The finest in trend trading

you are fantastic teacher! I like it :slight_smile:

Here we have Denise, (:smiley: :D) a reverse clean bubble >>>

You can see that the mid BB is going down.
Therefore the price action is going down.

She is rather naked too, so we shall dress her…

In this chart we see the price action >>>

I have used a different colour code for the down bubbles but the action is the same - the price action pulls away from the BB when the opposite BB starts to contract.

Here we have some clean bubbles in a price action chart >>>

This just goes to show how common they are!! :wink: :wink:

A chart of the Cable now >>>

This chart shows the 2 basic types of BB >>>

The blue ones are the clean BB bubbles which we are now familiar with.

The red one is a BB sausage. (NO you cannot eat it!! :smiley: :smiley: :D)

The price action in the sausage does not walk the BB as cleanly as in the bubble.
Instead it oscillates between the outer BB and the mid BB.
In fact, the price action here may be quite erratic.

Sometimes the price action walks the sausage BB in a very clean fashion.
But as the BB develops, you can see that it is not a bubble because the outer BB tend to stay somewhat parallel to one another to form the sausage pattern.

The areas not shown in boxes are areas which are difficult or impossible to classify.
This does not matter - we are not here to classify BB types.

But the clean BB bubble is an important case, and we will be working a lot with this one.

Sir Tymen,

There are lots of cases the mmacd seems to almost crossing 0 line then it reverses … and sometimes it does not even close to 0 line…

below, in the picture … no 1,2,3,4 are the places that I have missed.


[B][U]EXERCISE[/U][/B]

Scroll thro your favourite currency pairs.

Add the BB indicator to them.

Draw boxes around every clean BB bubble you see.
Draw tend lines for the price action in the bubbles.

What do you notice?

How common are these BB bubbles?

Now, I can predict the direction of a price movement … wow :slight_smile:
i guess the price action in the clean bubble moves faster

This is nothing to worry about - you are in profit. :slight_smile: :slight_smile:
Ignore these close approaches!!

You only act when the MMACD [U]does cross[/U] the zero line.

This one is also a bad scenario …


tymen, do you know what actually happens in the market in such common cases. I am very interesting in psychology of market (traders)?

I’ve been watching the AUD/USD this morning.
Attached are the 20m, 1h, and 4h charts. The 20m and the 1h crossed the zero line at almost the same time indicating to short. But on the 4h the super guppy is in an upward trend. Should we enter the short or wait for a long?
In watching the BB’s the mid bb has been sloping up but looks like leveling out. The outer BB’s on the 20m were expanding, but now are leveling out. Looks like the short would have only been good for a quick 10 - 15pips


Tymen,

Thank you for the very useful “bubble and sausage” examples. I have homework to do but you have certainly provided the framework. Hope the weather has cooled off for you.

I’ve noticed that we can continue to stay in the trade (in case of “sausage” market :smiley: ) until the price action crossovers mid BB

right?

Yes, you would have made a small loss here. :frowning:

You cannot win them all, you know!! :smiley:

Losses are part of trading. :wink:
I have not yet seen the perfect method that never loses!! :stuck_out_tongue:

There is a method that never loses, It is called “the no entry method”:slight_smile:

Originally posted by [B]cubanpip2010[/B] >

I’m sorry but I’m very interested too in the answer to this question
I would like to compare it to this thought from another respected member from this community:

cubanpip2010 quoting [B]Used[/B] >

Originally Posted by [B]used [/B]

[B]NO ONE knows what the market will do next.
The market does what it does.
It either decides to take your money & move in your chosen direction or it doesn’t.
You have no control over what the market is doing.[/B]

These statements by Used are correct.
I knew this stuff much earlier on from the books I have read.

Hindsight is always a wonderful thing. :smiley:

no prediction??? :confused:

Never use the super guppy for anything!! :eek:
Delete it!!
I used it only for the purposes of teaching because a reader posted the use of a 200 ema.

[B]The super guppy does not work!![/B] :eek:

Great that you used the triptych!! :slight_smile:

Now with your 4 hour, you would ascertain the direction by use of a trendline or by using the zig zag indicator as [B]Simbafx [/B]suggested.
This may give a different answer to the super guppy that you have been using.

If the trend on the 4 hour is still upward, then we trade only long and not short.

In watching the BB’s the mid bb has been sloping up but looks like leveling out. The outer BB’s on the 20m were expanding, but now are leveling out.

[B]Using the mid BB to detect trend works only to an extend - it is lagging - be careful.[/B] :eek:

Looks like the short would have only been good for a quick 10 - 15pips

Correct.
A sniper tactic, considering the main trend is probably up.
You are taking a risk even doing that much!!

[B]Finally please note that this work is not complete.
The time to trade using any methods described herein is when I post a PDF, and not before!![/B]