Flags, Pennants - my interpretation

rsd886647

Active member
Mar 24, 2009
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#17
1R loss

I took a hit!

I have amended my plan because I normally like to see 2 months of selling pressure before a bull flag signal forms (after one month + of buying/consolidation). This was part of my original plan and I moved away from it, but I think it's an important element. There was not this selling prior to the Brent Crude Oil flag trade. That doesn't mean it will always work, but it's now definitely part of my trading plan going forward.

I'll show what I mean below:
 

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rsd886647

Active member
Mar 24, 2009
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#18
A signal - Triangle (NZDUSD)

I've recently learned about triangles so I'm putting into practice some of that. I'm developing my plan as I go, so the ride could be a bit bumpy.
 

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rsd886647

Active member
Mar 24, 2009
205
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#20
I should have had a sell stop a bit lower down on the nzdusd trade, wait for the breakout to be significant, instead I've got caught on the wrong side of the market again. I will keep my position open and hope for price to drop in the coming days.
 

barjon

Well-known member
May 6, 2003
10,050
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#21
I should have had a sell stop a bit lower down on the nzdusd trade, wait for the breakout to be significant, instead I've got caught on the wrong side of the market again. I will keep my position open and hope for price to drop in the coming days.
...and if it goes further against you?
 

rsd886647

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Mar 24, 2009
205
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#22
...and if it goes further against you?
Hi,

I exited for a .5R loss.

I will now keep to my bread and butter bull/bear flag signals or wedges which indicate continuation of the trend.

I still have my bund trade open, nearly 2R up on that.

I started this endeavour with a small trading account. I had enough money for 15 trades. I've taken a few losses now.

I will step back and refocus.
 

barjon

Well-known member
May 6, 2003
10,050
1,474
223
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#23
Hi,

I exited for a .5R loss.

I will now keep to my bread and butter bull/bear flag signals or wedges which indicate continuation of the trend.

I still have my bund trade open, nearly 2R up on that.

I started this endeavour with a small trading account. I had enough money for 15 trades. I've taken a few losses now.

I will step back and refocus.
Well done for taking the loss (y). Hanging on in hope - when the rationale for your trade has disappeared - is an account destroyer.
 

rsd886647

Active member
Mar 24, 2009
205
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#24
Thanks Barjon.

You helped in the process :)

I have exited my Bund trade manually for a bit under a 2R gain. The MacD is looking like it is turning over and I feel it's best to bank some profits.
 

rsd886647

Active member
Mar 24, 2009
205
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#25
USDJPY Bull flag

I have decided to simplify my rules and take bull flags that form after prolonged sell offs that are in the first or second wave of buying, and vice versa for bear flags.

I'm being quite aggressive with this usdjpy trade then as a possible trend reversal unfolds. If we look at a line chart we can see how there is a higher high, then a lower high then another higher high, although this is not clear in a candlestick chart. This was a technique I was recently made aware of and I'm interested to see if it is valid in practice.

I'm long on this bull flag in any case.
 

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rsd886647

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Mar 24, 2009
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#28
West Texas Oil - caught off guard

I anticipated a flag forming here on this chart, but not one that pulled back so deeply so I had turned my attention elsewhere over the last few days. I looked back at this chart and saw that a great flag had triggered, alas I am not in this trade.

This is a lesson learned, flags can pull back quite severely.
 

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rsd886647

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Mar 24, 2009
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#29
My definition of a pole is now at least 4 consecutive bars of ideally the same colour, will generally not accept more than one bar being of the other colour.

I have dabbled with one hour and four hour charts as I have some spare time atm, but will try to focus on daily charts from now on.
 

rsd886647

Active member
Mar 24, 2009
205
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#30
West Texas Oil 1:1 trade

It is technically okay to enter on the high of the pole, the rewards are much reduced however. One might argue that I am chasing the market, but it is a valid entry point and it is thus far a winning signal so I have decided to try this out with this west texas oil trade. The pattern has shown itself to be valid so it is just a case of whether price can follow through to a greater extent. I'm shooting for a 1R gain.
 

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