Hi kechel,
Yes I did see them & was aware of the driving force behind the latest impulse move but like you, I’m not trading either of them this week.
I’m still in USD/CAD & decided to trade USD/JPY yesterday on that shallow pullback into the European session.
I still go through the daily/weekly identification & filtering routine even if I’m currently trading something else as I find it helps to practice & sharpen my observation skills. Plus of course it’s no hardship as it only takes 5 or 10 minutes to pick out the cleaner spotlight pairs.
I also don’t trade FX exclusively, so am tending to roll my trades over wherever & whenever possible, only really taking the clearer, higher probability opportunities.
To be honest I let more slip through the net than I currently take, but that’s no problem.
From what little I’ve observed so far, the approach presented here appears to highlight & capture its fair share of regular daily & weekly opportunities.
As regards the ADR, I’m focusing more on the weekly ranges than the intraday for obvious reasons, but as you’ve alluded to, I would consider very carefully about entering trades if the usual range had stretched too far beyond it’s normal boundary regardless the reason.
Again, there doesn’t appear to be a lack of decent quality intraday opportunities, so if the odd one or two slips by due to those types of circumstances I doubt very much it will impact too negatively on the longer term outcome.
I’d just like to thank the participants of this thread for their insights and prompting to look for the highest probability setups. I’ve used a 3 ducks style for a while, and whilst reasonably successful I was probably guilty of over trading through a combination of impatience and not seeing the wood for the trees.
Since coming across this thread my trading has slowed right down, and the number of losing trades has dropped significantly.
I’ve followed the advice to identify the main trending candidates - no more than 3 or 4 to watch and in the past few weeks only 1 or 2. If none are trending obviously on the 4h then I’m learning to wait. Then just follow the 1 hour hooks, and preferably in conjunction with the 3D smas. This leads to some fairly safe entries and occasionally I’ll just use the hook if the structure looks very good. Sometimes if the 3D breakout looks good I’ll take that but I need to see some pullback first (something the stoch trigger is very good at identifying). I do however need to look at how I’m takings profits - it’s clear that when a good trend is established I am often leaving a lot of points behind.
Using this approach so far in May I’ve taken 14 trades, with 10 clear winners. At least two of the losers were taken early on and in retrospect should not have been taken.
The other big bonus is that I’ve stopped looking at finding strategies to keep me trading all the time - bouncing off trend lines, s/r range trading etc. Its given me stacks more time which I spend down the gym and so feel healthier as well as much more confident in the trades I do take.
If people are struggling for consistency with this approach, then the one thing I learned which has helped immeasurably is this:
If you can’t identify within 2 seconds whether a 4 hour chart is trending, then it probably isn’t, so move on.
cheers Sketcher,
Me too - like a lot of things with this, repetition does help. I found that even with the pullback trigger, it was a bit counter-intuitive at first, looking for an entry as price moves in the opposite direction to what you want, but you get used to it after a while, especially after a few winning trades off it.
I also don’t trade FX exclusively, so am tending to roll my trades over wherever & whenever possible, only really taking the clearer, higher probability opportunities.
I would like to diversify beyond FX as well at some point. I have a look at the Indices & Metals available on MT4 but they don’t seem to offer any cleaner set-up’s than what’s already there with the fx pairs…
I agree here - trade management is key of course. Takes a bit of thinking about, what is possible for you as much as anything, eg. time available due to a job etc. Nothing’s perfect, but I’m trying 1 Take Profit target that could be hit Intraday, and then the remaining portion left to run & added to if possible… in that way feeding in the rest of a stake as has been mentioned in some of the other threads.
If people are struggling for consistency with this approach, then the one thing I learned which has helped immeasurably is this:
If you can’t identify within 2 seconds whether a 4 hour chart is trending, then it probably isn’t, so move on.
:35: I’d say the same could be said of a 1h chart as well
Coming back to my question, I would like to thank all who replied with their thoughts.
I guess the summary is the bold part above. The fundamental flows will show their hand through [B]the 1st duck, the SMA on the 4hr chart. [/B]
[B][U]Keep things simple.[/U][/B]
Markets have a tendency to test our patience in waiting for the right moves.
When a market enters a sideways period, we are eager to participate in any potential breakout. However, the right action is to sit on our hands and wait.
Similarly, when markets change direction (from down to up and vice versa), inertia pushes us to keep trading in the original direction, despite signals otherwise (change of trend on the higher timeframes - the first duck). We need to wait for confirmation of the new direction and trust that our system is guiding us correctly.
Finally, as it has been evident these past 2 weeks, it pays to wait for the trend to assert itself.
For those who are trading full time, do you close the computer and take the day off when you have no signals? Or stick around and watch the markets?
In some cases yes, but a lot depends on why & where the market is consolidating.
If it’s easing off on the back of an established & sustained momentum push or a strong impulse move & price maintains an orderly structure (in that it doesn’t violate the trending cycle of HL’s/LH’s etc), then you could argue that (some) punters will continue to accumulate bets in anticipation of a follow through breakout rather than risk playing the actual b/o itself or waiting for a pullback off the break.
If the move is a lazy, half-hearted affair & isn’t being influenced or driven by a theme or story & begins consolidating in choppy fashion, then perhaps it would be wise to sit & see what occurs next or avert your focus & attention to something that’s in trend mode.
But if you think about the fact there are at least 8 regional currencies incorporating upwards of 30 odd pairings to gamble on at any one time, there will generally be a story/theme orchestrating momentum on something or other most weeks
What appears sedate & consolidative to one person could well represent keen opportunity to load up more ammunition for another.
See couple paragraphs above.
The decision on how someone participates over a given time period will be based on how passive or aggressive their style is, how many candidates on the watch-list, what type of approach they prefer, how many stories/themes are in play & whether they’re employing more than one strategy or approach to the market.
If your particular game plan is structured to the extent it occasionally renders you side lined due to a lack of quality background or foreground set ups, then so be it.
Everyone will play their game based around differing criteria.
I’ve just recently properly joined this website after enjoying a thoroughly entertaining walk through the 3 Ducks thread. I was particularly impressed with the contributions from some of the posters on here & would like to thank you all for including & explaining the benefits of how the stochastic indicator adds a positive spin to Captain Currency’s fantastic triple timeframe set up.
It took me no more than 30 minutes to set up my charts & sort them into 8 block profiles for easy observation & soon after I was able to begin randomly choosing pairs to scroll back through & test out how the trend waves & pullbacks matched up with signals generated by your hook turns off 20 & 80.
I’ve forward tested in simulation mode & am not finding it too difficult at all to spot the relevant pairs for consideration & filtering so have decided to trial it on my live account starting off on a reduced size until I become more familiar & confident with the application & timing of the set ups.
Thanks again & I look forward to contributing to 3 Ducks & hopefully 16 candles too
I saw your USD/JPY trade comments on the 3 Ducks thread & can empathise with the timing thing. I traded it again yesterday & was stopped out today as it dropped through yesterday’s lows. But I’m with you regards keeping it at the top of the watch list for further bullish momentum opportunities.
Your entry was a valid trade & one which I would have definitely considered had I not already been positioned. Although I’m also quite new to this approach & spot fx in general, they are already indicating to me they’re the types of set ups that yield good returns when executed in line with clear trending background confirmation.
I think you’ll find you have to a minimum number of posts (5 if memory serves me correctly) before the site will permit the addition of links & charts.
You’ll also probably be subject to having your posts being held back for moderation. If your experience is anything like mine expect at least 15 or 16 submissions before getting the all clear.
You mention you’ve already set your charting profiles up, so out of curiosity what do you have on your priority list at the moment, given a few pairings have entered into transition mode this week.
I have transferred 3 cross pairs back onto my priority list as of yesterday & relegated 3 majors.
I’m intrigued to see if a fellow newcomer is seeing similar set up potential.
My crosses only involve 1 european currency in the pairing.
Hi sketcher,
Thanks for your comments. Yeah I liked the entry & set up on that one, but it’ll be one to put in the ‘got away’ column. They’ll be a fair share of those along the way, but i do like the general structure of this method & look forward to some healthy trades going forward.
Thanks for the heads up on the link comment. I did receive a message but don’t recall it mentioning a post count.
I have usd-jpy still on my priority list as it hasn’t yet traded back below the 4 hour higher low of 123.70 & is still well clear of the 60sma on the 4 hour.
usd-cad is still valid on the 4 hour (just), but has invalidated the higher low cycle at 1.2410 so would prefer to see more strength before seriously considering that pair.
Same with aud-usd. It’s ok on the 4 hour 60sma but has invalidated the lower high cycle of 0.7675
Of the cross pairs?
I have eur-nzd, aud-nzd & aud-jpy + eur-jpy & gbp-jpy.
As the Captain has said the market could be extra volatile this week with the mettings & greece still causing nervous jitters, so we’ll just have to see how one or two of these play out.
Yeah, it’s a pretty much straightforward eyeball & filter process. There really isn’t very much that should be out of kilter from one observer to another.
My concern is that during trend transitions on the major, some cross pairs have violent snap-backs which may not be predictable. Case in point, EURGBP has been swinging back and forth for the past 3 weeks, with no clear direction.
Bottom line,
you are absolutely correct.
We are going through this transition phase now, with most majors above the 1hr SMA but below the 4hr SMA or close. The Daily swing is possibly changing direction.
I’m sure the term you were looking for there was [I]higher probability[/I] opportunity as opposed to predictable, because I can assure you nothing is this game is predictable
I would certainly agree there are one or two pairs transitioning based on the decision process for this approach.
But as with most of the guys on this thread currently, I’m in the position of supplying the prices that you bet on rather than executing them. However, if I was betting mine or anyone else’s money this morning I would be taking the advice issued on this thread & discarding those candidates that weren’t exhibiting the types of background/foreground criteria in favor of those that are.
And if there weren’t any higher probability candidates exhibiting that criteria & I was only restricting myself to betting on currencies, then like you, I would be sitting tight.
If there are no targets to aim at then the best policy is usually to hang fire until a clear target comes into view based on how & why you choose it.
I bet that’s an interesting angle (no pun intended) lol.
Who do you make prices for AltTab if you don’t mind me asking & are you guys involved in retail brokerage?
I made an oops already this week. - - I’ll be patiently trying to recoup - hopefully by the end of the month. (note to self - don’t EVER do that again).
I’m not sure if this question can be answered beyond ‘Practice it & see what fits with your risk appetite’, like a lot of questions, but I’m really just looking for an idea of the options out there that people are using (if they’re prepared to say of course).
It’s regarding the actual specific pullback entry. You read a lot about ‘Enter on a pullback’, but as far as I can see there is actually very little on the specific point of entry itself. I’m fairly new to this type of entry - I’ve looked around but there seems to be very little out there…
I’ll show a couple of entries I made this morning, and just ask for any comments really.
On the Eurnzd, my first entry was on seeing a little group of doji-like candles forming round about a level that seemd to form in the Asian session. I’d consider this quite an aggressive entry as although there seemed to me confirmation that buyers were entering the market, there was no confirmation yet that they were winning.
I’m still looking back through pairs to see what seems to work, & forward testing, but I just wanted to get a feel for how people enter on a pullback in general, without anybody having to give away specifics if they don’t want – do you generally wait for a bit of confirmation or enter on signs of defence of a level?
EDIT: I should say - I hope Volan you don’t mind me using your template layout? I just find it keeps me on the right track.
It set up another opportunity along similar lines again this morning guys.
In fact almost like clockwork the price spiked up at the start of European trade presenting a 5 min & a 1 hour stochastic lower 20 hook.
eur-cad mirrored the same behaviour too.
Did you trade it again out of the traps this morning sketcher or kechel?
Or would you have been erring on the side of caution ahead of the major employment data out of the U.S?
Because it set up so early & had virtually all of the average range to go at I traded it up off that double hook & was quite surprised it covered over 70% of the range before stalling ahead of the payrolls data.
I’m sure they all won’t offer such good risk at entry, but i just couldn’t look this morning’s gift horse in the mouth.
Thanks for all your interesting & well presented posts guys, it makes putting the advice into practice all the more easier
Hi wyntac, personally I didn’t take any trades this morning. I’d decided yesterday that after a busy week & finishing with a couple of decent trades yesterday, I was just going to sit & watch. From what I’ve read, Friday does seem to be a day of book-squaring as well, add in the NFP of course & I just thought, I’ll stick to the sidelines today. But each to their own, & you picked up a couple of good wins there…
I’m sure they all won’t offer such good risk at entry, but i just couldn’t look this morning’s gift horse in the mouth.
I’d say they do all offer up pretty good risk at entry, well the one’s we should be taking anyway. If they don’t, I think it comes to our discipline not to take them - like the 2 Euro trades you mentioned this morning (Eurnzd & Eurcad), by the time I got to my charts (about 7.45am UK time, I treated myself to a lie-in), they’d already both moved over 50 pips from where I would’ve been putting my Stoploss & so I wouldn’t have entered anyway & would’ve just had to accept I’d missed those ones. It’s becoming clearer that these moves do show up regularly enough for us so that we can look to only trade the good & clear ones.
Unfortunately I was out of the loop completely yesterday wyntac travelling to & attending a wedding, but EUR/NZD did indeed oblige again with plenty of attractive potential.
It’s very much a judgement call ahead of any game changing data, but you had plenty of time ahead of the payrolls, so providing the set up ticked all your boxes & ensured you could safely extricate yourself from the trade before it was released into the market, then why not trade it. You’re only going to know if it’s worth the risk by experiencing these scenarios yourself.
As kechel points out, this approach supplies a decent selection of set ups most weeks across the board so it’s rare we’ll have to wait too long before another materialises with 30 odd pairs go at.
If you guys don’t mind, I’d like to put up a few charts in the next day or so just showing where & why I’m looking at certain pairs, and any input or comment is always appreciated, good or bad.
For the beginning of the week, some of the GBP pairs look to be showing good signs (HH/HL - Gbpusd & Gbpnzd, LL/LH - Eurgbp).
(The red line is the 4h 60sma transferred over to show price is on the right side & I’m looking to trade in the right direction.)
There’s a couple of GBP data dumps on Tues & Wed to be aware of, the FOMC on Wed & the Euro can be volatile with any announcement, so early in the week I won’t look to hold any trades beyond intraday.
I’ve marked off very similar areas on 2 or 3 New Zealand Dollar pairs over the weekend for consideration into next week too kechel.
I have nzd-usd as a short on a breakout or pullback into the lower hourly high at .7030
nzd-jpy as a short on a breakout or pullback into the lower hourly high at 86.80
gbp-nzd as a long on a breakout or pullback into the higher hourly high at 2.2165
& eur-nzd as a long on a breakout or pullback into the higher hourly low at 1.5970
All those are also coincidently either previous session highs or lows.
