Captain Currency
Experienced member
- Messages
- 1,091
- Likes
- 675
Blancspa screen shot was of a 5 min chart. On his 5 min chart the sma was flat, price on his chart looked like it was just bobbing up and down during a flat period maybe and making highs and lows just because it had to before it broke out.
This is where a good trader can observe price action based on the 3 ducks system. The 4hr chart may have been trending for the past few weeks a bit like eur.usd is now and the sma on the 4 hour chart is clearly up (not flat). So in this example we are clearly looking for buying opps Now drop down to the 1hr chart - what does it look like? whats the 1hr sma looking like? whats the candles even looking like? What has price done is the last few candles? Get all the info out of these charts. Are you getting a better understanding of what price did and what it might do? Now drop down to the 5min chart, if it is like Blancspa's chart and moving sideways for the last few hours then the 1hr chart is probably creating doji like candles.
You as a savvy trader need to be taking all this price action in and asking yourself "will I buy/sell on a break of the last low/high on the 5 min chart that has been bobbing up and down for the past few hours or do scan back out and have a look at what is happening on the 1 hour chart. You might prefer to be entering a position based on a break higher/lower of a decent candle from the 1 hr chart if the market has been a bit unsure, at least a break higher will tell you that prices are going higher now :|
If prices have been going higher on all timeframes and you are happy with everything you will be setting yourself up for a buying opp. Now you get price action like what is happening on Blancspa's chart (opp way around of course). The trend is in place, prices may have rallied a few hours ago and the price action on the 5 min chart is going sideways because the market maybe resting after the previous rally. I want to get involved in this strong trending market so im not going to be as fussy as to which high it breaks on the 5 min chart - its telling me it wants to go up! Stop-loss of course in a location I know if its hit that im wrong.
On a final note: The 3 Duck's Trading System is a great tool for helping you observe price action, you need to be taking this information in and using it well. This "system" is not an auto black box thinggy! Of course some days a flashing green light would have worked on the Ducks, you would have make a few $'s and not have to use your head.
Successful Trading is different, you need to be savvy and on the ball, The 3 Ducks can be a powerful little tool but you need to do the rest of the work and extra thinking :-0
Is that coffee ready yet????
Andy
