Technical Templates 2

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587

you�re not just a pretty face then!! :stuck_out_tongue:

worth a re-cap though huh?

the only markers we have on our technical maps are previous weekly high/low lines & previous day�s high/low lines.

we advocate sitting up & paying attention as price begins vibrating key s&r zones & round numbers/big figures.

where did they drop the price to after they unloaded their barrels?
A previously annotated buy/sell pressure zone. It then flirted with a typical reaction area (round number & previous day�s low level).

we got negative bias, failed upkick (off 6820) & a heavy tone into the late London/early NY action.

where�s the value & lower risk to be had?

players didn�t like the taste of that shovel load of extra quant cash very much did they, so they took a whack at it & unloaded their shells.

there�s a lot of stressed money up there at 1.6950, I guess it wasn�t too much of a surprise to expect those shells to get fired thru the barrels. Plus we�re sliding into the end of week prints ahead of the NFP circus.

and just for good measure, price has bounced & settled at their 2nd highlighted s&r zone.

common area’s of reaction, running with the flows & legging in at your preferred risk/value zone.
no surprises then huh?

600

Andre has not only managed to not burn the thread down, he’s actually done a wonderful job here

Agreed, I’d go as far as to say I’m another happy customer if this was a paid service lol

I can imagine one or two impatient & ill-disciplined souls have done their dough dodging around in all this hustle & bustle.

Haha I know I certainly have in the past, the funny/annoying thing is every time I’d feel pressured to jump into something ridiculous like a 1:20 R:R 5 min bounce trade and feel like a new man after recovering from the burn it’d only be a matter of time before I caved and lost patience i.e.waiting for a decent setup vs the pressure of being in the red or fear of missing an opportunity. Something of a vicious cycle, at least reading threads like these help keep me out of the deep end of the pool.

I have a feeling this might have been answered before but what would you guys consider a long term trade from the interbank level, as well as a retail broker trade? And how do you deal with all the news releases in between (loose/trailing stops?)? It just seems a little contradictory that (from my experience/googling anyway) news releases are something of a no-go zone while it’s almost impossible to enter an interday trade without running into some sort of announcement.

Then again by the time the news came around you’d (ideally) already be in profit so it probably doesn’t matter that much…

611

Hello UK crew:
Good to see some familiar faces from a bit back. I spotted that you all are posting soley here now. Been lurking in the bushes. Hope all is well!

Got a fairly “simple” question regarding entries and something I have grown to understand as (IMHO) the ture Irony of Trading… and it has to do with entries.

Goes something like this: When you are new to the game and have a small account, you must be damn near perfect, on your entries in order to hope to give the trade a chance to run (this after all of the understandings of S/R and price action) after you have a survived that, and your account size grows, you could be off a few ticks/pips and have the ability to ride the drawdown and survive it. As well as the ability to survive- whipsaws, fading of the breakout etc.

So I’d like to hear from you folks- your opinion. To set a good Risk/Reward ratio, it is advisable to enter as close to support as you can and have a reasonable amount of S/L to protect on a long, and vice versa on a short at Resistance. Is their a way to accurately gauge the probablilty that either the Support or Resistance will hold or fold? We can all see a large spike down with it ending upward on the bar, but how long do we wait to decide (ahh yes it will indeed rise) or will come back to retest and possibly stop us out.

Aaron

614

[I]So I’d like to hear from you folks- your opinion. To set a good Risk/Reward ratio, it is advisable to enter as close to support as you can and have a reasonable amount of S/L to protect on a long, and vice versa on a short at Resistance.[/I]

Hello Aaron :slight_smile:

No, not really.

I don�t know about you, but support & resistance zones/buy-sell pressure zones, call them what you will, are nothing more than guides or potential contact area�s.

Sometimes the price action (influenced by whatever is driving it at the time) will obey the area perfectly & offer up a clear, identifiable set-up or trigger from which to engage, & other times it will dance & flop around the area for hours, spiking & unseating positions, awaiting clear direction and/or sufficient participation to gun it into gear.

I will say that in the majority of cases we prefer to engage on & around our preferred (& much touted on here) levels & zones because they�ve proven to offer us very decent risk & value opportunities at those levels/zones at certain times of the trading day.

[I]Is their a way to accurately gauge the probablilty that either the Support or Resistance will hold or fold?[/I]

Not in my experience, no.
For me/us it all revolves around what is influencing the price action as it vibrates & hustles one of our identified levels. That, + the manner in which price behaves & interacts with the level, usually dictates whether we�ll take it on or not.

And of course, when we do engage & it fails to do what we expect it to, we don�t hang around waiting for it to prove us right�…we fold & get the hell out. Our planning is based on the current conditions & influences. It�s either going to step up & return the $$�s or the trade will get canned.

[I]We can all see a large spike down with it ending upward on the bar, but how long do we wait to decide (ahh yes it will indeed rise) or will come back to retest and possibly stop us out.[/I]

[B]That will usually depend on some or all of the following:[/B]
How you set your trades up according to the level
Current conditions (range/trend)
Overall behavior of the price action
Time of day
Timeframe
Present price bias/influences
Characteristics of the pair you�re trading
Expectations & aims of the individual trade intent.

617

Fair enough, that sounds very logical. Thanks

Yes indeed, thank you. And thus at this level- this is where you are waiting to see your trigger bar/bars to take the trade then- makes perfect sense.

Ok, I’ll tell you my recent dilemma, all of this is advice I have studied from you folks in the past and had much success in implementing. Lately, I have been getting hammered on whipsaws and fading of the break that have taken place. Long term I’m on the correct side of the flow- but the small pullbacks or fades that come in have been taking a beating on my stops and turning a great set up into sh*t soup.

I figure it has to be my entries, but I’m trying to grasp exactly how to strengthen my entries in order to give the trade a fair shot of banking money. Not sure if it is a psychological thing or what- but my execution as of the last few months has been horrible, and am working to try and correct it before getting into too much trouble.
Aaron

619

This has certainly been the time to pack your towels & lotion up & hit the beach!

A few of us here, including Jos & myself, have been away on vacations since early June Aaron & there�s a good reason for that�

Historically, volumes are very poor this time of the year & that often has a knock-on effect to (usually solid) technical & fair value levels. Don�t forget we�re also continuing to experience fall-out from the recent credit fiasco. That�s a pretty potent mix & it�s affecting the psychology & structure of the funding tranches right across the marketplace.

Unless folks have adjusted their game plays, especially those operating a more discretionary type model(s) to allow for this behavior change, then they might experience & encounter even tougher trading conditions than normal around this time of the year.

Again, it�s the main reason the guys here have swapped to a more flexible, aggressive & shorter term view of the market across the traditionally more active pairs.

It�s times like this where the trade selection becomes even more important than normal, and trade management takes on a more “active” role.

621

Tess-
Thank you for that. I started to have doubts about my own abilities. Needless to say, it really means that I still have a lot to learn for sure. Because if I had the skills necessary, I would still be able to make money- even in this market and its current conditions, it may be “less than normal” but it certainly should not be a negative amount on my account. So I feel that with this information and the understanding that I must be even more “in-tune” with the ebb and flow (accounting for the change in it) that it is a new challenge and chapter in my trading career that will need to be worked on and accounted for. Thank you for your insight!
Aaron

624

Not sure what potential reaction zones you got mapped out on your charts south of here. One or two of them might well be on your radar too.

4 hour view with the .8100-.8150 buy pressure zone shouldering the action into 3rd quarter activity.

30 min views on the other 3 charts with the next step up (.8180-8220) attracting continued bullish participation, tossing it back up the ladder.

See where every time price busted out aggressively & re-visited, it attracted renewed upside pressure? Any late (weak) sellers trying to jump on the train as it approached that station got mugged as it reversed sharply via those stair step buy levels.
Longs were waiting to position themselves in tandem with the longer range trend bias.


The pop back off the re-visit to the .8450 years high during mid August has so far generated a higher low pattern (buying dips) that will only threaten the bias on a concerted dip thru this 1st line defense at .8220, the prior higher low step.

Will it repeat the exercise next time price hustles this zone?
Who knows � depends what�s driving & influencing it I guess. Eventually the dip buyers will purchase one too many & get steamrollered.

Everyone plays it as they see it. If you can get a value seat (betting either side) & mitigate your risk into the bargain, then you can watch it play ball.

634

Things I’m mostly confused about are:

[I]I) Are candles self-fufilling indicators or purely the result of price action? Do traders at the commercial level take them seriously? Thinking that if not then they’re probably not as effective as if they were, and the failed ones are starting to be a real turnoff[/I]

Candles are simply representations of trader psychology. They mirror the activity of the price action playing out on whichever timeframe grid you�re observing.

That�s why you see & hear a lot of chatter on these forums about studying & analysing price action via a combination of different timeframes.

Using a top down approach (observing a 4 hour, 1 hour, 15min & perhaps a 5min for execution purposes?) supposedly offers the trader a more realistic & clearer message of what the technical map is saying.

That�s ok of course as long as the trader has an objective that sits in sync with that type of information stream��but essentially that�s all candles or price bars are.

[I]II) Does sentiment actually move in direction of anticipation of both market opens and news releases or am I just seeing coincidental movement?[/I]

Sentiment or bias moves because enough participants throw their orders into the hat at a specific level, which in turn attracts more orders. It slows when some or all decide to pull those orders back out again. The directional flow of the price action at that point will depend on why those exit orders were encashed.

If they were for the purposes of partial profit booking or re-adjustment, then eventually the price action might continue if sufficient order flow exists�.if not, & enough participants get spooked, take a different view of the bias, decide the level represents fair value for that currency pair etc then contrary price activity will ensue.

The same results will then wash thru the pipes again until the dominant camp subsides & cashes out their tickets.

News/data, impending releases, rumor, fear/greed, knowledge, lack of knowledge blah blah�.all have a direct impact on the transition of money into & out of the market.

If you�re smart enough & you possess robust skill sets & game plays, then you�re better placed to take advantage of this constant money exchange merry-go-round. It helps if you understand how & why markets work. Possessing adequate experience won�t hurt you either.

[I]111) Is there something I’m doing that’s relatively wrong i.e. counter intuitive to winning trades lol. Have a bit of a feeling I really need to pick better R:R trades[/I]

I think you�ll benefit from having the opportunity to actively observe & study the markets when they�re operating in full flow. It�s incredibly difficult to wire yourself into this environment & stake your claim to some of the action if you�re having to slip in & out at varying times of the day/week.

I also believe it takes a good lick of time before someone is really ready to set their stall out complete with the necessary tools onboard to tackle the day to day swell of the market rhythm. 6, 12, 18 months exposure to this gig just doesn’t cut it for the majority of folks.

It takes time to expose your strategies & mind set to the differing market conditions & psychology extremes that affect price flows & volatility readings etc. Hell, I doubt a person even knows what type of strategy play suits their personality in that short time span, especially if they’re coming at it from a part-time angle?

I don�t personally know of any successful professional players who don�t dedicate themselves 100% to completely wiring themselves into the circuit. When they switch on the screens & put on their headsets they�re ready to rock n roll. Everything else gets put on the back burner.

And they rock n roll anywhere from 5.30am thru to 6.00pm most days. That�s often what it takes to get the job done.

I’m not saying everyone has to go to those extremes in order to make a little money out of this gig, it depends what your aims & expectations are - but that’s the kind of competitor you’re up against when you click your buy-sell trigger.

The strong will take from the weak. They don’t care whose account it is they’re mugging. Cold, hard cash is all they’re concerned with.

635

Here�s another example of what I mean about mixing it up with competitors.

How many folks are seeking extra confirmation of directional bias before executing in this current turbulence? Breakout/pullback strategies are getting whacked inside the choppy swells, particularly around regional opening prints & session overlap periods�.continuation set-ups are getting unseated as players wait too long to feed into them.

Some of this turbulence can be attributed to ancillary market influence (commodity/equity index behavior patterns), some of it to time of day/time of month (option barrier activity�week/month end book squaring�calendar volume/liquidity issues etc). Thing is, if you don�t adapt or bend to a more flexible angle, you�re going to get smoked.

Bar/candle groupings, repetitive price behavior patterns�.clues to trader psychology are a big part of set-up & opportunity preparation. But sometimes you got to take a calculated risk or two & step in front of the herd. If you know where the herd are usually grazing, you can often sneak a pace or two on their route & give yourself a little breathing space.

Thursday & Friday prompted one such opportunity. If you were at your work-station around the time(s) that the price action was jerking around, you�d have been able to make a balanced decision (based on the available information) to engage or not.

If you can compute positive risk/value odds & put a proven strategy play to work, then you can confidently grab a hold of any opportunity that comes knocking.

Andre & one of the other guys legged into a typical set-up into the Thursday NY action on the Cable.

Typical s&r/level behavior�.typical trigger entry (1-2-3 higher low step) blah blah�…the interesting bit occurred yesterday morning though�.

Price consolidating in contained, overnight range play after a pop up on elevated momentum activity.
We know the breakouts have been difficult of late, so if you�re of the mind this consolidation has further upside potential, where do you suppose the next most appropriate level exists to grab a lower risk/higher odds entry?

Nearer the lower end of that range, or taking it on at the level that�s causing a lot of recent turmoil for continuation type activity?

If it�s going to fail or get faded then the likelihood is, that lower range floor will get flooded pretty fast, yeah?

If it does, then you can calibrate an option to take it on with a planned entry route.

If it holds up to inspection, then you want to seek out good value with limited risk (given it�s a potential intraday play) to get a seat & check out the continued upside potential�…you don�t really want to be in amongst all the hustle & bustle of the breakout activity if recent behavior has caused you to lose your seat.

Like I said, it�s just another slant or view to casing out & preparing an opportunity to pick up a few bucks in this sloppy low volume environment.


And the other option set & ready in case things don’t pan out as planned…

637

Wow that’s a bunch thanks heaps, guess all this time has been one way to wake up to the necessity understanding and keeping up with fundamentals; relying on other people to move PA in one direction or praying fundamentals will go that way because chart indicators said so just doesn’t seem to do it often enough lol

638

You tried perusing this mob?
Forex Trading, Broker and Software provider for FX, CFD’s, Gold, Silver Futres & Options Trading| ODL Markets Ltd

Couple of Jimmy’s clients use them for observation purposes & assisting with familiarizing themselves with mirror levels & generic intermarket ballpark area’s etc.
I had a quick squint at it earlier & you can play around with some of the combo’s & give it a whirl - for free anyway :slight_smile:

640

I’m with Ray on that on that’s incredible - you have no idea how over it I am with shoddy java-based charts and refreshing CNBC for live quotes, unless you’ve been down that road too at some stage :p.

Looks like things really took a nosedive a few days ago but surged into rally with the US markets. This week seems particularly volatile in terms of the news announcements though. G/U hadn’t seen the the 1.6110s since mid July - been running into plenty ridiculously long wicked candles and misleading or very short-term reversal signals on the smaller timeframes anyway

Again, in my experience the higher odds, lower risk opportunities nearly always deliver after you�ve meticulously prepared your groundwork, set-up your game plan & marked out your territory…Thursday & Friday prompted one such opportunity. If you were at your work-station around the time(s) that the price action was jerking around, you�d have been able to make a balanced decision (based on the available information) to engage or not.

This describes most of my longer opportunities to watch the markets but sitting there it felt as if price was bouncing and retracing anywhere between 5-30 pips or so as price usually does only the difference between a retrace and a step up seemed to be a random coin toss (or a news release). In fact alot of my recent sessions between news releases it feels like I’m watching a giant seek-and-destroy pattern in pick-one-of-any-3-zones. Then again this is probably just me getting back into old habits getting freaked out by the market noise

I also believe it takes a good lick of time before someone is really ready to set their stall out complete with the necessary tools onboard to tackle the day to day swell of the market rhythm. 6, 12, 18 months exposure to this gig just doesn’t cut it for the majority of folks…I don�t personally know of any successful professional players who don�t dedicate themselves 100% to completely wiring themselves into the circuit. When they switch on the screens & put on their headsets they�re ready to rock n roll. Everything else gets put on the back burner.

Purely technical analysis based systems that brokers seem to encourage or rather newcomers like myself were attracted to because being simple to follow give the impression that you only need to wait for the right candlestick, ob/os/momentum signals and hit the button to win, hence negating the need for any experience whatsoever. Not to say that they don’t always fail. Then there’s the scalp a few pips between what seems to be a channel and get hit by a -20 breakout. Or maybe it’s just me lol, it’s kind of disappointing to realise that what I figured would be easy(easier) money on the side requires a heap of homework in order to just stay in profit

641

Sure, but considering this is a reasonably busy week for data & market chatter, culminating in Friday�s NFP & the G20 gig in London at the w/end, it�s not too surprising that prices would once again attract each-way interest at some of the usual reaction levels.

You�re not going to get regular high end spec players committing tasty sized bets leading into late week fundamental power plays. Thin volumes might well lead to one or two extended range plays, but it�s not going to be dictated by serious money this late into the week.

Hate to keep chewing on the same, boring old bone but where did the Cable vibrate & bounce again during today�s trade?

Familiar contact zone by any chance?

In fact if you flick thru most of the $ based units you�ll see they all bounced off similar levels today.

That was confirmed by the Dollar Index (hourly view) spinning it�s wheels again into early European trade up at that recent prior level of $ weakness (c78.70-80).

Notice how it grew legs yesterday down at the 78.0 zone. Re-testing Friday�s lows (mirroring Cable�s bounce off Friday�s 6375 highs).

Think you can begin to work these common radar zones into your game plans someplace? :wink:

650

Hi all,

I haven’t had the time to fully explore your thread but what little I have read about it is that its based primarily on price action? I have recently switched my thinking and started demo trading price action this week. :slight_smile: It looks as though you all may be focusing on larger time frames than the 5min/15min I trade off of.

So after settling in at work today I placed these two trades netting 2.9% for the day and 5.7% for the week. I try to target 2-2.5% daily based on my current trading plan. As you can see I got nervous on my second trade and closed it out early. It ended up working out about 4mins after I closed my order but I was still happy for the 20pips I netted today in roughly an hour.

Anyways I hope this is somewhat of an addition to your thread. I doubt I will ever switch back to the fancy indicator systems that ultimately lost me money but I can’t thank them enough for leading me to this style of trading.

651

that�s the general flavor yes.

[I]It looks as though you all may be focusing on larger time frames than the 5min/15min I trade off of.[/I]

it depends on the trade objectives & current market conditions/behavior Dr Pip.
we use whatever tools are deemed appropriate at that time.

[I]I doubt I will ever switch back to the fancy indicator systems that ultimately lost me money but I can’t thank them enough for leading me to this style of trading[/I]

good to hear. Hope it works out for you.

655

The British Pound story is still large on the menu.

Apart from a temporary lull in sales around the time of Tess� last post when players were booking profits & re-assessing the playing field, momentum cranked up again over the last couple weeks, & if you focus on the unit as a whole, & base your trade decisions on a weak v/s strong theme, it might prove a little easier to identify opportunities in the pair or pairs that display risk positive trade set-ups & triggers.

It’s been mentioned on the thread before, & it’s circumstances such as these when that simple little cross reference item can really lever a good dollop of confidence to your analysis pot.

The general flavor of the appetite out there is reflected in the fundamental drivers & price influences.

If you want to keep casual tabs on that regular output & you don�t want to pay for the privilege, then Bloomberg, Reuters & generic (Bank) sheets are available to the masses via the popular sites.

Once the movers & shakers get their teeth into a trade (visible via the hourly chart references), it�s rare that sentiment & influences will spin on a dime & shake them out, especially if there�s mileage to be had out of a negative story, such is the case with UK Ltd.

King & his Central Bank cronies have been nattering to the wires for over a month now that GB is behind the curve & their weakening currency isn�t causing undue concern at senior treasury levels, well certainly not yet anyway.

If you know that, then simply sit back & wait for an appropriate currency pair that highlights the types of technical triggers you prefer to action & match it up with a set-up that you’re familiar & comfortable with.

The guys have been taking bites out of EURGBP & GBPJPY (to coincide with the negative Pound/positive Yen story) among others, & you can see again that consistent jawboning from the Bank chiefs & trade desks have been visibly mirrored in the technicals.

Simply keying in off major swings & previous weekly high-low markers (or prior intra-day high-low markers if you�re trading shorter timeframes) will generally be enough to get you aboard most of these moves.

It�s not like they play out in the blink of an eye. You can set up stop orders to get you aboard, or leg in via pullbacks on your shorter timeframe charts if you miss the initial pop.

As long as the prevailing story (drivers & influences) doesn�t change tack, then there�s no reason to leg out of a well calculated & executed value-risk play.

These stories don�t run forever and a day. Sooner or later something else will replace it in the pecking order & get shoved higher up the priority chain. But as long as these flavors remain visible & large on the menu, you can take advantage of them & leg into low(er) risk, higher value ticket plays, instead of running yourself ragged chasing 20 or 30 pips on fast & slippery timeframe charts paying extortionate (bottom line) spread costs to your retail broker.

656

I am watching GBPJPY for a break below the Fib support…

Attached is a daily and 240 minute chart…

Earlier, last week, I was fortunate to follow this down from the 38.2, my feeling is that there may be a nice break below the 50.0



657

As long as you got your each-way bases covered Blaiserboy, there shouldn�t be any surprises :wink:

From a technical viewpoint this is the first time price has re-visited the 140.0 zone since 1st quarter. All the way up from the beginning of the year it attracted aggressive dip buyers (evidenced by the strong rejection bars/closes at swing lows).

As we roll into final quarter of the year we got (soft) repeat behavior patterns surfacing once more. These are certainly the zones & area�s to pay attention to as the market goes about its business absorbing the activity & filtering the order flow.

Identify the key long & short-range (potential) reaction zones & set your radar markers out to catch a little action whichever direction it runs according to your strategy plays.

For what it�s worth, I got potential upside/downside (re-visit) pressure zones tick boxed from the most recent aggressive descent on this pair during 24 & 25 September.

Monday�s move up once again met resistance & found sellers at that last leg consolidation zone (2) only to attract a support kick at end of month/3rd quarter book squaring (& NFP fall-out) activity into Fridays closing prints.

Next potential upside hurdle resides back at the prior reaction zone around (2) c144.25-60 ahead of (1) 146.30-70. Those are the initial area�s that will likely test the absorption of near-term selling if upside momentum is to follow thru.

Initial downside is clearly marked up, & should the Yen strength gather continued momentum, then this pair looks destined for a trip down to c135.70-133.50.

Unfortunately, this will be our last contribution on the site.

A gradual uptick in our trading & private forum commitments during the second half of the year have put the squeeze on our time & forced us to prioritise our activity.

We hope interested parties will continue to benefit from the material on the 2 threads & thank all who have contributed & participated.

All the best in your trading endeavors!

658

While I’m glad to hear about your own personal and business growth, I am sad to see it will take you away from your regular visits to the BabyPips community.

We thank you for all of the hard work that you and your crew have contributed and we hope to see you all again in the future.

At the request of the original poster, Tess, we are locking this thread to maintain the integrity of the material taught.

If you wish to continue discuss the trading methods and techniques taught in the technical template threads, please visit the new thread 301 Moved Permanently