A cluster of stops all the way to 1.6218 on GBPUSD

forex live trades, setups, charts

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Paul
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one thought on Fibonacci

Postby Paul » Wed Jul 08, 2009 9:53 am

one thought on Fibonacci.
Three major Fibo retracement lines applied in any time frame on a given chart. From the mathematical and physical points of view there are many ways the market may behave on approach to them and each is equally probable. The market may ignore some of its past performance. Without this inner built memory it would be completely impossible to predict the future. And from time to time it seems that the market suffers some Alzheimer's disease. And it then depends who remembers what. Big players remember areas of price action, whereas retail players remember mostly levels. Big players remember much more information than the public. Compare this with music. The market plays a piece of music. You may remember a general impression, phrases, measures or single notes.

Big players cannot place lots of orders on a tail of a candle. They need much more time to open numerous positions. As a result their Fibonacci tools are being applied to different price levels than the actual tops or bottoms everybody else sees on charts. It makes big differences in drawing and using expansions.
Last edited by Paul on Wed Jul 08, 2009 3:27 pm, edited 1 time in total.

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1.3941 has been tested back again like USDCHF tested 1.0870.

Postby Paul » Wed Jul 08, 2009 10:20 am

Strong SELLs seen at 1.3941 on eurusd and more SELLs near 1.3915. Like I said 1.3941 has been tested back again like USDCHF tested 1.0870.
What is crucial is to observe the reaction on nearing to them. Now you know sth that was hidden from the public but it had left a urine mark and I smelled it.

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monolisa
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Postby monolisa » Wed Jul 08, 2009 10:36 am

Nice one, Paul. It seems I need to train my "nose" to smell the spot and understand what the "smart" money is doing/going.

Thanks.

Lis
"Know your enemy and know yourself, find naught in fear for 100 battles. Know yourself but not your enemy, find level of loss and victory. Know neither your enemy or yourself, wallow in defeat every time." - Sun Tzu

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Re: to noone22

Postby noone22 » Wed Jul 08, 2009 11:12 am

Paul wrote:I was talking about an alignment of forces/energy


Thank you for the idea.

I still don't understand its details, I could just smell,
that something really good and valid is standing behind this idea.

Paul
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urine

Postby Paul » Wed Jul 08, 2009 1:28 pm

Urine is an excretion. It is a product of an essential process in all forms of life. Urine has been used in the manufacture of gunpowder. :lol: No form of urine has been taxed in modern times. :D

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Postby rolska » Wed Jul 08, 2009 2:42 pm

Thanks Paul for your insights and humor
Do you have some links for study of your approach, or is it mostly based on lifelong experience? (and the ability to smell urine :P )

Paul
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Hi there

Postby Paul » Wed Jul 08, 2009 7:14 pm

Hi there,

A few thoughts about everything FX trading is about.

I will make a comparison with music performance.

What we get from an FX market is a chart of bars or candles like scores or sheet music. A proficient musician and a good sight reader will be able to play it at a glance. A worse sight reader will spend more time studying the material and everything will develop in his mind rather painfully. A complex texture will slow down the process considerably and such a musician will not be able to keep the right tempo. In the market he will be always behind, always too slow to react fast and execute an order and always grudging "I knew it!". This sight reading ability requires training. You cannot become a better sight reader unless you gain experience from loads of charts and unless you try to play what you see. The aim is to be able to sight read at a glance. IT is both technique and art at the same time and not everybody can do that like a master. (Nevertheless, traders ignore the fact they may never be able to approach a masters level yet they will rather put the blame on the market, not themselves). I disagree with a general belief that this reading ability is a primary school task and the real climbing higher is through complex setups and indicators.

In fact the use of complex setups and a myriad of indicators paradoxically does not make things easier for decision making. A setup is some sort of an artificial language. You need to know its vocabulary and grammar and idioms. And what is the most important you need translating this language into the normal language you use in life and instructions need to be simple and clear. If not simple then you will want to investigate longer and if not clear you will hesitate. As a result of poor translations you will not trade much, no matter how good the setup is. One of the side effects of such a situation is that you willingly indulge yourself in the "slang" of your setup to cover your inability to issue a clear instruction: BUY, SELL or STANDBY.

Does a setup add anything significant to what you should know to trade?
The answer is NO, and all the relevant information is already in the prices and a setup is just some kind of a derivative of the primary charts (I mean NO from the perspective of traditional TA). Adding more indicators only increases the entropy of a system.

Does a setup add anything significant to what you should know to trade? The second answer is definitely YES! But when? Only if you study the market from an entirely different angle, forgetting stochastic methods, applying methods from other sciences than statistics. Look what Simons has been doing and who he has been employing in his hedge fund.


Imagine a musician who cannot excell in sight reading so he choses to use
another way of coding music notes hoping to excell in that other way. Will
he make a better player? Maybe, but I seriously doubt it.

Now, the problems of fuzzy logic, of interpreting certain patterns and behavior arises from the fact that traders use their indicators in a raw state. Everything becomes subjective, even the definition of a trend (!) It is no wonder that people differ in their opinions about the same things. And they tend to consider "obvious" situations are easy to trade but will seek a trap inside, and "not-so-obvious" ones as very risky.
Last edited by Paul on Wed Jul 08, 2009 8:34 pm, edited 1 time in total.

Paul
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To rolska

Postby Paul » Wed Jul 08, 2009 8:12 pm

I study the problems of chaos, topology and turbulence in dynamic systems. I used to use fractal models (different than Bill Williams). I acquired allergy to
classical TA as it works ONLY in special phases of the market and generally it does not work and it can be proven mathematically why it cannot. I do not want to disclose my performance in public, I know this is unwelcome and immediately you get more enemies than friends. However, some clue you may get from a sequence of recommendations I have posted since June 10 which were all winners.

Paul
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some new developments on EURUSD

Postby Paul » Wed Jul 08, 2009 8:49 pm

some new developments on EURUSD.

New longs established at 1.3851. They look strong.
Above strong SELLs at 1.3941 and more SELLs near 1.3915.

Longs need a close above 1.3896 to gain momentum.
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Patch
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Postby Patch » Thu Jul 09, 2009 2:57 am

Paul

A little on topic, and a little off topic, but I think it will help me figure this whole trading thing out. Seventeen months ago, a good friend of mine told me that when he was nine years old his family traveled to the Grand Canyon and he was at the top and peed over the edge, leaving his sent for all time. As soon as I heard this story, I told him how wonderful, I want to do the same at the same spot if possible.

And I hope to learn to discern and follow the scents that you reference in your trade descriptions. There is no two ways about it, it takes a lot of work and continued dedication to move from easy losses to profitability in this project we are all perusing both together and individually

Thank you for being here and for your posts. jb
ENOUGH being a Yalie for me Back to the Sea. "What i can lose, i can win" "YES YOU CAN" - dragon33 -"Pick one method and one pair and stick with them until you master it. "The choice is yours - success or failure." TRO

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