Price Action, Candlesticks, and the Story They Tell

[toyogo00]

@DnB_Price_Action

Sure,

For Non-US residents I recommend Alpari-UK, they’ve always been good to me, never a problem withdrawing money and never any spread spikes.

They have recently shifted their server to New York Close time, and they also give you the option to trade commodities, not just gold & silver, they have both Crude Oil markets, sugar, corn etc…

For US resident brokers I only hear bad feedback. The one that seems to stand out is FXDD, it’s on NY time and I haven’t heard anything bad about them.

Hi DnB,

I’ve just installed with either Alpari UK or FXDD, both are using Europe time zone. See FXDD Q&A section:

Regards,
Toyogo

[toyogo00]

@DnB_Price_Action

When I enter a trade I assume the money already lost, and knowing I aim for about 3-6 times what I risk, the losing trades don’t really bother me that much. When I am right I jump ahead much more than I do step back when I am wrong. That’s how I look at it anyway.

Check this IB setup on the EURCAD. I think this one has potential to break down…

Hi DnB,

There is a major support @1.2886 (see chart) although it has been broken twice on 14, 28 May. My question is do you still think that support is significant? If yes, then the short setup of IB @1.2905 entry point may not be a high probable trade.

Regards,
Toyogo

[DnB_Price_Action]

You have spoken in the past about waiting for price to retrace for a trading oppurtuniuty but on the EURGBP there is no retrace but you are trading it.

What do you mean there has been no retrace ? Price pushed up to .8140 and then retraced into support .8050, bounced off .8050 giving us the rejection candle.

I’ve just installed with either Alpari UK or FXDD, both are using Europe time zone. See FXDD Q&A section:

Yes FXDD and Alpari UK have New York Close time.

There is a major support @1.2886 (see chart) although it has been broken twice on 14, 28 May. My question is do you still think that support is significant? If yes, then the short setup of IB @1.2905 entry point may not be a high probable trade.

Only if price respects it yeah, like I’ve said before, I like to work from a candle by candle basis, I make my evaluation of the charts after the candle closes. If the candle closes showing rejection of that level and I am short well Ill look to get out, if it closes underneath then fantastic. Generally Selling into support should be avoided, it does hinder the potential for the setup.

[lucariga]

So if I’m understanding right, in your choice to enter or not on a trade, you don’t care about support/resistance, even if they are placed only few pips above/below your entry point, right?
You just place your R:R to minimum 1:3 and use support/resistance just to exit your trades in case of contary price action signals in those areas, right?

As usual sorry for my english… hope to be clear:33:

Hey DnB
Sorry to quote myself, but for me is important to be sure to understand your thoughts. I love this way of trading…

Thanks

[DnB_Price_Action]

A few nice setups on the majors today…

Most of these setups are already shooting off, I missed the train on AUDUSD. Not happy, nobody likes missing the train.

[Paddymctaff]

would you have taken all of them? If so what are your thoughts about over exposure to one currency via having positions on multiple crosses? Surely the AUDUSD and USDCAD are basically the same trade?

[DnB_Price_Action]

They are all USD pairs, so they are going to be correlated. No I wouldn’t take them all, if I really wanted to take them all I would split my usual risk in 3 and place a 1/3 normal risk on each trade.

I wanted to get in on AUDUSD but I missed it, might get an entry during a retracement otherwise I am flat.

[Evermore_F]

This one looks nice, but for some strange reason I don’t like it.

[DnB_Price_Action]

Yeah I seen that one, but I didn’t post it because U/CHF is basically the inverse of EU at the moment.

[GabbyFX]

@DnB_Price_Action

What do you mean there has been no retrace ? Price pushed up to .8140 and then retraced into support .8050, bounced off .8050 giving us the rejection candle.

I guess I meant that there has only been one down bar and not a retrace of a few bars. Just to clarify the one bar down is a retrace?

And would this not be buying from the top or is that okay?

Thanks for your time and sorry again for questions. I am just trying to get it all worked out.

[Paddymctaff]

So if there are several set ups at once that are correlated you would just pick the one with the best PA?

[DnB_Price_Action]

So if there are several set ups at once that are correlated you would just pick the one with the best PA?

Exactly right, the Forex market is forever, I just pick the best setup at the time and let it go!

[Borged]

Hi DnB,

I am in the trade on the EU/US since last night. I entered at 1. 2587 and now i got my stoploss at 1.2583
at this moment it is over a 100 pips profit. For how long would you let it ride?

Greetz…

[DnB_Price_Action]

I am in the trade on the EU/US since last night. I entered at 1. 2587 and now i got my stoploss at 1.2583
at this moment it is over a 100 pips profit. For how long would you let it ride?

Greetz…

If you’re not sure just aim for about 1:3, since the over all trend is down I would just play it by each daily candle close.

[Borged]

It is looking good so i think i will let it run for a little while and see how it goes.

[GabbyFX]

@GabbyFX

I guess I meant that there has only been one down bar and not a retrace of a few bars. Just to clarify the one bar down is a retrace?

And would this not be buying from the top or is that okay?

Thanks for your time and sorry again for questions. I am just trying to get it all worked out.

Hello DnB,

Can you reply to my above questions pretty please?

I am trying to follow your thinking. You said EURGBP was a nice trade and I am a little confused for the reasons posted in previous post.

Thanks a ton!

[DnB_Price_Action]

Sorry Gabby, I missed your question.

I am just going to draw another picture for you…

The red arrow is what I am referring to as a retracement, it happened over 2 candles. A retracement is a retracement, whether it happens over one candle or 5.

There hasn’t been much follow through with this setup, it looks very bear heavy atm. But the setup is still valid until the low gets broken IMO.

[GabbyFX]

@DnB_Price_Action

Sorry Gabby, I missed your question.

I am just going to draw another picture for you…

The red arrow is what I am referring to as a retracement, it happened over 2 candles. A retracement is a retracement, whether it happens over one candle or 5.

There hasn’t been much follow through with this setup, it looks very bear heavy atm. But the setup is still valid until the low gets broken IMO.

Ok great! Thank you a lot.

The very last question I have is so if are to enter this either at the break higher (as I have seen you suggest) or even at market close would we not be buying from the top or from a high? In other words is it okay to buy from a swing high and try to sell higher like this setup?

I will leave you alone for a little while now!

[DnB_Price_Action]

I see your point,

Levels can’t hold all the time, they often get broken when you trade with market momentum. This pair has been quite bullish this week and then dropped this bullish signal off a nice area. There has been no bullish follow through yet this one could turn out to be dud.

[benjam1n]

Hi DnB, It’s obviously a great R:R to have 1:3 minimum for each trade, but what is the max you’d risk and why? I ask because if you win 3 trades in a row profiting 50 pips each but then lose the next trade where the risk was 100 pips it would wipe out a lot of your profits right? Or would you just adjust position size for these higher risk potential trades?

Thanks!