Thank you for help with ATR
1 Like
Was doing very well initially, but then it turned on me somehow, and I have not been able to replicate the early success. No matter how I studied it, I was no longer able to find winning trades.
That was about 4 months ago when I commenced live trading.
Willl revisit and see if anything has changed.
Was using the Eelfranz Heiken Ashi 4H approach, for anyone wanting to look it up and trade that way.
From finding trades that went in a trend for 5 to 7 candles, it collapsed into chop - whipsaw after whipsaw until I pulled out of it in disgust with myself.
Was looking at the Eelfranz Heiken Ashi 4H approach and it looks very promising even though the information I found on it is over 10 years old. Hoping it’s still good.
I am going to load the indicators on my mt4 and trade on a demo account to see how it works.
Will start it in the new year as markets this time of year can be weird. Won’t be touching gold.
1 Like
Agree, Doug.
The Heiken Ashi (HA) candles are very much under-rated.
Saying that because traders like myself are subject very much to our emotions.
Have lost count of the number of times I have been shaken out of good trades by spikes at low volume/high volatility times in the market.
Then the trend resumes and there I am out of the trade.
HA candles help very much with the volatility that has most of us biting our fingernails.
I like them also because we have the option to decide when we are contented with the pips we have made, and can exit any time with profits while the trend continues,
and
the reversal of trend is very easy to spot with these candles, so exits can be taken at much better times.
HA candles are a study on their own, which you will be aware of I think, but will re-state a couple of things about them for all readers (just sharing useful stuff here).
- When the candles are red (price is dropping) and the TOP of those red candles is flat (no upper wick) the price move is quite strong. Some people call the “wick” a “shadow…”
- When wicks appear on the top of the candles again, it is likely the trend is weakening, but continuing.
- Reverse is true for the ascending candles - the bottoms are flat in strong uptrends.
When wicks begin to develop again the uptrend could be approaching its end. - When the candles become small with either long upper or lower wicks, a reversal of trend is likely.
- Similarly when the candles are small with no upper/lower wicks, this also can reflect indecision and reversal is possible / likely.
- Small candles could also indicate the market is entering a ranging or consolidation phase.
That is proably more information than you need, Doug, since you have been around awhile, but when I write on Babypips, I am aware that it is a place new traders come to for help to get started, and each post should come with clear explanations.
We should never be shy of attempting new things, since success is just one good
idea away.
Proverbs 3:13:
Happy is the man that findeth wisdom, and the man that getteth understanding.
.
1 Like
Ingot54, this is great information on the HA candles.
You can never put too much information on here for others to learn. Myself included.
From my research, I was only looking at the TDI for entries or exits and strength of entry.
- Enter on the next candle after the green line crosses the red line for both ascending and descending trades.
- For ascending entries the angle of the green line should be between 12 and 2.
- For descending entries the angle of the green line should be between 4 and 6. Reference to a clock of course.
- For exits look for a flat or hooked green line on both ascending and descending trades.
This information on HA candles you provided is great for confirmation on continuing trend, strength of trend, or nearing end of trend. Very valuable information to have.
I was wondering if you only trade( using 4 hour candles) certain times of the day. That strategy I was looking at, the trader was only trading during the night. If I remember correctly, they looked at the candles for various pairs at 10pm and 2am for any setups and closed all trades at 6am. That would be pacific time.
I plan on looking at other times during the day with the demo account and see what would be the best for me as I live in the eastern zone. Just looking for your experience. Thanks.
Doug
1 Like
When I was trading only Gold I used just this HA setup from the Eelfranz thread on another forum.
4H was my preferred timeframe. Poor money management was the reason I stopped trading Gold.
I studied only Gold charts for 3 months, and sometimes OIL (WTI). I really got to understand what drove the price of Gold.
It’s very much a risk-on risk-off thing.
But towards the end, the signals were mixed.
For example, RED news on the Calendar was supposed to be a risk-on stimulant (Buy Gold).
But for some reason the market drove down the price of Gold on Red news, before then sending it to higher levels than what it was at when the news was released. That’s where the expectation was, on the release of the news.
The opposite also began to occur: ie with GREEN news (good = risk off) for a currency, one would expect Gold to be sold, but that wasn’t happening until price had been driven up to possibly hit stops, before dropping to lower levels.
It became harder to remain in these trades, and I was giving back profits, so simply quit trading Gold.
It didn’t matter anymore what I had learned about it - Gold just did what Gold does!! You said earlier that I was brave to try to trade it - and that was the case. I would have laster longer with smaller positions and deeper pockets.
Right now, after the fiasco in the markets today after the BOJ announcement of raising interest rates from 0.25% to 0.5% in the long term Bond markets, I am taking time out to allow charts to recalibrate themselves.
It’s Christmas markets now, and the desk traders won’t be back to trade until the New Year I suspect.
You are so right about gold and oil.
My friend and I were discussing this very thing a few months ago. Where we thought gold should skyrocket and US$ fall(in normal times) the opposite would happen.
With oil, which is closely tied with the Cdn$, should go in the same direction. But not this year. There are many other factors at play this year and I am hoping it will calm down in 2023.
I do have a strategy that I have been testing on gold and oil on demo for a few months, but not sure if I should post it here. I have had success, but where it starts to fail me is when emotions come into play and I end up breaking my rules(even with a demo 
).
It involves just using a 5 minute chart with rsi. Alerts are set up with TradingView. Still working the bugs out of it and just observing the price movement of gold and oil. Which you know, has been difficult.
Doug
1 Like
I find the Position Sizer tool from earnforex dot com quite handy at calculating the ATR values. It also has a multiplier feature for calculating the stop loss.
2 Likes
Thank you for sharing your strategy. I will definitely test it and use it if it works well.
2 Likes
Glad you see something in this worth investigating, Gizma.
Welcome to babypips, and thanks for posting.
Are we seeing our long-term weekly trends getting back on track?
AUDUSD
GBPUSD
Good luck, and remember to watch your exposure with correlated pairs. If you’re trading more than 1 pair in the same or similar currency, cut your position size back to control your overall risk.
1 Like
I feel the ADX and Volume indicators are under-rated. Always better to trade with high volumes and the ADX will tell you if a trend is strong and if it’s the buyers or sellers dominating the trend. H1 timeframe and higher has less noise but if the lower timeframes float your boat then do what works for you.
Just putting this out there for GOLD traders.
Over the years I noticed that in January most years, Gold has had a decent run up.
The entry is important, because there can be fake-outs that stop you out of your positions before the big run up.
To help overcome this, it might be better to scale in to your position after a strong pullback.
Not suggesting anyone should try this.
But check the MONTHLY chart of XAUUSD over the past dozen years, and you will see it if you drop a vertical line on the chart on 1st January every year.
In 2022, from April to October, each monthly price of Gold has finished LOWER than the previous month.
Then it set up a TRIPLE BOTTOM before commencing its uptrend at end of October, where it has ended 2022 by breaking above the June 2022 resistance.
To sumarise:-
- Triple bottom to end long down-trend
- Steady trend higher, finally breaking and closing above significant resistance.
I should mention that with world-wide inflation affecting and weakening currencies everywhere, and the trouble in Ukraine causing uncertainty in markets, it is looking like there could be further upside to the Gold price in 2023.
WEEKLY CHART XAUUSD
Can it match or exceed previous highs?
In August 2020 and March 2022, Gold hit $2070 and $2075 respectively.
Worth noting that this price action set up a double top at the time.
Gold then tumbled $450/oz.
It has put in solid support now at the $1615/oz level.
I hope some of you can trade this current recovery.
Be patient and be happy with small positions. Gold is a fierce commodity to tame.
2 Likes
Pulled the trigger on Oil. Price was rejected at the $86 mark, and not for the first time:
We’ve got a nice downtrend going which is pretty clear on the daily chart:
Looking at Gold, which was recently pointed out by @Ingot54 has blown through that resistance level and shows little signs of slowing. I feel like entering now might be chasing, so I might wait for a bit of a pullback, hopefully a retest of that level, before going in. I’m sure there will be plenty of opportunity.
1 Like
Experienced traders know the effect “Risk-on” and “Risk-off” sentiment has on the markets.
But other factors unknown or not revealed to the markets, can affect the movement in the price of Gold.
I think it was JP Morgan Banking that had more paper scrip short in the market than the entire physical gold supply on the planet during the 2008 - 2011 big price run-up in gold. (USD$720/oz to USD$1920/oz).
How this was allowed by the Chicago Board of Trade or the Federal Reserve, I do not know.
This is what gives the markets the flavour of corruption at times. No doubt JP Morgan Banking was able to explain or deny to the regulator that they held such short positions.
However, they were never held to account for it, and they were able to successfully unwind their shorts without becoming bankrupt, which they almost certainly would have, had they ever been forced to cover their short positions by delivering physical gold metal to those they “borrowed” it from, to create their short positions in the market.
Outrageous.
The price of Gold was predicted speculatively in those years to go as high as USD$50,000.
So traders have Morgans to “thank” that it didn’t reach such levels, despite the wanton and loosely controlled money printing that is now seeding inflation worldwide.
Thanks to Alan Greenspan and Ben Bernanke, who are long gone, and didn’t have to explain their activities to traders, and have never been held to account either.
Which brings us to today’s charts and price movements, that are not explained by news releases.
Try to follow what I have said on these charts, and the news releases, to see if I have erred in thinking this way.
Believe me, when you are watching the news releases and market responses hourly, you don’t miss these things.
Someone said: “The markets can remain irrational longer that you can remain solvent.”
My profits were trimmed in the past 24 hrs, and I remained out of the markets today, since it is Friday when the funny money comes out to play in the markets.
Incidentally, the Canadian and United States employment numbers has been released while I was constructing this post. The news was “good” (green) and should have triggered a sell-off in Gold, since good news needs no hedge. But no, Gold was bought on this good news, rallying from USD$1834 to USD$1852.
That is the exact opposite of what would be expected when good news is announced to the markets.
Go figure!!
1 Like
Yes, very interesting. I went long on a small Gold position last night because I didn’t want to miss the dip, Iand I’m happy I did. Stocks and Gold both up today. Big change to my portfolio over yesterday.
1 Like
Lowering the number of losses that a trader usually suffer is the cardinal challenge faced by every trader.
1 Like