Pure Price Action For Dummies

Beginner Questions Candlesticks, Chart Patterns, and Price Action
1566

In regards to your trade plan on AU.

Your Risk to Reward ratio of approx 1:3 is very good.

Your entry at 1.0280 is a solid plan. If we look at H4, we can see a nice support resistance area at 1.02853. An entry at that point would be very good.

SL is smack at the bottom of the previous wave, which is as good as it gets.

So your trade plan is good and is as per rules.

Correlation of GU and EU on the other hand, is an uptrend as you see it, if we do not take into account other factors.

Other factors are,

If we see GU and EU, GU has reached a previous peak and it might retrace before deciding to shoot back up, if it does go back up. On the other hand, with economic news later, it might just do one candle all the way up.

EU is retesting the same resistance that has held for a long time now. It looks like it might break and fly higher up, but again, buying EU at this point, with just bias and higher TF analysis is not a very good trade idea.

So correlation wise, I think its best to say that its not as clear as it should be.

It would be best to wait for a confirmation and an entry set up on lower TF, say H1 at 1.0800s level before putting in a trade manually.

Otherwise, your trade plan is good.

Keep watching the charts and you will come to learn to filter your trades. You wont take trades daily. You will know when you see a solid set up and you will hit that with maximum risk your money management allows.

Price action works, provided we do not expect to open the charts and find valid set ups daily.

This is one of the biggest reason why beginners who trade price action loose their accounts.

Wait for that ideal set up. You will know which one because it will clearly tell you which way its going to go, from where to where.

Trading set ups that are not as clear is not only damaging to ones account, it also causes traders to have psychological issues to deal with later on, because of prior experiences loosing on entries. We will than start cutting of trades before it hits SL, or worst, taking profit when the move is not complete, causing us to loose out on more profits etc etc.

It will take a long time for these bad habits to be unlearned later.

So avoid it if we can.

Do not expect to be able to read price action or price movement all the time. NO one can.

We dont need to either. We just need to be able to read the very clear set ups. Maximize your profits, minimize your risk, grow your money.

1567

Oh and not forgetting.

on the topic of correlation, look at UCHF Monthly chart.

It might give us an idea of things to come.

1568

Thank you Nikita for your explanation. I am considering all your suggestions. What the problem is I have a Day job. So I trade from the Daily chart. I can’t watch charts very often. But I am trying to check the chart whenever I can. I didn’t trade Last two weeks. Because lack of clear signal. Let’s see what will happen in this trade.

Happy Pippin.

Salim

1569

Trade plan sounds solid on the Aussie. I dont like to use orders as I like to watch price action on smaller time frames at my point of entry. At the same time orders can work if you based it off the daily 1.0280 is a decent entry. Be careful though as you mentioned price has been ranging around the 1.0300 area for quite some time now. Buy at the bottom of the range and sell at the top which looks like what you are doing. I just hope price will pick a direction soon and get back to normal. Good luck

1570

And to add to that, coincidentally I went long AUD/JPY overnight (off an order, sorry Bob, although I did have lower TF correlation for the idea, and I need [I]some [/I]sleep!), so am also hoping that the Aussie is going to strengthen! Mine’s not looking too clever right now, though - Price is hitting its head on the Weekly Pivot - although it is early days for the trade…

ST

1571

Sorry to be late to this - crazy few days domestically. I have certainly found it a little choppier than ‘normal’ over the past couple of weeks in terms of intraday trading, end of day has been fine, though - so I have focussed on that.

ST

1572

Thank you bob,

I am Going to remove the entry order. Because It didn’t retraced to my entry level as I thought. When I look at 1 Hour Chart From 13th April, the pair was a downward movement. I draw a Line and It perfectly resisting this trend line 4 times. Now the pair ready to resume the down trend. I see this isn’t a good trade now. If I trade from 1.0280 it will stopped by my stop loss or around 1.0320 area. 1:1 R:R. It not good ahead of FOMC meeting. Anything will Happen. Waiting for a good entry later.

Happy Pippin

1573

Aussie should be looking to go north. Even though I want it to go South. For some odd reason the markets dont seem to listen to me go figure. I guess part of the reason for my short bias is I remember the pain from last year at pairty and I think deep down I want to try again for round 2 with what I know now. So I will probably be hurting again if price decides to go south.

Also I dont have anything against pending orders and at the end of the day that is what a stop is. Just pending entry orders seem to kick my butt. Kind of like leaving your hand in the cookie jar. I see everyone else do it with no repercussions but sure enough let me leave my hand in the cookie jar and wham down comes the lid and here comes the pain. After a few hundred (probably thousand) of time being caught I have learned not to leave my hand in there. I still need a refresher from time to time.

1574

Greetings :slight_smile:

My first post to this wonderful thread :slight_smile: Thanks to all for presenting such an interesting and intelligent thread.

I had an enforced day off from work due to illness which gave me my first full day of forex watching!!!

My thoughts:

Looks like the 3 USD pairs are starting to point in the same direction:

GBP recovered from its’ early plummet to resume it’s uptrend

EU continues to improve with another up candle to confirm the recent swing low

Aussie currently looking like an up candle to confirm its’ turn around.

Are we clear for take off to sell dollar?? Time will tell I guess :wink:

Finally, I wish you wonderful success with the continuation of this thread.

And thanks again.

Slan go foil :slight_smile:

1575

This was said after looking at the weekly candles on all USD pairs and comparing it with last weeks weekly candle bias.

Now I only wish that I have the nerves of steel and stick to my analysis and hold till my entries hit the next support or resistance levels.

1576

Wah… Wah… Kya Baat Hai… :smiley:

Some days ago somebody here commented that when he is post a trade Idea in this thread, not works well. It ended in a loss or breakeven.

My yesterday’s AUD/USD trade not triggered. Now It gone beyond my predetermined Target. It’s Sad. After some week I just spot a trade on this pair.

I saw many times when a Hammer printed in Daily, 4H and 1H next candle will retrace at least 50% of the Hammer’s wick.

But yesterday it never retrace and I miss a good trade.

Lol… Waiting for next trade Idea.

Good Luck

1577

Badiya…ye thread pe, hindi ko dekh ke maza aagaya yaar, …Trades tho athe hi rehthe mere bhai…
All we need is patience just to spot the trades using Niki’s method. At first, i use to execute atleast 10 to 20 trades per day, now it has dropped to 3 ro 4 trades a week. A drastic change, isn’t it ? Well, out of the 10 (max ) trades im takin a month, 7 of em are winners…the rest are losers only because, my itchy finger pushes that sell/buy button even before there’s a trade setup…

1578

It seems it’s not possible for a new user to open a thread here.
What is the problem ?

1579

Ha ha ha,

Great, gs8888. Where are you from?

1580

India…

1581

Dont worry I missed that same trade. You dont have to wait for the 50% retracment of the hammers wick. I do it for personal preference to get my stop loss as small as possible. Also on the AU if you look at most of the main swings on a chart for that pair you will find that most of them begin with some form of hammer and the next candle does retrace to the 50% mark almost everytime. Unfortunately not everytime as you now see. Trading is never a perfect game it is about risk/reward and probabilities and most importantly patience to wait for that low risk high reward setup with the highest probability of success. It takes a lot of discipline to watch a trade go on with out you because you did not get the retracement in the end it does payoff at least it does for me. I can not speak for others. Good luck on the next trade and good job letting that one go because it did not meet your rules for entry (even though it would have been a good trade). Thats a hard thing to do shows discipline. There will always be another trade so if you miss one dont sweat it just hit the next one.

1582

Thanks Bob for your encouragement.

Salimvp

1583

Hello bhai hindi me baat kari accha laga.

Forex market me bahut kuch seekhna hota hai paise kamane ke liye.

Not all traders can become profitable or winners :slight_smile:

1584

I see a few of hindi speaking forex traders from different parts of world here.
Main bhi hindi/punjabi bolta hoon. I am from Chicago though.
Any other native language speakers here from Chicago?

By the way, I have been off tracked from forex for almost two weeks.
Getting back now.

1585

I am from South India. Not from the north. :smiley: