Ideas for increasing trader performance

[DHB]

If you have a look at the zoomed out 5 minute chart, you'll probably see a familiar pattern (breakout, pullback [twice], continuation). The H1 pin (highlighted in orange on the M5 chart) was a mere pullback to a M5 breakout level, before reversing back up again.

As you can see, price behaves in a similar fashion, whether it's on a D1, H1 or M1 chart. With a little practice you'll start recognizing this stuff more easily. I'm at it now for a little over half a year, and only recently have I seen the light somewhat. Mind you, this is only the beginning. It's the psych stuff that is really the most challenging.

 

[DHB]

By the way, I was having a closer look at the action on UJ at the moment. You just gotta love it. This is classic price action at its best. Just look at the included chart and see for yourself.

Also, do you see where this action is taking place? That's right, a round number. Plot the 50's and 00's on your chart and see for yourself how often this occurs.

Round number + Price pivot point + Price action = Kaboom

 

[jefftheripper]

One more question about the news. Is is best to stand aside during high impact news or go ahead and trade what you see? ex: the h1 chart of USD/CAD this morning showed a nice pin bar at 7am NY time. The bar was neat s/r, 50% fib and trend line. The buy signal was triggered at about 8:25 am when the next candle went 1 pip above it. High impact US news was due out at 8:30. The same candle that triggered entry (barely) went on to trigger stop 1 pip below pin bar. This looked like a good setup and was rejoining the new trend up. Was this due to news impact or do you see something I don't?

 

[DHB]

Okay, I'm not going to spam this thread anymore after this post, but the chart shows what I would consider the most dominant issues regarding loonie right now.

But ignoring the D1 momentum for a moment, there just wasn't enough confluence supporting the H1 pin you indicated for me to even consider going long. I'd rather wait for a retrace to the 50 or 62 fib, and the latter especially, since it's also a round number. But my bias would be to sell any rallies right now.

Re: news, unless it's NFP friday or a rate decision day, I pretty much ignore the news. But that's just me.

 

[trader_dante]

Okay, I'm not going to spam this thread anymore after this post, but the chart shows what I would consider the most dominant issues regarding loonie right now.

But ignoring the D1 momentum for a moment, there just wasn't enough confluence supporting the H1 pin you indicated for me to even consider going long. I'd rather wait for a retrace to the 50 or 62 fib, and the latter especially, since it's also a round number. But my bias would be to sell any rallies right now.

Re: news, unless it's NFP friday or a rate decision day, I pretty much ignore the news. But that's just me.

View attachment 79526

Where did you learn all this?

 

[trader_dante]

Thanks TD and DHB,

I too had been waiting for a breakout, but I was watching for a break then a retracement to the 90.80 but when I saw the pin I thought it was a good setup. I had read early where TD had said after a big candle is a good place for retracement with the right signal.

Hey Jeff,

What I meant was after a big candle, wait for the retracement and then follow the momentum, not fade it!

 

[trader_dante]

By the way, I was having a closer look at the action on UJ at the moment. You just gotta love it. This is classic price action at its best. Just look at the included chart and see for yourself.

Also, do you see where this action is taking place? That's right, a round number. Plot the 50's and 00's on your chart and see for yourself how often this occurs.

Round number + Price pivot point + Price action = Kaboom

View attachment 79522

It was a fantastic move. I bought the flip on the arrowed area.

 

[DHB]

Where did you learn all this?

Hmm, let's see. First I started reading Making Money Trading over here (thanks Tom). After that, I started reading the J16 thread over @ FF (thanks Jim et al.). At the moment, I've gone through the first 1,700 pages of that thread, as well as the last 600 or so. I've also watched all of the J16 guest videos at least a couple of times (highly recommended btw for those who don't know yet).

Then one day, watching one of Jim's guest videos, I had this epiphany about how price behaves around PPZs (for those who don't know: price pivot points), which I believe I mentioned earlier in this thread. Incidentally, shortly after that I learned about this guy over at FF, BillyRayValentine, whose No Brainer Trades thread more or less covers blind entries @ PPZs the way I was trying to demo it.

So reading, reading, reading, reading, and many hours watching charts and demoing is how I got to where I am today. No shortcuts, just a lot of dedication. Now I'm at a point where I feel I'm almost ready to give it a go with live money on a micro account, but first I need to sort out some personal stuff before taking that step.

B.

 

[DHB]

It was a fantastic move. I bought the flip on the arrowed area.

Nice one. That's well into double digit R:R.

But you speak in past tense. Does that mean you're out of this trade now? If so, where and why did you exit?

 

[jefftheripper]

Okay, I'm not going to spam this thread anymore after this post, but the chart shows what I would consider the most dominant issues regarding loonie right now.

But ignoring the D1 momentum for a moment, there just wasn't enough confluence supporting the H1 pin you indicated for me to even consider going long. I'd rather wait for a retrace to the 50 or 62 fib, and the latter especially, since it's also a round number. But my bias would be to sell any rallies right now.

Re: news, unless it's NFP friday or a rate decision day, I pretty much ignore the news. But that's just me.

View attachment 79526

I see what you mean, and long term yes going short would be with the overall daily trend. But on the hourly charts it's been in an uptrend since about the 17th. I have always looked for all time highs/low within the last 12 months which it is at.

Your's and TD's analysis make since after I read it, but I guess it's not clicking yet with my own setup analysis. I get a little confused with all the time frames. For ex. you zoomed in on the 5 min chart and gave me a perfect analysis of why my 1hr UJ pin didn't work. Then zoomed way out on the daily to show why the loonie pin I found failed. How many TF's should you look at? Do all 5min, 1hr, and daily need to agree?

Thank you and TD for analyzing my setups and answering my questions (I'm sure you have better things to do). I actually feel better knowing I read the setup wrong instead of the system failing. It gives me confidence that when I figure this out I'll have a viable system.

 

[jefftheripper]

Hey Jeff,

What I meant was after a big candle, wait for the retracement and then follow the momentum, not fade it!

I got it from page 7 of your pdf. You were talking about large moves and traders booking profits. "I much prefer to fade high range candles at carefully selected areas on the chart."

The difference being as you've pointed out, this wasn't a carefully selected area on the chart.

 

[DHB]

I see what you mean, and long term yes going short would be with the overall daily trend. But on the hourly charts it's been in an uptrend since about the 17th. I have always looked for all time highs/low within the last 12 months which it is at.

Your's and TD's analysis make since after I read it, but I guess it's not clicking yet with my own setup analysis. I get a little confused with all the time frames. For ex. you zoomed in on the 5 min chart and gave me a perfect analysis of why my 1hr UJ pin didn't work. Then zoomed way out on the daily to show why the loonie pin I found failed. How many TF's should you look at? Do all 5min, 1hr, and daily need to agree?

Thank you and TD for analyzing my setups and answering my questions (I'm sure you have better things to do). I actually feel better knowing I read the setup wrong instead of the system failing. It gives me confidence that when I figure this out I'll have a viable system.

Hi Jeff,

As far as time frames are concerned, it really isn't as complicated as you might think.

If you trade off H1 charts, then you should monitor H1 predominantly. However, the momentum on bigger TFs will alway exert influence on smaller TFs. So if you have a bearish trend going on on W1 or D1, that will mean that if you trade off of H1, your longs will have a significantly smaller chance of evolving into large winners than your shorts, since you would be trading against the macro time frame trend. It doesn't mean that you shouldn't take longs if they present themselves, but you should alway be aware of what is happening on the bigger TFs, and be aware that if you trade countertrend, you need to be hands-on with your money mgt.

If you trade with the trend, you can only be wrong once, and that's when the trend reverses.

As for shorter TFs, the only reason I showed you the situation on UJ on M5 was to make the support/resistance levels more obvious. Remember, what may seem as insignificant highs and lows on H1, are clear support/resistance levels on M5, and as such, should be taken into account, even if you trade off of H1, because as you could see, the UJ support did hold and stopped that bearish pin from moving further down.

So how many TFs should you watch? Well, you should always look up for the bigger momentum, so that you're aware of your trades being with or counter trend. Managing the trade should be done from the TF you used to enter the trade. However, if your trade is going really strongly in your favour, you might want to move up in TF for managing the trade. Going lower in TF is something I would only do to fine tune an entry. For instance, when you see a breakout/pullback on H1, but the pullback doesn't show a pin or whatever, you might want to check M30, M15 or M5 for clues that the price is going into the right direction again so that you can enter on the pullback.

Hope my explanation helps a little.

 

[trader_dante]

I got it from page 7 of your pdf. You were talking about large moves and traders booking profits. "I much prefer to fade high range candles at carefully selected areas on the chart."

The difference being as you've pointed out, this wasn't a carefully selected area on the chart.

Yes, that would seem a bit contradictory and confusing, so apologies. The way I trade is very instinctual rather than rules based. When you watch charts day in, day out, for a very long period of time you get a feel for what to fade and what to follow. It is very hard to translate this information into posts because there are so many elements that are not easily expressed.

The reason I wrote that in the PDF in the first place is because a lot of new traders think "wow, big green candle, it's going to the moon" and I think that this is not always correct (It always comes back to location).

I already wanted to be long USD/JPY from the daily so there was no way I could fade an hourly level. I guess that is the key point I am trying to make with reference to the PDF quote above.

If I had wanted to go short, I would be happy to fade a high range candle at a significant area (e.g. the range of the candle wouldn't necessarily worry me).

However, I would usually not prefer to do this if there were several preceeding it because that would most likely be painting another picture altogether on the daily TF which is always my trend decision time frame.

So, in most cases, whether I wanted to be long or short on USD/JPY I wouldn't have wanted to get in up there.

The other thing to remember with your trade is that you have:

a) Got in well after the level has been touched e.g. after the pin has formed (the PDF was written with the "blind touch" in mind which is how I now trade

b) You are selling into previous hourly resistance (not the three tops from DHB's post)

 

[trader_dante]

Hi Jeff,

As far as time frames are concerned, it really isn't as complicated as you might think.

If you trade off H1 charts, then you should monitor H1 predominantly. However, the momentum on bigger TFs will alway exert influence on smaller TFs. So if you have a bearish trend going on on W1 or D1, that will mean that if you trade off of H1, your longs will have a significantly smaller chance of evolving into large winners than your shorts, since you would be trading against the macro time frame trend. It doesn't mean that you shouldn't take longs if they present themselves, but you should alway be aware of what is happening on the bigger TFs, and be aware that if you trade countertrend, you need to be hands-on with your money mgt.

If you trade with the trend, you can only be wrong once, and that's when the trend reverses.

As for shorter TFs, the only reason I showed you the situation on UJ on M5 was to make the support/resistance levels more obvious. Remember, what may seem as insignificant highs and lows on H1, are clear support/resistance levels on M5, and as such, should be taken into account, even if you trade off of H1, because as you could see, the UJ support did hold and stopped that bearish pin from moving further down.

So how many TFs should you watch? Well, you should always look up for the bigger momentum, so that you're aware of your trades being with or counter trend. Managing the trade should be done from the TF you used to enter the trade. However, if your trade is going really strongly in your favour, you might want to move up in TF for managing the trade. Going lower in TF is something I would only do to fine tune an entry. For instance, when you see a breakout/pullback on H1, but the pullback doesn't show a pin or whatever, you might want to check M30, M15 or M5 for clues that the price is going into the right direction again so that you can enter on the pullback.

Hope my explanation helps a little.

This is fantastic stuff you are posting here. I will happily take a backseat

 

[DHB]

Thanks.

Mind you, it might seem that I can talk the talk a little, don't forget I have yet to prove that I can actually walk the walk, which is the only thing that matters in the end. Until then, I wouldn't pay too much attention to what I'm saying.

 

[temporarilylight]

Thanks.

Mind you, it might seem that I can talk the talk a little, don't forget I have yet to prove that I can actually walk the walk, which is the only thing that matters in the end. Until then, I wouldn't pay too much attention to what I'm saying.

First time I've ever heard someone call themselves out!! lol

Good posts

 

[jefftheripper]

DHB and TD,

Thanks a million. I'm going to print those post out and add them to my notes file. DHB, great explanation on the TF's. And TD I see what you mean on the blind touch, and yes that would be too risky there. I sent you a pm with my email. I definitely need a mentoring session. Oh, on the CAD I did enter long on the next pin bar and managed to lock in some profits (about 40 pips), got shaken out before it made about 30 more. I think you're right to let it retrace a bit and look for a short near significant s/r levels.

Thanks and have a great weekend.

 

[Marwan2010]

Kiss

 

[FXTrend240]

right so you hit into daily resistance, why then did you use a teeny tiny stop loss? fair enough use the pin as an entry, but goodness sake give it some room...

 

[N Rothschild]

i wouldnt be shorting the yen anytime this year