No thread here for Ichimoku, but may create one soon.
Ideally would rather this stayed completely focused on price action as that is what this thread is for.
Kind Regards,
Chris Capre
No problem, cheers
Hello Traders,
Chiming back on the Euro, the pair has been underpinned like I said in my weekly market commentary on monday, up slightly on the week.
But on the daily, this pullback still looks corrective, so Iāll look to sell on rallies towards the daily 20ema around 1.2921, and add more shorts around 1.2966 should it get there (chart below).
Downside targets are 1.2750 and 1.2650.
Also look to sell Gold and Silver on rallies as the PMs are under heavy pressure, with the former potentially going to test 1527 key support in the coming days, while silver going for a multi-year lows around 26.21.
Kind Regards,
Chris Capre
Ahead are two fundamental days ahead today. We can expect a rally or at the beginning of one.
The pullback on the EUR/USD looks all set end before the close of the day. Keeping fingers crossed for my side
I like watching the dramatically moving markets until all the news are released. And with jobs down in the US
maybe another round of Q.E?
Good luck guys
Grix
Hello Grix,
Thatās what I am looking at the moment. I believe in bears and itās time to break the near support. Missed very good opportunity to catch a Gold trade. Hope you ppl doing great. In any case play safe.
Alan
Hi guys,
Iām just looking for your thoughts on trading large pin bars from areas of confluence. Iām pretty happy with the idea of what constitutes a good pin bar signal, and usually look to place my stops below the low of the tail.
My question is this, if a large tail contributes to a good pin bar, can it become impracticable to trade due to a larger stop loss?
Cheers
Pete
Hey mate, good to see you hereā¦ My answer to that would be, if your risking the same amount per trade, then it really shouldnāt be a problemā¦
If your already trading 1 mini lot and cant go down further, then you have 2 options:
- go to micro lots or
- wait for another trading opportunityā¦ The market never dies, it will be there tommorowā¦
Basically, just stick to your risk parameters and youāll live another day in this marketā¦ Also, I dont believe large wicks constitute better signals all the time, I guess it all depends on what the story of the market is telling you.
Hope it helpsā¦
AP.
Hi AP,
Thanks for the quick reply!
Iāve been trading pin bars for a while and havenāt had that much success. I seem to struggle getting my 2:1 risk reward off them, probably because my 1R is too great to get a 2R return.
I think for larger tails, the best option would be to place an order on a 50% retrace, this should give me a better entry and a tighter stop. If the price doesnāt retrace that far, then as you said, live to trade another day and forget about it.
Iāll give it a go and see what happens!
Cheers
Pete
Hello Pete,
Iāve actually done the numbers, and the 50% retrace method is actually quite inefficient and statistically does not pan out.
As one student of mine just said;
[I]āI have just learned why 5 years of trading pin bars has failed to produce a positive return. Now I know how Iāve been trading it improperly, and can definitely see how your method is far superior.ā[/I]
See there is a reason why you havenāt had that much success, especially in getting your 2:1 reward to riskā¦because a) the entry is inefficient, and b) you have to understand the order flow behind them.
Keep in mind, pin bars are the [B]result[/B] - [B]not the cause[/B] of the initial price action. They may later offer a cause with late traders coming into the play, but this is a late and less optimal entry.
There are far more efficient and optimal entries once you understand the order flow behind it. So Iād say learn how to read price action and the order flow in real time, and scrap the inefficient 50% pin bar entry, as there are far superior options out there.
Hope this helps.
Kind Regards,
Chris Capre
Hello Traders,
So feeling a bit under the weather, but wanted to share some thoughts on the Euro.
Today behind Super Mario Draghiās āNo Plan Bā comments, the Euro launched higher, forming both engulfing bars on the daily and 4hr charts, closing above the daily 20ema for the first time since mid - Feb.
This will likely change the dynamics, but we have to be aware of the NFP tomorrow.
Iāll still look to sell rallies to the channel top just shy of 1.3000, but if this fails, then will consider it in a range so will trade it like one. Downside targets are 1.2875 and 1.2750.
Also, JPY pairs should push higher, after a retrace with the CME hiking margins from 19-33% today, so watch for pullbacks towards key support levels on the 4hr charts, particularly targeting GBPJPY, CADJPY, SGDJPY, AUDJPY, NZDJPY and USDJPY.
Kind Regards,
Chris Capre
Hi Chris,
Thanks for your advice here. I havenāt used the 50% method yet, I was just considering it as a method on the larger bars as Iām finding it difficult to hit the 2:1 ratio.
The way Iāve been trading them to date is to see if they form at an area of confluence e.g. support & resistance, extremes of trend channels and moving averages. I also look to see how far they may run before placing the order, but Iām missing something.
As you pointed out, I probably need to understand order flow, so thatās where Iāll concentrate the next part of my trader education.
Do you know of any good resources on this to get me started?
Thanks for the advice
Pete
Nice Analysis Chris, Like your chart very much. I am not gonna trade today. NFP + Friday = Nightmare. See you guys next week. Enjoy your weekend.
Pete,
Good to see another PA lover here. There are so many valuable materials on Price action ( including order flow ) provided by Chris available on 2ndskiesforex website. I am still following those and learning every day. Hope you can get some important ideas from there. Good luck mate.
Early morning trading only before the madness starts but for long term traders. The next trade may be on Monday
or Tuesday. After Draghiās no Plan B speech, and QE in Japan, we may have a range based market for the month. Luckily
for us PA is the king and will do whatever the price asks.
Grix
Hi Perry,
I love PA! It has definitely turned my trading around and I understand a hell of a lot more through PA analysis rather than the indicator cross over type strategies that I started with.
Iāll check out the 2ndSkiesForex site, but in the meantime, I found this thread in the forum, itās helped me and is full of information to get anyone started understanding Order Flow.
Unable to attach as a link as Iāve only made 4 posts! But if interested search the forum for 51590-order-flow-trading by Dali.
Cheers
Pete
As requested link removed.
Todayās pound move reminded me of something that I learnāt in one of the PA
classes:
i) Market move in an impulsive manner reversing the existing bearish trend after ECB
ii) A corrective move in quite a narrow range
iii) Resumption of the impulsive move in the previous direction.
Unfortunately it is in the H1 time frame, if this had appeared in the
D1, the party would definitely be on.
Hello Pete,
As per the thread rules, please remove the link posting to another thread.
Iāll be sharing my articles and content which are in here that directly talk about how to read order flow from the price action, so please keep the material and content succinct as requested in the first post of this thread.
Thanks in advance.
Kind Regards,
Chris Capre
Hello Grix,
Yes, this is the base model I use to understand and analyze price action, and it works on all time frames, not just the daily.
When you learn to use it well, you will find that it will change your trading. So good spot on this one mate.
Kind Regards,
Chris Capre
Hello Traders,
This week is showing a lot of good setups on the JPY pairs, Gold, Silver, Oil, European Indices, AUDUSD, Euro, and more.
Today Iām going to focus on the GBPJPY and Gold.
GBPJPY
The japanese yen has been monkey-hammered by the BOJ bazooka which is now making helicopter ben look like a miser when it comes to central bank intervention and quantitative easing with its bond buying program.
I think among the JPY pairs for now, the GBPJPY looks the best as its cleared the yearly highs easily, while EURJPY is just above it, and USDJPY the same. I think these new yearly highs have taken out any stops or shorts, and thus sets up an opportunity for a breakout pullback setup (chart below).
Iāll look to get long at either the 150 big figure or the 148 role reversal level, and stops below the March highs. I think the JPY will depreciate massively over the coming weeks, months and years - probably more than others anticipate, with USDJPY going to 250 eventually.
For the GBPJPY, short term targets are 153 and 162.30 which is the 2009 double top highs.
Gold
In a long protracted downtrend since $1800, Gold was approaching the 2012 lows before finding some buyers last week off of $1540. This was first marked by a pin bar signal, which then found further buying to the tune of $30 higher.
What is most interesting to me, is how the pair formed a new swing low below the prior support, but then broke back into the larger range. Usually in heavily mature trends, a breakout failure like this, either signals a reversal, or a āre-distributionā of the order flow.
Although the PM looks fragile, a clearing of $1620, or a second test and hold on the yearly lows will likely bring in more buyers and thus neutralize the medium term bear trend. Bears can look to sell around $1620, targeting $1600 and $1554, while bulls can look for a pullback towards the latter level to get long.
Kind Regards,
Chris Capre