Hey traders this maybe newbie thing but as I trade larger time frames I suppose it take more time to get same amount of experience as a trader on smaller times with more trades maybe.
However I use chart patterns and support and resistance line, etc. I also use indicators but I’ve notice couple of times, say, I’ll add my indicators to the chart and see my signals triggered, however I’ll clear the chart and see if any chart patterns come up and say one comes up that would suggest the markets going to move opposite what my indicators set suggested. Which gets mr bit flustered because I’m not sure what to do after that aha.
I maybe over thinking it too much, and should go with what I see first. What do you think ?
Also another question which I think @krugman25 , and @tommor would be able to answer well. When say your looking at a chart, do you first look at price action and looks for any chart patterns sets ups, like Elliott wave or ascending channels, etc first before putting say your indicators for a trend system set up for example.
I know @krugman25 doesn’t personally use indicators. So his answer will be interesting.
I would avoid using chart patterns and indicators together with one exception and thatwould be for instructional purposes. Assuming that the chart pattern is consistent with market structure go with that. One word of caution. Nothing works everytime. So you will find times when the indicators were wrong and price action was right and vice a versa. Do not let that confuse you.
As you mentioned @robotrades, I don’t use indicators, but in a general sense if I see an entry signal but I also see price action that is contrary to my signal I may not take the trade or do something different. For example if there is a nice bullish pin bar off of a key support level on the daily charts but then there is a large bearish weekly pin bar, I may just sit it out, or I may take the trade but reduce position size or defend more aggressively.
I use 20, 50 and 200EMA’s, SMA’s would do just as well. They let you see which is above which, which is sloping upwards, which hasn’t broken a weekly bar in how long, how many weekly closes have been above/below which MA etc… The idea is not just to see if a trend is there or if its up or down, but to gauge which trend out of 10 is the best. MA’s are really useful for stuff like that but NOT for cross-over entry signals coupled with cross-over exit signals.
@krugman25 yeah that is a fair shout and very much what I’ve been doing because as I get flustered, I think nope I’m to emotional aha best stay out for this one. And @tommor Ops I’ve been using LInear weighted moving averages5,12,20 for a crossover signals, because I noticed with LWMA that there a lot more smoother on the chart and I noticed that when the LWMA crossover about 70-80% of the time the currency pairs I traded started to go into a trend. ( I went though and back tested on MT4 ).
Also it’s very interesting that you both trade weekly , I use weekly to get my “ okay where’s the overall trend, daily time frame for market bias, then 4 hour for the best or near best entry point.
@Traderjohnsblog thank you for the advice! May I ask why you don’t use chart patterns? Not asking out of like why not use them there amazing aha I’m just curious aha.
Also just a side note, I find it interesting how everyone starts on the smaller time frame, but alway nearly end up on the larger time frames in the end aha.
Also just wanted to say big thanks, cuz you guys have pretty good advice and are always willing to spare little time to answer my questions. Also how long have you guys been trading ?
I made my first trade around 12 years ago which was actually trading stock options. I started trading Forex about 5 years ago. I now trade all of that plus some, options, futures, futures options, and Forex.
@krugman25 wow that awesome, I take it youve made good progress I guess. Also that brilliant, I’m currently as you know reading the intelligent investor and am looking at possibly doing bonds and stocks portfolio but I’m learning about it so it’s a long way off because I seem to be flitting between things on my forex trading plan, I think it’s because I’m away atm and can’t really make any good trading decisions on my phone.
Yes, in the sense that I understand price action better and also in my approach to the markets. I now take a more holistic approach to trading which provides a number of advantages. One is that diversification reduces portfolio variance and std dev, The more uncorrelated trades introduced into a portfolio, the lower the portfolio’s std dev and variance becomes. I like to achieve diversification through both strategy and instruments. On the strategy side by profiting through directional trades and also profiting through short premium trades. On the instruments side by trading a wide range of products like equities, commodities, agriculture, currency, etc. The other advantage to diversification is opportunity. I have very strict entry rules for both directional and short premium trades and if I were to limit myself to one market or one strategy I would hardly be able to trade. By trading a dozen or so different price action candlestick patterns, half a dozen options strategies across dozens of different markets really increases the chance of opportunity.
