Forex Price Action

Hey all just finished reading the first 200 pages and must say apart from the recurring question themes it is well worth the dredge through some real priceless info there plus when you see people make mistakes better to learn from there’s then your own :20:

I feel better about my plan and also my weaknesses i.e looking too hard for PA to present its self and when it does jump on mediocre setups which would of saved me some losses.

But better to iron out the problems early on then start up some bad habits.

Thank you everyone who has positively contributed to this thread and jonathan for starting it.

after my shaky friday night trades on the eur/jpy and nzd/jpy ( nice pins at a swing high but bhops wisely pointed out this maybe due to traders closing positions before market shut) the market gapped in my favor. And decided to close all positions before the market attempted to regain back against its gap.

Also closed my USD/CAD trade as gapping occurred.

All in all 2.5% gain to start the week off though. And i’m just glad a survived this rookie mistake.

“From now on I must stick to the plan”- mantra ( you can say it with me :wink:

Darth

I wish USD/JPY could jump again to 99 so I can close and old silly position I have and then I will start repeating with you
"From now on I must stick to the plan" :smiley:

I don’t see any problem with USD/JPY getting to 99 and above in the near future if USA settles their problems. This pair is now trading in a range and you are inside the range EternalNewB.

Time to go short on gold ?

Gold has been in a downtrend and ranging recently since mid April

It closed under support (at least for me) @ 1278.41 last week and actually retesting this “flip zone” now acting as resistance.

Looking for PA to go short on the daily chart since this is what I am sticking to for now


Johnathon in your last article The Secrets Traders Can Read From Candlesticks & Price Action - Forex School Online you state the one should NOT draw the S/R lines only based on line charts however this is what I have learned to do here.

Can you please refer to the correct way to do it ?

thank you

You should not be confused, I have always said not to draw support and resistance from line charts for that reason… I have never, ever said to mark levels using line charts. That goes against everything I use.

Where you may be getting confused is that some other members have in this thread said that they find it easier to mark their levels using the line charts because it “takes away the bumps and makes a smoother chart”, but every time in this thread I have seen someone saying that I have corrected them.

It is these bumps that we need for information. These bumps are the wicks on the candles and the line charts take them away and don’t show them and we lose a lot of information with line charts not having these. Some people find it easier, but easier is not better it just means they need more experience to learn to read about the price action and what it is trying to tell them.

Thank you Johnathon
Do you have any article explaining how to do that correctly?

Nice trading!

Just keep in mind moving forward that you really gotta be careful when playing small pins on intraday charts against the recent trend/momentum. You will notice there were some really large candles moving up into this area before the pin and then the smallish pin.

What you have to keep a look out for is when we get really large candles with full bodies making a big strong move either higher or lower and then a small pin bar. These are not true reversal pin bars and this is why we say it is so important to only trade big and obvious pins and that stand out.

These moves with large full bodied candles have a lot of money being made and these traders have to take their profits and the only way to do that is to cash out their trades. Until they cash their trades they are sitting on paper profits. These small pins or small rejection candles can often be just the market shuffling orders or in other words the traders who have made profits in the large moves taking profits and creating the small pins.

Your pin bar did work out and did move lower into the near term support level. Just keep this in mind going forward and look out for small pins after huge moves.

NZDJPY 4hr Chart


Hello Bizzaro,

nice post, just a lit confused what you are looking for with the 1,2,3. I can see what you mean exactly with the double top and agree with you and can see that it has made a top. I discussed this pair a little while ago and this same area that I was looking for short trades is price made it back here. You can read that post here: http://forums.babypips.com/free-forex-trading-systems/42378-forex-price-action-1404.html

Johnathon

Nice one mate. You have come a long way in short time. Keep up the good work! :35:

thanks for review. It kind of worked out for me but only due to market gap and i closed the trade as soon as the market opened. But as soon as the market shut on friday i realised that this was a weak trade and regretted it. I am now going to find much stronger setups. hopefully.

Thanks again.

Darth

Really appricate that mate. means alot :21:

Johnathon I was a little confused here because clearly that level the pin formed at is not a key level so Darth had no business shorting at that level (No offense Darth :slight_smile: )

no offense bud.

But it did form at a key resistance level. If you look at the graph above you see the red line. you also see it lines up with BRN of 0.8200 and you also see it reject the pin. all on the 4hr chart.

It just was a short term counter trade that i thought was a good oppotunity but did not take it consideration the sell of before the weekend and it could of been a bigger pin too.

Darth

Hallo ENB!

Gold for me is a bit “messy” at the moment, but the recent momentum is definitely down, so I agree with you on looking for shorts.

Cheers

.

Hallo,

Also just to alleviate confusion that I “may” have created…

Notice in the posts where I talked about using line charts for drawing S/R, the last instruction is ALWAYS to switch back to candlestick charts and ‘best fit’ the S/R [ the reason for which is what J talks about, i.e, wicks give important info about a level’s ‘break-ability’; price failing to close above/below a given level tells a story ]

Hope that clears it from my end.

Cheers.

Hallo Frosty,

When price gets to new levels, we typically use price reaction’s to (V)BRNs to draw the S/Rs.

Also, when the Daily candles hesitate at a level, that becomes a new S/R (in this case, it would have been support, and the previous stalling above price would have been resistance, where we would have looked to short had price pulled back).

Basically we flow with where the price halts/consolidates, and try to enter the dominant trend by looking for PA at pullbacks on TF’s such as H4/H6/H8/H12

Hope that makes sense

Cheers

2 Likes

Thank you for your continuous support and help my issue now is that I don’t know how to put S/R with candlesticks :slight_smile: I mean with line chart it is pretty obvious but after I switch back to candlestick how do I tweak ?

Cheers

Hello guys,

does anyone know a Broker that offers MT5 and New York 5 day close candles? The only one i know is Roboforex and it does only offer a few pairs.

Not sure if that discussion is allowed in that thread - if not PM me please.