Alternative Technical Templates.

[Tess]

kagien (George) : I can see where you're coming from regards the lower top behaviour & possible short bias etc, but I'm a little unlear as to your actual triggers? what do you mean by your comment regards missing trades on the 3rd example?? I see generics (the background of price revealing it's behavioural intent), but I don't see specifics (the actual set-up or trigger you're intending utilizing).

summerpip : I can certainly see your charts if I click inside the chart boxes. Yes, it's probably down to the method you're using to save the chart examples.

pkfrpa : I'm not aware of any Bank pod or Hedge operators who observe pivots. I don't think Jocelyn or JimmyMac are either. That's not to say they don't, just that we're not aware of it from the folks we speak to on a regular basis.

One or two sure observe Fibonacci via the larger timeframe references. We're talking 4 hour plus timeframes here, not intraday plots.

Some of them are also well aware of their favorite moving average levels off the Daily, Weekly, Monthly charts too.

They'll use these as back up guides to support-resistance zones as they come into view. Also to assist in adjudging position sizes on compounding/profit-taking as price begins moving towards/away from them in conjunction with their own s&r configurations.

[Harry Potter]

Hi Tess, good to have you back

I've been using the content of this thread for 2 months now and I managed to achieve pretty amazing results. Despite my results though I still get confused often. I watch price action at the s/r levels, look for triggers, execute, compound on the way. Everything works just fine most of the time, i just dont know why. I always wonder, if there's loads of people following indicators then how could s/r levels play out? Is it because big players focus on the least complicated and oldest methods (fibs, MAs, s/r)??

And a technical question:
Do you add to an existing position at countinuation patterns or pullbacks on the way to an other significant level, or just book profit at "micro" levels and start all over when the next level comes in focus?

Oh and could you please post a chart with the current s/r levels?

Thanks!

[free84]

Tess and Jocelyn , I must tell you that this thread and the topics discussed ( in particular your answers) are one of the most interesting threads that I have found on the entire forum!
Can you tell me how many pairs you monitor, and what pairs do you trade most?
best regards
thierry

[Tess]

Originally Posted by Harry Potter

I've been using the content of this thread for 2 months now and I managed to achieve pretty amazing results.

Everything works just fine most of the time, i just dont know why. Is it because big players focus on the least complicated and oldest methods (fibs, MAs, s/r)??

And a technical question........

Oh and could you please post a chart with the current s/r levels?

Hello Harry

It’s indeed pleasing to hear when folks like yourself are able to add to the framework which we’ve assembled here. Remember, nothing is achieved until someone picks up the baton & actually begins making use of information.

Support & Resistance are simply the wheels. You still need to add a steering wheel, brakes & accelerator to the frame in order to drive the vehicle.

Which links nicely into your questions:

Most of the savvy operators out there (large Bank desks….Hedge Funds….Investment Funds…..High Net Worth Speculators etc) are very aware of the key technical levels across all of the instruments they trade on a regular basis.

Some of these operators will choose to add the odd technical flavor to their analysis, such as: Fibs, Waves, & Moving Averages according to their preference & the specific aims & objectives of their trading structures.

The obvious swing levels & zones which appear to draw price in like a magnet are being observed (& traded) by these firms day in, day out for very specific reasons.

More often than not, they hide collections & bunches of stops. They’ll be profit stops in there, limit orders, new buy & sell stop orders etc.

Price action will be determined as a direct result of the dominance of orders (supply-demand) stacked at these levels.

If price is in a solid up trend & sufficient continuation & fresh buy orders are resting above a previous level of fierce s&r activity, then we’ll witness a consolidation of sorts until the Bulls have either absorbed all the counter activity (including the fresh orders) & continues on it’s journey.

If the resultant sell or contra activity is stronger, then price will get batted back down to previous level of support where it will sniff out further bid activity for another assault on the resistance line. And so it goes on.

But it’s essentially all a direct result of the laws of supply & demand at each section of the price ladder. And yes, most of the smart money certainly drives this activity.

We vary our compound entries Harry, dependant upon the strength of an impending zone or level.

Usually we’ll add to our positions on pullbacks of a breach of next level support (in a downtrend) or resistance (in an up trend).

We will also get aboard a pair on an approach to an important level if the opportunity presents itself via a smaller timeframe reference. Reason for that is so we can monitor the initial reaction & get an “average position” to maybe front run a possible aggressive breakout. That strategy will generally be actioned on smaller size until we receive confirmation that the (possible continuation) level is genuine.

Regards your 3rd question: which chart are you referring to re; the s&r levels?

[Tess]

Originally Posted by free84

Tess and Jocelyn , I must tell you that this thread and the topics discussed ( in particular your answers) are one of the most interesting threads that I have found on the entire forum!
Can you tell me how many pairs you monitor, and what pairs do you trade most?
best regards
thierry

Hello thierry,

Thank you very much for your kind words. Much appreciated

We monitor all the relevant carry trade instruments (those v/s Yen) & the majors.

Some of the exotics are also on the radar, but to be honest the volumes/liquidity on those instruments can be very wishy washy, so we tend to stick to the ones which we can get filled on with decent size.

Personally, I like to watch the GBPUSD, EURJPY, GBPJPY & NZDJPY via the 60min+ timeframes.

Jocelyn trades those (+ Oz & Swiss) via the smaller timeframes for specific objectives when she has to.

Like everyone else, we like to engage where the liquidity is good & the ranges are active

[Harry Potter]

Thank you very much for the detailed explanation Tess!

Support & Resistance are simply the wheels. You still need to add a steering wheel, brakes & accelerator to the frame in order to drive the vehicle.

What I do now is map my pairs on the daily and 3h charts, mark the s/r zones with different coloured lines according to which frame they appear on, so i see their strenght immediately on the low time frames. After that i go down to 15m and start examining activity around these levels, and look for rebounds or breakthroughs. A rebound has to be a clean double top with divergence or candlestick patterns and a breakthrough should be also clean with a retest to the line. I'm always careful with consolidation at the s&r lines because I had some really bad experiences with these (they could go practicaly any direction).
After I mapped the higher timeframes i usually look for minor s&r lines on the 15m frame (usually any minor retest or spike does the job) again with different colors, and use them as compound levels. The only thing I'm not too confident with is re-adding to my position on the countinuation signals, so the farther price gets from the place of opening the smaller my position is. I might be greedy but it is something I definetely want to work on.

Regards your 3rd question: which chart are you referring to re; the s&r levels?

Just the usual ones: GBPUSD, EURJPY, GBPJPY

Thanks!

[Tess]

Looks as though you've assembled a very adequate price check facility there Harry. Nice to see.

I don't think you'll encounter too many hiccups if you remain loyal to your foundation analysis.

Keep it as simple & uncluttered as you possibly can. I'd fiercely oppose the inclusion of any indicators or ancilliary & unecessary distractions if I were you.

Continue to explore/learn, focus & major on understanding the supply-demand relationships & the common sense application of support & resistance. These are the concepts which govern the journey of price action & they're all anyone really requires to generate profits from the markets.

Ok, here are our current area's of mid-range interest on the 3 pairs you requested.

Jos & her crew will have intermediate levels of s&r plotted on their intraday foray's to the respective instruments, but they are easily adjudged if you expand a 15min frame out to maximum tolerance & plot your cross-hairs.

[Harry Potter]

Originally Posted by Tess

Keep it as simple & uncluttered as you possibly can. I'd fiercely oppose the inclusion of any indicators or ancilliary & unecessary distractions if I were you.

So you say I should leave that stoch?
I have to tell you I've always had mixed feelings about indicators.
I never knew how and why they work. The only reasonable explanation to using them is that loads of traders watch them which adds to the self fullfillment.

May I ask what timeframes you trade?
And finally, this might sound a little dumb but do you trade during the summertime? I heard that low liquidity makes trading pretty dangerous at that time.

Thanks for the charts!

[Tess]

Originally Posted by Harry Potter

So you say I should leave that stoch?

May I ask what timeframes you trade?

And finally, this might sound a little dumb but do you trade during the summertime? I heard that low liquidity makes trading pretty dangerous at that time

No, I'm not saying any such thing Harry. If you can utilize the stochastic price aid sensibly & it doesn't unduly influence your main working template, then be my guest.

You certainly don't need that or any other indicator for that matter to trade profitably, but it's a free world out there & folks can plot whatever makes them happy. Just ensure you fully understand the pro's & con's of whatever it is you're observing & more importantly, it's limitations.

I base most of my template work off the 4 hour timeframe. I rarely drop down smaller than a 60 minute reference.

The Daily & Weekly are also observed for range & bar percentages, but 90% of my trading decisions will emanate from the 4 hour.

Sure, we trade thru the summer months. It's not a dumb question Harry, there's no such thing in my book.

The volumes are certainly lower during mid July thru early Sept, but there's still sufficient participation to get involved. Obviously you need to be aware that ranges & channels can become a tad skittish & open to volatile expansion here & there, but the pairs are still tradeable.

If at any time you're unsure of what's occuring out there, or uncertain of the directional flow on a particular pair, then proceed with caution. There's no harm in reducing your position size/exposure until you can get a handle on things again.

[johnnykanoo]

Hi everybody, I have a question. Ive been working on my own template and I have changed my focus to price action and chart patterns. I still use stochs as per the ib/ob system of James. My question is about average daily range. While Im trading I read and reread this thread and the 40-100 for a glimpse into the mind of in my opinion the best traders and teachers (Tess, Jocelyn, Tony, Jimmymac). Ive come across a piece where you guys talk about average true range of a pair. I would like to incorporate this into my arsenal but frankly im not sure how to. First how do I find the average range of a pair, Second can you help me to define what that means. Is it the total of the up and down movement or is it the total of the deviation between high and low for a given day, I think this would be usefull in particular to see if a move is fizzling out. Since I am still trying to define my stratagy I welcome any input or suggestions, and finally I wanted to thank everybody again who participates and offers advice and insight, because of you I have grown and my perspective has changed. Because I am new to trading I havent developed any really bad habits other than my nervous finger on the button to close my position but Im working on it.
thanks, john