learning price action using MAs, fibo and horizontal levels

[TAjammy]

i remember saying i would take a year away from here, lol i think it has been just over 2 weeks since that, and by jove have i improved.

So i figured i could show you some of the trades i take on a MT4 demo account, as there really are some gurus on PA out there. I stripped my chart of all indicators, except for MAs
i trade daily and H4 charts, i go back to the weekly timeframe back about a year, if there if a downtrend i draw a fibo level, if price action forms around that level i will trade it.



ok here is a trade i took today, the first chart is the weekly timeframe of the USDJPY, and the second is the H4. As you can see the weekly trend is down, then there was a retracement towards a fibo level, so i zoomed in on the H4 chart and i see a nice bar forming which is pretty much a pin bar- however the pin bar rejected the higher price at a major resistance level aswell as at a 38.2 weekly fibo level, creating 'confluence'.
you can't actually see the fibo level because that red resistance line is over it.

Pleasssseee post your thoughts because i'm trying to improve trading PA..lol icould maybe change my name to PAjammy, eh?

edit: by the way the thread title is not for me to teach you guys lol it's about me learning but as always you can learn by reading what the pros have to say

 

[TAjammy]

woops here are the charts

 

[TAjammy]

interesting, noticed price was heading againt me so i zoomed in on the 5 min chart and noticed price is coming back up to the prior trendline and this would be a great retracement trade -if i was a day trader that is

o, it did retrace!but off the MA, a good reason to have MAs is that price usually reacts to them... comon tank u little bi*** ,

 

[TAjammy]

here's that chart

 

[Claudia123]

here's that chart

So much to learn still but keep trying. Tell me what is the indicator at the bottom of the chart? I just know you going to say volume.

 

[cr6196]

yes that is indeed volume, the most worrying quote is "i think it has been just over 2 weeks since that, and by jove have i improved"...yes you probably have but that is what learning how to trade is like, i've been learning for somewhere around 8 months and i almost every day have that feeling of learning and realisation...don't get overconfident about this feeling.

The best thing to do is just stick to one way of trading for a few weeks then make a decisions, don't keep switching it is a waste of time, i did that for so long and it doesnt get you anywhere, and keep your mind open.

The thing i am coming to realise it doesn't matter how you trade, it is if you feel comfortable. Keep it up, at your age you can do some serious damage to the markets, i know someone who started trading young and they bought a merc for their first car...it can happen, they were already minted but still, it can happen...

 

[Claudia123]

yes that is indeed volume, the most worrying quote is "i think it has been just over 2 weeks since that, and by jove have i improved"...yes you probably have but that is what learning how to trade is like, i've been learning for somewhere around 8 months and i almost every day have that feeling of learning and realisation...don't get overconfident about this feeling.

The best thing to do is just stick to one way of trading for a few weeks then make a decisions, don't keep switching it is a waste of time, i did that for so long and it doesnt get you anywhere, and keep your mind open.

The thing i am coming to realise it doesn't matter how you trade, it is if you feel comfortable. Keep it up, at your age you can do some serious damage to the markets, i know someone who started trading young and they bought a merc for their first car...it can happen, they were already minted but still, it can happen...

There is no volume in forex so that is silly to start with. Your post is good. I would suggest he concentrates on one currency pair and gets to know it inside out. Develop a system as simple as possible and stick to it. Take the silly lines off the chart use eyes and win. That's price action. Action is what is happening - lines are what has happened. Once the difference is understood then a big step forward has been made. Told him all this before - be back to rsi and ma's tomorrow no doubt. Oh well.

 

[TAjammy]

lol that volume was there by accident it was actually meant to be stochastics- i very rarely use them, but in this case it gave me a little help.

 

[TAjammy]

yes that is indeed volume, the most worrying quote is "i think it has been just over 2 weeks since that, and by jove have i improved"...yes you probably have but that is what learning how to trade is like, i've been learning for somewhere around 8 months and i almost every day have that feeling of learning and realisation...don't get overconfident about this feeling.

The best thing to do is just stick to one way of trading for a few weeks then make a decisions, don't keep switching it is a waste of time, i did that for so long and it doesnt get you anywhere, and keep your mind open.

The thing i am coming to realise it doesn't matter how you trade, it is if you feel comfortable. Keep it up, at your age you can do some serious damage to the markets, i know someone who started trading young and they bought a merc for their first car...it can happen, they were already minted but still, it can happen...

i have been learning about the markets for a year now! trust me i'm not in the holy grail chase anymore, i learnt a lot when i joined here and posters here slapped me back into reality, trading price action using 4H+ charts is something i feel comfortable with

 

[cr6196]

yes sorry i meant learning is in actually learning to trade if thats any difference. Concidentally, i also trade using 4h altho i do sometimes enter on lower TFs, best advice i read was buy when it goes up and sell when it goes down, you can only ever be wrong once or twice, when you buy the top/sell the bottom.

 

[TAjammy]

i suppose that'd work fine if you were happy with one or two bars in your favour

 

[TAjammy]

an update on that trade..going well so far but if that H4 candle turns out to be a pin i may sell some of my position as it is lying on some decent support which it has already penetrated, if a pin penetrates a good level and moves back up it's, as james16 says 'go time' .

 

[TAjammy]

actually, i might just wait until this H4 candle closes, it's rising at quite a rate, and it may well close at the high of the other bar, making one of those great double high bars, then i'll wait for the break of those two bars, if it goes above the high of that bar i'll close

 

[BSD]

TA, like I told you earlier, I wish I had had the good sense to start looking into this when I was 15, think it's really great that you're doing this.

Most important thing to realize is that this isn't rocket science, so keep it simple.

Markets can go up, down, or sideways, that's it.

The only 2 ways you can make money through directional trading are by trend trading, ie buying breakouts or buying pullbacks.

OR through trading reversions to the mean, which sounds complicated but only means that you're picking tops or bottoms.

Those are the only ways you can make money trading.

Trading isn't about being right - losing is a cost of doing business as a trader - it's not about the individual trade which is entirely meaningless in the big scheme of things, trading is only about your long term bottom line, your long term profit and loss statement.

There is no pattern that tells you what will happen next, BUT you do not need that to make more money than you can ever spend.

Don't go chasing a non-existent holy grail, don't believe that if you just keep on studying markets until your head turns blue that you will one day be able to predict what happens next, you do not need to feel that you must understand what'll happen next to get rich.

Markets can go up, down or sideways, that is all they do.

All you need to make a fortune is to do what any kid in kindergarten could do, grab a chart, eyeball where the path of least resistance is, jump on board, cut your losses when and as they occur, and otherwise ride that trend all the way until it bends.

Trading is nothing than a probability game.

You create your positive expectancy not through predicting markets.

You create your net profitability through combining risk/reward ratios and hit rates in a way that provides you with net profitability.

That is all trading is.

Claudia is right, you most definitely do not need any indicators as price tells you everything. That said I myself have some up but that's more laziness than anything else let alone necessity.

Good place to start:

Price Action

All you need is ONE setup.

Don't want to influence you as you really need to define what works for you, but imo opinion one of the best and most profitable ways of trading is aligning yourself with the cyclical way that markets move, while at the same time creating excellent risk / reward ratios, through buying pullbacks to the trend.

Eg like here:

Maoxian Swing Trading Strong Stocks Using the Holy Grail Technique

Master that and you're set for life.

Good luck !

 

[Splitlink]

"All you need to make a fortune is to do what any kid in kindergarten could do, grab a chart, eyeball where the path of least resistance is, jump on board, cut your losses when and as they occur, and otherwise ride that trend all the way until it bends."

No one more blind than he who will not see

 

[BSD]

Hehe yup Split mate

Your chimp has some cousins too.

 

[TAjammy]

lol! actually that trade i just took would have had a risk reward of 1:1.2 , not much but i forgot to put in a stop anyway. Later put a trailing stop and got stopped out but still made + $66 demo money lol. This trade has just made up for the silly day trading attempt which led to a $60 loss.
Gotta look for price levels and trade the price's reaction to them.

 

[TAjammy]

aw look at this beatiful set up,price is retracing back to the 0 line, although the current candle is forming bullish it is still inside it's mother candle two bars previous is very much bearish, would enter short at the break of the mother candle.

 

[TAjammy]

hmm NFP seems to be killing euro so i'll stay away from those pairs, but AUD/CAD seems good on the sell side, a pin forming at channel resistance plus a failed break of a previous high... not taking any positions yet

 

[TAjammy]

great pin forming on EURJPY hourly forming on a channel line