I am doing this with 3% risk per trade and I think I am overdoing things … 5% is way too much imho …
I agree cvds. As my account grows larger in size, I will reduce my position sizes to 3%. If I have doubled my initial investment ($130) by 6 months (mid-August) then I think there is something to the Price Action strategy. I’m almost there. I’ve been trying my hardest to only trade PA and to stick with a list of rules. So far so good. I was thinking of starting a Twitter feed or something just posting positions taken, lot sizes, SL and TP targets, etc. I might as well post them and stand behind them - pass or fail.
Are you trading PA as well? It’d be nice to hear what your experiences are from trading PA.
yes, I am trading PA off daily and 12H charts since about a month, good results so far, but a bit early to tell. I used to do intraday trading and this seems to be way more my thing. I got much less stress now.
But starting this weekend I am going to risk only 2.5% a trade anymore … been reading up some on things like risk of ruin / drawdowns and I probably should go down some more. Seems going below 2% seems to be the sensible thing to do if you don’t want to risk a drawdown of more than 20% of your capital at one point.
I added a long silver and short USDCAD to my positions since today …
be caurefull with counter-trends
In the first 50 pages of this thread, there are some examples where the scenario you mentioned happens. I guess it has to depend on what are the PA story that you read, if you do feel that the few candles before the trigger entry is too strong, then it may be better for you to stay off. But if you feel that the trigger entry (PB or EB) is much bigger than the previous candles, and you are comfortable with the RR, you may wanna follow your plan and take the trade. Another thing to note is whether it is trending or ranging, as signals are usually higher in probability when in a trending market.
Another thing to note is whether it is trending or ranging, as signals are usually higher in probability when in a trending market.
Thanks for that. I always will have that in mind. 
[QUOTE=“Jebroni;712268”]Hey guys, I am new to FX trading and would like to post a quick question. Since reading this thread, I understand that we should look to take trades only when, 1) Price are at swing point 2) Key Resistance/Support Level (Long at Support and Short and Resistance) 3) There is a price action signal (PinBar and Engulfing bars) My question is that, if the retracement is led by series of strong bullish/bearish bar, is it still safe to enter the trade base on the three criteria? Will the pinbar be strong enough to reverse the direction of the retracement?? Thank you guys![/QUOTE]
Wow your 4 points pretty much sums up my trading criteria eheh!
To answer your question, the market may show all the things you need to see to make the decision to enter the trade.
But ultimately it’s up to you to pull the trigger.
Price action moves swiftly and it moves slowly but if price moves up in an uptrend and retraces to a previous resistance level to test as support, then it gives basis for a buy.
But a violent move to the said horizontal level may make you think it may move against you.
If that’s the case the best way is to reduce lot size and enter the trade.
That way if you lose on it you lose much less and you feel comfortable enough to be in the trade and you can always enter a second position if the trade goes in your favor right?
Personally I’d rather wait for an engulfing even after a pinbar has been made and enter at the next retrace.
An engulfing after a pinbar pretty much shows the market’s hand to you and it gives reason enough with 2 candlesticks showing trend direction.
A bullish pinbar say on the daily chart shows a swift move down and then back up again on a h1 chart?
And a bullish engulfing on the daily chart shows an ending downtrend on the h1 with the most recent Lower High broken and trend changing to an uptrend.
Entering on a retrace on a lower timeframe based on a higher timeframe signal is something I use to confirm and justify my entering a position.
Hope it helps.
Hello everyone. I used to post on this thread a few months ago, but then I wandered off and continued building on Johnathon’s approach by adding new techniques etc. to make this price action strategy as profitable as possible. Basically, I turned to the 4 hr, 6 hr, 8 hr, 12 hr and daily charts, and figured: is there a way for me to locate support & resistance zones with great accuracy, and know that if there’s a price action signal at the level, there’s a high probability of the trade working out if a number of criteria are met?
There is a way. It makes this price action strategy much more effective and profitable. It DOES use indicators, and I’m aware that this thread dislikes indicators. But hear me out and judge for yourselves afterwards! Let’s get to it:
By adding weekly & monthly pivot points, I can determine levels at which price might produce these high probability reversal/continuation signals. On Sunday evening I normally go to a daily/4 hr chart of any currency pair, and I add my weekly and monthly pivot points. With the help of these pivot points, I can locate levels of S&R that have had lots of bounces in the past and are likely to produce reversal signals in the future. Here’s a chart that illustrates what I mean:
As you can see, we saw a nice morning star pattern off a key horizontal level, with a great point of confluence: the S1 pivot. On-top of that, we can add fibonacci retracement levels etc. to determine the validity and to gain even MORE confluence for that particular level. We can add moving averages to see if price action is REJECTING an MA of importance, such as the 100 or 200 SMA’s. If, at one horizontal level, price has had 1) previous bounces, 2) there’s a fibonacci retracement (I only look at 38.2%, 50% and 61.8% retracements), 3) Price action is rejecting a moving average (either the 20, 50, 100 or 200 SMA’s), 4) There’s a pivot point at that level, 5) We have stochastic/RSI divergence at the level, 6) We have the trend on our side and finally, but most importantly 7) We have a good 4hr, 6hr, 8hr, 12hr or daily chart price action signal supporting a long position.
Those are my rules for entering a trade long or short. My charts look as clean as Johnathon’s do, I just look at my charts on the weekends and make sure there’s enough confluence (in terms of there being fib retracements, pivot points etc) at certain key horizontal levels, and when the trading week starts I wait for price action to reach the levels and fire off some good price action. Once I see the price action, I throw on my moving averages to see if price is rejecting them, and if price is rejecting for instance the 100 SMA, I’ll enter in the direction the trade setup dictates.
Confluence is KEY to profitable trading. I’ve been trading for about a year now, and I’ve been losing money - slowly but consistently up until this point. I’m growing out of being a net losing trader by just looking for several points of confluence to confirm my thesis on where a market is headed before I enter. It’s a simple recipe for success!
I am with you on this one and I added gold!
Isn’t it best to short Gold now. ?
Looking at AUDUSD today.
Price made a double bottom and pushed up and broke the most recent active high, has retraced back to resistance to test as support and has made a Bullish Engulfing candle on the h1 timeframe.
closed both trades at breakeven … but I am long gold now …
Hi Buster, I have started to follow this thread a couple of weeks ago and went over all the PA links on the first page. As I am considering to buy Jonathon’s course I went to look on his profile and found out that he is not active in here any longer and besides that, I found that some members were stating that this PA method and course that Jonathon teaches is a total rip off and that not even Jonathon is profitable, I also noticed that this guy Jadd806 was banned after he said that he bought the course and got very disappointed.
As you are the only active member that was present on during that time, I would like to ask you
- What do you think about the course and PA method that he teaches ?
- As you have been active here for so long I imagine you have tried this method yourself, have you been successful ?
- Do you know what happened to the old members, did they become successful and left or they got tired of losing money?
- This was a place where a lot of set ups were discussed, were you able to profit from them?
- Finally I have seen that you said that you are not a great supporter of Jonathon’s methods but still think that this thread can lead to great opportunities? I do not understand how is this possible?
I am really sorry if I am questioning too much, I am doing it because I really like the theory behind this method but I have also seen a couple people in this forum that disagree with Jonathon’s teachings and even his integrity so I am very confused.
If someone like you that has been here for such a long time could help me out it would be great.
I am also sorry for my english it is not my mother language, greetings from Colombia
I think the best thing you can do is go back through this thread and demo trade based on the methodology. You can get a lot of good information from this thread and learn the theory just by reading through the first page walkthrough. I have not bought the membership but I do put a lot of the practices laid out here into action in my own trading. I have had some success and some failures and have shaped it into my own trading plan. The best thing you can do is not listen to others telling you he is a scammer or even that he is great. Do some work in a demo account and learn about the methods first hand. If you like then maybe you could consider reaching out to learn more about the membership option.
I agree 100% with Potato. I read most of this thread (focusing more on the first 30-40 pages as those have the examples to reference). I do find this method to be simple and effective. First of all, your charts are really clean using only horizontal S and R lines (without other indicators). After a couple of months of watching and playing with a demo account, I noticed that I had a lot of trades that went the way I thought they would…and the losers were only pretty small since I was only putting trades at or near support and resistance. That makes the risk to reward much more in your favor. Like Potato said, there are main pieces that Johnathon talked about that can be used in your trading. I was having success in my demo account so I thought I’d start with a small amount in a live account. Though it is a laughable amount at this point, I have managed to turn $130 into $250 in just a 4 months. The theory is that if I can consistently make 3-5% or more a week then there is something to this method. Once I am over $260 (hopefully this week) then I will have doubled my account. I will start to slowly feed the account weekly after that so that my $3-4 winners will be larger and larger.
Of Johnathon’s examples, I focused on a handful of setups off the bat. As the account grows I will most likely go back and look at other setups that he described and add them to my trading strategy. Right now I only really look at pinbars, engulfing candles, spinning tops, and double inside bars. I am also playing a couple of pennants right now on EUR/USD and EUR/JPY (daily charts). Another suggestion, only trade the major pairs at first - EUR/USD, EUR/JPY, GBP/USD, GBP/JPY, USD/JPY, USD/CAD).
Read through, take notes and fully understand some of the setups Johnathon talks about in the thread. Open up a test account. Pick 4 or 5 setups that you fully understand and are comfortable with and only trade them, nothing else. It will take some willpower to keep from straying but stick to it (I think that is the hardest thing to learn when trading Forex - making a plan and sticking to it). If you don’t see a set up right away, move to the next pair. Also remember, lot/position size is key.
knotthead
[QUOTE=“knotthead;715673”]I agree 100% with Potato. I read most of this thread (focusing more on the first 30-40 pages as those have the examples to reference). I do find this method to be simple and effective. First of all, your charts are really clean using only horizontal S and R lines (without other indicators). After a couple of months of watching and playing with a demo account, I noticed that I had a lot of trades that went the way I thought they would…and the losers were only pretty small since I was only putting trades at or near support and resistance. That makes the risk to reward much more in your favor. Like Potato said, there are main pieces that Johnathon talked about that can be used in your trading. I was having success in my demo account so I thought I’d start with a small amount in a live account. Though it is a laughable amount at this point, I have managed to turn $130 into $250 in just a 4 months. The theory is that if I can consistently make 3-5% or more a week then there is something to this method. Once I am over $260 (hopefully this week) then I will have doubled my account. I will start to slowly feed the account weekly after that so that my $3-4 winners will be larger and larger. Of Johnathon’s examples, I focused on a handful of setups off the bat. As the account grows I will most likely go back and look at other setups that he described and add them to my trading strategy. Right now I only really look at pinbars, engulfing candles, spinning tops, and double inside bars. I am also playing a couple of pennants right now on EUR/USD and EUR/JPY (daily charts). Another suggestion, only trade the major pairs at first - EUR/USD, EUR/JPY, GBP/USD, GBP/JPY, USD/JPY, USD/CAD). Read through, take notes and fully understand some of the setups Johnathon talks about in the thread. Open up a test account. Pick 4 or 5 setups that you fully understand and are comfortable with and only trade them, nothing else. It will take some willpower to keep from straying but stick to it (I think that is the hardest thing to learn when trading Forex - making a plan and sticking to it). If you don’t see a set up right away, move to the next pair. Also remember, lot/position size is key. knotthead[/QUOTE]
Wow!
In all honesty I think your post is what everyone needs to see.
It’s short and to the point and I agree with you a 100%!
Great stuff.
Knotthead,
Can I ask what broker you are using and more generally are people using this method to spreadbet or trade directly?
Regards
Peter
I am in the US and I use Oanda. Love it or hate it, I have grown to like their charting software. I set it to New York Open/Close and use weekly and daily timeframes. I mark major support and resistance lines in White and then move to the daily charts and mark those lines in yellow. Then I use daily charts to trade (noting the major weekly lines as well as Big Round Numbers (BRN - a term Johnathon talked about in this thread). I can post up some screenshots if anyone is interested. Weekly and daily charts are better for me for a number of reasons. 1) I don’t have to watch it every minute when I have positions open. 2) The TPs are usually much greater. 3) Trends, support, and resistance is easier to see. It almost feels like I am scalping but on a larger timeframe. I trade directly, no spreadbets. I had three winners yesterday of roughly 80 pips each. I’ll look at my trade history to see exactly. My TPs were set much higher, but making $8-9 on a $250 (well now $260) account seems small…but it’s 3.5% in a 24 hour period!! So I cashed it out and moved on. Not sticking to a trade plan is one sure fire way of blowing up and account, but greed is the other. Take the profit and move on to the next chart. It’s not profit unless you take it 
The EUR/USD and EUR/JPY pennant plays were great yesterday. I had a limit buy 20 pips above the pennant and a limit sell 20 pips below the pennant. I thought there may be a false break on the upside but it ended up panning out last night. I woke up this morning to a nice gain Right now I don’t have any positions open after cashing out this morning. I could hop back on the EUR run to the north but the TP is much closer now and the SL is much greater. So, I’ll sit on the sidelines and wait for the next set up(s).
~knotthead
Yaniu.
Thanks for the comments! I don’t claim to have all of the answers…and maybe my sample size isn’t really large enough yet, but keeping it simple and sticking to a strategy (which is VERY hard to do) seems to be paying off so far. I have tried numerous strategies using numerous indicators and nothing has come even remotely close to this trading strategy. The overall market was trending at the time but in my demo account I had a string of 18 straight wins. That is when I decided to put a small amount of real money into it. Logistically, price action makes sense. It’s like analyzing human nature. So far so good!
GLTA!