Hi all
i have a question for TMB and all who trade harmonics
do you pay attention to other crosses when you are in a middle of a trade,and how you deal with it…
for example you trade usd/chf,do you pay attention if lets say eur/usd or eur/chf are in corelation with your trade…
do you take any caution if your long usd/chf trade goes with your direction smoothly,but eur/usd is going towards dolar weakness…or its about to hit major support/resistance lvl…
i am trying to find any conection,but at the end theese are different crosses,…on the other hand most of the trading volume passes through eur/usd and i think it has impact on the croses even on other majors…
:eek:
coment please:confused:
Hey guys,
I just posted a long ass intro about myself and deleted the whole thing by accident when I was previewing the post so just bare with me.
I used to trade these patterns last October with TMB and WRTM, and a cpl of other traders, my name before was Monster Trader, but it might have been changed to JasonAFX after I requested the change from babypips.
Long story short this was around the time when we were experimenting with pivot points lining up with convergences, and that crazy trade where TMB made like 11g’s off a hedged trade. We were actually trading in a group on skype every night, where some ppl were in charge of certain pairs and we’d share analysis and what not.
Anyways the group eventually drifted apart for whatever reasons, and my path led me to take a course with a CMT and then I got into Elliott Wave. Elliott Wave and Fibs are currently my weapons of choice, however, these patterns can potentially be invaluable when trying to pin point the best entries for my style of trading (if anyone cares, or has a grasp of Elliott wave, I’d be more than happy to explain in greater detail) both for swing trades or intraday set ups.
So although I won’t be trading them exactly as set out in the thread, I’d still love to engage in regular conversation regarding any emerging patterns or to offer feedback should anyone ask for it.
On an end note, I’ve attached 2 patterns in which the harmonic patterns lined up with Wave 2 and Wave B entry points for the aussie and aussie yen pairs, as well as a Wave 4 entry point on the Cable. Those types of set ups are what I’d like to start paying attention to, and how I’d like to incorporate those patterns into my trading plan.
All the best!
Jason
Hi CashDemon,
Sounds like you’re referring to currency strength/weakness - pairing a strong pair vs a weak pair. This is the ultimate for trendfollowing, particularly longer term.
You can do this manually by looking at each of pairs respective crosses, or there’s also “currency meters” which do it as well… but you gotta be careful how they measure it.
Then you can get into things like intermarket analysis which is more advanced and another can of worms…
Ashraf Laidi has a great book on this if you’re interested.
Whatever you choose, stick to it and be consistent.
Happy researching 
Welcome back Jason,
It’s nice to see someone who’s adapted and combined harmonics with EW into their trade plan, interesting. I know a trader who also trades using both.
I haven’t looked in depth into EW and it seems too subjective on initial observations to this newbie.
Nevertheless, I look forward to your perspectives.
Good trading.
Good spotting there Casho… i also saw and traded the AUS/USD but i take my trades all the way to just after the 50% retracement so i get a better risk/reward ratio. I wish i saw the EUR/USD b4 
i’m only now realizing that the once a pattern is recognized, if the price action doesn’t turn right on the Fib level or just after it, it fails… what kind of risk reward ratio to you use Cash?
Stuart
Trinidad
hi Stuard…you are right about the price action around the fib convergence lvl.
i have tried different strategies once you are in the trade/adding more positions, hedging and more,but now i think this one works the best:
on 30 m/1h patterns go for 30 pips,on 2h-6 h go for 50-60
i use the same stop rules as written here by TMB,and sometimes i exit at -5-10 pips if entry candle closes negative,and your stop doesn’t get hit
for 2 days im trying to enter long at EUR/CHF on a daily pattern and price keep koming back after 40-50 pips in my direction…got stopped at BE twice so far,and left 100+ pips on the table…
at the end its personal choice and every should fight his greed alone : )
this one gave 30 pips fast,and there was no presure trading it…i prefer this way now…dont care if it goes 200+ pips after i exit…
i think once you are sure you can count on your method,and you can control yourself/most important/,you can increase lot size,and there you go…you will make money faster,with 30 pips a day and less time being in the market
By radofx at 2010-12-17
hey cash, you know whats funny i placed a buy order on the eur/chf pair as well, it stopped me out once already, i could have taken the 100 pip profit but my goal was set to .382 retracement lvl, now i’m back in the trade for long, roughly 400 pip tp and 100 pip sl, i just don’t see the pair moving down any lower, so i’m in it for the long ride 100 pip sl i think will be sufficient enough plus gives it plenty room to breath 
i like what you’re saying though, take 30 pips off the 30/60 min timeframes and 50/60 pips off the 4 hour, i just don’t have the 2-6 hr timeframe, i use alpari us, they don’t let me pick a 2 hr timeframe and such, about the daily, have you figured out how many pips would be good to take and leave the rest on the table?? just want to get an opinion on it, i personally draw fibs from C to D leg and close my order partially on the .382, and then once it hits .50 i close out the trade completely, i’ve been looking at many previous patterns, it seems to work well if your tp is set to those lvls, hope to hear your opinion soon
is it soon enough hehe:D
hi man…400 pips tp is ok 100 pips sl…wow
why would you like to watch market go 100 pips against you
im sure you will make same money/not pips/ faster on smaller patterns with larger lot size on the same pair with less risk and nerves…what if price reaches 390 pips and turn down again…and what if it takes 2 weeks to get there : )
i made 110 pips on 3 patterns for 24 hours easy
ask yourself is your greed kicking when you place theese orders : )
at the end its all about personality and trading style
your take profit strategy at CD leg fibs is great,i use it too,or 236,382 AD/more agressive/
the fact that you dont see the price going lower,it does’t mean that it wont 
there is a perfect convergence lvl 280 pips lower
its forex!
here is something a friend told me long time ago/out of the contest/
–Dont trust something that bleeds for 3 days and does’t die!-- /he ment women:D/
no offence to the ladies
cheers
hmmmm… Personally I don’t use or like the 30 pip exit TMB uses but i can understand the logic.
My method is not nearly as simple. Since each currency pair has vastly differing pip movements as well as the fact that each pattern produces different pip targets based on each time frame and price action swing movement that create the pattern(a 20 pip AB legs vs a 50pip AB leg) , i choose to always exit just after the 50% retracement, since, in theory, these patterns are 70% successful. Again, since my pip targets vary drastically due to my limit being based on the 50% retracement, i perform a lot size calculation b4 each trade i.e. my risk/reward ratio is always 1:2, so if my target is 100 pips my risk is therefore 50 pips and my account size is $1000 and i won’t risk more than 5% blah blah blah blah, but everything is based on the varying target, 5% risk 10% reward.
Now whats interesting to me now is that since if the price action turns immediately at the fib level then there’s no need for me to risk 50 pips when i’m looking to gain 100. i could probably just risk 25 pips or less becuz we agree if doesn’t turn right away, its likely not to turn at all thus giving me a 1:4 risk ratio or better… thats why i asked what risk/reward ratio your use Cash.
You follow me?
yes i got it!
just clarify that:
you exit just after the 50% retracement of?? AD or XA or CD
and if you dont mind can you share more details of your strategy …thanks
Thx for the welcome :). I’ve had my eye on this guy alllll week, I was actually long this pair, got stopped out on the sunday open, and 3-4 hrs later it rocketed upto my take profit, lol after two yrs of trading, I can honestly say that just NOW I’m starting to not let it get under my skin.
Anyways here is the first completed pattern that would have been the long trade, and the second just completed. I actually entered a small position, with a stop above the high around 8560. If I get stoped out I’ll keep an eye out for the next 2 convergence points. I’ll swing trade something like this for 150-250 pips bc of the E.W. set up, so my trades are a bit different then the majority of traders on this thrad.
anyways feedback appreciated!
Hey guys, just a little word of advice from trading these things b4, and now incorporating them into a trend trading methodology…
Although these patterns work great for turn around points, the best way to use them is to take them in the direction of the larger trend, now if your goal is 30-50pips, then a counter trend trade may be do-able, but a lot riskier imo. I could tell you from personal experience of trading these guys on 4 hr charts in the opposite direction of the larger trend is a death wish bc they will just stop working, and you will take loss after loss.
I’ve learned the hard way, and from now on will only trade these things in the direction of the larger trend
Eur/Chf is a sweet pair lately and I’ve been in and out of that thing a few times shorting it of course over the past few weeks. Do I think it needs a breather? yes, absolutely, but do i Think that it can not go any lower? Absoluetly not, its in a huge down trand and has not showed signs of bottoming out yet, so until I start seeing evidence via elliott wave analysis I wouldn’t long that thing with a 10 foot pole. You got to remember, these are currencies we’re trading over here, they can trend better than most financial instruments, eg: I NEVER thought the usd/chf could go under 1.00 a few months ago…clearly I was wrong - just saying
happy hunting
50% of the AD always. The true nature of the Gartley and Butterfly are the ABCD which just happens to hit another larger Fib making them even more likely to complete. I understand that its supposed to have a 70% chance of hitting the .618 retracement therefore i take my exit before that which is just after 50% level.
Well my strategy is this:
My pattern recognition is strictly Gartley and Butterfly thanks to TMB. I use a 1:2 risk/reward ratio ALWAYS and I ALWAYS risk 5%. This means i’m always trying to gain 10% from every trade while risking 5%. So before i even start plotting a pattern i know whats at stake. i.e. my account is $1000 so i’m risking $50 to gain $100. On top of that i ALWAYS exit just after the 50% retracement.
My strategy only has those 3 constants:
- 1:2 risk/reward (which i’m just beginning to realize could be 1:4 instead)
- 5%:10% for each trade
- exit after the 50% mark.
Everything else is therefore subsequently calculated based on those 3 rules.
So here’s the example:
If after plotting my pattern on my chart i see a clean gartley 222 and i see that a little more than a 50% retracement equals 120pips i begin my calculations.
- my account is $2400 so: risk=$120(5%) reward=$240(10%), a 1:2 risk/reward.
- my target is 120pips so i need to make $240 out of those same 120pips = $2 per pip which is equal to 20k lot size. My risk is 60 pips obviously.
- i place my advanced entry order for 20k, 60pip risk, 120pip reward using the exact convergence of the fib levels.
This strategy gets complicated for multiple open trades so i create an excel spreadsheet to calculate account sizes after losses to then calculate the dollar value for the risk/reward ratio etc. Making calculations for uneven acc balances i.e. $3672, got annoying so excel does it for me.
You still haven’t told me what risk/reward ratio YOU use!
JasonAFX,
I have a question, so what time frames have you been looking at with EURCHF for trading with it going down so much? Thanks in advance
daily, 240min, and 60min for set ups, and then even 30-15min for entries depending on the timeframe of the trade. I look at them all to get an onverall feel of the main trand.
hi Stuart
my max risk is 2% account size and i adjust it every time account doubles/1 time so far/…i need few more months of confidence and i will adjust it to 5% acc size
nice one for the strategy…how long you have been trading this method??
1.0188-Is the area where there might be a D trading point.Pattern X starting at 1.0288.
Well Cash i’m very new to this all. I’ve been trading this test setup for a couple months using demo this with outstanding results. I recently changed the risk/reward to 10%/20% on the demo account and almost doubled the account in 2 weeks. I was so impressed with those results i took it to my live account. I’m trading 10% risk on EVERY trade now live. i’ve been trading live for a month now starting at $200. I have a funny story though 
So i bought that book trade what you see, read it through in 2 days and thought i had it covered. Decided to give it a shot for a month of disciplined DEMO trading using my well calculated strategy only using 5% risk per trade. At the end of the month i made 70% on the Demo acc so i was pleased and ready to go live. Opened my $200 live acc with these dreams of great fortune, new cars etc etc. My first 7 trades were 6 straight losses and 1 win :’( but i only lost 25% of the acc so i was down to $155. Beaten and bruised i read the book again… turns out i was plotting the ABCD pattern all wrong thereby creating a host of invalid pattern extensions… i was just lucky with the demo b4.
I created a new demo account with my revision charting skills and it was like clockwork. Previously my trades would turn welllllllll after the plotted entry point so i thought i needed ample risk but with the correct method of convergence, the price action turns IMMEDIATELY at the fibs this is why i ask whats ur risk/reward ratio. mine was 1:2 but i’m now thinking it could be 1:4.
With the correct pattern recognition yes i find less patterns but they have a higher success ratio. i started trading Live again just Tuesday this week and i’m up 25% with 2 closed trades(1 loss, 1 win) and 2 open as we speak. 10%/20% risk/reward. I have no fear trading such high calculated risk because:
- it’s only US$200 at stake
- with the proper calculations and belief in the probabilities, i can easily withstand 10 straight losses and bounce back with less wins.
If you have multiple trades open like me, for each new trade you have to imagine all the open trades will lose the calculate what the account size with be after and do ur percentages based on that… Excel helps.
And you still haven’t stated your risk/reward ratio… for any given trade you risk how much to gain how much?
i know 100 pips is a huge sl, but i only risking 1% of account balance on it, risk reward looks fair, 1:4, 2 weeks is deff possible, so i’m taking your advice, i just exited my position with some profit, i honestly am tired of seeing those candles making a LL lvls lol
i have a question for you, would you be able to show me how you find your Ds, i find mine somewhat ok, but it just doesn’t feel very accurate… btw i’ve watched TMB’s youtube videos several times, the only thing is sometimes it turns around at 886 not 100
lmao your friend’s advice makes sense about the market, because this is the 3rd day that it doesnt do anything, yea well i’m still keeping my eye on it to see which direction it can make a move