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dojirock
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Postby dojirock » Mon Sep 24, 2012 5:34 am

newscalper wrote:Great pic and trading there. One thing that has me puzzled and may be a part of the puzzle for me...B is momo? As opposed to A? C i see as momo but A? I suppose as compared to the 3 bars before making a doji it could be considered pace starting down but is it actually momo?


Newscalper,

For a long time the definition of momo puzzled me. Mighty One originally stated, I believe, 2x the previous candle is momo. Well I took that literally and it puzzled me for a long time. I have reprogrammed my thought process to take momo as any area where price has stopped and then left. I read it as a story in my mind now as I trade. As you said you can see the combination of candles that made up the "a" mbar. After that period this is how I read them, the red one next to the #1 is where price stopped. #1 is more than 2x the previous, that one is pretty easy. The open of #1 is the zline and I think to myself, ok when that line gets broken, momentum has changed. So #1 is up, #2 then forms and breaks the open of#1, but is not 2x the size of the previous? But this is still momentum down to me, due to it engulfs the previous 2 candles. #3 closes up but doesnt break the open of#2 and there are no like colors to combine yet. Its like imagining #1 on top of #2, the green would not completely cover the red of #2 correct? So to me momentum is down. #4, made up of 3 candles, breaks the open of #2, doing a overlay you wouldnt even see #2, so to me no up momentum. #5 is simply a retrace into #4, price would have to close above the #4 before I would thing longs. 6-7 make up a down momentum. #8 is upward momentum but doesnt overpower the 6-7 downward momentum, then #9 does what?? It engulfs the previous 2 candles again! 9 and 10 break the 'a' zline...so now I know retrace then drop...

I have tried many ways in this thread to explain how I see, momo, momentum, mbars, from history trading, which is again looking to the past in relation to current price, waiting for the current price to overpower what has happened in the past. momo is more than 2x. It can be 2x, engulfing, railroad, morning star, these are all momo, or mbars to me. Its just a shift in power from buyers to sellers in which one of the two wins.

Hope this helps, I didnt mean to ramble.
:)
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Postby dojirock » Mon Sep 24, 2012 7:17 am

new week...yea...g/u
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Postby newscalper » Mon Sep 24, 2012 11:25 am

That helps quite a lot doji, thanks. The other thing that catches me out with that kind of approach is this, this may get a bit confused as I'm not referencing the pic while I write this...
We see A - momo up, therefore then from the m15 looking for supply areas within the momo to go long from yes? Are your 'rat' entries also taking the break of the high of a red candle in that instance? How do you define your exit criteria? The same (rate break in the opposite direction)?

The other thing is this - B momo forms down but long entries are being looked for BUT unless there's some criteria for no longer looking for longs while that B down momo forms you get smashed trying to go long during that period as the only momo evident at that point is A - are you seeing that supply area on the m15 and saying that once the smaller TF bars close over that area you're no longer looking for long trades?

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Postby Tony Montana » Mon Sep 24, 2012 6:06 pm

;) today

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Postby dojirock » Tue Sep 25, 2012 1:10 am

[quote="newscalper"]That helps quite a lot doji, thanks. The other thing that catches me out with that kind of approach is this, this may get a bit confused as I'm not referencing the pic while I write this...
We see A - momo up, therefore then from the m15 looking for supply areas within the momo to go long from yes? Are your 'rat' entries also taking the break of the high of a red candle in that instance? How do you define your exit criteria? The same (rate break in the opposite direction)?

The other thing is this - B momo forms down but long entries are being looked for BUT unless there's some criteria for no longer looking for longs while that B down momo forms you get smashed trying to go long during that period as the only momo evident at that point is A - are you seeing that supply area on the m15 and saying that once the smaller TF bars close over that area you're no longer looking for long trades?[/quot]
[
The 15 min candles following the 'a' momo, yes I used the highs of the red candles also. If your referring to the 15 min candles within the 'a' momo like stated, I cant answer that due to I need to see what is left of that 'a' momo area. Defining my exit, I dont advise on exit methods in general, due to I take what I can get and dont give much back. When 1st starting Iwould trade long to the upper bb, then I realized the upper and lower bb's often pull the best levels(zlines)out of all the noise, and over time...just learned to see them. By learned to see them, in depth, I visualize the area from entry to swing and go for 1:1, 2:1 even though I dont mark it out...besides..my minimum goal is 20 pips a day..not hard...

Notes on the 'b' down momo. Your right...longs during the formation of the 'b' area you will have some losses and I do have some small losses. Keep in mind and try to visualize the swings on the 15 min chart as a higher time frame candle wick, there will be a point its apparent that even though on the 15 min chart, the swings will adventually put you above the ema on a 2, 4 or 8 hour chart, indicating...to look for shorts only also... the few losses I do get are on the turning points, and I have learned to wait for break of zline on 15 min to opposite side, like in the pic where the ????? are. then I feel better about reversing.

make sense?
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Postby Tony Montana » Tue Sep 25, 2012 4:12 pm

I enjoyed a lot this day ;)

First one (my spider sense help me to get out of this trade lol )

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and later

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Time to relax
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Postby dojirock » Tue Sep 25, 2012 5:37 pm

Great job tony, I slept thru those... lol
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Postby bettlebox » Tue Sep 25, 2012 8:00 pm

Hi Doji

I like what you done really explains it all very nicely here todays price action on Eur/Usd. 2 nice trades and failed 15min rat trade which i got caught by as price was coming up off bottom in the morning and hitting the 4hr zline on down 4hr momo down. lol :D.

I think im getting it now.


BB
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Postby dojirock » Tue Sep 25, 2012 8:20 pm

there ya go bb great analysis.....now just keep repeating....

:D
It always takes Momentum to break Momentum!
"A small loss is just as satisfying as a large gain" -MO
"Sometimes we need to stop learning and start thinking...."
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Postby newscalper » Wed Sep 26, 2012 8:31 am

Thanks Doji. I must be thick because there's still something I'm not seeing

Image

The first is that using H4 bars as a basis is going to give different pictures, second is that you're taking weekend bars into account. Gap also = momo because for price to move like that over weekend = demand but it's a very different scenario. Next is most of the big moves are missed in exchange for a few scraps here, if the gap was actually bars, there's be no trading there, followed by (possibly) a scalp during the pin that formed then the steamroller down with plenty of losses. Yes I see the zone looking far to the left but that's not what is being looked at here. See the big move down on the left? You would have been looking for longs all the way until price passed the zero line of the previous up move?

I do see those 2 down bars before that big drop on the left but they don't close below the 'up' z line so would still be looking for longs?

I've been puzzling over this 'method' for years and still don't get it

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