to me constitutes a currently bearish tone & bias.

Do you see anything different?
Because if you do, please enlighten me

Thank You JimmyMac

[kipper]

For those with other objectives, fading upside moves towards 1.28 is still the higher probability play until the technical picture begins to flip from a "sell rallies" to a "buy dips" view.
Be aware that tomorrow is a Canadian & US holiday, so volumes will once again be on the thin side, as they have been through much of the recent US election period.

That outlook is mirrored right across the majors if you pull up an hourly chart. Bias is clearly to the downside on Cable too with the most recent lower high on that timeframe at 1.5905 into friday's close violated during the early asian session.

So even though an hourly lower high cycle sequence has been snapped with a move above it, the overall bias on Cable remains bearish until at least the 5930-50 zone where clearly visible S&R is evident on that timeframe. Price would need to move through & pull back in order to begin to flip the bias back to a tentative bullish tone.
It would only then favour a buy-dips micro timeframe cycle trigger.

The fade into today's tokyo session materialised on the resumption of a micro timeframe cycle sequence as price fell away from the early morning's highs, broke through the tokyo & friday's lows, pulled back & began to print the familiar lower high swings.
That, in my view, is the lower risk/higher probability option for this pairs current technical outlook & a good example of how to play a bias influenced, short-timeframe cycle entry.

As se7en reminded us, today's volumes & liquidity is thin due a bank holiday in North America, so if anyone has/is triggering a short-range entry be very careful & manage the bet actively, especially on this pair as there are rumours of a large dividend payment being worked into the ECB fix into lunchtime which has interest to sell the cross eur/gbp (buying sterling).
Remember this approach requires momentum & if for any reason it lacks follow through or starts to exhibit choppy, indecisive behaviour you have the option to scratch it & wait for another potential opportunity on this or another pair displaying similar technical behaviour.

[Eidriel]

Today, I am hoping someone can help me with this problem on placing ideal stop loss.

I mainly trade based on the Daily, 4H, and 1H.

I will Draw S/R zones on the Daily, Look at the directional bias and cycle on the 4H, and then wait for momentum shifts / cycle change on the 1H to enter. This is an example of a trade I took on GBPAUD.

Problem, is I was having a bit of a dilemma where should I be placing my stop loss. I have marked the 2 possible places on the 1H chart attached. Should it be placed behind the S/R zone or behind the previous swing high?

Another thing is, I have noticed that placing stop loss behind swing highs / lows on the 1H can sometimes be too big, resulting in a small lot size.

Judging from my trading style, do you guys think it is feasible if I drill down to the 15M or even 5M to put stop loss behind swing highs/lows instead? so i can have larger lot sizes?

This is one part I am really confuse about. which Timeframe should I be using to place my stop loss so that it is optimal?

Thanks guys

[zilly]

I mainly trade based on the Daily, 4H, and 1H.
This is an example of a trade I took on GBPAUD.
Problem, is I was having a bit of a dilemma where should I be placing my stop loss.
Should it be placed behind the S/R zone or behind the previous swing high?

Your stop (risk) will be somewhat influenced by your trading objective for this specific bet Eidriel.
You haven't said what you're looking to achieve from your entry or anything about the ongoing management of your bet.

We know you're short through 1.5255 but that's about it.
Are you planning on running an "all-in all-out" strategy & trailing your stop down behind any lower swing high cycles on the hourly?
Are you looking to scale out a percentage of the bet at a pre-determined level & re-adjust your remaining stop on a successful continuation of the move?

No-one is going to be able to give you precise advice on your risk because it's such a personal issue.
We're continually & constantly dealing with, & trading "probabilities"
Part of assessing & adjudging those probabilities are weighing up your own personal risk options.
And the repetitive question you have to keep asking yourself is:
"how much am i willing to pay (or am i prepared to risk) in order to check out the potential of this bet"

For each of us that question is & will be different dependant on our own risk attitudes & tolerances, objectives & capital exposure.

It is possible to tuck your stop behind a shorter timeframe swing or cycle high on that pair such as the 1.5280 area & in some instances you'll be fine & your stop will be safe, but when conditions are volatile & price action gets choppy, those close quarter stops will get washed away in a heartbeat.
One of the drawbacks of seeking & exploring the potential of a decent price run when utilizing a smaller capital base is the fact you have to compromize with reduced bet sizes on these larger timeframes.

[jjay]

There's no perfect scenario where stops are concerned Eidriel & zilly actually called it bang on to be honest.
It does really come down to trade expectations & perceived personal value.

When I'm looking for a potentially longer range bet outcome & I'm able to engineer & position myself into what I perceive is a pretty decent value entry I won't tend to position my stops above or below recent swing highs or lows either at initial entry or when I pyramid a core stake, because they are magnets for stop hunts.
But then the capital base at my disposal isn't mine & it has quite a few noughts on the end of it. And regardless of what anyone says, that makes a huge difference to the psychological pressure when establishing & running multiple positions.

However, if it was my own money & I was considering an entry at 1.5255 with a view to running it towards the 1.5070/4960 area, then I'd be looking at hiding my stop back towards Friday's lower high level around the 5350 level, which coincides this pairs average daily range.

I would then reassess into the day's close (at the very least) at the end of NY & decide how I want to play it overnight & into early next day (europe) referencing the following days data events concerning both sides of the currency bet, where the leading flows were today & what was influencing/driving prices into the early week business.

But that's just my view based on my own personal style, risk & objectives.
Yours may well be very different in all 3 areas to mine.

nb: I see it's moved down in a very orderly manner today, so it should offer you a couple of positive & stressless options when you next get the opportunity to review it's progress.
You caught a good, logical entry there, well done!