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MightyOne
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Postby MightyOne » Thu Jul 02, 2009 2:51 pm

If you post the version of the custom candles that you are using that it would be more easy to answer your questions.

monolisa wrote:MO,

Thanks. Actually there's one available (with time shift function) but the period converter indicator doesn't work well over weekend period and there's some issue with refresh after you change the shift factor. I have attached a copy here.

Anyway I use custom candle to create custom period with specific opening time.

As you can see on the attached GBPUSD H1 chart ("mo2"), there was a burst of momentum after the candle marked with an upward arrow. I count the number of bars before the upward thrust disappear (n = 3). I then create 3 hr custom candles starting from the pre-momo candle. I note that price corrected in the next 2 candles, but the 3rd and 4th candles (bull bars) didn't have much momentum at all.

I would probably place a short limit order near the low of the 2nd bull bar. In hindsight momentum did increase and price broke downward.

Just wonder if you could explain a bit more about term extreme in this sentence "As far as price is concerned, a real move is when price moves further than the largest correction that returned to the extreme." If the attached chart is used where is the extreme?

Thanks again.

Lis

PS. I just notice there was a mighty zone play starting from the candle with a downward arrow on the chart "mo3". Correction was weak and the real move appeared, hit the "extreme" and went downward. Is it how I should play the setup?

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monolisa
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Postby monolisa » Thu Jul 02, 2009 2:54 pm

Thanks, MO. Here's the indicator I am using...

Lis
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CustomCandle6.mq4
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Postby MightyOne » Thu Jul 02, 2009 3:07 pm

MORE COMMON SENSE:

See the story not the some "setup"

Image

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Postby MightyOne » Thu Jul 02, 2009 3:22 pm

They wait

You wait

They trade

You trade

They are the action

You are the negative reaction:

Image

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monolisa
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Postby monolisa » Thu Jul 02, 2009 3:43 pm

Hi MO,

The 5 bars box are used because of a previous momo breakout of equal time period (ie. 5 bars)? I note that the box is placed at the highest high of the range - you are looking for a correction/breakout away from the box?

Thanks for the "story". It's like watching a chess game unfolds :)

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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Postby MightyOne » Thu Jul 02, 2009 4:14 pm

Momentum post box breakout is what I am looking for:

Image

Ranging markets can be fun to trade

You just follow the pattern:

UP DOWN UP DOWN

if it goes

UP DOWN UP UP

then you trade DOWN and follow the prev. pattern.

3 same colored candles and the range is either broken and price is trending or price is ranging diagonally in which case you trade the range toward the bias.






monolisa wrote:Hi MO,

The 5 bars box are used because of a previous momo breakout of equal time period (ie. 5 bars)? I note that the box is placed at the highest high of the range - you are looking for a correction/breakout away from the box?

Thanks for the "story". It's like watching a chess game unfolds :)

Lis

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Postby monolisa » Thu Jul 02, 2009 4:18 pm

Hi MO,

I have a go at the EJ chart (attached).

First there was a breakout/momo (upward arrow). Counting from the pre-momo candle there was 4 bars to the highest high point. Custom candles were draw using 4 bars (yes it's a H4 chart but with a specific starting point). Next 2 H4 candles lacked momo (downward thumb). The 3rd one (bearish) has momo and broke the lowest point of the previous 2 H4 candles. My short limit order would be near the thick yellow line, trading toward the zero line @ 135.100. I do note that the thick yellow line got wicked a few times before the downward trend occured.

Your comment is appreciated. Thanks.

Lis
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mo4.gif
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monolisa
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Postby monolisa » Thu Jul 02, 2009 4:24 pm

Hi MO,

I was writing the EJ post and missed your explanation on the 5 bar box.

I presume you start the box after the momo candle, but why choose 5 bars?

Great advice on ranging market trades. 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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Postby MightyOne » Thu Jul 02, 2009 4:37 pm

It is based on THE LAW OF THE CHARTS by Joe Ross

The box starts with the first overlapping candle that closes within the range of a prev. candle and ends when all the rules are met.

monolisa wrote:Hi MO,

I was writing the EJ post and missed your explanation on the 5 bar box.

I presume you start the box after the momo candle, but why choose 5 bars?

Great advice on ranging market trades. Thanks.

Lis

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monolisa
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Postby monolisa » Thu Jul 02, 2009 4:58 pm

GJ trade. Blue shaded area was the ranging box. Looking for a breakout of the box. Price eventually broke to the downside.

I used a 15 bars custom candle.

Lis
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mo5.gif
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