In that case the “safe” first TP is the level it retraced from ? (sorry for all these questions )
The lower wick does not appear to be completely engulfed on my charts. I suspect H.M Murdock had a hand in this, damn fool!
you are right 2 pips higher I didn’t notice it
Not at all, and yes first tp is prev. relevant swing.
Thanks Kasravi
Very interesting that 1 pip below can also be classed as an engulfing bar. This is not a trade for B.A! I Keep getting sent back to GO (Page 1 - 200) but it seems some things have changed since then which makes what first appears to be a straight forward strategy a little more complicated when arriving back in the present.
In the EUR GBP case it is in the .836 range ? that is less than 20 pips away making the trade R/R less than one am I right ?
No it is simple. Only obvious engulfing bars from obvious levels are tradable.
Leave all those setups that are not in tune with those you saw from Johnathon’s page.
There is nothing to get confused about,it is a straight cut strategy.
Cheers
Thanks EternalNewB, glad I managed to get one thing right, perhaps there is still hope for me yet. I hate those damn fool snicker bars!!
You’re quite right,first tp would leave you probably with a Risk ratio less than 1.
I’m looking @ the D1 chart because that is where I’m now focusing my trades from. If there were an opportunity at a lower TF that I deemed a very high probability setup, I would have to reconsider my strategy. But, I like to set pending orders with about a 8-10 pip buffer from the high/low of the signal candle (entry would be around dotted line).
I think there may be a good chance that price can swing back down to .8358 but the signal just isn’t strong enough for me.
If the candle closed as this:
Instead of this:
I’d feel much more confident going short.
Cheers Kasravi, that’s what I thought, since going back again to the glorious summer of 2012, I am now only looking for A+ poke you in the eye type trades. I think I am on the right path!
and that doesn’t invalidate the trade from a MM perspective ?
Thanks for putting in all the effort to demonstrate your view.
Is that part of your trading plan? That you don’t trade pins with wicks?
cheers.
[QUOTE=“Kasravi;534970”]
Thanks for putting in all the effort to demonstrate your view.
Is that part of your trading plan? That you don’t trade pins with wicks?
cheers.[/QUOTE]
I have a general schema that I have laid out but I think you need to be a bit fluid and organic, b.c that’s how the market is. You can’t be 100% rigid in your ways or I feel you’ll never be able to pull the trigger. It’s not so much that I don’t trade pins with wicks, it’s just the context in which the pin formed in relation to recent price action that dictates a setup for me. That level is obviously very strong, seeing how deep price tried to go and then was able to reverse back up and close above. Again, I just don’t think it’s that strong of a signal for me to risk money.
What’s MM?
Break of pin comes at 0.8386
top of pin 0.8410
swing low 0.8355
calculating in your spread and a few pips buffer @ entrance leaves you with
roughly 25/30 R/R.
quite sharpish
Cheers.
Thank you for your patience MM = money management
Fair enough, I’m done for tonight.
Just one thing before I go, feelings are inconsistent. Making trade decisions based on an inconsistent fundament makes being consistent difficult, isn’t it?
Something to think about.
Cheers.
Hey man, I get what you are saying, but I’ve also heard many successful traders say that trading is more of an art than a science. Regardless, none of that matters because what you and I see as S/R, 100,000 other individuals may see different areas. We plot near the BRN of 84, but, some can plot using wicks only:
There may be some objective aspects about trading, but I’d argue the majority are vastly subjective. What you see and feel is going to differ from what I see and feel. Obviously this goes without saying…
Usually when we see a A+ setup, we do not care much about MM unless there really isnt much space for the price to go towards FTA(First Trouble Area). Thats my view on the latest setup you guys are discussing.
If you have learnt MM is important, it sure is. However, you have to unload most part of the MM ideas here(i had a difficult time doing that n for a while i doubt this method), but after few months of trading PA, i realised what Johnathon saying is VERY true, not to mention that his method has such a high winning probability that i did not lose a single trade yet even sometimes my MM is only 0.3 ~ 0.5 : 1.(Of course it depends on how to manage your trade and selection of A+ setup as well)
Now just to share more thoughts on EURGBP 4HR or 6HR.
In order to be an A+ setup on 4HR TF, it should be a MUCH MORE CONVINCING Pin bar than what you usually trade on Daily. It is because its a 4HR TF which is 6 times less information than Daily in the candle, only BIG and Very Convincing Candles will show that the price will most likely go towards your way.
To illustrate my points below.
(source from FSO)
For example if the small pin is a Tradable A+ Pin Bar on DAILY, then the A+ Tradable PIN on 4HR must be the Bigger one. Only the Bigger PIN will ensure that edge is on our side.
What I’m trying to say is that the Pin on the 4HR is not convincing enough to me(based on the photo provided by you guys few post back) not to mention other criteria.
Cheers!
Jack
I disagree, Kasravi. BA is the correct one here, your engulfing bar is not valid and the best decision here according FSO way is to let it go. Even one or two pips off is something that we should not tolerate in our trade. No butts and no iffs.
[B]HOWEVER![/B]
While what you and BA were discussing there really does not fit our definition of Bullish Engulfing Bar, it [B]DOES[/B] fit our definition of 2 Bar Reversal. I’ll quote Johnathon’s words at FSO website fully here:
“The 2 Bar Reversal is similar to the Engulfing Bar in that they are both reversal Price Action Reversal signals. The main difference between the 2 Bar Reversal and the Engulfing Bar is the 2 Bar Reversal does not have to fully engulf the previous candle or bar where as the Engulfing Bar does have to engulf at least one previous bar.”
In short: Is it BUEB? [U]Nay[/U]. Is it 2 Bar Reversal? [U]Yay[/U]! 
Please read more here:
The 2 Bar Reversal
Bullish and Bearish Engulfing Bars Introduction
PS: But that does not mean we are free to take this trade, though. Please check it first whether we have A+ trade setups here. 