The Captains Chest - Naked Trading & Other Stuff

[pips400]

guys I need some help. I'm having a hard time correctly predicting PA based on levels. So many pairs right now have continued on their current path for 5, 6, 7 or more levels. When I think I see 3 levels and an M or W, I keep getting into pairs that only retrace for a half day then keep going the way they were.

Take AUDUSD below. This is a 1H chart with 3 clear levels in 3 days (green lines) It gives an "M" pattern, retraces for one day,then keeps going up. (this pattern started on Aug 30th and AU is still going up)

Au.png

Or perhaps take this snapshot of CHFJPY.
3 clear and nice levels up after a swing low and an "M" pattern taking us down to level 1. You can see my predicted next level down (cyan line), but again, right back to the up trend.

CHJ.png

A third example is EURAUD. Swing high, 3 levels down, my predicted level 1 up after a "W" was forming, and nope, continues down.

EA.png

I could go on (EURGBP, EUPJPY, EURUSD, GBPCHF, GBPJPY, ETC....) all have similar patterns over the last couple of weeks.

Obviously I'm missing something here. There's been talk of "Bias" and "level reset" where some of you have predicted a continuation of a trend. If anyone can give any input on where I'm going wrong I sure would appreciate it. I keep taking one step forward and 2 back.

Hi Odellcash FWIW I wrote a little bit about M's and W's here http://www.stevehopwoodforex.com/phpBB3 ... 844#p75844 it's trading price action, but learning how to map price to give better entries and exits.

[odellcash]

Kwanann,

Exactly my point. Your bias long trumps any level count. that dip down after the 1st 3 levels up is (was) 100% correct to be short lived. Perhaps I need to look at the longer time frames to get a better feel of PA bias? Should I use 4H and daily charts and only trade with their trends?

[odellcash]

Ah I see now that you saying my levels are pushes and the 1st 3 pushes made the 1st level. But...but...but Each of my green lines is 1 day, for a 3 day 3 level rise. Now your saying that a rise in a day is only push? that would make a for 9 days cycles....

lost again.

[kwanann]

odellcash

Like i said, it depends on which timeframe you are playing.

A push on the H1 could be a 3 pushes on the M15,

Look at the same chart on the M15 and on the H1.

Its up to you what you want to trade, the higher the TF the lesser baby sitting you have to do

[odellcash]

I know that levels on 15 can be pushed on 1H and so forth. But 3 days for a cycle isnt dependent on chart time frame. it just uses more or less candles. The chart you marked up, which was AUDUSD will take 2 weeks to from start to finish to complete the levels you drew.

Look at the same same chart expanded. the down trend proceeding this current up trend, went 3 pushes down. But now the uptrend will be 9 pushes. My overall questions, is how do we know which will come next. 3? 6? 9? I keep looking for a reverse of the up trend (just like it did after the down trend).

expandned_aud.png

[kwanann]

AUDUSD will take 2 weeks to from start to finish to complete the levels you drew.

I guess i just dont get it. thanks anyway

As a VERY VERY rough guide,

M15 > 3 days
H1 > 1 week
H4 > 2 weeks
D1 > 1 month
W1 > months

These are not cast in stone though, there are many factors affecting the cycle, it may be shorter or longer depending. Sometimes you will get the textbook setup of 3 days 3 cycles on the M15, most times, it never happens. You might get 4 levels, 4 pushes over 4 days or goodness knows how many levels over the entire week (take a look at EU last week and this week)

If you notice for the H1, there are actually M formations or RRT on the H1 which signifies DT on the M15, but on the H1, you would have just closed the trade and waited for the next available opportunity

Same for H4, D1 etc..

My suggestion is to trade the M15, take from the W thru 3 pushes and 3 levels to the M and exit. set your SL at the bottom of each level.

Give it some time to sink in, and of course, trade on Demo to figure the whole thing out

Going to afk till much later, i will mark up the chart so that it will become clearer. One more thing.. M15 will give way to the H1 trend, the H1 trend will give way to the H4 trend etc...

[kwanann]

This is the weekly chart. And already we are seeing the pattern being conformed. M, 3 levels down, W, beginning its upward move

Of course since this is a weekly, you would expect the 3 levels and 3 pushes to take AGES, in this case, 3 years from the M to the W

[kwanann]

And now the D1. And the reason why i'm bias long on this pair. Unless the weekly/daily trend line is broken, i'm still bias long.

Of course with the D1 and W1 charts, we are looking at movement of hundreds of pips

[kwanann]

And now for the H1 chart

YOu can refer to pips400's dragon lair for the box setup, whatever you want to call em, its still all the same thing.

This is an extremely messy chart so you will need some time to digest all the stuff

Forgot to mention, take a look at the pushes and levels and note the time taken, in the higher timeframes, it aint the 3 day cycle anymore. Of course if you leave a trade sitting for ages, and you happen to go in at the low, you are looking at an extremely high r:r ratio

That said, more or less on an INTRADAY basis the same thing usually happens for NON asian pairs

asian sets the range, LON extends the range both high and low, kills everyone with the stop hunt, NY reversal to book profits

[ciliano]

Also Odell, using your picture you can paint a 3 level chart using the FOMC news yesterday as a third push.

3 levels does not always mean the next time will be in the opposite direction. It usually just means 3 levels then choppiness then 3 more levels wherever and always ROUGHLY.

AUDUSD.png