I’d like to ask some questions about the AUDUSD 4H you posted:
Does it matter that the first of the two candles has a much higher high ?
I have my SR area marked 60 pips lower at the candle highs from 27th March - Is this wrong. Should I move it up to coincide with the RN. I’m still a little unsure on how to mark these levels correctly - candle highs / candle closes / etc. Any help would be great. I think I will go back to the beginning of the thread and reread the relevant linked material.
This move did pan out and move beyond the recent lows so would have worked out. Mind you that’s easy for me to say in hind sight
I have a question. . If a pinbar was formed at that level, not far form the inside bars. Should we take the trade or the inside bar is still would be considered like a warning. I mean until how many candles should we wait so “the market shows its hand”.
When we say ‘it has traffic on the left’ and therefore an area to expect some possible stalling are we looking for areas of minor consolidation or simply the next bar high / low. Just trying to clear up in my mind how to assess these first trouble spots
Hey man. That’s is a solid area to short, however the pin bar does stick out comparing to the candles before. The wick of the pin has to be longer and it will be a solid A+ setup! For both of the pairs. It’s a shame!
Let’s just hope the price can shoot back higher and down again
It is ok to one of the candles be with higher high for 2BR setup.
Although the S/R lines are not something with scientific accuracy but more like a S/R “area” where you are looking for the PA, it better to combine as much S/R areas as possible to one(if it could be done of course). This way you can create much stronger buffer area which have to be passed before the price take you out by Stop Loss.
So, when you S/R coincide with RN (BRN or VBRN) you have stronger buffer.
In order to mark the S/R levels take into account both highs and candle closes, these will help you to create the “area” I talked about.
*Some bonus answer to 2BR setup question :
Look at 2BR setup as a PB when two candles are combined together, just combine two of them and see what you got. If it is tradable PB than it also will be tradable 2BR. Sometimes when two bars are perfectly identical in size you will get PB with no body - it is also good 2BR setup, but i think you got an idea
So, as to your question about higher high of first candle - when candles are combined it just a wick of a PB
I prefer to wait for price to breakout and pullback and then trade from a decent signal. Thats how you can anticipate where price is headed. You see trading immediately after IBs is tricky and it get’s worse if you are looking for a reversal trade. You want price to loosen up or so to say show it’s hand.
You can think of it like that graph you shared. Where top traders enter and amateurs enter.
Seems like on both charts we get a clear engulfing candle from a strong S/R zone. My first TP is at the previous high and low on the daily chart. What are your thoughts ?
Hey jadd806. I was looking at GBP/NZD as well. What confuses me a bit about those type of situations is that if you go to a 4 hour chart the price is at the support level. How do you handle these type of salutations(when we have opposite SR zones on different time frames, daily and 4hr) ?. I didn’t take the trade here and on the rest of NZD pairs because of that.
You take the trade on the Daily so you manage on the Daily. Don’t fall into the trap of going to lower and lower timeframes to manage trades.
I’d recommend you treat each time frame as a separate chart (after marking your levels on the Daily). So if we were looking to take a 4H trade, we’d do it from a Daily level, but we’d set our targets based on 4H price action. On the Daily chart, we set our targets based on Daily price action. Hope that makes sense.
Daily S/R levels are good to trade on the Daily, but you can trade Weekly levels on the Daily (or any lower) TF too. They hold just as well if not better. So those are your levels for all time frames. Then if you spot a PA signal at one of those Daily/Weekly levels on a 4H or 1H chart is the only time you’d be concerned with the intra-day levels, but only to manage your trade and never to base your entry off of.
yes when there is traffic and no matter if it has candles like tails only at the high or low you have to avoid it. When the indecision / traffic area has a shape like a box (you could draw a box around it) and close to your entry candle than STAY OUT.
