Buy @ support, selling @ resistance, selling @ minor resistance, buy @ minor support

This is a discussion on Buy @ support, selling @ resistance, selling @ minor resistance, buy @ minor support within the Forex forums, part of the Markets category; Originally Posted by dbphoenix And now a "higher high". What do you do with that? It's "higher", but it's also ...

Reply
 
LinkBack Thread Tools Search this Thread
Old Jan 6, 2007, 8:31pm   #25
Joined Dec 2002
JTrader started this thread
Quote:
Originally Posted by dbphoenix
And now a "higher high". What do you do with that? It's "higher", but it's also lower than the high set on the 8th. Which is where so many traders wander off into the weeds.

The major high and low were determined almost four weeks back. Anything inbetween is minor. One can trade these minor fluctuations if one wants to, and many do, but if he does so, he is also much more subject to whipsaws. Is this overtrading? Depends on the strategy. If one is going for only a few ticks in any direction, then whether this style of trading is worthwhile or not is entirely up to the trader. But knowing which direction to shoot for, much less whether or not to get into SAR, remains a key question.
Thanks a lot DBP,
The commentary you've provided on these charts should prove a big help, in providing a better framework for how to think in terms of future chart interpretation.

I'm going to absorb this info before posting anything else, thoughts, questions etc..

Just one quick question first -

By SAR do you mean support and resistance S&R, or are you referring to something that I am unfamiliar with?

Many thanks
JT.
JTrader is offline   Reply With Quote
Old Jan 6, 2007, 8:34pm   #26
 
dbphoenix's Avatar
Joined Aug 2003
Quote:
Originally Posted by jtrader
Thanks a lot DBP,
The commentary you've provided on these charts should prove a big help, in providing a better framework for how to think in terms of future chart interpretation.

I'm going to absorb this info before posting anything else.

Just one quick question first -


By SAR do you mean support and resistance S&R, or are you referring to something that I am unfamiliar with?

Many thanks
JT.
Stop And Reverse. In other words, get out of whatever position you're in and take the opposite. (It's also the name of an indicator, but it's easier to type "SAR" than the whole thing.)

In the meantime, if you're interested mostly in intraday, repost your original chart, only start at 13:31 to get rid of those first two long red bars. And no lines or annotation.

Db
dbphoenix is offline Training literature vendor (e.g courses / spreadbetting guides / eBooks)   Reply With Quote
Old Jan 6, 2007, 8:45pm   #27
Joined Dec 2002
JTrader started this thread SAR = Stop and reverse - the post makes full sense to me now.

Thanks again.

Last edited by JTrader; Dec 20, 2007 at 1:08pm.
JTrader is offline   Reply With Quote
Old Jan 7, 2007, 10:52am   #28
Joined Dec 2002
JTrader started this thread
Quote:
Originally Posted by dbphoenix
Now price drops below "S". And the couldawouldashoulda begins.

Should I have shorted that last swing high? If I had, where would I have entered? If I had been long off the last swing low, where would I have covered? Would I? Why?

If I hadn't shorted that last swing high, should I short now? Or wait? Should I go long? What the hell is the direction of price anyway?

And if you're waiting for the other shoe to drop, the shoe is in your hand. All this may seem like a tease because I can't tell you what's best for you.

You have to define your trading environment.

You have to determine how much risk you can stand.

You have to decide how much profit to go for.

You have to decide exactly what price has to do in order to tell you whether you're right or wrong.

You have to decide under what conditions the yellow lights will flash.

None of this is especially difficult, but it is time-consuming. On the other hand, you've been a member for at least four years and have most likely viewed a great many charts. If you determine in advance what it is that you're going to look for, the mess will resolve itself into trend, momentum, "divergence", and so on and you'll begin to be able to screen out the noise that distracts you from your goal.
Hi DBP

the highlighted parts above express some of my thoughts/doubts.

I can now see on the historical charts posted, the potential significance of the lower-highs (LH) and lower-lows (LL).

However, I now need to go on to try and establish ways of deciding whether or not LH's or LL's have formed in real-time in order to be able to decide if and when a trade is appropriate - particarly if trying to trade the minor reversal swings (LL's and LH's) between the more major S & R.
As things stand right now, I would be more comfortable trading for reversals around the very obvious (major) S & R levels, but the swings inbetween major S & R, seem to be more difficult to trade as I have less idea why price is/might be stopping and reversing where it is, as this is inbetween (major) S & R. Hence, I would have more doubts before taking on such a trade, and less good reasons to take on such a trade.

LL's and LH's now seem more obvious on the historical chart, and easy to recognise in hindight, but in real-time it will naturally be more difficult. Recognising when price is running out of steam and forming an LL or LH.
In the run-up to a LH, on a candlestick chart, there are likely to be a few red candles among a majority of green candles. Maybe two red candles form next to each other that makes me think that price has topped and an LH has formed, therefore I may look to short. However, price then continues up and the next few candles are green, until the actual formation of the LH. In the mean-time, I may have had to activate my stop, as it would/I could not tolerate the continuation upwards, against my trade.

Therefore, particularly if I am to make use of LL's and LH's to trade possible reversals inbetween of major S and R, in real-time I need to start to define my criteria for when LL's and LH's have actually been formed, so that I can determine good trade entry points. Getting a better feel for for when price has run out of steam, as opposed to stopping briefly for a breather etc.

Thanks again.
JTrader is offline   Reply With Quote
Old Jan 7, 2007, 2:19pm   #29
 
dbphoenix's Avatar
Joined Aug 2003
Quote:
Originally Posted by jtrader
Hi DBP

the highlighted parts above express some of my thoughts/doubts.

I can now see on the historical charts posted, the potential significance of the lower-highs (LH) and lower-lows (LL).

However, I now need to go on to try and establish ways of deciding whether or not LH's or LL's have formed in real-time in order to be able to decide if and when a trade is appropriate - particarly if trying to trade the minor reversal swings (LL's and LH's) between the more major S & R.
As things stand right now, I would be more comfortable trading for reversals around the very obvious (major) S & R levels, but the swings inbetween major S & R, seem to be more difficult to trade as I have less idea why price is/might be stopping and reversing where it is, as this is inbetween (major) S & R. Hence, I would have more doubts before taking on such a trade, and less good reasons to take on such a trade.

LL's and LH's now seem more obvious on the historical chart, and easy to recognise in hindight, but in real-time it will naturally be more difficult. Recognising when price is running out of steam and forming an LL or LH.
In the run-up to a LH, on a candlestick chart, there are likely to be a few red candles among a majority of green candles. Maybe two red candles form next to each other that makes me think that price has topped and an LH has formed, therefore I may look to short. However, price then continues up and the next few candles are green, until the actual formation of the LH. In the mean-time, I may have had to activate my stop, as it would/I could not tolerate the continuation upwards, against my trade.

Therefore, particularly if I am to make use of LL's and LH's to trade possible reversals inbetween of major S and R, in real-time I need to start to define my criteria for when LL's and LH's have actually been formed, so that I can determine good trade entry points. Getting a better feel for for when price has run out of steam, as opposed to stopping briefly for a breather etc.

Thanks again.
You've made several important observations and you're asking very good questions. You're also addressing your tolerance for risk and the nature of your "comfort zone".

You may find it helpful to think about your preference for trading trend vs trading S&R. The two do not necessarily have anything to do with each other except when they intersect, such as, in this case, at 1.30 (+/-). You have at least begun thinking about the difference between major and minor swings (or fluctuations or oscillations or whatever you want to call them) and which are more likely to help you reach your goals. That's a start.

Db
dbphoenix is offline Training literature vendor (e.g courses / spreadbetting guides / eBooks)   Reply With Quote
Old Jan 8, 2007, 6:54am   #30
Joined Dec 2006
hi following fridays move eur/usd

I believe price will break down the 1.3 support and reach the area of 1.29 over there there is major support
thebull27 is offline   Reply With Quote
Old Jan 8, 2007, 9:00am   #31
Joined Dec 2002
JTrader started this thread Hi thebull

I can't see the major support that you refer to at 1.2900. What chart are you looking at? and when (dates) do you see this support?

Does this major support come in the form of previous resistance, as opposed to actual support?, or did this support at 1.2900 exist way back, and has long since been broken?

Cheers
JT.

Last edited by JTrader; Jan 8, 2007 at 9:48am.
JTrader is offline   Reply With Quote
Old Jan 8, 2007, 9:09am   #32
Joined Dec 2002
JTrader started this thread I don't want to get sucked into trying to short 1.3000 today just for the sake of it, not unless my chart setups, give me good reason to.
It's a new week, but i would rather miss the move down (or some of it) than lose another 13 pips like i did on Friday. I want to see how price reacts around 1.3000 (a very round century level). It still looks like heavy support exists around the late 2990's. WHen this S has collapsed, price has only dropped to 2980 before recovering back above 1.3000.

In my mind, I'm just imagining the level 2 order book with huge S below 1.3000, and many more buy order than sell orders. I could be completely wrong though.
JTrader is offline   Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Similar Threads
Thread Thread Starter Forum Replies Last Post
support and resistance bertie123 Technical Analysis 2 May 29, 2007 12:10pm
Support and Resistance - But Where? YachtFund Forex 2 Aug 2, 2005 7:52pm
Support and resistance stoploss please Indices 0 Oct 1, 2003 12:12pm
Support/Resistance tip wallmann Technical Analysis 3 Sep 11, 2003 12:18pm
Support and Resistance darth trader Technical Analysis 3 Aug 26, 2001 12:43am

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)