Hi Guys (new member, first post )
OK, I know this journal is not about ccy's, but I hope you can all forgive me. One more thing to add is that I might not start posting actual trades until... well maybe not until next week, however, I wish to examine the fundamentals before I start posting the trades.
So, lets get into the nitty gritty of the egy:
Instruments
The trades I post will be for the popular Eurex futures contracts - EuroStoxx 50 futures and Bund stocks. I will look to make trades between 07:00 and 18:00 for Bunds, and 08:00 - 18:00 for the Stoxx (the money market in stocks does not open till 08:00, thats the reason ). I won't hold any overnight trades, which means I will have to close positions by 21:00 at the latest (the exchange closes).
Strategy principles
The egy is basically comprised of two factors:
1) Mark out significant prices in the market structure
This basically means support / resistance. All prices aren't created equal, some are more significant than others - that the first part of the egy is to highlight the important ones and pay attention to these.
2) View the price action at those important levels
When we get to those levels, we watch the behaviour to have a heads up of the new price discovery prejudice (which way it is likely to proceed ).
My Strategy particulars
I will be using volume bars at two different periods (originally, 20k and 2k, but these are susceptible to change) - a bar/candlestick is shaped when x many contracts have exchanged. Volume is the lifeblood of any market! I know getting accurate volume amounts can be tricky in forex, but I guess you can use tick/range pubs or plain old time pubs if you wanted. You guys play around with it and post the results if you want.
What exactly are we searching for?
The quickest way to describe is by taking a look at the pdf's I will unite, but just in case...
The support/resistance part is fairly self explanatory, so I will concentrate on the decrease timeframe (well, volume frame) stuff...
The lower TimeFrame (TF) will be utilized for entrances only. We will concentrate on the swing highs and swing lows - we all know the Lower Low / Lower high idea, and it is for a change in this dynamic that puts us right into a position. We seperate the Highs / Lows to a top edge and a lagging edge. In a downtrend, the swing extremities are the top edge, along with the swing highs are the lagging edge (and vice versa). If we do not receive any clear indiion of the bias against the price action, we define the price as rangebound and change to a breakout egy.
If you have a look at the lengthy Entry PDF, I have seperated it into three parts. The first part is what we look for in a trade off service (just reverse it all for shorts off resistance)...
1) Long entry
At service, we are set to amber once we get a poorer leading edge - in this case, a Higher Low. We then put orders in to trigger a trade long once we receive a break of the lagging edge - in this case, a Higher High. The stop moves behind the Higher Low.
However, it does not always work for this, so we will need to be ready for chop...
two ) Range Definition
If we are set to amber and waiting for the green light, but the Higher Low is breached (hence setting a Lower Low)we pull on the order and place the range as appropriate - we are then on the watch for a.. .
3) Breakout Strategy
Once we've set a range, the next thing to do is to await price to exchange away from the range. If we exchange over the range we look for longs, brief if we exchange under. We wait for a pullback after the breakout (so we know where to put our cease ) and put an order in over the high / beneath the low.
One thing to note is that firstly, we are looking for a change - but when (by our definitions) price goes to a rangewe can exchange both OR short.
Thats about it for entrances.
EXITS
like I mentioned previously, our lower TF is ONLY used for entrances. In my experience, micro handling trades on a lowly TF makes you too early. My basic philosophy on lower time frames (but you define low) is that they are only useful a number of the time; when you think there may be some sign because of the particular context of the broader market. If the current price is not significant in term of market construction (i.e. at or close a particular service or resistance level) then that which on the decrease TF is merely sound generated by order flow.
It follows, then, that our exits are managed on the Longer TF. Plain and simple, we look for the upcoming significant level in the market, and place our targets a two or three before it. Stops behind pullbacks, but only pullbacks on the higher TF, not the lower.
Example
The following example is from EUR/USD (I will try and post setups on the major intruments if and when I get the time, but I thought I'd place a forex one for you guys in my first post).
Firstly, we'll have marked out the reduced of 25th March as a significant price in the market arrangement.
Https://www.forexsoutheast.asia/fore...ce-pivots.html
We then look at our lesser TF (in this case, 60m) for an entry...
https://www.forexsoutheast.asia/cryp...st-mt4-ea.html
in this examplewe see a lengthy entry triggered by the sequence...
LL LH LL HH HL HH
The particulars are that we will have been LONG 1.3348 (one tick above the HH) with our stop under the Higher Low (so stop at 1.3264). Our exit order is set just underneath the last swing high on the daily chart (remember we do not look at the decrease TF for exits), which by my reckoning is at about 1.3680, making our exit order 1.3 678. I've put it all on the 60m chart only for clarity to start things off.
Https://www.forexsoutheast.asia/gene...e-hunting.html
I am pretty sure I will have left out something, so any questions just ask, and please don't hesitate to comment!
https://www.forexsoutheast.asia/atta...1774173782.pdf
https://www.forexsoutheast.asia/atta...3174711458.pdf
https://www.forexsoutheast.asia/atta...1201131779.pdf