4xpipcounter's trendlines
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Nugget #2
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VJAY nailed my next nugget.
Also, I'm going to address another point about this chart in close to my next post, as well as address Krishere's comment.
The point I made in the 1st nugget was candle crosses the TL, it retraces back, then enter.
I also mentioned that I don't like the hourlies, particularly on forex, because of the real slow times in the middle of the day, which leads to the candle sneakily crossing over the TL. That leads up to the main topic of this nugget, and the point VJAY made. He posted the same chart I did, with different design, which is the 4-hour chart on top of the of the DJIA. The first TL I drew shows the very personality the hourlies have. Simply put, they do not count. That is not a legitimate TL break. The first thing I always check is that I drew the line right, because it is rare that something like happens. The next thing to do is draw the line to the next dip. I did that and ran into the same thing, so I draw it to the next dip. Just keep doing that until you get the proper break.
We also have what appears to be a similar problem at the current level. Notice how several consecutive candles settle on the TL. This is also risky.
The next thing to do is keep climbing with the TL until you find the appropriate place for it. The beginning point on the next chart is the 2nd to the 3rd dip, and you see the TL. That is the next thing we look to with the prescribed characteristics.
Another thing I do occasionally is cheat. In this case I drew a SL at the recent dip. That also lines up nicely with the peak on the left, which makes it an even more solid support, which would add for a strong break if broken.
The other thing I have always been a strong advocate of is to pay attention to what is going on with the other TF's. The DOWN TL was broken recently on the daily which suggests it is headed higher.
If you plot the TL's from the 4-hour, daily, weekly, and monthly you will have a very good idea of the overall picture. That was really no more than a fresh hit on the daily TL.
In summary, in this nugget, we learned:
1. To make sure it is a strong break of the TL, not sneaking across.
2. Move up with the TL if necessary after making sure it is a proper TL, or draw from the dip to the next swing low.
3. Be aware of what is going on with the other TF's.
One more point on the other TF's. You are not even considering anything less than the 4-hour. I know traders that use this methodology to scalp on the 15-min and 5-min. You can do it. You can experiment and backtest. What you will notice is there are more risky situations you'll get into.
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VJAY nailed my next nugget.
Also, I'm going to address another point about this chart in close to my next post, as well as address Krishere's comment.
The point I made in the 1st nugget was candle crosses the TL, it retraces back, then enter.
I also mentioned that I don't like the hourlies, particularly on forex, because of the real slow times in the middle of the day, which leads to the candle sneakily crossing over the TL. That leads up to the main topic of this nugget, and the point VJAY made. He posted the same chart I did, with different design, which is the 4-hour chart on top of the of the DJIA. The first TL I drew shows the very personality the hourlies have. Simply put, they do not count. That is not a legitimate TL break. The first thing I always check is that I drew the line right, because it is rare that something like happens. The next thing to do is draw the line to the next dip. I did that and ran into the same thing, so I draw it to the next dip. Just keep doing that until you get the proper break.
We also have what appears to be a similar problem at the current level. Notice how several consecutive candles settle on the TL. This is also risky.
The next thing to do is keep climbing with the TL until you find the appropriate place for it. The beginning point on the next chart is the 2nd to the 3rd dip, and you see the TL. That is the next thing we look to with the prescribed characteristics.
Another thing I do occasionally is cheat. In this case I drew a SL at the recent dip. That also lines up nicely with the peak on the left, which makes it an even more solid support, which would add for a strong break if broken.
The other thing I have always been a strong advocate of is to pay attention to what is going on with the other TF's. The DOWN TL was broken recently on the daily which suggests it is headed higher.
If you plot the TL's from the 4-hour, daily, weekly, and monthly you will have a very good idea of the overall picture. That was really no more than a fresh hit on the daily TL.
In summary, in this nugget, we learned:
1. To make sure it is a strong break of the TL, not sneaking across.
2. Move up with the TL if necessary after making sure it is a proper TL, or draw from the dip to the next swing low.
3. Be aware of what is going on with the other TF's.
One more point on the other TF's. You are not even considering anything less than the 4-hour. I know traders that use this methodology to scalp on the 15-min and 5-min. You can do it. You can experiment and backtest. What you will notice is there are more risky situations you'll get into.
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Krishere, very important point here. My chart shows the low of the candle bouncing off the TL. Yours shows it going under it. This could only be a technicality in the long haul, but my TL was drawn perfectly. I drew it perfectly just to make the point. I don't make them perfectly all the time. Notice on the original swing low the wick falls under TL.
There might be a new pivot low, but the swing low still stands. The TL is still providing legitimate support. I drew the line from the dip to that swing low, and then made some pips on the break. Most likely, the pair will move higher, which means my drawing the TL's the way I have been talking about is still the right way. I do make exceptions in my trading when obviations are present for them to do so, but I'll do my best to stay away from them in this thread.
Isnt this trendline now more valid??? Or is it invalid because there is a new Pivot-Low????
Krishna.
Krishna.
Re: Nugget #2
VJAY nailed my next nugget.
Also, I'm going to address another point about this chart in close to my next post, as well as address Krishere's comment.
The point I made in the 1st nugget was candle crosses the TL, it retraces back, then enter.
I also mentioned that I don't like the hourlies, particularly on forex, because of the real slow times in the middle of the day, which leads to the candle sneakily crossing over the TL. That leads up to the main topic of this nugget, and the point VJAY made. He posted the same chart I did, with different design, which is the 4-hour chart on top of the of the DJIA. The first TL I drew shows the very personality the hourlies have. Simply put, they do not count. That is not a legitimate TL break. The first thing I always check is that I drew the line right, because it is rare that something like happens. The next thing to do is draw the line to the next dip. I did that and ran into the same thing, so I draw it to the next dip. Just keep doing that until you get the proper break.
We also have what appears to be a similar problem at the current level. Notice how several consecutive candles settle on the TL. This is also risky.
The next thing to do is keep climbing with the TL until you find the appropriate place for it. The beginning point on the next chart is the 2nd to the 3rd dip, and you see the TL. That is the next thing we look to with the prescribed characteristics.
Another thing I do occasionally is cheat. In this case I drew a SL at the recent dip. That also lines up nicely with the peak on the left, which makes it an even more solid support, which would add for a strong break if broken.
The other thing I have always been a strong advocate of is to pay attention to what is going on with the other TF's. The DOWN TL was broken recently on the daily which suggests it is headed higher.
If you plot the TL's from the 4-hour, daily, weekly, and monthly you will have a very good idea of the overall picture. That was really no more than a fresh hit on the daily TL.
In summary, in this nugget, we learned:
1. To make sure it is a strong break of the TL, not sneaking across.
2. Move up with the TL if necessary after making sure it is a proper TL, or draw from the dip to the next swing low.
3. Be aware of what is going on with the other TF's.
One more point on the other TF's. You are not even considering anything less than the 4-hour. I know traders that use this methodology to scalp on the 15-min and 5-min. You can do it. You can experiment and backtest. What you will notice is there are more risky situations you'll get into.[/QUOTE]
Thanks Paul....you mean strong break is big bar closing high/low distance from TL?then only we look its retrace for entry?...othervise we not look as TL break...waiting for other RAy for new TL.....
VJAY nailed my next nugget.
Also, I'm going to address another point about this chart in close to my next post, as well as address Krishere's comment.
The point I made in the 1st nugget was candle crosses the TL, it retraces back, then enter.
I also mentioned that I don't like the hourlies, particularly on forex, because of the real slow times in the middle of the day, which leads to the candle sneakily crossing over the TL. That leads up to the main topic of this nugget, and the point VJAY made. He posted the same chart I did, with different design, which is the 4-hour chart on top of the of the DJIA. The first TL I drew shows the very personality the hourlies have. Simply put, they do not count. That is not a legitimate TL break. The first thing I always check is that I drew the line right, because it is rare that something like happens. The next thing to do is draw the line to the next dip. I did that and ran into the same thing, so I draw it to the next dip. Just keep doing that until you get the proper break.
We also have what appears to be a similar problem at the current level. Notice how several consecutive candles settle on the TL. This is also risky.
The next thing to do is keep climbing with the TL until you find the appropriate place for it. The beginning point on the next chart is the 2nd to the 3rd dip, and you see the TL. That is the next thing we look to with the prescribed characteristics.
Another thing I do occasionally is cheat. In this case I drew a SL at the recent dip. That also lines up nicely with the peak on the left, which makes it an even more solid support, which would add for a strong break if broken.
The other thing I have always been a strong advocate of is to pay attention to what is going on with the other TF's. The DOWN TL was broken recently on the daily which suggests it is headed higher.
If you plot the TL's from the 4-hour, daily, weekly, and monthly you will have a very good idea of the overall picture. That was really no more than a fresh hit on the daily TL.
In summary, in this nugget, we learned:
1. To make sure it is a strong break of the TL, not sneaking across.
2. Move up with the TL if necessary after making sure it is a proper TL, or draw from the dip to the next swing low.
3. Be aware of what is going on with the other TF's.
One more point on the other TF's. You are not even considering anything less than the 4-hour. I know traders that use this methodology to scalp on the 15-min and 5-min. You can do it. You can experiment and backtest. What you will notice is there are more risky situations you'll get into.[/QUOTE]
Thanks Paul....you mean strong break is big bar closing high/low distance from TL?then only we look its retrace for entry?...othervise we not look as TL break...waiting for other RAy for new TL.....
Re: Nugget #2
Yes, VJAY. The main characteristic of the candle is that it will be bigger than the average. For the most part it will also have a large body and small wicks. In essence, you want it to be a no-doubter on the TL break; and, that will usually be the case.
Thanks Paul....you mean strong break is big bar closing high/low distance from TL?then only we look its retrace for entry?...othervise we not look as TL break...waiting for other RAy for new TL.....[/QUOTE]
Yes, VJAY. The main characteristic of the candle is that it will be bigger than the average. For the most part it will also have a large body and small wicks. In essence, you want it to be a no-doubter on the TL break; and, that will usually be the case.
Thanks Paul....you mean strong break is big bar closing high/low distance from TL?then only we look its retrace for entry?...othervise we not look as TL break...waiting for other RAy for new TL.....[/QUOTE]
Nugget #3
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I was waiting for a situation like this to come up, so I could post my 3rd nugget. I'm expecting a topping process for the EUR/USD around circa 1.4385, maybe a little higher. This is a situation where I drew the TL at the recent peaks on the uptrend. As it extends is shows about as highest the price will go given any time in the future. That, however, is not the important part of this scenario. The burgundy line that is dropping is drawn from the monthly chart which is also forming a butterfly. We have an effective apex, where the lines connect. That would mean the beginning of a longer term reversal. The other thing that would happen is that we get a violent continuation that takes out the apex. In trading this, a viable entry would be once price hits the top TL, then go short. After you are in, keep an eye on the TL if you do not get immediate acceleration. On the downside, watch for the TL that connects the higher lows for a break, and then that TL becomes R.
Apexes can also form on the side, when you get a an uptrend TL connecting a downtrend TL. Which ever way it breaks, it is going to be very strong, and it will become a very solid S or R.
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I was waiting for a situation like this to come up, so I could post my 3rd nugget. I'm expecting a topping process for the EUR/USD around circa 1.4385, maybe a little higher. This is a situation where I drew the TL at the recent peaks on the uptrend. As it extends is shows about as highest the price will go given any time in the future. That, however, is not the important part of this scenario. The burgundy line that is dropping is drawn from the monthly chart which is also forming a butterfly. We have an effective apex, where the lines connect. That would mean the beginning of a longer term reversal. The other thing that would happen is that we get a violent continuation that takes out the apex. In trading this, a viable entry would be once price hits the top TL, then go short. After you are in, keep an eye on the TL if you do not get immediate acceleration. On the downside, watch for the TL that connects the higher lows for a break, and then that TL becomes R.
Apexes can also form on the side, when you get a an uptrend TL connecting a downtrend TL. Which ever way it breaks, it is going to be very strong, and it will become a very solid S or R.
Re: Nugget #2
VJAY, yes, if there is not a solid break of the TL, then the TL was not drawn right, or a new one needs to be drawn.
If you can properly anticipate the TL to be broken, then you can trade in the same direction price is currently going. But, yes, after the TL is broken, there is going to be a correction, and then when you get close to where the TL was broken or the TL itself, then it is time to enter going its new direction. At my other thread, "Some of my forecasts", I made a forecasts concerning the TL broken on the EUR/GBP, which indicates an imminent move north, and then a move back in the new trend, which is south.
Thanks Paul....you mean strong break is big bar closing high/low distance from TL?then only we look its retrace for entry?...othervise we not look as TL break...waiting for other RAy for new TL.....[/QUOTE][/QUOTE]
VJAY, yes, if there is not a solid break of the TL, then the TL was not drawn right, or a new one needs to be drawn.
If you can properly anticipate the TL to be broken, then you can trade in the same direction price is currently going. But, yes, after the TL is broken, there is going to be a correction, and then when you get close to where the TL was broken or the TL itself, then it is time to enter going its new direction. At my other thread, "Some of my forecasts", I made a forecasts concerning the TL broken on the EUR/GBP, which indicates an imminent move north, and then a move back in the new trend, which is south.
Thanks Paul....you mean strong break is big bar closing high/low distance from TL?then only we look its retrace for entry?...othervise we not look as TL break...waiting for other RAy for new TL.....[/QUOTE][/QUOTE]
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I have been long this pair, and it is an example of what I referred to as anticipating the break of the TL. I am waiting for that apex to be challenged, and I will probably get out of this trade once the sharp break of this TL has happened. Afterward, I will be looking to go short. Another reason I would get out after the thrust is that I am expecting a correction back to the TL before the trend continues. I cold get back in after the TL is hit again, but my concentration for this pair would be to find a point to go short.
The point of this thread is to maybe show situations like this, but the thing I really want to convey is that if you are new to using TL's, is to only trade (Preferably demo trade in the beginning.) the basic rules.
Some live action
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The nice thing about a 4-hour TL is that it is easier to report the live action. We got the break of the TL. The candle is much larger than most, with the body making up the greatest part of the candle. As long as we don't get some obscene retracement, the candle will finish above the TL. Possibly between now and Tokyo, and it will make for a nice long opportunity for tomorrow.
Being able to anticipate that TL to be broken is not something I'm going to get into in this thread, but I did want to show my thinking on it. My S&R's are very accurate. The red line where this UP began is my WS1 at 1.4160. We will probably get a slight bounce from current level as the blue line it is currently camped at is my DR2 at 1.4238. In essence, there are ulterior elements to use in order to determine hey intraday reversal points. All I wnat to show in this thread is how to use the TL's to get a good approximation for the entry for a high probability trade.
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The nice thing about a 4-hour TL is that it is easier to report the live action. We got the break of the TL. The candle is much larger than most, with the body making up the greatest part of the candle. As long as we don't get some obscene retracement, the candle will finish above the TL. Possibly between now and Tokyo, and it will make for a nice long opportunity for tomorrow.
Being able to anticipate that TL to be broken is not something I'm going to get into in this thread, but I did want to show my thinking on it. My S&R's are very accurate. The red line where this UP began is my WS1 at 1.4160. We will probably get a slight bounce from current level as the blue line it is currently camped at is my DR2 at 1.4238. In essence, there are ulterior elements to use in order to determine hey intraday reversal points. All I wnat to show in this thread is how to use the TL's to get a good approximation for the entry for a high probability trade.
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This is a bit of a warning sign. This move was predicted as per my post in my other thread, "Some of my forecasts". I'm ready for this pair to reverse around 121.95 (Long story short for this thread.). A lot of times, when I feel we are near a reversal, I would also be looking for a break of a TL in case it does not make it all the way to my point. This TL is not safe to gauge our basic rules on. It's too steep, so it proposes to basic problems:
1. It could pass on the other side by default, even though the basic property of a strong move could be evident.
2. Once the correction begins the TL is so steep, that the correction could go for a long time and still be legitimate.
The one thing to do is watch for impending action on the lower TF like the 4-hour, and see if something develops there.
Note: I noticed afterward I messed up. This was for the EUR/JPY that I made the forecast for, and then the chart did not post. As of this writing the peak was 121.89. When I originally wrote the above, the price was in the low 120.00's. I'll try sand post the chart later to show what I was talking about.
1. It could pass on the other side by default, even though the basic property of a strong move could be evident.
2. Once the correction begins the TL is so steep, that the correction could go for a long time and still be legitimate.
The one thing to do is watch for impending action on the lower TF like the 4-hour, and see if something develops there.
Note: I noticed afterward I messed up. This was for the EUR/JPY that I made the forecast for, and then the chart did not post. As of this writing the peak was 121.89. When I originally wrote the above, the price was in the low 120.00's. I'll try sand post the chart later to show what I was talking about.
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