2009.09.10 DRAIN THE BANKS - LIKE A RAT

[TheRumpledOne]

Yesterday's trade.
Any comments would be appreciated

Weekly & H1 are green
Price within 20 pips of daily low

Looks like you could have made 3 pips. Price was moving slow, so take the pips fast.

Actually the highest price was 78.090, which is 0.9 pips.
This is including the spread, so didn't take any profits / moved my stop loss yet.

And TRO, how many M5 candle bars before you consider that the price is moving slow?

One or more... Velocity = distance / time.

[TheRumpledOne]

Homework for the weekend(Dec 3):

Q) What clue does the frequency distribution for the weekly candle wicks give you?

No one has an answer?

[Relativity]

Can I answer? Lol.

[TheRumpledOne]

What do these charts have in common?









How can you profit from them?

HINT: The lines show the highest open and the lowest open price.

[TheRumpledOne]

HINT No. 2: Time frame does not matter:

[slingblade]

Homework for the weekend(Dec 3):

Q) What clue does the frequency distribution for the weekly candle wicks give you?

No one has an answer?

I'll just be able to guess without any certainty. This is a new paradigm for me.

Does it give us a potential target for how much retracement we can expect from a reversal at the rat zones?

New indicator/template coming?

[unreconciled]

Hi TRO,

As nobody else seems to want to share their homework... ;)

According to the frequency distribution for W1 candle wicks, as far as I understand, it shows
that after price retracing 10 - 19p. off the weakly LOWEST low (for the green rats) there is 50%
chance of it going up to 70p.+ and as high as 90% chance of 30p.+.

According to the charts with highest and lowest open prices that you have posted, all I see is:

PRICE WILL MOVE 'X' AMOUNT OF PIPS FROM HIGHEST HIGH TO LOWEST LOW,
AND FROM LOWEST LOW TO HIGHEST HIGH WITHIN 'Y' AMOUNT OF TIME.

(...what is by the way what 'MightyOne' always says).

Is importance of holding to winning trades what you want us to see?
Then still, I do not quite get how to profit from this :|

Or is it visual presentation of:

"Now, 2 patterns of market behavior happen on a regular basis:

1) the price breaks to new high's (or low's)

2) the price reverses from new high's (or low's)

They happen regardless of time frame (with the obvious limitations explained above)

They are phenomena that can be exploited without the fear if found out by others, that they might cease to exist." - H. Rearden

Well, what is common for all those charts is that the price closed lower than the lowest low
and higher than highest high NEVER after.

That may solve my problems with not being able to stay +10p. in profit for the day, giving me the exact,
higher probability zone to buy, and prevent me from overtrading
(MAINLY IN THE RED RAT TIMES, WHICH I PERCIEVED AS A 'TREND' FOLLOWING MUST).
I just do not know why have I refused to see this before.
WOW! I am really kind of like -> :O

I am grateful for making me rethink what I claimed to have known.
I will be pleased to see any comments on the above.

Have a nice day!

[TheRumpledOne]

Good observations so far but there is still something else to be seen in each case.

Anyone else??

[vincentws]

I see simply that regardless of time period, profit can be made in either direction by taking reversals off of the high or low. to use Rat terminology, there is cheese for everyone.

[slingblade]

Blue is NY, Yellow Asian, Maroon London. Look and SEE. Now you tell me if it matters.

Frankly, I'm beginning to see that I'm having difficulty seeing much at all. I'm seeing that I tend to gravitate towards a rule which means I don't have to understand, just follow the rule. But after "seeing" that simply taking a rat reversal anywhere on the chart doesn't seem to get me the cheese I need I'm left wondering if there isn't more nuance to being a rat. I'm suspicious that there is something else to look for in order to "know" that a good setup is at hand.
The GPS seems to be a good indicator of that as it highlights rat zones. But the idea of the broker's time not mattering is throwing me as daily highs/lows are suddenly perspective dependent. Time frame not mattering isn't as hard to swallow, I get that price is the same on all TF's.

What I see from your graphic is that price makes highs/lows and reverses in all market times. Am I missing something else? I might as well draw a line anywhere on the chart.