All You Need To Trade Is A Horizontal Line

[daedalus]

I see potential in this when its moving like in the above example. But what about the 80% of the time where its consolidating to or from the big moves?

I can make money on the chart posted above. Its the past two days prior to that move that I think I would get hammered in. Any suggestions?

[kagein]

i like this guy's method seems simple enough, what i would do is wait for a break of a strong level then trade a continuation Inside bar. This way i stay out when the markets are choppy.

[TheRumpledOne]

One of the things you want in trading is an "edge".

You are NOT going to win every trade.

So you want something that gives you a edge.

Casinos have edge in the range of 0.55 - 2%. That's all they need.

My statistics show this edge is much higher.

Choppy days? I love choppy days. So long as the average hourly range is over 25, that's all the edge I need. THINK ABOUT IT!!

[TheRumpledOne]

You can look for situations where this doesn't work...

-OR-

You can wait for the setup and walk away with a handful of pips.

IT'S ALL UP TO YOU!

[4xStar]

I don't understand the answer to the doji question below. If a candle is a doji, it is neither red nor green .. so do you ignore and wait for the next candle to close, or do you treat it as "could be either" so whichever color the next candle is, you go either long or short?

And on the big run up of the G-Y, you would have gone long after that last red candle at the bottom around 2 am ... and looks like that would have been a long at 203 .. but then where do you get out? Next candle topped at 203.05, no real profit yet with the spread, the one after that at 203.31 so I probably would have taken the 30 pips there and at that point there was no way of knowing the run up was about to happen. Then, according to the rules, no new red candles until 5 hours later so you miss a good part of the run.

I can see it could be a good strategy to grab your daily pips, but when these runs come, is there something that would 'override' the 'wait for the next counter color candle' rule? The only other way I could see to play it is always take 2 positions, take profits from first, move second to b/e so it is there in case of a further move.

Anyone have comments?

[TheRumpledOne]

The best trade is waiting for the reversal.

When to get out? If you have profit, get out when you want to. You can always exit part of your position. Move stop up to breakeven and let the rest ride!

Once again, the color of the previous candle makes no difference. YOU TRADE WITH THE CURRENT CANDLE COLOR. It is that simple. Don't make this simple trading method complicated.

Learn to BE THE LEAF: YouTube - The Zen Mind - An Introduction in the trading stream.

Attached is a PDF that is worth reading.

[bflag]

Originally Posted by TheRumpledOne

The best trade is waiting for the reversal.

When to get out? If you have profit, get out when you want to. You can always exit part of your position. Move stop up to breakeven and let the rest ride!

Once again, the color of the previous candle makes no difference. YOU TRADE WITH THE CURRENT CANDLE COLOR. It is that simple. Don't make this simple trading method complicated.

Learn to BE THE LEAF: YouTube - The Zen Mind - An Introduction in the trading stream.

Attached is a PDF that is worth reading.

I think post #6 is what is confusing some people when you say to ignore the previous candle

[Andrewunknown]

Originally Posted by TheRumpledOne

Pick ANY candle on the chart.

1) identify the color.

2) let the candle close

3) if the next candle is NOT the same color then:

if the current candle is GREEN go LONG at the FIRST line it approaches

if the current candle is RED go SHORT at the FIRST line it approaches

True; this does make it sound like a signal is only taken on the current candle if two criteria are met: a) the prior candle was the opposite color, and b) price reaches the next line in the direction corresponding to the color of the current candle.

Some ambiguity comes into play if, for example, as the prior candle you have a negative candle with a shallow body and small wicks (e.g. encompassing 10 pips) opening and close between lines, and now a current negative candle that is crossing the next line down.

Short (yes, if working from current candle only) or remain flat (yes if working from prior and current in tandem)?

[TheRumpledOne]

Once again, waiting for a reversal is the "safe" trade.

You must trade in the moment. The past is over!

All that matters is what price is doing now!!

[TheRumpledOne]

Originally Posted by bflag

I think post #6 is what is confusing some people when you say to ignore the previous candle

What would you do if all you had on your chart was the current candle?

If the current candle is green would you short?

If the current candle is red would you buy?

Does this make it clearer?