IN THIS THREAD: IronFist learns (the elusive) PRICE ACTION

One thing you might work on it just making sure you can get in a trade in the right direction. Don't worry about the trend yet. Remember that not every day is a trend day and once you get in you have no gurantee it will not reverse.

Once you can consistently get in the trade in the right direction then try and stay in until you see price start to consolidate. It almost always will but it can reverse w/not much consolidation.

IMO getting in and once price starts to consolidate is where you need to know how to read price and what it's doing "A la PA". Once it starts to consolidate you are going to need to decide IF you are trending or reversing.


I haven't been doing anything the first 30 minutes to 1st hour in the trading day. I try to get a feel for how the markest is reacting. Also pay attention to what happens to price around lunch and after lunch EST. There is almost always a difference in the way it acts.



Quote from IronFist:

So after points 3 and 4 have plotted, it's still in the middle phase of "determining trend" or "possibly reversing"? (see first image in attachment)

Seems like there could be a lot of times when it's not trending, then. Interesting. (see second image in attachment)

The numbers in parenthesis indicate new points for potential new trends. So the first "4" is the 4th point of a possible uptrend, but it's also the 1st point of a potential downtrend, which is why the second point is 2.

attachment.php


So you're saying in the second example, where 5 points in the same trend are never made, you would not have taken any position, correct?
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Quote from IronFist:

So after points 3 and 4 have plotted, it's still in the middle phase of "determining trend" or "possibly reversing"? (see first image in attachment)

Seems like there could be a lot of times when it's not trending, then. Interesting. (see second image in attachment)

The numbers in parenthesis indicate new points for potential new trends. So the first "4" is the 4th point of a possible uptrend, but it's also the 1st point of a potential downtrend, which is why the second point is 2.

attachment.php


So you're saying in the second example, where 5 points in the same trend are never made, you would not have taken any position, correct?
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That's correct. After point 5, a HL, I would enter. Have you tried that strategy yet? Say in a certain time frame or using CVB?

BTW, I've also tried entering after point 3 and some people trade that way based on S or Volume prior to that.

In your second example, the 2n point 2 would mean to me that I don't have a trend yet (using the five point method.)
 
Quote from KingZardoz:

Why not post and comment on todays chart?
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First trade +19 ticks

Second trade -20 ticks

Both trades were taken in down trends.

First trade was high, LL, LH, enter (after "point 3", so to speak)

Second trade was high, LL, LH, LL, LH, enter (after "point 5", so to speak)

Interesting to note that the second trade, if taken after "point 3", would have been (may have been) profitable).

The candles from around 2pm to 3pm (CST) were choppy and directionless so I stayed out.
 

Attachments

thanks for the chart.

u were a bit late to the party on the second trade. Knowing that we were in some kind of down trend. U saw the triangle breakout but then it quickly ran out of steam and was followed up by a small double top. Seeing this double top, considering the down trend, and knowing that the breakout on the triangle was kind of a failed signal, one could place a bet that we would test the lows again. mitsu called a short at this point right before 13:39 on your chart. It was possible to get in earlier on that second downward push. Obviously you were following your rules, but I just wanted to point out my perspective on the story of the market today. I know you are looking for rules to follow but that is not my specialty so I don't know how much help I can be.

Just because the market stops making LL does not mean the down trend is over. It all depends on where those LLs stop and other factors. If they stop at S/R then it might be time to consider the possibility of a reversal. But we did not stop at S/R today when we formed that triangle it was just floating.

hope youre having fun with this stuff, you might be on the right track regardless of how many cooks are in the kitchen. In the end you are the chef and it is your kitchen
 
Quote from KingZardoz:

In the end you are the chef and it is your kitchen
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Ah but what's being cooked I wonder?

@IF: I would not look for a critique of your rules based on such a small sample of trades... if you could generate a few hundred trade signals then a decent analysis might be possible. JMHO.
 
Havnt read the whole thread so maybe this has been mentioned before but I used some methods of PA taught by James16 on forexfactory and on his own website.

I found them to be of limited use on their own but when combined with other methods such as stochastics, S&R and HA candles they are very useful on some instruments like the YM and ES.
 
Quote from tetramorium:

if you could generate a few hundred trade signals then a decent analysis might be possible. JMHO.
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Unfortunately that is beyond my automated backtesting capabilities at this point.
 
Iron, on that first short, i would have taken it short the candle before. but your getting better. Why you like shorting in oversold conditions i dont know, but hey, whatever works.
 
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