I was zoomed out and looking at the EURUSD bigger picture and at least technically the picture is looking more and more bearish. I will certainly be keeping my eye open for good short setups.
yep im 100% with you on that one, especially with the fed talking more and more about tapering and drag hi being as dovish as he is
[QUOTE=âkrugman25;589874â]
Hey B.A., These comments are all based on the chart you posted, I donât have my charts up right now. I think technically, anything can be called âtrafficâ. Every high and low of a candle can exert some tiny amount of resistance or support. If you have a bunch of candles piling up on each other you can start to form traffic. The problem is almost nobody explains traffic correctly. The other problem is that many traders see these beautiful price action setups off of teaching websites, and so most traders will get that idea of what tradable setups look like. Those picture perfect setups happen a few times a year, and by few I mean like 2 or 3. But the picture perfect trades sell memberships, not messier setups, so you get a bit of an incorrect idea of what price action trading entails. Itâs a fact everyone needs to face, trading isnât clean, itâs messy, you just have to do your best to filter the garbage and look at the key areas of your charts.
When I mention âtrafficâ, I am referring to any type of traffic that is great enough to affect your trade or greatly lower itâs chance of success. So in your chart, the group of candles right before the pin bar is not traffic in my opinion. What you are most likely seeing here is price reaching an important resistance level and then consolidating. Consolidation usually happens before a pinbar forms because when the market reaches a key S/R level, it takes a while for the orders to build up enough for the break out. As you go lower in time frame, you will notice consolidation a lot more. Consolidation is just a part of the reversal process. Some of the best setups are when price reaches a key level and then consolidates for 3-5 or more candles because it may be building up steam for an aggressive breakout. Some traders would pass up trades because they see the consolidation as noise, but in reality it is part of the reversal process. It looks like in this chart there was a buildup of price with a false break out. Then a partial retrace of the pinbar before price actually reversed, which to me is close to a text book pinbar reversal process. Many of the daily reversals that happen look like âquick and cleanâ end up having a lot of consolidation and mini false break candles on the intra day. I would agree with you that this isnât 5 star but it could be a 3-3.5.
What is traffic then? Traffic that you should care about is usually from ânoiseâ. That is price just bouncing around without much rhyme or reason. A little bit of this doesnât matter much, itâs when you have it happening for an extended period of time that it begins to matter. At that point the glob of candles that are just randomly poking around will start to exert resistance, and you will have a hard time drawing good clear horizontal lines from it because the candles will most likely be all over the place. Today I was cleaning up the list of currency pairs I trade and many of the exotics that I removed had lots of noise and traffic which makes it hard to play from one key level to another.
That was a lot to lay out at once! If you have any question from that let me know.[/QUOTE]
Hey Aaron
Thanks for your great reply, makes a lot of sense. Ouch I should have taken that one, it does look like a lovely pin bar now - it moved very fast also so did not have much time to think about it. I have lost quite a lot of confidence in my ability to spot decent set ups, I have a horrible habit at the moment of not taking successful set ups and taking unsuccessful ones. This has resulted in not having a single winning trade in over a month putting my account now into the minuses. The only trade I took this week was the NZDUSD daily pin bar which moved nicely in my direction, after it broke the first trouble area I moved to break even and then wham it came back at me and I got stopped out, bugger! Lol. I did not trade any of the 2 bar reversals.
Thanks again Aaron, loved the part about the picture perfect set ups, that is so true and something I think I needed to hear.
Have a good weekend mate!
BA
hey BA i took the same NZDUSD trade but i didnât move to BE at the first SR level, still in the trade its looking good right now. the reason i didnât move was based a little on fundamentals and the fact that it wasnât the middle of the range
Hey everyone! 
I havnât been participating in this thread latey because i have a lot on my plate but be asured that i will be back soon!
Just wanted to give you a heads-up on the EURJPY which seems to be developing a nice bullish flag pattern on the daily in case anyone of you wants to take advantage of that.
See you all soon! 
[QUOTE=âWookie1985;590123â]
hey BA i took the same NZDUSD trade but i didnât move to BE at the first SR level, still in the trade its looking good right now. the reason i didnât move was based a little on fundamentals and the fact that it wasnât the middle of the range[/QUOTE]
Hey Wookie
Thatâs very interesting, maybe I should have stayed in it longer. Iâm trading pretty defensively at the moment and didnât want to take another loss. When it hit the 50 pips profit line I moved to break even and left it to the elements hoping it would find the minor resistance if it retraced, as soon as it broke I knew I was done for! I hope it works out for you though. I was actually grateful I managed to move to break even, how dumb is that? Lol.
where do you enter on a flag pattern?
We have lift off!
Safest entry is on the break of the upside and showing bullish PA, like an IB with a PB or just a PB rejecting the upside trendline it has just broken.
I would be careful with this one, I am short at the moment, but I might go long at the swing low on H8.
Wookie, check out Krugmanâs video on the flag pattern, itâs a good one (link below). All his lessons are in links on the first page of this thread.
http://forums.babypips.com/free-forex-trading-systems/58037-price-action-matters-74.html#post552865
Thanks mate
just watched the video and have to say, as always, explained so well. Iâve always thought you explain things in such an accessible way
Itâs hitting a very long term (check monthly) trendline and .618 retracement of previous swing. Itâs already tested the .618 twice. I think this is a very critical level weâre at.
Someone already mentioned the video which covers in detail the riskier entry, here is the link to a post I made that mentions the 4 different types of entries for a flag and how they rank from most to least risky.
Anyone else is in the GBPCHF trade? Itâs been going for a while now and has been a fun ride! Almost stopped out yesterday and now today almost at TP.
This is a comment I made on the members interview I did a while back. One of the worst things that comes with trading is the emotional drain that can occur if you donât keep yourself in check. You will become less emotional with trading as you become more experienced and understand price movement better but there are other than you can do to help become less emotional with trading and have less focus on the price charts. This is the worst for beginners but even experienced traders can get emotionally drained from trading, and that is just not healthy. It was too good not to share, I will also be posting a link to it in the Quick Navigation area.
How to reduce trading emotions: 301 Moved Permanently
I like that one quote, Cap. At the end, what I really want is to have more money in my bank account, not the adrenaline boost from the ups and downs of God-knows-what-really-happens-there-in market.
Krugman, would you by any chance be willing to post what currency pairs you view? For some of the newer traders like myself it may help us focus on pairs that show good price action instead of getting discouraged by trading the ones with noise and traffic.
I removed about 5 or so from my list in the last few days and have a few that could be going on the chopping block in the near future. For the most part if you have high volume and liquidity you will get decent trade setups on a normal basis. I have removed a few of my exotics and some of the CHF pairs. A few of the exotics have very good chart structure and have even higher volume than the some of the minors that are normally traded.
P.S. I will link this post to my quick nav. and update my list as I add or remove symbols.
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