Synthesizing Tharp and Alexander
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I have yet to finish looking at any of the sample videos Brooks has made available at his website, but I did glance at a sprinkling of the tons and tons of information he offers, partly in the form of Webinars uploaded to YouTube, with the rest being publications he has written, to which I have temporary access.
I find his information much more useful than that offered by Elder or Tharp, which was all kind of basic and theoretical in nature. What Brooks offers is much more practical and it is very specific, such as "there is a 50% chance the first (U.S. index) breakout will reverse; the high or low of the day forms early; by the close of bar 18 on a five-minute chart (90 minutes) there is a 90% chance the index has already formed either the daily high or the daily low," etc.
I also like the fact that he looks at nearly everything from the perspective of statistical probability, which is how I prefer to analyze price action.
The only problem is, his observations go on and on forever. No doubt, they probably took years to compile, and it would probably take most people years to commit them all to memory. However, should I decide I would like to incorporate any of his ideas in my own system, I have a sneaky suspicion that memorizing them will not be necessary because they are likely to end up all coinciding with the price ranges and tend lines I am already using.
I find his information much more useful than that offered by Elder or Tharp, which was all kind of basic and theoretical in nature. What Brooks offers is much more practical and it is very specific, such as "there is a 50% chance the first (U.S. index) breakout will reverse; the high or low of the day forms early; by the close of bar 18 on a five-minute chart (90 minutes) there is a 90% chance the index has already formed either the daily high or the daily low," etc.
I also like the fact that he looks at nearly everything from the perspective of statistical probability, which is how I prefer to analyze price action.
The only problem is, his observations go on and on forever. No doubt, they probably took years to compile, and it would probably take most people years to commit them all to memory. However, should I decide I would like to incorporate any of his ideas in my own system, I have a sneaky suspicion that memorizing them will not be necessary because they are likely to end up all coinciding with the price ranges and tend lines I am already using.
Stopped out of this long position setting my stop at the lower band of the burly-wood adaptive price range envelope and had to reenter the trade, which I believe will eventually hit my take-profit target.
Perhaps it would have been better to set my stop at the lower band of the dashed crimson simple moving average envelope instead. Continue evaluating to decide which to use in the final analysis.
Perhaps it would have been better to set my stop at the lower band of the dashed crimson simple moving average envelope instead. Continue evaluating to decide which to use in the final analysis.
Target (set at the top band of the crimson envelope) was not quite hit, but I exited the trade when the rate reached the upper band of the adaptive price range envelope (lowered my take-profit target to there) due to the high probability price might pull back at that level.
Go ahead and set your stop losses at the dashed crimson bands for now. Once you begin trading full-time, you might want to consider entering long positions at the bottom of the adaptive price range (see bold red circles), and exiting at the center of the channel for a "fast buck," or at the top of the dashed crimson envelope if you're inclined to be more ambitious. (You're original take-profit target was indeed hit a few minutes later after all.) Do the opposite for short positions.
Reentering the position recouped your earlier loss with a few pennies on top, but it would have been nicer had it been all profit...
So all of that effort for just over $1 profit? eeesh
EVALUATION...
Let's call the trend lines you are using universal, global, and local. The thesis on which you are currently operating is that the immediate moving averages rule the moment, but that the universal trend lines win the day.
Rare is it for the global and local trend lines to move so dramatically so quickly as to force the universal trend lines into submission (a sudden reversal). That said, EURJPY has been headed north for the past five hours, but the universal trend lines indicated it should be traveling south.
If your thesis is valid, shorting the pair as soon as the hourly trend turns south (price is currently at 121.06) should lead to a significantly profitable trade. Let's see if this turns out to be true.
Let's call the trend lines you are using universal, global, and local. The thesis on which you are currently operating is that the immediate moving averages rule the moment, but that the universal trend lines win the day.
Rare is it for the global and local trend lines to move so dramatically so quickly as to force the universal trend lines into submission (a sudden reversal). That said, EURJPY has been headed north for the past five hours, but the universal trend lines indicated it should be traveling south.
If your thesis is valid, shorting the pair as soon as the hourly trend turns south (price is currently at 121.06) should lead to a significantly profitable trade. Let's see if this turns out to be true.
This above diagnosis is no longer applicable in that the universal trend lines are now tending toward neutral.
USDJPY, which spent all of Friday climbing, is beginning to pull the universal trend lines upward. If this is completed, it would suggest that if and when the hourly trend turns south, buying the pair following a "touch-and-go" ought to once again lead to a significantly profitable trade.
EURJPY did not complete the process of pulling the universal trend line upward and is now on the verge of falling south of the hourly trend line, so a significant trip south could very well still be on the horizon.