rat reversal

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2trade
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rat reversal

Postby 2trade » Fri May 14, 2010 1:43 am

for months i have been trying the rat reversal trades but keep missing them because often times i see a rat reversal against h1 and other times what looks like a rat reversal is just an continuation of the bar. can anyone tell me when it is safe to take the rat reversal and when you should wait.

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Postby tmanbone » Fri May 14, 2010 2:24 am

TRO's rule is to take the trade within 20 pips of the daily high if you're a red rat and of course 20 from the daily low if you're a green rat. It's not as easy as it looks so don't think you're by yourself. I would recommend reading the drain the banks thread/threads, take notes, save screen shots of charts, and dig in and study like you would for anything you want to learn bad. Post charts of what you are doing, mark them up with your trades, others will offer advice. Cheers,
"The simplicity of the markets is it's greatest disguise"

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Postby tfg » Fri May 14, 2010 8:41 am

tmanbone,

I hv the same issue. I traded DTB-Rev 9 on M15 last week and worked magic. This week has been nightmare as I got caught with a lot of false reversals on gbpusd when trending down on London morning. (even when LWP, H1 bias LONG....as soon as I opened the trade, price went the opposite, H1 bias changed RED and hit my 10 pips SL as TRO suggested)

My experience so far...
1. When strongly trending, a lot of false reversals on low.
2. 10 pips SL do get hit quite a lot on M15 and killed could have been profitable trade.

Any thougts please? Thanks.

tfg

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Postby tmanbone » Fri May 14, 2010 12:17 pm

tfg wrote:tmanbone,

I hv the same issue. I traded DTB-Rev 9 on M15 last week and worked magic. This week has been nightmare as I got caught with a lot of false reversals on gbpusd when trending down on London morning. (even when LWP, H1 bias LONG....as soon as I opened the trade, price went the opposite, H1 bias changed RED and hit my 10 pips SL as TRO suggested)

My experience so far...
1. When strongly trending, a lot of false reversals on low.
2. 10 pips SL do get hit quite a lot on M15 and killed could have been profitable trade.

Any thougts please? Thanks.

tfg


Zoom out, get a bigger picture, you're trading against a freight train with a full stove of coal. Do not get run over by the train by looking no further than the tracks. Are you a red or green rat? Looks like the red rats are getting their share of cheese out of the G/U this week.
"The simplicity of the markets is it's greatest disguise"



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Postby tfg » Fri May 14, 2010 12:36 pm

Thanks, tmanbone. I think for this week (which is already Friday), I have to be the red rat. Questions:

1. All RAT trades are reversal, right?
2. Do we use the same entry/exit rules for dynamic res/sup like the daily high/low in RAT trades? If so, what pip distance should we use? In RAT, 20pips from the daily high/low is opportunity.
3. I guess I am a bit confused between naming conventions. Rat trade is only one type of trade in DTB. Is that right? Apart from RAT, DTB also trade dynamic support/resistance, right? If this is correct, can you enlighten me the entry rules (if different from RAT's).

Many thanks. tfg

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Postby TheRumpledOne » Fri May 14, 2010 7:57 pm

If you are a RED RAT then you are a RED RAT for life otherwise you are a YALE STUDENT. RATS DO NOT CHANGE COLORS.

Let's clear things up:

1) To trade like a RAT is to ALWAYS trade in ONE DIRECTION - either LONG or SHORT. Once you pick a "team", you can't switch.

2) The "within 20 pips of the daily high/low" is the BEST possible entry to get the maximum run BUT the RAT REVERSAL entry works ANYWHERE on the chart.



RED RAT REVERSAL - SHORT ENTRY CRITERIA:

1) GREEN CANDLE CLOSES
2) RED CANDLE CLOSES
3) PRICE TOUCHES LOW OF PREVIOUS RED CANDLE - ENTER SHORT.
STOP LOSS IS ALWAYS 10 PIPS.
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!

Please do NOT PM me with trading or coding questions, post them in a thread.

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