I read it as the inside bar’s close compared to the average.
Buuuuut then I also was taking only the three candles BEFORE the first bar to get high’s and lows to determine average so I may may be wrong. Interested to hear if I got that wrong.
Anyone using Trade Interceptor on Android?
How do you determine which hourly candles make up the 4 hour?
I’ve tried to correlate but it seems odd to me (on the previous charting SW was very obvious) On Trade Interceptor I put a vertical line on the 4H candle switch to 1H view and it is the bar AHEAD of the current one.
I’M with you guys trying to learn morning\evening stars, but I get the inside bars, just add the lowest price of lowest wick and highest price of highest wick of three candles before mother bar, and divide by two…then wait until next 4 hour candle starts and see if the candle that was just before it (the inside bar) closes above or below that average price, and trade that trend.
@slipperywhippit I’m using trade interceptor on iOS and for me candle times refer to the close and my candle close times are 00:00, 04:00, 08:00, 12:00 est (although I trade gmt as I’m in the uk) so when you highlight a candle on the 4h and zoom into 1h the highlighted candle is the last out of four and the three before it make up the rest of the candle, hope this makes sense! If you put a vertical line on a couple of 4h candles in a row and zoom into 1h you should see what I mean
@everyone: I’ll try to sum up stars if i can:
Morning and evening stars: Stars are a three or more candle formation that is defined as follows:
- A candle of the current trend in place (bullish or bearish)
- A candle or candles signalling indecision (indecision candle, doji, hammer etc.)
- Confirmation of a reversal in price (A candle contrary to the current trend in place)
This can be further explained as
1.The first candle in the pattern contains the momentum of the previous candles and is continuing the trend
2.The second candle(s) show(s) the struggle between the two forces
- The third candle shows who has won at the end of the fight
The final candle in the formation must close atleast halfway down the body of the first candle in the formation and the first and the last candles in the formation cannot be an indecision candle
The major question everyone is having is how do we determine whether or not the first candle is going in the same direction as the near term trend and market momentum, we dont want to be trading morning stars at the top of a move right?
- take the first candle in the star formation and the three candles before it
- define the Highest High
- define the Lowest Low
- define the average price of those two value (like this : Highest Price + Lowest Price / divided by 2)
- If the close of the first candle in the star formation is higher than the average price and the candle is bullish, sell!
- If the close of the first candle in the star formation is lower than the average price and the candle is bearish, buy!
Basicly we see who has gained more ground recently, the bears or the bulls, it doesnt matter if price has gone up or down in the period of time we are looking at, what matters is how far each team has brought price at their point of greatest strength, so we can see who has the most momentum behind them, if the bears dragged price down 100 pips it doesnt matter if it didn’t close 100 pips away, what matters is that they dragged price down that far, the closer we are to the extremes of price the greater chance we have of price being pulled back to mean by the other team, so if the bulls rallied price up 100 pips, but then the bears dragged it straight back down to their side, who has the advantage? The bulls! From dragiing price down all the sellers have become exhausted, and the number of sellers has dwindled as people start cashing out their positions, now is the time for the bulls to pull price back up, and that is the fight we are looking at, sort of :P…
@niX1990: just wait till i finish my testing of ATR stops and take profits ^^ this week has been an average week, nothing more, nothing less, yes there has been a streak of winning signals, HOWEVER none of the signals were allowed to compound because of the strength of the moves, meaning although we had a higher quantity of winners they weren’t of the highest quality possible 
@juicypips: feel free to post anything that might benefit someone 
I have a very different view in trading then most and it is always good to get different perspectives I’m sorry my explanation was confusing, I hope the message I recently posted helps
Jawa, an update and a question. I posted way back on pages 19, 23 and 24. I experienced 30% drawdown on my account when I was trading the system incorrectly. I just wanted to update you and let you know that after you and Jonkie helped me (thanks for your hard work on that indicator Jonkie), I’ve since gained back that 30% and I’m up almost 20% this week as well. I’m hoping it’s not just luck, because I’ve been trying to follow your rules like a robot.
I do have a couple issues I wanted to discuss though and they may have already been answered.
I seem to find that Sunday and Monday are horrible days for me. In fact, most of my losses seem to occur on those days. The rest of the week is fine. I’m wondering if anyone else experiences the same? As for trading hours, when I trade the 4PM and 8PM EST candles (low liquidity) they seem to bring in more losers, with the exception of the AUD or JPY pairs for obvious reasons. Do you still trade EUR pairs during these hours? It seems like you have a higher probability of loss due to the spread.
My biggest issue is receiving opposing signals on pairs that run parallel together. It seems like this occurs quite often. For example, I’ve seen several cases where I receive a BUY on EUR/USD and a SELL on GBP/USD. If I buy eur/usd and sell gbp/usd, we all know what’s going to happen. One pair will TP and the other will hit my SL. It’s hedging. The only way I make a profit is if the TP pair keeps running. Many times it will come back and hit my break even though. What do you do in this scenario?
Just had all trades hit full TP!..tried AudUsd and it hit SL on a buy
@stb2000: thats great! i’ve actually been wondering what happened to you, i hate being the cause of someone losing money :\ but im VERY glad you stuck with it, and have been able to come back! I assure you it isn’t luck if you are trading the system to the letter, it is based off of very sound principles and this week especially since people like pipcompounder have been trading it you dont have to take just my word for it I would suggest using the checklist and using a trading journal atleast for a couple weeks, this way you will be able to see your exact mistakes and why you made them, and learn from them
now for your questions: Sunday and Monday have been losing the past 5 weeks, not one week have the positive trades made during those days redeemed the losing trades, in fact it seems that most losing trades in a week happen during these two days, I am not saying this will always be like this, but it has been lately, I think if you wanted to take a 3 day weekend and wait till tuesdays first candle to trade it might be a good idea, 90% of our pips are made during tuesday wednesday and thursday anyway, and i do try to stay away from trading after 12 friday, so if you want to avoid drawdown and maybe get a little extra sleep trading only midnight tuesday - noon friday might be a good idea, you might even end up making more that way, who knows, either way you can expect a lot of pips, i myself will only start trading monday at midnight as i am hopelessly addicted to trading, every time pipcompounder posts an update on his trading i feel like a piece of me has died because i stopped trading this week…
But as for skipping the 4 and 8 candles we cant do that, skipping candles in this system wont work out very well because it relies on the quantity of signals to compound profit and cut losses short, so we cant afford to even miss one candle! Even one candle messed up or missed can suck back up half the pips you have made in the week, heck it even happened to me this week
And honestly as far as trading confluent pairs go you will notice that the 4 pairs i trade are HIGHLY confluent, i did not choose them because they were confluent but it is a nice bonus, one thing you must remember is that these charts are traded by different groups of traders, and are effected by different news announcements, the AUD pairs are effected by the same news, just as the EUR and GBP pairs are effected by the same news, when i have a buy on one chart and a sell on another chart with confluence i am a happy camper! i am basicly assured pips, remember this system is good at cutting losses short, so more often then not the losing trade will be caught and turned around, sometimes it wont but most of the time that is the case
I am working on an ATR stop and tp that will improve your odds and allow this system to be traded on all pairs equally effectively, right now EUR/USD especially doesnt have quite the volatility to be optimal in a 40 sl 70 tp system, ill post it up tonight i think
@everyone: I have quite a bit of unexpected spare time tonight 
so if anyone has any questions about ANYTHING related to the forex, this system, or otherwise i would be happy to answer them as best i can
also i will be making what should be the final change to the system (decided not to add any more patterns as it already works well enough, im sick of backtesting :P), the ATR settings
Any ETA on when you are gonna post the ATR (and how to use ATR in relation to this system)?
Good evening citizens.
Great week so far! I’ve banked a few hundred points. Do I owe you a royalty?
Jawa, I couldn’t resist your invitation to ask anything.
What is the significance of the fifty percent wick rule? Why isn’t a doji an indecision candle? For example, one forty five percent wick, another forty five percent wick, and then a ten percent body. Doesn’t that show just as much indecision as a pin bar?
Thank you.
gr
@Gamblers Ruin: aha awesome job trading! As the three amigos would say, “My reward… is that JUSTICE has been done” 
im just happy to help
Q) What is the significance of the 50% wick rule?
A) The entire philosophy behind this system is to find the areas in price where the bears and the bulls are neck and neck fighting each other to pull price to their side, and when we see these struggles occurring in the candles, depending on how the fight is unfolding and how price has moved we make an informed guess and put money on who we think will win and pull price, the indecision candle is just one of the types of fights in price we see. The significance of the long wick in an indecision candle is that at one point in the candle either the bears or the bulls had full control and were pulling price, but then their opposing team was able to pull price back near the open of that candle, at this point in time both buyers and sellers have been exhausted, and this is when we look at the 1 hour candles to see who we think will win and pull price at this point where it could go either way, so basicly the long wick signals a scenario where the bears and bulls are both exhausted from buying and selling and price could move either way
Q) Why isn’t a doji an indecision candle? For example, one forty five percent wick, another forty five percent wick, and then a ten percent body. Doesn’t that show just as much indecision as a pin bar?
A) The answer to this is that it shows even MORE indecision then a pin bar! and making an informed guess and who will pull price cannot be made with much accuracy because buyers and sellers are so closely tied in price, so if we were to make a guess we would have less information and less reliable information to decide on, And because an account only has so much margin to use we are better off sticking to the higher probability patterns
Hey Sith,
You may or may not have a chance to respond, but right now on the 4HR charts of GBPJPY, AUDUSD, EURJPY, AUDJPY, I don’t see a candle that says to make a move (I am referring to the Jun 8 candle at 0:00).
I’d be curious to hear your take on it.
Just so I can learn, especially while you are very active in this thread :).
Black box would be the evening star right?
ATR: Developed by the ingenius J. Welles Wilder, ATR (Average True Range) is an indicator used to measure the volatility of a currency pair. The way it does this, in short, is by measuring how far price moves in each candle within a certain time period (normally 14 candles), the more price moves within each candle the more volatile the market is considered as price moves farther and faster than in a less volatile market where price moves very little between candles
The way it calculates the value is by first calculating the true range, using the highest value of these three equations:
- TR = H – L
- TR = H – Cl
- TR = Cl – L
Where:
TR - true range
H – candle high
L - candle low
Cl – previous candles close
After it has obtained the true range data of a candle it averages it with the period you set the indicator to (normally 14 candles), meaning it will calculate the average true range of every candle within that period of time
How I use ATR:
This system by definition looks for places where the bears and the bulls are neck and neck fighting to pull price to their side, and at these points in price we enter in the direction we think is most likely to win the fight and pull price, but now that we have entered in the market, how long should we stay in the market? The logical need of every stop and take profit is to determine the strength of the move being traded, and then give it a reasonable pip target to achieve within its capabilities, while also limiting its losses should the move fail
ATR is the perfect dynamic stop and take profit, by calculating the volatility of the struggle between the bulls and the bears at any signal we can give an accurate estimate as to how far price CAN be pulled by either the bulls or the bears
Stop Loss: ATR (14) x .75
Take Profit: ATR (14) (half take profit), ATR (14) x 2 (full take profit)
The way we calculate our ATR values is by looking at the ATR value of the signal we trade, at every close the ATR value of a candle gets set in stone and this is the value we use, to look at the ATR value of a signal move your cursor over the candle and have the data window open, there will be a few numbers behind a decimal probably including some zeros, use ONLY the first two numbers as the value (dont include the zeros before the first number), meaning if the ATR value of a candle is .5361, the number we use is 53 pips, if the ATR value is .0040, the number we use is 40 pips
Now which candle do we use in each signal to determine the ATR for the trade?
Indecision Candles: Use the ATR value of the Indecision Candle
Inside Bars: Use the ATR value of the mother bar
Stars: Use the ATR value of the final candle in the pattern
@jmacar: correct The large green candle is of the trend in place, and then there is a period of very little movement and longish wicks, followed by a sharp and sudden change in direction If you have been trading EUR/JPY you should have already placed sell orders on those two pin bars within the evening star, meaning right now you would have three sell orders currently two of which have already hit half tp compounding profit anyone? possibly… lets hope the bulls are exhausted and this isnt a news announcement playing tricks on us