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I'm
enjoying this thread so far. The phsycological aspects you talk about
really get me thinking, but I'm confused about your chart example for a
couple of reasons. Your position entry looks like a fairy tale short
trade. When you ask "do you see the entry", if the overall trend is
going down I could say yes, although with a spike that large I might
not do anything for a couple more candles. On the next chart I might
observe that price has fabulously broken resistance. But until I see
the next candle, I wouldn't've called it a short entry. Plus, both
conclusions are based on interpretations.
Realistically I would be viewing the action sometime before or after your entry candle (more likely after), and would at least look for signs from an MA cross or a reliable candlestick pattern. Yet another interpretation. Thats huge movement for a 5M chart! |
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I see you like Yoda. What makes you say "that's a huge movement for a 5M chart"? Do you think PRICE knows what a chart is? Do you know the average range of the GBPJPY for M5, M15, H1? What is the reason you want a MOVING AVERAGE CROSS to signal an entry when we all know those entries are LATE?!? You see the support? You see the resistance? Do you see the last two 20 pip scalp opportunities from the go Short and go Long lines? Now, FEEL THE FORCE!! TO BE CONTINUED... |
TheRumpledOne,
I am new here and thank you for your thought provoking posts. As I was
reading the thread, I was thinking to myself, "Is this Zen and the art
of Forex?" Then the zen student story was post #20 :)
I have a lot of studying to do, but I will be keeping up with this thread with great interest. Thanks Again for your interest in sharing, David |
TRO
- Ok, so what i'm seeing is this.... basing entries solely off of S/R
lines that you would wait for a move to breach into a new S/R area and
contract and close back above/below prior S/R from previous swings,
thus not on establishing a signal, but clearly defining the Risk on the
trade prior to the entry.
Am i anywhere close? :confused: |
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Thanks for this thread! It's nice to finally see support and resistance. I wouldn't even need to draw lines on the GBP/JPY 5M it's so obvious. |
A question about support and resistance: How far do you go back to determine usable support and resistance?
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Careful what you study... your chart could wind up looking like spaghetti.. squiggly lines everywhere!! I don't need or want squiggly lines at least no for trading. The most important thing is to find what works for YOU. FOCUS ON YOUR ACCOUNT AND YOUR TRADES. |
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Have I mentioned "breach", "previous swings", "contract"?? Don't complicate trading. Price is price. Price either goes up or down. Your job as a trader is to recognize what price IS doing, NOT what it may do in the future because ANYTHING CAN HAPPEN! |
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You need to UNLEARN a few things. You talk about THE SPREAD. THERE IS NO FIXED SPREAD IN FOREX!! The spread changes during the day. I keep repeating it because anyone who trades with a FIXED SPREAD BANDIT, I mean broker, is giving their money away. You need to trade with an ECN. I would suggest you study FOREX and how it works then you'll know what I am talking about. I used to trade the USDJPY all the time. I can see S/R on the chart. What's the reason you can't? "Ultra scalping"? What's that? I just take what I can when I can. Price action is always there. Sometimes is a little more volatile than others. |
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The SR RR indicator ( that plots the S/R and entry trigger lines ) defaults to 21 bars. Why 21? Why not? There are no MAGIC NUMBERS. It could be 20 or 22. Use whatever works. Sometimes you just have to test different things until you find something that works for you. On the other hand, if you apply a STATISTICAL ANALYSIS to price action, you'll know what the "best" numbers are. :D Look at the H1 NB SR(240) gauge in the chart on the right side. The number is orange is the current price. The number "1" to the right is the number of times that price was a previous candle's high or low over the last 240 H1 bars. Since most of us draw support at candle lows and resistance at candle highs wouldn't it be nice to know what you are at or near those levels? The numbers in red above are the next 5 prices and are potential resistance. The numbers in blue below are the next 5 prices and are potential support. It's like have a real time radar screen for S/R. I don't need to draw the lines anymore. |
Hey TRO,
I realize you're using a different type of broker but you probably know anyways about market orders vs pending orders? From what I understand for example, a sell limit, the price has to go up for it to trigger a sell order? Just making sure I understand them, or even if I'd ever want to use them. Do you use them? Thanks :) |
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By now, most people know I use MB Trading. I am not allowed to post the link anymore. You will never see a market order because it gets filled IMMEDIATELY at the prevailing market price. Limit orders are stacked up on LEVEL II MARKET DEPTH. |
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Not exactly. No "hopefully" about it. I put in my LIMIT SELL order at the price I want to sell. |
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I've had lengthy live chat discussions with MBT about Rumples claims of buy at bid and selling at ask. I've had them read the posts and comment and there is no magic order that allows this. They assure me they work just like any other broker. For a limit order to be triggered, price DOES have to hit order line to fill (at your price or better). They work like you're accustomed to. |
I
use EFX as well, and basically what hes saying is that unlike other FX
brokers you can get in at the bid and out at the ask (depending on the
prevailing market conditions and orders used). When i was with gain i
was always in at the ask and out at the bid, eating up my chunk of
profit. With EFX i'm able to limit order into markets, and get out at
the ask in certain conditions maximizing that profit in the middle.
Basically, MB isn't a bucket shop, and as has been discussed in the broker review forum 1,000,000x's before, they are a great broker to use. |
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You really DO NOT UNDERSTAND! Yes, Price DOES have to hit your order. If you are long, someone has to BUY from you. But the bid does NOT have to move up. They can enter a MARKET BUY ORDER on the ECN and you will be filled if yours is the best off. |
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Finally, someone who KNOWS what they are talking about!! |
I
wish I wouldn't have mentioned spread in my last reply. I would hate
for such a potentially educational thread to wander. I would also
rather not go back to evaluating brokers again, thinking I've made a
poor choice. That was way too time consuming, when I could have been
learning to trade.
When you mention "studyiing forex", I'm guessing your talking about how trades are made on the broker end, the idea of sellers needing buyers, etc. I've been learning more about candlesticks, indicators, money management, etc. I'm figuring this whole learning process is going to take some time to gain well rounded forex knowledge. Last night I watched GBP/JPY for a bit. I noticed on couple of occasions, long candlesticks touching resistance, then another long candlestick reversing into profit. Doing thing my old way, I'd wait for that next candle to close for confirmation, so even though I was successful with every trade I made on GBP/JPY last night, if I would have placed an order when price touched support/resistance I could have made even more. Is this the idea your trying to present? This morning I thought I'd try GBP/USD, figuring the market hours for that pair should be vigorous. Not quite the same action, but watching the 5M chart is still more active and interesting. I'm not so successful though. Since reading this thread and seeing the GBP/JPY action, I started ignoring trend. Last nights GPB/JPY chart didn't care about trend. This mornings GBP/USD chart cares very much about trend. I've been faked out twice so far. Once on a pretty solid reversal pattern. I'm not sure quite what I've learned this morning. Anxiously awaiting more goodness form this thread! |
http://i34.tinypic.com/ftzyxj.gif
Trend? Price is either going up or down... If you are scalping you find the immediate "trend". Remember, price moves in "waves".. up, down, up, down, .... You want to ride the waves. Correctly identifying which way the price is moving results in profits. And it has nothing to do with what time frame you are looking at because PRICE IS THE SAME on ALL time frames. If you are NOT looking at a 1 tick chart, then you are NOT looking at the actual movement of the market. |
Your really one of the few here who doesn't say that anything under 20M or 15M is noise.
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What is noise to one is music to another! See the 1-tick chart in the bottom window. That streams by as trades are being executed while the M15 candle goes up and down. The 1-tick chart is the REAL MARKET. The M15 candle is just a representation of what occurred during 2 points in time. DON'T BE FOOLED. |
Also,
would it be correct to say, and my thoughts are still a bit muddled on
the matter, that limit orders won't be of any advantage with a retail
broker as they are with an ECN?
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Market orders mean you are filled IMMEDIATELY ( unless the Fixed Spread Bandits cheat you i.e. "slippage" ) at the prevailing market price. IMHO, the only time one should enter a market order is when they are panicking because market orders are for suckers who don't know any better. |
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FOREX is NOT a consolidated market like the stock market. Different brokers use different banks or liquidity providers so prices may vary. So unless your broker's feed is delayed, it should be real time for them. FIXED SPREAD BANDITS (FSB), I mean brokers, do NOT have to hunt for stops. They already know exactly where they are. That's just another market myth. If one FSB moves their market too far, someone will ARBITRAGE their (_*_)s!! |
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At
the very last candle or the very next candle? Even with an almost 1:3
risk/reward, I wouldn't. But that is because the last candle is telling
me the downward push is not done yet. So it' not time for a buy and
it's too late for a sell.
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Hmmm...I'm thinking perhaps setting a buy limit for 200.93 ?
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What day of the week is today?
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It is ALWAYS triple interest and the shorts USUALLY cover right before rollover. But they didn't today! That's the reason you have to focus on what is happening instead of what you think or believe will happen. TO BE CONTINUED... |
Back to limit orders...I found this explanation of when/why one would consider using them:
1. Limit orders are commonly used to enter a market when you fade breakouts. You fade a breakout when you don't expect the currency price to break successfully past a resistance or a support level. In other words, you expect that the currency price will bounce off the resistance to go lower, or bounce off the support to go higher. |
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Sorry, I don't have access to any charts here at work, so I can't see what's happening. :o |
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Yes, usually the shorts cover right before rollover and you can take advantage of that occurence. |
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