Just wanted to say thanks again for the Overlay-MA indicator, it definitely saved my behind multiple times last night!
Overall, I have a long bias for the long run but I had a short bias for last night’s LO session. SMT Divergence, pivot zones, Trader’s Trinity resistance level, etc.
I looked for a short OTE on the Fiber, as it was a better candidate for few reasons. I zoomed into the 5 minute chart and entered short at around 1.4500 psychological level.
Had a 22 pip stop loss and was looking for 45 pips giving a 2:1, I didn’t scale out but set my SL to BE+1 once price had reached +22 pips profit.
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Currently up 8% for the week, so I’m going to be extra conservative and try to save my profits so far.
Hi, thanks for the feedback! Glad you found it helpful. We all have a different story on here, different things bring us all to trading, and we all make it work in different ways, so I am always interested to hear what brought us all here.
To answer your question no, I have never been one of those who advocates focussing on only one or two Pairs. I have a few currencies that I do not trade, but I monitor some twenty-odd currency pairs regularly. The reason for this is that the strategies I employ use a few key market conditions, that are able to present on any one of a number of currency pairs. So I prefer to scan a number of pairs, then enter a trade when I see the right setup. Scanning so many pairs means that I feel able to reject imperfect setups, knowing that there will generally be a ‘cleaner’ setup available in the not-too-distant future. I don’t take that many trades, single figures a week, so prefer to scan a number of pairs to ensure that I take trades with a higher probability. This is a probability game, at the end of the day, and I have always felt that were I to limit my focus to just one or two pairs, I would have too many periods during which I either did not trade (and, therefore, not make money!) or during which I was tempted to take less-than-perfect setups. So I know that many traders prefer to focus, and make that work for them, so I am not debating that, but for me the multiple-pair approach works well.
I wanted my early trading days to be representative of my whole trading career, in order that all my experience would be directly relevant to my long-term trading. So I monitored many pairs from day one and have continued to do so. It was tough at first, but is now second nature and, as they say, ‘train hard, fight easy’…
To answer the second part of your question no, I have not back-tested much. I went on a Forex course at the outset, and the strategies taught there had been extensively back-tested (that is part of what I was paying for, I guess), so I did not go over that again. I have back-tested the tweaks that I have added to the strategies over time, but to be honest not in enormous detail so I cannot say that that is a high percentage of the time I have put in. You have it absolutely right in the later part of your question: looking at charts all day trying to spot S&R levels, and chart patterns. When I first started, I had no trading experience at all. I looked at charts, saw nothing, then my coach would point out loads of patterns and key levels. It all felt like a mystery that I would never crack. After MANY hours invested, I now see levels leaping out at me on most pairs I look at - if I don’t see key levels, or a pattern, or something in my first minute or two looking at a chart, then I figure that there is no clear setup, there, and move along to the next pair. That quick initial scan is one way that I try to ensure that I am only taking really clear setups. I practised drawing Support & Resistance levels on my charts, then I practised some more, then some more… for me, it all starts with S&R, these days. I just invested thousands of hours in learning to draw lines on my charts, trade those lines, understand why it did not work out and then go back and have another go. Now, I spend much more time scanning and drawing levels than I do actually trading - but I sit down at the computer each month genuinely confident that over the month I will make money.
Anyway, I don’t want to take up the whole thread with this, as it is really just my take on things, but I hope that that answers your question.
Basically, I think that whatever strategy one is trading, success comes from putting in the screen time and becoming very familiar with how charts look, how Price reacts, and how the various key levels come into play. That takes time, but once it clicks it all becomes (relatively) simple.
Very well said, 100% agree. Screen time is very important, at least it was important for me. I also realized few things after I wrote dozens and dozens my own indicators. It forced me to think in a bit different way about charts and then everything clicked suddenly.
Read the first 30 pages of the book. Very good book, he’ll explain the divergencies from pages 15. It is what ICT explains about the SMT, only this is projected on stocks only. All the credit goes to ICT since he discovered the same divergency principal in the forex market when two pairs are strongly correlated such as the cable and fibre. This of course is due to the fact that they both are relying on the dollar. I have checked it with other pairs, as long as they have a strong currency in common, e.g. EUR/CHF and USD/CHF or any Yen pair. It is a very powerfull tool and it jumps right of your chart (you don’t even need a overlaying chart IMHO!).
Good luck!
Chapter 2 is what you are looking for Ali. Same underlying principle we use with our SMT except Larry is looking at a longer term bias. He uses the Accumulation concept to identify stocks that are outperforming the index. So in a nutshell if a stock is making higher lows and the index is making a lower low, that stock would be a good candidate to buy or you would put that stock on your watch list along with others showing the same accumulation pattern (divergence). Sort of like a filter. Finding stocks where the Smart Money is active. He then takes it one step further and explains the use of the Williams Accumulation/distribution indicator which is a variation of OBV but specifically designed to track accumulation or distribution of a stock. When the stocks price is making a lower low and AD line is making higher lows, this sets the stage for a buy. The same way we use the SMT. Very nice read
I agree with you TP, you don’t even need the overlay chart. Comparing highs and lows is just as beneficial and often a lot less complicating. And as I have said before this tool is worth more than gold and will transform your trading
I don’t know about your all-or-nothing gunslinger trade management, Clark, but that was an awesome entry that you spotted! SMT divergence, price came under the CPP and bounced back to the figure, which was also a previous H4 resistance, and the Weekly MR1. I would call it quits for the week at 8% because volatility will most likely drop off the closer we get to non-farm payrolls on Friday.
Regards
Ali
P.S. I am suffering the same frustrations as AK this week…the only difference being is that I consider him lucky to be able to trade the London Open. The only chances I have are Mondays and Thursdays.
Apologies Clark because I think I may have misinterpreted your post! I saw 8% and thought that you made 8% on this trade! It is an easy assumption to make because it was Bank Holiday on Monday and I recall you saying that you were sitting on your hands. Was it 8% on this trade?
What I thought you did was enter at 1.4500, bring stop to BE+1 at 22 pips, and then let her ride to 1.4380 area without taking any profits off the table…that would mean risking 1.5% on 22 pips, which would give you 8.1% gain on full TP at 120 pips. Do you see what I am thinking? I am just worried that you threw all of your normal rules out of the window for this one trade! You wouldn’t have lost because you brought up the SL, but it was risky shooting so high with 100% on the table - hence ‘all-or-nothing’ !!!
Thanks Trader Pilot and Shaunnd. The book was sitting on my computer in electronic form but as it didn’t seem to relate directly to forex, it was was way down on my list of ‘things to read’. For stocks it seems easy to interpret because you are comparing one stock against the index, and you are obviously looking to enter the stock and not the index. If there is strength on the stock (a higher low), then that is a sign that there is professional accumulation in that particular stock. In this respect you can enter the currency that is failing to make lower lows as there is obvious accumulation in that currency, but because of the correlation, the other pair is most likely to follow in its footsteps. Hence you can trade either.
When you say you don’t need the overlay chart, well ICT said he never did anything other than compare the separate Cable and Fiber charts, so that is the truth. Personally, I think the overlay chart is a good way to see the divergence with 100% clarity, but each to their own. Larry Williams suggests getting tracing paper, tracing one of the charts, and then laying it over the other! Now that really is old skool;)
What I am saying is Ali, I am watching cable and fiber constantly and see the divergency happen in front of my screen, I don’t even have to plot them on the same chart. Anyway…if it helps you plot them on an overlay chart (I do that too:).
TP
Not new to the thread, been keeping tabs whatsoever. Seemed like a crazy day for me today, didn’t take any trade since i couldnt figure out where it would go.
In the end , ended up frustrated missing the move on EUR/USD from Central Pivot down.
I’m still not relatively sure when to apply OTEs to follow through since i can do practically for both sides of selling and buying and end up confusing myself on where it would go. That added to market flow , trends , S and R and what not , i end up not taking any trade whatsoever and sometimes even worse , not taking the trade and seeing it go through like what happened today.
That and dont know where the markets consolidate or setting up for a reversal due to what i wrote before.
Hey ICT,
I wanted to leave this post for when you get your internet back. I hope all is well with your home and your family. Your in my thoughts and I am wishing you a speedy recovery to the disasters that happened recently with the earthquake and that hurricane. Hope the new rug looks good ;-). I am sure you are itching to get back to trading.
Did anyone else trade this LO? I had so many tools line up suggesting long, esp on the GU. Both pairs were in their Trader’s Trinity buy zone, also in daily pivot point buy zone, daily TF GU was overbought on the Williams %R, I had an ascending TL on the daily being tested, On EU daily I had a long term S/R line being tested and PDL was 10 pips away from yesterdays S1 and todays mid- pivot… The there was positive divergence led by GU on the SMT and also on the 15M & 30M TF, there was positive divergence on both pairs’ MACDs.
Whilst i had my eye on the USDX wedge breakout, thought the probs were highest for a long. Lost 30 pips.
One of those things? Or did any of you guys/girls stay out, or go short?
Im long GU and GJ, but not really very strong long signal for me yet. Long entry was based on TT and some H1 candle patterns. Anyway, I dont care too much , I usually hedge almost all my trades.
Is that your MOMO strat? - perused the links on your site but couldnt work out what it was all about. Like your indi though, I have a robot similar alerting me to pin bars at signif levels, 00s etc.
Snap!!
Bloody frustrating sometimes isn’t it?!
If you look on the 4h SMT it looks like EUR is coming back to be in line with GBP as far as highs and lows are concerned so hopefully things will start to make more sense after that.
i am here to seek your help i have get the traing i traded on life
account and lost all my money plz tell me what i have don wrong
because i went to know the in an out of the market and not lose
again plz!!!
