The Basics Of Profitable Trading Using The 15m chart

[PurplePatchFX]

Hi, I have a certain aim for this thread and I’m going to do everything possible to keep that aim, I want to start from scratch, keep it simple and stick to the 15m, so I we can keep it as clear as possible as to what we are doing.

So First of all - Candlestick reading.

I will keep terminology to a minimum and try and call a spade a spade, I do like the term pin bar, because it looks like a pin, so some basic terminology there.

A PinBar indicates weakness in the direction of the pin, in the above case, the move up is weak, so we are most likely to see a reversal, this will be our entry point, not on their own, but this will be the basis of our entry point.

A full bodied candle indicates strength in the move, so in this case strength in the up move, and this is very important because this is when we stay in trades, if the market has moved substantially in context and you see large full bodied candles, stay in the trade ‘run with your profits’.

I won’t be going into detailed variations of candles like doji, spinning top, etc etc etc. as far as I’m concerned, all candles are varying degrees from the above, the more the candle you are looking at is deviated from the above the less likely the market will turn around or continue as it is respectively, simple as that.

So that we get real benefit from this thread:-
Posters with silly questions will be answered.
Posters with stupid questions will be ignored.
Posters insisting on irrelevant postings will also be ignored.
This is a serious thread for serious learners.

Ok, lets’ go then!
You’ll notice a slight variation in my username, there is a good reason for this

[SimonTemplar]

Bump!

Interesting stuff, Purple, look forward to following. Sorry not to respond sooner, builders in so only around sporadically at the moment.

So is the original PPF deceased, this being the new you, or are you simply ring-fencing an identity for this thread? If that counts as a stupid question per your opener obviously just ignore it and I’ll make my next one trading-related lol.

ST

[PREDITER]

We know by these signals the market will either move forward or retreat, odds are they will go in the desired direction but are you using anything else to filter out any price movement not in the intended direction?

Have you tested this system?
Have you used different time scales?

Thanks for posting

[bobmaninc]

Nice I will be following.

I was also going to ask how you got demoted back to newbie status lol. I didnt even notice you actually changed your screen name.

[purplepatchforex]

@ST - It’s a thread control thing

@PREDITER
Tested the system? No, the thing is this approach works, it’s candlestick trading applied in the easiest possible way, and hopefully in a step by step method.

This is the dilemma I have, the stuff I will go through can be applied to any TF, but I will use the 15m for system and illustration, so for instance on the 15m, 3 pinbar close to each other is a strong sign of rejection of a price level, on a 5m chart it’s not something you’d trade in the same way although pinbars will feature as a price level rejection indication.

It’s like making yourself a set of trading tools, some you will use to crack small nuts, and some you will use to crack big nuts, so although you can use the same principles, you cannot use them in exactly the same way on all timeframes.

[PREDITER]

@ST - It’s a thread control thing

@PREDITER
Tested the system? No, the thing is this approach works, it’s candlestick trading applied in the easiest possible way, and hopefully in a step by step method.

This is the dilemma I have, the stuff I will go through can be applied to any TF, but I will use the 15m for system and illustration, so for instance on the 15m, 3 pinbar close to each other is a strong sign of rejection of a price level, on a 5m chart it’s not something you’d trade in the same way although pinbars will feature as a price level rejection indication.

It’s like making yourself a set of trading tools, some you will use to crack small nuts, and some you will use to crack big nuts, so although you can use the same principles, you cannot use them in exactly the same way on all timeframes.

Thanks for the clarification,
How often do you trade with this style and how many approaches do you trade with?

[purplepatchforex]

Thanks for the clarification,
How often do you trade with this style and how many approaches do you trade with?

How often you trade is a really difficult question to answer, firstly, I trade when I feel like it, hardly ever on Mondays, and not on Fridays if I can avoid it, but I suspect you mean how many trades do i put on, now that is dependent on the market, but on a daily basis on the 15m chart 0 to 2 maybe, but that can also mean no trades for a week or more, the market can ‘stall’, on the 5m chart you may potentially have twice as many entries. Win/loss ratio, I don’t know, I can have a run of 4 losing trades, I am not the most patient of traders, but I’m getting more patient all the time, which brings me nicely to the post I has in mind this morning.

One of the key things of keeping in profit with forex is to ‘run with your profits’, but how often do you see that? ‘Run with your profits’ yes ok, I don’t know about you but I’ve heard ‘Cut your losses short and run with your profits’ so many times it annoys me, it annoys me because it is just quoted with no explanation how to. So what does it mean in practice? It means like I said when you see big full bodied bars you stay in the trade.

Take this part of yesterday’s chart, big bodied white candles after each other and then towards the end of the move, long wicks, then the market slows and comes to the end of that move.

When you enter a trade, you don’t know if you’re at the start of a big move or not, you will get some ‘big shot’ saying because of this it will move X, don’t listen to it, it’s normally garbage, what you do know, is that if you are in that trade and you see big candles with no wicks you stay in there, the market “will” keep moving. So unless you’re ridiculously aggressive and don’t get into silly entries too often, you will make a profit over the long run by staying in those “big” trades.

[Nikitafx]

Finally a home for Purple!

My contribution to the thread so I would get the updates as you keep posting.

Oh and one question. If say this profile also gets to hit the mile marker and is awarded the Honorary FX Men title, would that mean you get double the monthly allowance from Babypips?

[purplepatchforex]

Ok, a little about market dynamics - the way the market moves. Now I’ve studied Elliot Waves in depth, I’ve studied Wyckoff in depth, VSA, you name it, I’ve looked at it, so to save you guys all that bother I’ll to try and put the most significant thing above all else in one simple post.

As we know, the key to Forex success is Support and resistance, but how and where?

Here we are :-

Look out for consolidation, you could call it Accumulation/Distribution, as you know I like to call a spade a spade, so what we are looking at is a range, now in that range you will see ‘tidy bits’, that is the direction the market is trying to break through, you want to be trading off the untidy bit for the best trades, more often than not there is an overshoot (‘to take stops out’), after that, it is the best trading opportunity.

Imagine if you like the currency is knocking at the door, but someone at the door says - ‘You’re not coming in’, so you get pushed back, you try again, you get no answer, so you step back a bit, knock again, then you get pushed away, you get more detwrmined, so you kncok louder, you get thrown off the step this time, a little bit further, then you go, I’m coming in like it or not, and take a run at the door and burst through!!

Exactly the same but opposite for shorts.

Apply this to your 15m and 5m, larger timeframes become a little different.

[fartist]

@purplepatchforex

Ok, a little about market dynamics - the way the market moves. Now I’ve studied Elliot Waves in depth, I’ve studied Wyckoff in depth, VSA, you name it, I’ve looked at it, so to save you guys all that bother I’ll to try and put the most significant thing above all else in one simple post.

As we know, the key to Forex success is Support and resistance, but how and where?

Here we are :-

Look out for consolidation, you could call it Accumulation/Distribution, as you know I like to call a spade a spade, so what we are looking at is a range, now in that range you will see ‘tidy bits’, that is the direction the market is trying to break through, you want to be trading off the untidy bit for the best trades, more often than not there is an overshoot (‘to take stops out’), after that, it is the best trading opportunity.

Imagine if you like the currency is knocking at the door, but someone at the door says - ‘You’re not coming in’, so you get pushed back, you try again, you get no answer, so you step back a bit, knock again, then you get pushed away, you get more detwrmined, so you kncok louder, you get thrown off the step this time, a little bit further, then you go, I’m coming in like it or not, and take a run at the door and burst through!!

Exactly the same but opposite for shorts.

Apply this to your 15m and 5m, larger timeframes become a little different.

In technical terms, its akin to what we call a bull/bear trap?

[Nikitafx]

@purplepatchforex

Ok, a little about market dynamics - the way the market moves. Now I’ve studied Elliot Waves in depth, I’ve studied Wyckoff in depth, VSA, you name it, I’ve looked at it, so to save you guys all that bother I’ll to try and put the most significant thing above all else in one simple post.

As we know, the key to Forex success is Support and resistance, but how and where?

Here we are :-

Look out for consolidation, you could call it Accumulation/Distribution, as you know I like to call a spade a spade, so what we are looking at is a range, now in that range you will see ‘tidy bits’, that is the direction the market is trying to break through, you want to be trading off the untidy bit for the best trades, more often than not there is an overshoot (‘to take stops out’), after that, it is the best trading opportunity.

Imagine if you like the currency is knocking at the door, but someone at the door says - ‘You’re not coming in’, so you get pushed back, you try again, you get no answer, so you step back a bit, knock again, then you get pushed away, you get more detwrmined, so you kncok louder, you get thrown off the step this time, a little bit further, then you go, I’m coming in like it or not, and take a run at the door and burst through!!

Exactly the same but opposite for shorts.

Apply this to your 15m and 5m, larger timeframes become a little different.

Nice, but what about direction? How do you filter out north or south? Is it just based on the false breakout?

[PurplePatchFX]

In technical terms, its akin to what we call a bull/bear trap?

You could call it many things, but like I say, I’m going to call it what it is, which is a range, the problem with terminology is that it has connotations that lead to expectations, and that is bad for trading.

[fartist]

I see.
Yes i do notice these type of patterns and they’re good to trade.
I look forward to hearing more from you! Cheers

[system]

:45:Good illustration & analogy Purple

@purplepatchforex

Ok, a little about market dynamics - the way the market moves. Now I’ve studied Elliot Waves in depth, I’ve studied Wyckoff in depth, VSA, you name it, I’ve looked at it, so to save you guys all that bother I’ll to try and put the most significant thing above all else in one simple post.

As we know, the key to Forex success is Support and resistance, but how and where?

Here we are :-

Look out for consolidation, you could call it Accumulation/Distribution, as you know I like to call a spade a spade, so what we are looking at is a range, now in that range you will see ‘tidy bits’, that is the direction the market is trying to break through, you want to be trading off the untidy bit for the best trades, more often than not there is an overshoot (‘to take stops out’), after that, it is the best trading opportunity.

Imagine if you like the currency is knocking at the door, but someone at the door says - ‘You’re not coming in’, so you get pushed back, you try again, you get no answer, so you step back a bit, knock again, then you get pushed away, you get more detwrmined, so you kncok louder, you get thrown off the step this time, a little bit further, then you go, I’m coming in like it or not, and take a run at the door and burst through!!

Exactly the same but opposite for shorts.

Apply this to your 15m and 5m, larger timeframes become a little different.

[SanJ]

Just throwing in a real example of your post as i think it’ll help others visualize…

We had all the makings of your example bar the stop raid before the rally in price (which i was quite surprised at actually)

Last week’s action in the GU…

@purplepatchforex

Ok, a little about market dynamics - the way the market moves. Now I’ve studied Elliot Waves in depth, I’ve studied Wyckoff in depth, VSA, you name it, I’ve looked at it, so to save you guys all that bother I’ll to try and put the most significant thing above all else in one simple post.

As we know, the key to Forex success is Support and resistance, but how and where?

Here we are :-

Look out for consolidation, you could call it Accumulation/Distribution, as you know I like to call a spade a spade, so what we are looking at is a range, now in that range you will see ‘tidy bits’, that is the direction the market is trying to break through, you want to be trading off the untidy bit for the best trades, more often than not there is an overshoot (‘to take stops out’), after that, it is the best trading opportunity.

Imagine if you like the currency is knocking at the door, but someone at the door says - ‘You’re not coming in’, so you get pushed back, you try again, you get no answer, so you step back a bit, knock again, then you get pushed away, you get more detwrmined, so you kncok louder, you get thrown off the step this time, a little bit further, then you go, I’m coming in like it or not, and take a run at the door and burst through!!

Exactly the same but opposite for shorts.

Apply this to your 15m and 5m, larger timeframes become a little different.

[purplepatchforex]

Just throwing in a real example of your post as i think it’ll help others visualize…

Looks beautiful 15m tf too!

[anon88459104]

Looks almost the same as Purple’s picture, but the stops are not taken out prior to the rally up.

[SanJ]

Looks beautiful 15m tf too!

Yeah, i use 5m for entries, 15m to monitor with HTF bias and support and resistance premise in mind… Im an ICT student lol
But im a fan of PA and been following your posts for a while so looking forward to seeing more…

Looks almost the same as Purple’s picture, but the stops are not taken out prior to the rally up.

And yeah, was just a nice example to compliment his post…
The failed stop raid before the rally is what surprised me, it made it down that far and missed taking out that low by literally two pips…

But PPF did mention ‘more often than not’ - guess its not always… But i agree, a lot of the big moves seem to happen after these stop raids…

[anon88459104]

Yep, all part and parcel of the market behaviour, no reason why stops should be taken out prior to a rally.

[PurplePatchFX]

Looks almost the same as Purple’s picture, but the stops are not taken out prior to the rally up.

Ah yes, good point, I was thinking about that and forgot to mention about it, the dip could be anywhere along the support area, in SanJ image it’s right at the beginning, so then you have a smaller probability of another dip when you get to the end of the range, but you can’t rule it out, so you might enter once, get stopped out, and you may want to enter again in the hope that it will continue up eventually, of course you could scalp the range until the end of it, and then when you see long full bars at the end breaking through the resistance hold on to the long big trade too. But let’s keep our feet on the ground!