Liquidity concept pt2Always understand the liquidity concept...like I said before,the market moves from one pocket of liquidity to another... understanding where liquidity are ,will help you in your trading journey
#IamACE #ACE.the trader
Fractal
Basic liquidity concept Remember to always spot the liquidity, before you become the liquidity... whether you trade liquidity or not,it is one of the most important thing to consider when trading,price moves from one pocket of liquidity to another.
stay safe guys
#IamACE #acedidit #AcetheTrader
S&P 500 ETF Multi-FractalTheory of multi-universe rhymes with idea that entangled market can go either way and we're not quite sure which. Since nobody can predict market in the future, we'd ignore news and stick with markets distinctive reaction to reports and news. Positive and Negative fundamentals pushes market to their causing path anyway, we just need to know which extent the targets - endpoints of me. So It's about points of reversals that really matter and are self-evident and very distinctive for any observer .
The term " observer " has second meaning which is also backbone of my own perception of %/TIME based collective consciousness observing the market causing this "matrix glitch" and proves that market has it's own path.
Read role of the term observer
Market's reaction on fundamentals already has been captured in history, so instead of using Elliott Waves why not use the interconnected market patterns itself DESPITE OF different scales.
Black fractal path feels more natural for my subjective perception.
White fractal might play out UNLESS price crosses pattern's violet uptrend line, which will cause at least parts of black pattern to play out, simply because it can cross earlier.
Fractal Scales:
Decade:
/2:
CloseUp FROM DECLINE:
Grateful to @jdehorty for this calendar which I've just used to align events into my fractals such way.
Events can cause HL points of fractal iside future bigger cycled fractal.
Along side with indicators it's always good to look back into making sense out of consequent patterns and their collective relationship with zeroed in and zoomed out" versions of the entity itself.
IF the slope of the fall would be steeper:
SP500 Fib Modeling IIn physics, when charged particles are fired at double slit, chances are they will leave 2 marks as they would go through 2 slits. Those waves of uncertainty crash into each other and interfere, merging and canceling each other out just like any other waves. Then, when an electron's wave hits the back screen, the particle finally has to decide where to land. Slowly, electron by electron, the wave pattern builds up. Our expectations can be evaluated by checking the results. But results can change by simply witnessing the process closeup. An intervention of consciousness can alter reality. Particle as we know started behaving like wave as if they were aware of being watched. So each time particle is fired, it becomes a wave of potential as it approaches the slits and through the quantum world of infinite possibilities finds its final destination. As a result we get interference pattern , the mark that commonly shared by targets of particles after going through such chaotic journey. The electron can go through both slits as wave of potential, then it collides back forming particle hitting the layer! Act of additional measuring by repeating experiment can make the particle act normal again with two stripes pattern. From this I'd outline the sharp changes in behavior as well as shift in entity itself. The collapse of wave function caused by particle's awareness of ongoing surveillance can in some way mean that matter is a derivative from consciousness. And these are the building blocks of universe, where things can simply appear and vanish without evident reason.
Removed irrelevant fibs:
Fibonacci Ratios found in regular Retracement as well as TimeFibs fit the parameters of Wave Function. The overlap of Golden Ratio with real life example of interference pattern formed by two slits using regular white light as a source.
I was pleased to acknowledge that Fibonacci numbers with its known features are also applicable in Quantum Mechanics, when we're dealing with the odds, probabilities and forecasting. This observation actually adds more credibility to FIBS and explains my long fascination over price behaving differently near fibs in one way or the other.
Wave-particle duality is an example of superposition. That is a quantum object existing in multiple states at once. An electron, for example, is both ‘here’ and ‘there’ simultaneously. It’s only once we do an experiment to find out where it is that it settles down into one or the other.
Today we know that this ‘quantum entanglement’ is real, but we still don’t fully understand what’s going on. Let’s say that we bring two particles together in such a way that their quantum states are inexorably bound, or entangled. One is in state A, and the other in state B.
The Pauli exclusion principle says that they can’t both be in the same state. If we change one, the other instantly changes to compensate. This happens even if we separate the two particles from each other on opposite sides of the universe. It’s as if information about the change we’ve made has traveled between them faster than the speed of light.
This makes quantum physics all about probabilities. We can only say which state an object is most likely to be in once we look. These odds are encapsulated into a mathematical entity called the wave function. Making an observation is said to ‘collapse’ the wave function, destroying the superposition and forcing the object into just one of its many possible states.
Arranging the fractal by phases with fibonacci on both price and time scales is an alternative approach to the known quantum mechanical solutions to finance, thus relying on a postulate that quantum mechanics applies to finance unchanged. For market prices, it is important to note that nowadays we are looking at a lot of noise when handling them. In financial markets we are dealing with infinite possibilities emerging patterns which also creates chaotic process just like in subatomic levels. On molecular scale, we know that elements don't just react without a reason. It can bond with other elements if it shares corresponding properties of valence. When it matches the electron configuration, it bonds into new compound generating geometric shapes like hexagon of new chemical structure, like shapes of puzzles unite to resemble a bigger picture.
Similarly, as market makes a move, it determines next candle's dimensions. If previous candle hypothetically had different properties, then the current candle wouldn't be the same it's forming right now. I'd say even the slightest change can significantly delay or change targets and outcomes. Price action also rhymes with time cycles. Sometimes these cycles of different wavelengths overlap resulting in breakout with short-term rapid growth rate.
To get an approximate idea of where price is heading to, we must carry out a thought process. Let's assume market is heading up. We know that chances of a rapid pump to establish new ATH in one day is very low. We assume it's rather going to start with gradual growth when breaking from cyclic entangled side trend. Imagine the candles are made out of metal string so you could touch it and play with it according to all laws of physics just like with a regular piece of metal wire in real life. Now imagine just grabbing the right end of it and pulling upwards to simulate shape unfolding into direction of your target... Nevertheless, various fragments of final structure would still carry its systematic shapes which were originally determined by the market.
In both cases these is a psychological effect, almost convincing me, that the market path is predetermined by trajectories of EMA with intermediate arguments rather than by short-term direction of a wave a spike and collapses. And it's not about the overall performance of the economy or any other factors, market simply derives the path on the go like in multi-universe concept.
The fact that >90% of people are losing is a result of sticking to the current market information noise and news. chances are market simply would have already reacted to the narrative even long before entries were placed. That's how fast things are happening. This happens when market is correcting to other "upcoming" more dominant arising fundamentals whether they are positive or negative. The curve of information distribution speed is vital concept which contributes to ignoring the naive need for information backup behind price moves. Many serious participants of the market are deaf to news. Whatever we receive, we must acknowledge that by the time we receive the news, millions of people already digested those them provided by some media company with their own angle in it. News trading is a very hysterical thing to do, unless you are among the first wave of investors possessing the information from real insiders. The lots and billions of entries in favor for the narrative are already locked in and they are waiting for the last remaining crowd to jump in to be kill them at 5th wave. Considering an accumulation should be after completing a fall. We must feel comfortable at places where the rest still feel fear in order to be able to beat them off due to averaging trades without blind faith.
Modern approaches to stock pricing in quantitative finance are typically founded on the Black-Scholes model and the underlying random walk hypothesis. Empirical data indicate that this hypothesis works well in stable situations but, in abrupt transitions such as during an economical crisis, the random walk model fails and alternative descriptions are needed. For this reason, several proposals have been recently forwarded which are based on the formalism of quantum mechanics. In this paper we apply the SCoP formalism, elaborated to provide an operational foundation of quantum mechanics, to the stock market. We argue that a stock market is an intrinsically contextual system where agents' decisions globally influence the market system and stocks prices, determining a nonclassical behavior. More specifically, we maintain that a given stock does not generally have a definite value, e.g., a price, but its value is actualized as a consequence of the contextual interactions in the trading process. This contextual influence is responsible of the non-Kolmogorovian quantum-like behavior of the market at a statistical level. Then, we propose a sphere model within our hidden measurement formalism that describes a buying/selling process of a stock and shows that it is intuitively reasonable to assume that the stock has not a definite price until it is traded. This result is relevant in my opinion since it provides a theoretical support to the use of quantum models in finance. Fibonacci ratios are another way of exposing the probability of future prices in respect to timing.
Even when overwhelming majority of people expect growth after good news with obvious positive factors, price can fall and expectations of millions can easily be shattered by market in an action. Identifying patterns is a part of making sense of out of randomness. There is a logical parallel: If an observer can collapse wave function, same way the collective consciousness of market crashed the wave function of uptrend. This happens and quite often.
Some people incorporate prime numbers to their trading systems. But of course I'd stick with fibonacci, because golden ratio governs chaos behind price swings as well as its time cycles derived from coordinates of fractal peaks and bottoms. I put tremendous amount of accent on raw data of candles. It doesn't just stop where it does, it is predestined to do it due to chain of cause and effect loop. New formed candles of particular metrics is a direct result of nearest historic candles and mathematical relationship shared between all of them. The way things are curved in nature and space, even exponential growth can be perfectly simulated with fibonacci sequence. Fib ratios are credible as they share and fit into concepts from fractal geometry and chaos theory as well as describing behavior of complex processes. A line simple line can be used to link of some recent buildup of systematic patterns to similar historic fractal echoing back into present.
A properly observed shape can tell more words than any news article, as it passes through the phases of cycle. By documenting nature of short-term swings we can evaluate how market is determining the most efficient price having continuous stream of information, different opinions, events and other factors on the background can directly or indirectly shape the value of an asset. Patterns can tell whether collective psyche of the market feels distrust or approval of ongoing narrative and world trends are unfolding.
It's quite easy to say "buy the dip" or "buy at the finishing stage of falling". It sure takes a good combination of decisiveness, discipline and being able to stick to your plan. But how can we be so sure that price will follow the direction after entry. To answer that question, I'd monitor the security with BSP - "Buying & Selling Pressure".
During selloff SP is obviously over BP. We wait till SP loses momentum and declines while BP begins grow. This way we got ourselves interested.
Then we examine the hypothetical entry by chain of logical confirmations.
We actually need to wait for Buying Pressure to cross over Selling Pressure.
IF bpma > spma is true, confirm with:
volume > ta.ema(volume, 20) or ta.atr(10) > ta.atr(10)
ta.ema(ohlc4, 13) >= ta.ema(ohlc4, 13) and ta.ema(ohlc4, 5) >= ta.ema(ohlc4, 8) and ta.ema(ohlc4, 5) < ta.ema(ohlc4, 8)
bpma > bpma and ta.crossover(close, ta.vwma(close, 13))
stoploss = close - average(bpma, spma)
If all of the conditions are met in a row, wait for correction to complete, see the Selling Pressure falling and enter with the next green candle. Meeting just 1 of these conditions would technically push me into placing a long order. However, I wouldn't do it without fabric of PriceTime scales interconnected with candle data by fibonacci ratios. Refracted EMA can also be a tool of choice to determine the levels support and resistance. Personally I'd go with fibonacci, because they are based on raw chart data instead of averaging with MA's and its derivatives.
Gold Order Flow - Bears Rule The MarketHey traders,
Yet again, the OFA script clearly show we should not be meddling with the affairs of the bears, side fully in control of the price action in the Gold market.
Let the flows, identified via the formation of fractal-based structures, determine the path of least resistance. As usual, credit where is due (Bill Williams). The script simply makes it visually easier to call these trend, which otherwise would be seemingly hard to continuously identify through manual analysis.
Be reminded, when applying the OFA script , it has 2 main components to study:
Magnitude: A major clue that will help determine the health of a trend is the type of progress by the dominant side in control of the trend. We need to ask the following question: Are the new legs in the active buy-sell side campaign as identified by the script increasing or decreasing in magnitude?
Velocity: When it comes to the distance the price moves, the magnitude is only ½ the equation. The other ½ has to do with the velocity of the move or the speed. Was the new leg created after a fast and impulsive move? Or did price make a new low or high with the movement being sluggish, compressive and taking too long to form? A good rule of thumb is to count the number of candles it took to achieve a new leg.
DISCLAIMER: This post contains commentary published solely for educational and informational purposes. This post's content (and any content available through links in this post) and its views do not constitute financial advice or an investment or trading recommendation, and they do not account for readers' personal financial circumstances, or their investing or trading objectives, time frame, and risk tolerance. Readers should perform their own due diligence, and consult a qualified financial adviser or other investment / financial professional before entering any trade, investment or other transaction.
Silver Explodes - A Lesson To Track Shifts In Order FlowHey traders,
In today’s analysis, it’s hard to ignore Silver following the 🚀explosive🚀 8%+ move up.
Let’s unpack the action as of late via the OFA script :
To do so, I am not going to apply any subjective type of analysis such as drawing trendlines, counting waves based on what way the wind blows, or any other form of guessing game…
Instead, we let the formation of fractal structures (objective measure of moves) create the pathway from which we can all make decisions. Fortunately, there is no need to engage in laborious manual work?
Why? The OFA script has all of us covered. So, with that in mind, what can we observe in the silver market?
What recurring pattern do you notice? Clue - Pay attention to the visual Ms and Ws type pattern forming…
These patterns entail, as stated in the chart, “dynamic fractal-based order flow cycles where a decreasing involvement in one direction (depicted by cycle/wave/line counts leads to a predictable move in the opposite direction seeking out the next equilibrium area, in most instance, with potential profits as a by-product…”
If you are into disseminating order flow, nothing I’ve seen beats the objectivity in analysis one can carry out via the formation of structures derived off fractal structures. Note, the chart ignores the dominant trend and simply focuses on the M and W patterns. Can you imagine if you start to align trading in the direction of just simply the dominant trend in the higher timeframes + proper risk management? Let you fantasise with that!
Remember the two key main features of the OFA script:
Magnitude: A major clue that will help determine the health of a trend is the type of progress by the dominant side in control of the trend. We need to ask the following question: Are the new legs in the active buy-sell side campaign as identified by the script increasing or decreasing in magnitude?
Velocity: When it comes to the distance the price moves, the magnitude is only ½ the equation. The other ½ has to do with the velocity of the move or the speed. Was the new leg created after a fast and impulsive move? Or did price make a new low or high with the movement being sluggish, compressive and taking too long to form? A good rule of thumb is to count the number of candles it took to achieve a new leg.
DISCLAIMER: This post contains commentary published solely for educational and informational purposes. This post's content (and any content available through links in this post) and its views do not constitute financial advice or an investment or trading recommendation, and they do not account for readers' personal financial circumstances, or their investing or trading objectives, time frame, and risk tolerance. Readers should perform their own due diligence, and consult a qualified financial adviser or other investment / financial professional before entering any trade, investment or other transaction.
TLT: Order Flow, Auction Process & Failures To RotateHey traders,
If we zoom out to check the price action in TLT from a daily perspective, what do you notice?
Every single time there is a failure to rotate (hinted via diamond labels), the new expansionary wave leads the market towards a new equilibrium point that so far has been found at much lower prices.
I’ve circled each and every instance where these failures to rotate back up occurred. Each market is an auction process, and via the OFA script , we are able to get a pristine read of the constant ebbs and flows.
The structure depicted via the script should also be a clear red flag that in this type of well-anchored bear market, being a hero typically gets you in trouble, so stay with the trend.
Remember the two key main features of the OFA indicator:
Magnitude: A major clue that will help determine the health of a trend is the type of progress by the dominant side in control of the trend. We need to ask the following question: Are the new legs in the active buy-sell side campaign as identified by the script increasing or decreasing in magnitude?
Velocity: When it comes to the distance the price moves, the magnitude is only ½ the equation. The other ½ has to do with the velocity of the move or the speed. Was the new leg created after a fast and impulsive move? Or did price make a new low or high with the movement being sluggish, compressive and taking too long to form? A good rule of thumb is to count the number of candles it took to achieve a new leg.
DISCLAIMER: This post contains commentary published solely for educational and informational purposes. This post's content (and any content available through links in this post) and its views do not constitute financial advice or an investment or trading recommendation, and they do not account for readers' personal financial circumstances, or their investing or trading objectives, time frame, and risk tolerance. Readers should perform their own due diligence, and consult a qualified financial adviser or other investment / financial professional before entering any trade, investment or other transaction.
GBP Collapses - The Power Of Order Flow & The M Pattern Hey traders,
Remember that the market is a mechanism that transfer wealth from the patient to the impatient.
If you wish to stay on the side on the patient practioners, few things beat letting the price behavior and the swings that form in the process dictate your entries.
The OFA script applied to the chart of GBPUSD speaks a thousands words.
While there are a number of setups that it identifies, with the circles and diamond triggers, today I want to touch on a recurring pattern that when taken under the right context becomes a great application of the OFA properties.
So, lets talk about the M pattern in the pound.. check the video to find out all the insights...
Remember the two key main features of the OFA indicator :
Magnitude: A major clue that will help determine the health of a trend is the type of progress by the dominant side in control of the trend. We need to ask the following question: Are the new legs in the active buy-sell side campaign as identified by the script increasing or decreasing in magnitude?
Velocity: When it comes to the distance the price moves, the magnitude is only ½ the equation. The other ½ has to do with the velocity of the move or the speed. Was the new leg created after a fast and impulsive move? Or did price make a new low or high with the movement being sluggish, compressive and taking too long to form? A good rule of thumb is to count the number of candles it took to achieve a new leg.
The Truth About Trade AccuracyA critical component relating to trading success is the relationship between your win percentage and your bottom line. Many new traders hold some extremely inaccurate views when it comes to what kind of win percentage is required to generate net profit, including the notion they need a 70% or higher win percentage to achieve success. This notion is wrong and misleading. The relationship between your win percentage, your risk management, and the profit you generate from each trade are intricately related.
The beauty of this post is that the backtest logic in our Olympus Cloud indicator showcases the concepts covered with real trades, which is shown under this post in the data section.
The Positive Win Percentage
A win percentage over 50% is regarded as a probable edge or edge. Yet, even with a 60% win rate, you can generate a net loss. How? If your average loss is $100, but you are in the habit of falling prey to your emotions and prematurely selling your winners so you only generate an average of $50 when you win, you will lose money regardless of your 60% win rate.
No trader goes into a trade thinking, “Hey, I’ll lose $100 if I’m wrong and I’ll make $50 if I’m correct.” Nevertheless, random wins of $75, $25, $60, $40, $90, and $10 will average out to $50 per win. No one purposely tries to win half of what they lose, but random trading combined with random emotions produces random results.
We all desire winning and making good profits when we take a trade, but as emotions come into play, things quickly change. You may take a trade that reaches $75 in profit and then decide the move looks gassed out, so you sell. On another trade, you might get scared by some volatility, or notice a resistance you neglected to spot initially and sell for $25 of profit. It is all too common to fall prey to your emotions and behave in a way you didn’t plan to. The irony is, that you will regard the $25 trade as a winner, and it will raise your trade accuracy.
Let’s look at a simple example:
Example: 100 total trades with 60% trade accuracy
60 winning trades at an average of $50 per win = $3,000
40 losing trades at an average of $100 per loss = $4,000
Net loss of $1,000
In the example above, your break-even point is a 67% win percentage for a whopping $50 in profit. With this type of random risk and profit management, any meaningful net profit requires a win percentage upwards of 75-80%.
The psychological damage of having a higher average loss than an average win is hard to quantify, but it’s easy to feel frustration when one loss wipes out two wins. While this sounds like common sense, many, many new traders fall into the habit of random profit management and find themselves in this undesirable situation. The same theory holds true even if you let your winners play out, but you also let your losses escalate and take a few big hits to your account. In either scenario, your 60% win rate means nothing.
The Negative Win Percentage
In the case of a negative win percentage, you can produce a net profit even if you are correct less than 50% of the time. In this scenario, your advantage over the market is getting into trades that consistently provide large gains when you win, and by letting those winners play out fully. Furthermore, you can’t hesitate to cut your losses and keep your drawdown controlled. With this kind of win rate, you must not sell early or your entire business model falls apart. You must understand that the big winners will make up for any profit you leave on the table.
Let’s look at what happens if you are correct 40% of the time, but your average win is $100 and your average loss is $50:
Example: 100 total trades with 40% trade accuracy
40 winning trades at an average of $100 per win = $4,000
60 losing trades at an average of $50 per loss = $3,000
Net gain of $1,000
It is now clear that win percentage is not everything. You can make money even if you are correct on 40% of your trades as long as your average win is double your average loss. The smaller your average win compared to your average loss, the higher your accuracy must be to make a net profit.
Of course, if you can maintain a win percentage over 50% while also having proper risk and profit management you will end up far ahead.
Putting It Together
Clearly, the best approach is to combine a reasonable win percentage of over 50% with proper risk and profit management. You must consistently let your winners play out regardless of the emotions you feel in the moment and ensure you don’t take losses beyond a certain threshold. Furthermore, scaling out of trades – selling portions of your position as the market moves in your favor – will increase your accuracy and ease your mind. By dividing your position into two or three tranches you can lock in a certain amount of profit at predefined targets and then let the final portion ride out the trend with a trailing stop-loss.
Revisiting our example, let’s put these concepts together with a reasonable win percentage:
Example: 100 total trades with 55% trade accuracy
55 winning trades at an average of $100 per win = $5,500
45 losing trades at an average of $50 per loss = $2,250
Net gain of $3,250
Now, that’s what you want to see!
It’s more important you behave in a consistent manner and follow a predefined game plan than it is to have 80% trade accuracy. It is wise to strive for reasonable trade accuracy – 50% to 65% – and remain consistent in order to fulfill your trading potential.
After you have mastered your emotions with a consistent strategy, perhaps you can raise your win percentage to mythical values like 80%. As we have covered, though, such accuracy is not required for great trading results.
Quantum Mechanics in Financial MarketsWave–particle duality is the concept in quantum mechanics that every particle or quantum entity may be described as either a particle or a wave.
Basically has 2 types of behavior.
Duality concept is present in Financial Markets
We have 2 directions of outcomes of the market activity.
UP and Down assumed as Bulls and Bears
Whatever we see on a chart is nothing but outcome of Interference of Bulls and Bears in a given TIME.
Indeed at given price we have certain confrontation of 2 forces. Like a spin of a particle, it has 2 CHARGES when MEASURED at given point of TIME: Positive and Negative.
Wave dualism are applied to fractal with fibonacci ratios.
These ratios are used irregularly in my analyses not by a chance.
Just like the alternation of the dim and contrasting bright colors are used to simulate the Quantum Phenomena.
The steeper the angle of incline of fibonacci channels the more it is related to TIMING of the Fractal.
We witnessed in my number of ideas how Fibonacci ratios work well with reversals.
The direction of fib channels covers the MOMENTUM of the market representing the dualism of the market inside ratios.
Behavior of masses rhymes on lines of Fibonacci Channels which shows interconnectedness of critical points of the market activity.
Peaks and Bottoms must be indexed with fibonacci ratios and adjusted to golden ratio to make sense out of bits waves.
Crossing means a takeover of either of participants of the market activity.
shake-n-bake fractalThis is just your typical head and shoulders pattern, but when a range is so tight, you'll just see one after the other after the other. It's pretty bizarre. I'm declaring this fractal as a "shake-n-bake" pattern where h&s leads right into another h&s of equal size and volatility
THERE ARE SO MANY DIFFERENT KINDS OF PULLBACK/REVERSALAs you've seen in the chart. Both are on the Resistance Level. So the key here is to plot fibb retracement from high to low.
The first trend on the resistance level are seen the trend creating a 2 bullish candles before touches our 618 level.
And the second trend on the resistance level different before you'll never see the retracement when you stick to 1hr TF. but you will also see this chart same on 15mins tf.
My Analysis on this are, Next time I'll explain because Its too hard to explain in English. HAHAHAHAHAHAA
The 6-Candle RuleThe 6-Candle Rule can be applied to any time frame chart of the traders choosing. 60 minute chart means that we have 6 hours for this trade to start moving. If the short is entered in that area and price doesn't begin to move down, we'd then make the adjustment. If the level is identified on a 15 minute chart, then we’d manage the trade after 90 minutes (6 15-minute candles).
One of the biggest questions that I hear often from traders are questions about finding the perfect entry, and a close second is how to place stops and targets once that order has been entered. While entries, stops, and targets are of the utmost importance, something that I’m typically missing is how to manage the trade once I’m in and before it hits either the stop or the target. Ultimately, this comes back to understanding the power of time.
Any trader who's ever gotten into a position that has “stalled” after entry knows what I’m about to describe. The feeling of dread that creeps in, leaving only a sliver of hope because everything in their gut tells them it’s all about to go against them. This is the point where many traders stay in, having a rule that says to stay in no matter how long it takes to hit the stop or target. This then causes emotional stress that’s only compounded when the stop is hit and the trader feels like they should have gotten out earlier. Over time it may cause a trader to jump out because they feel like they’ve gotten burned, only to see price just before it makes the move you thought it was going to make anyway.
If this sounds like you, don’t feel alone! I’ve seen this in more people that I can count, but there’s a rule to help fix it. The rule is called the 6-Candle Rule. The 6-Candle Rule is pretty simple and consists of 3 parts:
1. Upon entry of the trade, if 6 candles on the entry timeframe have passed without price starting to move in the direction of the target, we have to make an adjustment.
2. If the trade is currently profitable, this is the time to move the stop to breakeven and leave the trade open. This gives the trade time to work, but removes the risk of the position.
3. If the trade is currently in the negative but has not yet hit the stop, close the position and move on.
The 6-Candle Rule can completely transform your trading . The rules will take some discipline to implement, but it can be a total game changer to your trade management. The rules are not set in stone set for you to follow but the idea is if you implement a framework for trade management of current open positions, the impact will be a positive one! This will be different for every individual trader/TF/Risk tolerance etc etc etc
FX:EURUSD
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The cycles of the S&P500 | PART 1The cycles of the S&P500 / PART 1
This post introduces a study I'm conducting with the main objective of understanding the cycles and sub-cycles that the S&P500 Index has.
Why am I studying the S&P500? Because it is the most relevant index in the world. There is not any other economy in the world that gets close to the returns of the US stock market as a whole, and also, we have a massive amount of data back from more than 100 years ago. So with all that said, let's start.
The fundamental view I have regarding the market is that the price has moved between periods of fear and optimism through history, on a cycle that never stops. There is either Fear or Optimism, in other way impulses and corrections. On this chart, we can go through periods of optimism and fear caused by multiple factors, different governments, different geopolitical situations, massive crises, changes in interest rate; you name it, all of them are on this chart, the dot com bubble, the subprime crisis, the missile crisis with Cuba, wars, oil crisis, 1929, etc.
The first conclusion I can make at first glance is that despite what was causing it, fear and optimism tend to have characteristics that we may be able to understand. This is a strong base for technical analysis as a discipline. Fear looks the same through several situations, and the same applies to optimism. That's why understanding the price is a powerful element to conclude where we are on the cycle. So what is the price telling us?
In this post, we will not only go through the big cycles, but also we want to understand the smaller ones. Now I will put my main conclusions regarding the information I have found.
THE BIG CYCLE:
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Impulse 1: 1877 - 1881 = 4 Years / 152% from bottom to top.
Correction 1: 1881 - 1897 = 16 Years / -41% from top to bottom.
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Impulse 2: 1897 - 1902 = 5 Years / 144% Fromb bottom to top.
Correction 2: 1902 - 1921 = 19 Years / -40% from top to bottom.
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Impulse 3: 1921 - 1929 = 8 Years / 400% from bottom to top.
Correction 3: 1929 - 1933 = 4 years / -84% from top to bottom.
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Here we can observe a clear change in behavior regarding impulses. Until 1933 we observe short impulsive periods and long corrective periods. From 1933 until now, this trend reversed, we have long impulsive periods and short corrective periods compared to the past.
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Impulse 4: 1933 - 1969 = 36 years / 2106% from bottom to top.
Correction 4: 1969 - 1974 = 5 years / -48% from top to bottom.
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Impulse 5: 1974 - 2000 = 26 years / 2500% from bottom to top.
Correction 5: 2000 - 2009 = 9 years / -58% from top to bottom.
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Impulse 6: 2009 - present = 13 years / 600% from bottom to top.
In PART 2 of this series of posts , I will go through the sub-cycles we observe from 1933 until now. My main objective is to understand the similarities between these impulsive situations (impulse 4,5 and 6)
Here I give you a snapshot of what will be coming:
Impulse 4 with sub impulses and corrections:
Impulse 5 with sub impulses and corrections:
Impulse 6 with sub impulses and corrections:
Here you can see the Days and % decline of each correction inside the impulses. Thanks for reading! I will be updating this soon.
Market Structure: Basic TrendsHey! Hope you are well!
In this chart there is a display of a swing trend. In a downtrend, there is a characteristic lower low and lower high; however, the downtrend is not officially broken until the prior high is violated.
In this chart, there are three lower bottoms; the tops are confounded; the second top partially violates the first; then, the rest of the tops are in the range of the prior swing consummating with the large wick.
A similar micro example is found in this chart.
This is a five minute chart exemplifying the same characteristics.
Be well, and enjoy!
Suggested Reading:
Law of Vibration - Tony Plummer
Michael Jenkins - Geometry of Stock Market Profits, Chart Reading for Professional Traders, Complete Stock Market Forecasting Course
Scott M. Carney - The Harmonic Trader, Harmonic Trading Volume I, Harmonic Trading Volume II, Harmonic Trading Volume III
H.M. Gartley - Profits in the Stock Market
Bill Wiliams - Trading Chaos, New Trading Dimensions, Trading Chaos 2nd Edition
J.M. Hurst - The Profit Magic of Stock Transaction Timing, Cyclic Analysis: A Dynamic Approach
Fabio Dreste - Quantum Trading
Michael Jardine - New Frontiers in Fibonacci Trading
The Wave Principle, Nature's Law
Ralph Nelson Elliot
Technical Analysis of the Financial Markets
John J. Murphy
A Complete Guide to Volume Price Analysis
Anna Coulling
Mastering The Elliot Wave
Glenn Neely
🌊 ELLIOTT WAVES CHEAT SHEET 🌊10 Rules to 🏄♂️ them all! Hello, You may have never heard of Elliott Wave Theory before! Here is a cheat sheet for Elliott Waves for top 10 Rules, so you can master them all! print this out and keep on your desk.
How do you read Elliott waves?
The Elliott Wave Theory is interpreted as follows: Five waves move in the direction of the main trend, followed by three waves in a correction (totaling a 5-3 move). This 5-3 move then becomes two subdivisions of the next higher wave move (fractal).
The Elliott wave principle is a form of technical analysis that finance traders use to analyze financial market cycles and forecast market trends by identifying extremes in investor psychology, highs and lows in prices, and other collective factors. Ralph Nelson Elliott (1871–1948), a professional accountant, discovered the underlying social principles and developed the analytical tools in the 1930s. He proposed that market prices unfold in specific patterns, which practitioners today call Elliott waves , or simply waves. Elliott published his theory of market behavior in the book The Wave Principle in 1938, summarized it in a series of articles in Financial World magazine in 1939, and covered it most comprehensively in his final major work, Nature's Laws: The Secret of the Universe in 1946. Elliott stated that "because man is subject to rhythmical procedure, calculations having to do with his activities can be projected far into the future with a justification and certainty heretofore unattainable." The empirical validity of the Elliott wave principle remains the subject of debate.
OpenSea version in signature below
Trading Tip: Adjusted AxisStep 1: Find two swing pivots you would like to use
Step 2: Draw a parallel line along the axis of the pivot; draw a second line perpendicular to that axis of the pivot
Step 3: Done! Now you have an adjusted axis
What is an adjusted axis?
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If looking at a coordinate plane, the normal axis goes perfectly vertical and horizontal at an offset of 0 degrees to the true zero point.
When looking at a coordinate plane, it may be noticed that sometimes the points on the plane do not follow the perfectly vertical and horizontal axis accurately; in such a case, creating an adjusted axis may shed some light.
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In-exhaustive book list
Law of Vibration - Tony Plummer
Michael Jenkins - Geometry of Stock Market Profits, Chart Reading for Professional Traders, Complete Stock Market Forecasting Course
Scott M. Carney - The Harmonic Trader, Harmonic Trading Volume I, Harmonic Trading Volume II, Harmonic Trading Volume III
H.M. Gartley - Profits in the Stock Market
Bill Wiliams - Trading Chaos, New Trading Dimensions, Trading Chaos 2nd Edition
J.M. Hurst - The Profit Magic of Stock Transaction Timing, Cyclic Analysis: A Dynamic Approach
Disclaimer: Not financial advice, no recommendations to buy or sell, no warranties of merchantability, profitability, or probabilities.
Geometry: Angles, Cycles, and SymmetryThe harmonics of two are as such:
1, 2, 4, 8, 16, 32, 64
Cycles are merely sequences;
sequences can be arithmetic, geometry, or some other variation ( harmonic for example is 1/n).
is a sequence. If we are looking at the idea of cycles in terms of the time duration between highs, lows, highs to lows, or lows to highs, we could measure out the duration of a high to high using that as the base one unit.
is also a sequence; this is a geometric sequence with the factor being two; likewise as the above scenario, we could take the first measurement, and use it as a base unit.
Explore the different sequences, and explore the relationships of price and time: time from high to high; time from low to low; time from high to high to low to low to high; price from high to high; price from high to low; price from low to low.
Some sequences to start off are
1,2,3,5,8,13,21; n = (n-1) + (n-2)
1,1.414, 1.73, 2, 2.23; n = sqrt(n)
.236,.382,.618,1,1.618,2.618; n = 1.618n
In-exhaustive book list
Law of Vibration - Tony Plummer
Michael Jenkins - Geometry of Stock Market Profits, Chart Reading for Professional Traders, Complete Stock Market Forecasting Course
Scott M. Carney - The Harmonic Trader, Harmonic Trading Volume I, Harmonic Trading Volume II, Harmonic Trading Volume III
H.M. Gartley - Profits in the Stock Market
Bill Wiliams - Trading Chaos, New Trading Dimensions, Trading Chaos 2nd Edition
J.M. Hurst - The Profit Magic of Stock Transaction Timing, Cyclic Analysis: A Dynamic Approach
Disclaimer: Not financial advice, no warranties of merchantability, profitability, or probabilities.
Fractal example
its like extension of a simple base pattern spreadig by the rule of butterfly effects
with considering of crypto market atmosphere and 2 ex-waves "A" and "B", it would be easy to predict what's going to happen ...
zoom out to find out the orginal A ad B
you can read more about fractal and butterfly effect on my related tutorial
Supply and Demand - AUDJPYThis is a good example of the relationship between supply and demand, accumulation and distribution (see the 1m chart insert from Friday 17th September). Price is constantly fluxing between the two forces deciding who has control of the market. At the point where the recent high fails to break, this is a strong signal that sellers could be in control and shorts become the more likely play. Eventually we see that demand is over-powered and at that point, price gives way and bearish momentum kicks in.
Study price at the weekends when the market is closed and eventually you'll see this unfold live before your eyes
Smart Money CONCEPTS - Can you relate?Here is an overview of (to me) why support and resistance don't work (at a successful enough rate).
If you feel like this is the case be honest with yourself. And maybe try something new. please remember the 90 90 90 rule!!!
90% of traders
Lose 90% of their account
In the first 90days
Have a little think as to why?
For the majority of newbie traders that enter the market.. the first thing they are taught to understand?
Support and Resistance, Trendlines, Fibonacci (does work if used correctly)
So just be mindful of what the banks are doing and understand from their perspective that if they know the MAJORITY trade Support and Resistance... Don't you think they know where the majority of the people stop losses are going to be? ...
Any questions feel free to ask
Apple Market Cycle TOP!!My point of view for what it's worth..
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TA= on the H1, H4, D at lower BB just holding on.
MACD= BEAR, worse on the weekly, daily.
Stoch= BEAR COSSED on the daily, about to on the Weekly.
BIG GAP AT 90$ needs to be filled. test lower weekly BB.
Market Cycle top in distribution phase. plateau
Logistic curve top.
do your on FA if you really don't understand.
I'll give you :
7nm(A13) EOL
CHIP SHORTAGE!!!
market saturation
dividend increases ..
just need the silver sparrow( unknown fundamentals) to really kick it off, but it will not take much now.
Adam
