Compare & Contrast with Christopher Lewis

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Monday, January 15, 2024
Quintessential Observations:

As already observed, Forex prices do not typically remain separated from the 90-minute baseline by more than 0.07% deviation beyond 30 minutes. If they do, it's likely that the corresponding asset has initiated a medium-to-long-term run.

But even if on a run, prices will still be hard-pressed to veer off beyond 0.19% deviation, with 0.13% serving as an intermediate measure.

If they DO somehow manage to press on (supported by monster momentum), look for them to finally turn around at or near 0.45% deviation from the seven-hour baseline.

An even faster barrier exists in the form of the 14-minute price range envelope at 0.04% deviation.

Price will sometimes run outside this level, but more often than not, it will reverse direction here. If it DOES keep going, the bands at 0.10% deviation will typically reign it back in to keep things from getting totally out of control. Once again, rates might choose to "ride" this level, or they might choose to simply reverse direction here instead.

But this only applies to faster/lower-time frame charts!

On the higher/slower charts, the alternate levels that apply are 0.06% and 0.12% deviation, with the underlying baseline being 21 minutes rather than 14 minutes.

 

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Quintessential Observations:

See about adding this...

Basically, candlesticks will not break out of the two-minute price flow channel at 0.02% deviation. So, if an asset begins riding this measure in a given direction for at least eight minutes, consider the possibility that it might do so for a total of at least 15 minutes (that it might continue to do so for at least seven more minutes).

And you might want to give even more attention to possibly going along with such price action if the two-minute channel begins matching (riding) the slope of the upper or lower band of the 8½-minute price range envelope at 0.06% deviation (along with the five-minute baseline).

(Okay, that does it...all that stuff is back on your charts. So, you have now worked your way backwards from the daily charts all the way back down to the one-minute charts.)

 

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Nix whatever intraday chart configurations you recorded here that included ten-hour measures. Five hours is about as high as you should go...seven hours max. Anything slower than that is too lagging for day trading application.

 

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And you might want to give even more attention to possibly going along with such price action if the two-minute channel begins matching (riding) the slope of the upper or lower band of the 8½-minute price range envelope at 0.06% deviation (along with the five-minute baseline).

DEFINING A RUN

See how often this works...

Consider that price might very well be on a run if the upper or lower band of a sloping 14-minute price range envelope at 0.04% deviation begins tracking with the upper or lower band of a sloping 8½-minute price range envelope at 0.06% deviation, especially if the five-minute baseline is spending all or most of its time between (or on the exterior side of) the two (and if two-minute price action is doing the same).

This is even MORE likely if price action is taking place to the outside of the 20- (or 21-) minute price flow channel at 0.07% deviation.

As a general rule, the overall (ultimate) trajectory of the intraday price flow is suggested by unified (in direction) 50- and 90-minute measures.

 

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So, in going back and looking to see what chart configurations I can delete from my overstuffed quiver of templates, here is the tentative "facts" I have gathered so far:

In tracking the immediate overall flow of daily candlesticks, three days is the maximum measure I should use. Anything slower evidences too much lag. Price will typically limit itself to 0.40%, 0.80% or 1.40% deviation from the three-day baseline, depending on liquidity, volatility and trend. If it wanders outside of these parameters, look for it to turn around somewhere in the vicinity of the upper or lower band of the seven-day price range envelope at 4.00% deviation.

To track the day-to-day flow of price, look to the 21-, 13-, 10-, 6- and 3-hour baselines, but the last two are not to be trusted in that they suffer from unstable fluctuations.

The 10-hour measure is more to be trusted for signaling reversals, but it too lags behind when the day-to-day trend executes radical swings, in which case, the 6-hour moving average is a better measure.

So then, in the final analysis, the safest move to make is to wait for all five measures to be sloping in the same direction, and then enter positions when the hourly tend reverses direction from a course that is opposed to the angles of the five multiple-hour baselines to a trajectory that matches them.

 

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So then, in the final analysis, the safest move to make is to wait for all five measures to be sloping in the same direction, and then enter positions when the hourly tend reverses direction from a course that is opposed to the angles of the five multiple-hour baselines to a trajectory that matches them.

Now, moving from the broader picture all the way back down to the almost microscopic level... When price is NOT running you'll want to enter positions in the direction of the hourly (50-minute) price flow as price is coming out of pullbacks in the 8½-minute "current," or if the 20-minute baseline is making steady progress in the same direction as the hourly slope...while price is on the "far" side of the 8½-minute baseline.

(This would be more appropriate for binary option trading than for activities with a traditional Forex broker.)

 

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Rightly interpreting the signs of the times...

 

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Now that my intraday trading is, as best as I can tell, fully optimized, I plan to start "fooling around" with a longer-term outlook until I've done the same thing with respect to swing trading—God willing.

Buy EURJPY as it exits a pullback anywhere between 160.73 down to 158.98. (GBPJPY, USDJPY, USDCHF and USDCAD are in similar situations.)

Sell EURUSD when it exits the current pullback.

 

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So then, in the final analysis, the safest move to make is to wait for all five measures to be sloping in the same direction, and then enter positions when the hourly tend reverses direction from a course that is opposed to the angles of the five multiple-hour baselines to a trajectory that matches them.

Okay then, with which of the ten pairs that you follow is this (the above) the case (or the closest to being so)?

• AUDJPY: All but the 21-hour (which is neutral) and four-hour (which is bearish) baselines have just reversed direction from bearish to bullish.
• GBPJPY: All but the four-hour price flow are headed north.
• GBPUSD: All but the 21-hour baseline have just reversed direction to head north (the three-day price flow is neutral).
• USDCHF: All measures except the four-hour channel (which is neutral) are bullish.
• USDJPY: All measures except the four-hour channel (which is bearish) are bullish.
• EURGBP: Virtually all measures have gone bearish. (The single exception is two-day price flow, which is neutral.)

Do you see any problems?

• Yes, EURUSD's multiple hour baselines are almost all turning north, against its bearish three-day price flow.
• USDCAD: Though the three-day and 21-hour price flows remain bullish, most of the other measures have gone neutral, and the four-hour channel is now slightly bearish.