The finest in trend trading

Well, here we have our answer :smiley: :smiley: >>>

The LONG ENTRY CBL is shown and the price action has really shot up since then!! :smiley:

Important

Note the position of the stop loss.

It is easily figured - it is at the point of the lowest low.

[B]So now we know how to draw and set a count back line.[/B] :slight_smile:
It can be done on any timeframe.

The above candles were taken from a 4 hour chart.

The count back line will become the major tool for our[U] entries.[/U]
At this point we can use the SR lines as [U]exit points[/U].

Remember we use a [U]2 contract strategy[/U] for money management.
Therefore, we have 2 exits - one at an early SR line and one at a later SR line.

I have shown you how to draw a count back line when the trend is down and we are looking for an entry into a reversal, that is, an uptrend.

I must now show you how to draw a count back line for an uptrend when we are looking to enter into a downtrend.
(confusing but the diagrams will make it clear). :smiley:

this had completely catch my attention… but í think is only the top of the iceberg :smiley:

as usually tymen is the suspence master, you should be writting novels tymen:D

if you start a book like you start a thread you´ll made only best-sellers.

i can wait to read this system completed…

sorry tymen, would you please remind with the post # for [U]2 contract strategy[/U] for money management

thanks :slight_smile:

I would be the first who bought his book :slight_smile:

Here is the link…

http://forums.babypips.com/analyst-arena/12562-using-multiple-lot-positions-improve-trading-fx.html

I thought I have missed something in this thread

oh, I have read that (btw, no pictures to see :o )

Ty, word yo. That was some street slang I picked up in my youth living in the Ghetto of Miami Lakes Fl. :smiley:

When I see posts that say “system does not work” and “I thought we were talking about not using indicators”, it gets my attention. From the beginning it was my understanding that you were laying a basis for something different than the same old same old. But what can happen is threads can get derailed, so I thought by asking this we could get a “Thread Enema” as it were, to ensure there is a clear understanding of where you are headed for those who just start Reading at the last posts.

The way you are breaking things down here reminds me of Jeet Kune Do.

Also, your observations on price action, specifically post 1475 are excellent. While we may disagree on the reason for price swings like this, whatever the reason, it does happen and Rookies/Probies need to be aware of these swings.

Anyway, very interesting stuff, so Post on Brah, post on…

The Ever Interested VIPER :smiley:

Hi Renala

Tymens Definition : Multiple Amount trade.

It opens the trade with two amounts instead of just one.
If we just trade 1 amount then the number of losing trades is likely to exceed the number of
winners. In that case we are just wasting time and making a loss.
The 2 amounts strategy works as follows :

  1. Firstly, we get one small profit from the 1st amount.(T1)
  2. The stop loss (PCI) is now moved to the trade entry point. (Break Even).
    The 2nd amount has a much larger profit target, but at worst, it would retrace to the trade
    entry point, giving a profit/loss of zero for this amount.
  3. Therefore, at worst, we have the 1st amount profit only, but this is superior to a loss.
    Using this approach gives us more winning trades, hence a winning edge, just like the
    visual ballistic player in roulette.

I think this is enough for u to understand

OK, now I show you the same operation for an uptrend >>>

The trend is up this time and we look for the highest high.

From there we draw the CBL.

It goes… bottom, left, bottom, left, bottom.

As before, we then extend the line to become our SHORT ENTRY line.

We continue by seeing that the next candle has a higher high >>>

The same procedure as before - bottom, left, bottom, left, bottom.
Extend to the right to give new SHORT ENTRY line.

We forget about candle A because it does not have a higher high..
But the next yellow candle does.

Again, the CBL >>>

The short entry line is much higher now, giving a better short entry.

This is also the last of the higher high candles.
After this one, the trend started downwards.

Now to look at the whole picture >>>

The stop loss is placed at the highest point.

The count back line came from this point as in the previous chart.
The SHORT ENTRY line is shown.
It crosses the lower wick of a red candle - we enter here.

The rest of the trade is a roller coaster ride downwards!! :smiley: :smiley:

I am with anticipation waiting for continuation :slight_smile:

Who??? :confused: :confused:



Anyway, very interesting stuff, so Post on Brah, post on…

The Ever Interested VIPER

Thank you for the encouraging post, [B]TradeViper[/B]!! :slight_smile: :slight_smile:

Is the value of new short entry line equals to low candle #1? Am I correct?

why there is no “new short entry line” that can be draw through
the candle # 2

Here is a complete operation using the SR lines and the count back line for entry >>>

Explanation.

The SR lines from a daily chart are drawn and I have made them easy to see by using different color bands between the SR lines.
There are 5 SR lines in all with the bands in between being (from top) yellow, green, yellow, blue, grey, orange.

A downtrend is shown, starting with a high candle that was the top of a previous uptrend (not shown on the chart).
The high candle also touches one of the SR lines.
These lines mark turning points so that is not surprising.

So there was an uptrend (off the chart) - it hit the SR line and reversed into the downtrend that you see on the chart.
The high candle also has the stop loss drawn alongside it. (red dashed line).

From that high candle, we draw a count back line to give us a SHORT ENTRY line. (blue line).
Check for yourself that I have drawn the count back line correctly. :slight_smile:

The Trade

We enter the trade with 2 contracts by entering SHORT at the CBL.
As the trade progresses, we hit the first SR line (green/light yellow).
Our first take profit (TP1) should really be about the same as the stop loss (SL) so this point is not enough pips.

We let the trade run.
Our 2nd SR line (yellow/blue) is better.
Here we can exit our first contract for a profit.

The 2nd contract exit is up to you - we have 2 choices.
The first choice (blue/grey) if you are conservative.
The second choice (blue/orange) if you are daring.

Remember, the price action could turn on you anytime, so it a really daring move to go to the second choice (blue/orange).

I assume the same entry rule applies as to the close of the candle. Even if our entry price is hit we do not enter until the candle closes?:slight_smile:

Correct.

why there is no “new short entry line” that can be draw through
the candle # 2

Because the presence of that small red candle short circuits the drawing.

You need to practise drawing these yourself (many times) - then you will understand better how they are formed . :slight_smile:

The entry line through the 2 candle is equal to the previous entry line