Price Action

[sniper012]

This is a short from this morning. Sell 4 lots at least. The stop los is 12.7 pips so this is our risk. This was covered when we hit 12.7 pips profit, which was hit by the second circled candlestick. Now that we've closed half of our position, the worst we can do is break even. If it continues to go our way, we should be looking for 1:2 risk reward instead of the usual 1:3 risk reward because we do not have the support of the long term trend. The long term trend is up but we are trading short so this is why we are taking less profit. If we get to our next target, close 1 or the remaining 2 lots and then let the last lot ride. Something amazing might happen but if it doesn't, you're only going to lose about $14 usd. Keep in mind that you have already locked in over $50..that is, if you are trading 4 lots. If you're trading more then obviously you would be making more.

[sniper012]

One more nice on on 1hr chart. Short on gbp/jpy. Look at the tight stop loss though. You're barely risking anything, and this is one of the more volitale pairs.

[yogibear]

Hey Sniper
Yeah i wish i could trade the lower tf, i'm hoping in the new year i might get some time. As you showed with those 2 good trades, the sl is much smaller, so very little risk, cash in quickly for some profit, and let the other part ride risk free.
The eur trade last week was eur/cad, i'd put 100 pip trailing s/l on it, and got taken out by fridays bar. Shame as its now much lower.

Cheers

[sniper012]

Ok, I thought it was eur/usd. Take a look at where gbp/jpy is now. Easily did 1:3 risk/reward today. The risk on this trade was 20.3 pips, by the way.

Uploaded with ImageShack.us

Hey Sniper
Yeah i wish i could trade the lower tf, i'm hoping in the new year i might get some time. As you showed with those 2 good trades, the sl is much smaller, so very little risk, cash in quickly for some profit, and let the other part ride risk free.
The eur trade last week was eur/cad, i'd put 100 pip trailing s/l on it, and got taken out by fridays bar. Shame as its now much lower.

Cheers

[trade4life]

It just works on so many levels!! And the great thing is that you are ALWAYS with the trend. Can it go against you? Of course, it's trading. Buy doing it this way gives us a MASSIVE advantage.

Sniper, so if I am reading your "closing" strategy correctly, it seems like you use the higher time frame's close to determine the direction you trade in and then you wait for price action signals to enter the market? Is this basically correct?

[trade4life]

Sniper, do you have indicators for price action, it looks like it based on your charts, if so can you link me to them?

[yogibear]

[QUOTE=sniper012;46395]Ok, I thought it was eur/usd. Take a look at where gbp/jpy is now. Easily did 1:3 risk/reward today. The risk on this trade was 20.3 pips, by the way.

I had a look at gbp/yen on the daily. Sunday and monday printed inside bars.
The stop loss on them would have been just over 50 pips, excellent for a daily chart, where they're usually well into 3 figures.
You can see from the chart what a good trade it would have been !
I'm definately gonna start looking at including inside bars in my analysis.

[sniper012]

Absolutely! That was almost a double inside bar. Those are supposed to be even more telling than a regular inside bar.[QUOTE=yogibear;46418]

Ok, I thought it was eur/usd. Take a look at where gbp/jpy is now. Easily did 1:3 risk/reward today. The risk on this trade was 20.3 pips, by the way.

I had a look at gbp/yen on the daily. Sunday and monday printed inside bars.
The stop loss on them would have been just over 50 pips, excellent for a daily chart, where they're usually well into 3 figures.
You can see from the chart what a good trade it would have been !
I'm definately gonna start looking at including inside bars in my analysis.

[sniper012]

That is exactly right. This is exactly what I do in a nutshell; let's look at this week. I go to a weekly chart and draw my red line at the exact price of last week's close. If you want to enhance it even more, you can feel free to go to last month's close and draw a line at that exact price as well, but the weekly close is enough to tell you what the long term trend is. Once you have drawn that line, you can now switch to a daily, 4hr or 60 minute chart, nothing less than 60 minutes though. If you decide on using 1hr or 4hr charts, you have to draw an additional line to indicate the daily open. I consider 1am NYC time to be the daily open because this is about the time that the big boys start playing. I draw a blue line on the open of that 1am candle and I'm ready to go. If we are already below last weeks close and we get an inside bar formation below the daily (1am) open, then I will ONLY TRADE SHORT. This makes sense. We are obviously trading with the trend. Let's say that we are above last week's close, but below the daily open. What do you do if an IB forms below the daily open? You can still trade that short but keep in mind that you don't have the support of the long term trend. All this means is that instead of looking for a 1:3 risk reward on the second half of your position, we take 1:2. When you have the support of the long term trend, then we can look for 1:3 risk reward. Check out my "1 hour inside bars" thread for more details and loads of charts. If you need anything else, pm me with your email and we can discuss it further. Good luck and happy trading!!!

Sniper, so if I am reading your "closing" strategy correctly, it seems like you use the higher time frame's close to determine the direction you trade in and then you wait for price action signals to enter the market? Is this basically correct?

[al3ash34]

aaffxx,

I do not really know how or want to make videos, you should check out some of Nial Fuller's videos though, they are all about price action, I learned to trade from his videos and course. Here is the link to his youtube page, check it out: Price action videos

hes A smart guy

[al3ash34]

Short and sweet.
Price retraced to 1.5534, taking out my sl 6 pips lower.
Still, i followed my plan and caught some pips, so cant grumble.

yes it isnt the end of the world

[yogibear]

Well i drank a lot of scotch last night, and in a drunken haze placed 2 orders, both of which have kicked in. The moral here is definately stay away from your charts when you're pissed!

trade 1 long gbp/chf @1.5638 , closed half at 50 pips, stop will be moved to b/e.
trade 2 short chf/yen 83.17 currently -30 pips. i'll stop it out if it goes past 50.

[sniper012]

No indicators. I do it based on what I see. But actually I do have 1 indicator that will show you where the inside bar is when it forms. You don't need it though.

Sniper, do you have indicators for price action, it looks like it based on your charts, if so can you link me to them?

[sniper012]

Nicely done!!!

Uploaded with ImageShack.us

[yogibear]

Here's something for the newer or struggling traders.
How many of you trade the sunday gap??
Tonight i picked up about 70 pips, and it's the same most weeks.
Those in the US have an advantage, as it happens 5pm, for those in the UK, it's 10 pm.
Pull up a 5 min chart at the open. You're looking for gaps at least 20-30 pips . Nature abhorrs a vacuum, and the gaps usually get filled within 1-3 hrs.
I play them half stakes, with a TP 5 pips below fri close. R/R is 1:1
i.e if you have a 30 pip gap s/l 25 pips(allowing for 5 pip margin on t/p)
Try it next week, although we are into december, with thin mkts.
I've attached the chart for eur/usd, and the gap has now filled.

Hope this helps.

[Charles]

This is all well and good, but you still need some sort of indication of trend, draw trend lines, trend channels, these are all in a true sense of the word "indicators" even if you do it with your eye.

[Charles]

No question! That's the only way to trade it. If you want to trade it on a daily or 4hr chart, just draw a line on LAST WEEK'S close. Wait for the inside bar to form and if it forms above last week's close, only trade it long. If it forms below last weeks close, only trade it short.

Yes exactly! Draw Lines everyone, trend lines! I bow to them

[yogibear]

[QUOTE=Charles;47264]This is all well and good, but you still need some sort of indication of trend, draw trend lines, trend channels, these are all in a true sense of the word "indicators" even if you do it with your eye.[/QUOTE]

No argument here with that. I use trendlines and channels in my trading.
I also use some ma's which also give a good indication of trend, and can be used as floating levels of support and resistance. See the attached chart.

[sniper012]

That is probably what you have been told since you started trading. I am here to tell you that I didn't become a profitable trader until I REMOVED all of that from my charts. I have had times when I strayed away and went back to having some indicators on my chart, but I'm telling you, YOU DON'T NEED IT. The strategy I use requires you to draw two horizontal lines on your chart. 1 that indicates todays open and one for last weeks close. If the pair you're trading is above the daily open, then the short term trend is up. If it's below the daily open, then it's down. If it's below the daily open, then the short term trend is down. Last weeks close represents the long term trend, but it works the same way as the short term trend. That's all we really need to know. That's it and that's all. I don't know if you're a profitable trader or not, but I can honestly say that indicators have actually done more to hurt me than help me. It may be hard to wrap your mind around because I know it was difficult for me. But I was tired of bleeding money so I gave it a shot and basically have never looked back.

This is all well and good, but you still need some sort of indication of trend, draw trend lines, trend channels, these are all in a true sense of the word "indicators" even if you do it with your eye.

[sniper012]

...but hey, whatever makes you comfortable.