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Everything posted by Mercury

  1. Hi JB, Can you explain your rational for the GBPAUS Long? I have been tracking this for a while, looking for another strong leg up but now my reading is that the big trend is down so your position would be counter trend. It does look like a counter trend rally is shaping up and could be a good 1000 point or more so worth considering but I have always found it hard to pinpoint such turning points, the retrace points on the main trend are easier and generally more lucrative. Look forward to hearing about your rational and supporting analysis. M
  2. Hi Welshman, I never look at anything below 15mins, did in the past but often got wrong signals as it is just too unpredictable for me. Day traders use 5 mins a lot but I don't subscribe to that mode of trading. On the 15mins there is a valid 1-5 count up from the Mar16 12.00 wave, which suggests this rally is done, however there could easily be another leg up first and as price has broken the 62% Fib I would certainly not rule that out. M
  3. I don't trade this much but there are a lot of pips on offer on Japan if you get it right. The general shape of the price action is suggestive of a bearish sentiment with a possible A-B-C complete just short of the 50% Fib. the ending Triangle formation seems good, though Ideally I'd like to see another hit on the top line, maybe at the 50% Fib? having said that the shape is suggesting the top has already been hit but a sharp 1-2 relief rally is probable behind US opening (remember this market is closed right now). I'll be tracking this over the course of the day and if it looks good may put a stop in short over night at the 50% OR go earlier if the US markets drive a 1-2 earlier. here is the chart 
  4. And I see your logic absolutely, it's just that I'm wary of the more exotic formations. I sometime wonder if the EW people use these things to make sense of things that don't fit the normal models. As for me I go with the KISS principle and if it gets too complex I stand aside and wait until it clarifies rather than trying to make sense of it. Complex W3-4 moves are the graveyard of traders, as someone once said to me... Best avoided until things become clear.
  5. Following on from my Brent Crude post I looked at Shell; I like to see if Shell can help me get a fix on Oil and vice versa. After I went short at 1700ish the price jumped this morning and them dropped almost all the way back. It may still it the Fib at 1780 after another leg up (just as with Brent) and if it does that has to be a great place to short. I have a similar dilemma on Shell as I have on Oil, namely have we just seen (or are about to on the next leg up) a completed relief rally or just a Wave A first leg? On the charts you can see the two alternatives (Red and black tram pairs & Red labels as alternative, which support the Black trams). There is strong indicator support for a drop soon and I guess we cannot judge which scenario might unfold just yet. The third scenario, that we have seen bottom and are on our way to $60 (Brent) I don't yet buy into. Any thoughts on this? Here are the charts: 
  6. Just moving this one out of Trade of the Month into it's own thread as I think Oil is the main overall market mover at present. I have been on the mindset that Oil is due a drop before another strong leg up to about the $50 mark (Brent Crude) but now I am wondering if there is any actual justification for that and second guessing (re reanalysing) my position. Would welcome some help here. I have a strong resistance tramline on the Daily with the price action having just bounced back off this. I have Neg Mom Div on the Daily with additional ones on Stochastic and RSI and Stochastic has just come back below the over bought line. All this happened just below the 38% Fib off the W2-3 wave (Pink labels). On the hourly I have a decent A-B-C EW count with a final 1-5 on Wc (albeit that another leg up to the 38% Fib is not at all out of the question). There is Neg Mom Div on the Hourly too but perhaps has a bit more development in it still. I am already short at 4110 from a few days ago with stops above the 38%, likely a bit premature but often the Fib line is not quite hit. Given all this I am wondering if we have seen a W4 (Pink label) and will not see a drop to a final lower low to mark the bottom or Oil or will this turn out to be a Wa of a larger A-B-C? For now maybe it doesn't matter so long as we get a drop and reanalyse as the next few weeks unfolds. Here are the charts: 
  7. The recent move down on the Dax is strong and could be the beginning of a drop for indices in general. It has bounced back off the Fib 50%, an exact touch too, and good EW count to the top, with strong neg Mom Div on the hourly, supported by Daily indicator too. We may well get an equally strong counter rally, especially if the US open strong, but then perhaps the real drop will begin? I am short just below my triangle break at 9975 with stop just above the 50% Fib. Here is the chart: 
  8. Jamko, Totally agree on the diary side, I keep it to just those entry and exit moments I want to learn from rather than trying to record everything. As a technical trader I feel I need some science behind by views, otherwise it's just sentiment and that can give you very wrong received wisdom. Re management in flight, consider moving stops to breakeven when you have moved a certain distance in the direction you were looking for (e.g. same distance as your stops). Once at BE it is essentially a free bet, unless there is a super fast move and then, as you say, you can always seek to get in again if stopped out. My overall approach seeks to move to this BE as early as possible without negative the reasons for the initial stop position to give the trade some room to evolve.
  9. Expanding triangles are always compelling because they are so rare. I think they mainly form at all time highs when the market goes a bit crazy and that doesn't feel like it is the case with Gold don't you think? Your expanding formation fits inside my parallel trams, which are obviously very common so my bet is that we see one final hit on my upper tram, or a miss and drop through the lower one to begin the Wb (or W4) descent we both agree on before the final push higher. So far I have not had a Neg Mom Div and ideally I'd like to see one coinciding with a touch on the top tram to end my longs and swing a short. I suspect the final push up will coincide with a drop in the main stock indices so I will be looking for that correlation as well. If that is right it could support my A-B with a Wc still to go scenario on the Dow etc. no doubt there will be some twists to this, as always, as we progress. Safest play here is to wait for the Wb drop to a good Fib level and then go long, if everything else is supporting. As I'm already Long I need to find a good exit and then I will consider a swing but only if it is set well with other indicators. Gold is very interesting right now as it is the only asset class I trust with a Long (FX not included of course). However you have to admit Gold is still very highly priced on historic terms so I do wonder about a total asset value meltdown sometime soon, i.e. a deflationary depression. this is one reason I track Gold closely, if it starts to drop heavily in line with main indices and commodities then there is a major crisis in the offing!
  10. Always a risk trying to hit the top, I should probably play it a little cooler but sometimes it just seems to scream at you... It will be interesting to track the Dow and other main stock indices over the coming months. If you are right with the triangle (and others with their A-B-C) then a new all time high is on the cards but that doesn't scan with the general sentiment I'm picking up. Right now I am leaning the other way such that I believe we have had the high back in May 2015 and a large wave 1-2 down done and a W1 of W3 down done and are in an A-B-C retrace to W2 of W3. I am not sure if we have hit Wc or just Wa, though reaching 76% Fib on the Dow is more suggestive of Wc I think. If this scenario is right we should get a relative shallow drop to a new W1 with a retrace (could almost reach a double top) and then a massive drop that will not stop until we get below 10000ish. If Wa is where we are then we will get a deeper drop to Wb before a Wc in a 1-5 formation. Alas this latter may look like your We so could be hard to tell at this point. Given all that I will be taken a few positions on the way down but moving stops to BE quickly to protect against a rally back up and searching for one of the 3 possible scenarios to present itself. The more people looking at this the better so let's keep posting thoughts and observations as I do not want to miss either a new higher high or a massive drop...
  11. I see it Welshman, I have an EW count with the W4 already in and a 1-2 of W5 down completed but comes to the same thing. Let's see if we are right. I have stops above the 76% Fib on the W4 (your Wa I think). cheers, M
  12. Hi Jamko, Thanks for outlining your trading approach, it is always interesting and useful to hear how others do it. I have found that the most important thing is to get experience with the analytical tools one uses as there is nothing ***** proof out there and many fools (myself included) to prove that point... Your interpretation comes from experience, consider keeping a diary with screen shots of key trades to do post trade diagnostic of both what goes right and wrong. In my welcome post I outlined my strategy, which is based on EW, Tramlines and Fibonacci retrace. To this I add Momentum, Stochastic and RSI to try and pinpoint the turns highlighted by the former tools. MACD is an interesting one, I look at it from time to time but only to identify major trends on a macro scale and I don't use bollinger or moving averages, I don't trust them... Re CFD vs SB, I too started with CFDs and for trading individual shares I like them because you can mirror an actual trade by buying a set number of shares or a set value of shares and then I used to set a certain percentage loss that was acceptable as my stop level, rather unscientific. I would advise SB for anything else. It works the same way as CFDs in principle, though the mechanism is a bit different and in the UK at least there are tax advantages as it is treated as betting, correctly I think. It is also easier to apply a set stop loss maximum with SB, at least conceptually (see point below on risk management). Regarding risk management I was advised, correctly in my view, too never have more than 3% of your entire account exposed at anytime (i.e. not 3% per trade). Anything more than this and you risk catastrophic losses. This is a challenge if you are starting with a small account but is also a good discipline so that you do in fact start small and build slowly, there are no quick wins here only the graveyard of people who try for them! With the method I use for analysis I seek to identify high probability (therefore lower risk) entry points, especially around points of resistance (Trams and Fibs) where EW is indicating a completed move. I set the stops close above such points knowing that if I get stopped out there is always another entry point at the next level of resistance. The method also indicates likely resistance points for exit and I like to have identified a target exit before I enter the trade. Often I will take 2 positions and exit one at the first resistance point and go breakeven on the second but let it run, this gets over the dilemma of cutting short and loosing out on a long run or not cashing a decent position. I have found it is all too easy to get caught up in the short term views and hourly (or worse 15 or even 5 min) price moves. This has never been sustainable profitable for me so I prefer to pull back and plan out moves o longer term horizons like the daily and weekly and execute on the hourly. Final thought, I believe it is inevitable we will loose more than we win, even with good analysis, owing to the vagaries of the markets (FOMC, general sentiment etc) and our own impatience (personal psychology). Therefore my approach is to seek only big win opportunities and cut and run quickly on losers. If I can win big when I am right and loose small when wrong even a 40/60 hit rate will suffice to keep my account ticking over. That said I am not immune to breaking all the rules from time to time, i am a work in progress... Hope to hear more from you on your analysis and other topics of interest. M
  13. Calling all gold bug! Well I'm not a bug, not sensible for a trader to have any passion for a particular asset but I have been tracking Gold for a low turning point for some time and got it at about 1080 a while ago. A few days ago I put in another Long at 1233 at the break of a nice little triangle on the hourly chart and am now targeting 1290ish (top tramline pair resistance) before cashing in everything and considering a short then long again at a suitable Fib retrace. It is interesting that Gold jumped in line with Oil and Stock indices after the FOMC but today both Oil and indices are falling back while gold remains bullish (Oil may have a bit more to go in this rally before a drop BTW). Despite my prevailing view that indices are due a sharp fall (maybe we have just seen the beginning of this?) I also think Gold must retrace for a bit before moving on to fresh highs. I'm targeting 1400ish region for the end of this current rally, after that, well that's for another time. Here are the charts, would love to get some perspective from others on this. Oh and BTW, Happy St Patrick's day to all! 
  14. I assume you are referring to EURUSD? You may be right. Now that the price has broken my triangle resistance the next stop could be the 76& FIb at 11450ish or the green tramline at 11460. These are looking good now for a turning point.
  15. USDCAD Long didn't work long term, had a decent 150pips before FOMC chaos, fortunately had protective stops in so no loss incurred and we live to fight another day on this one. Time for a rethink, I'll let things play out for a few days before considering this and it has a lot to do with what Oil does. Will post again on this in a few but I'm still stalking either a relief rally of another leg up to new highs.
  16. Update on my EURUSD take for post FOMC price action: So far things are going according expectation with a pop to complete an A-B-C relief rally in play (assuming that is right...). I have an updated Daily chart with a nice triangle formation (Blue lines). If right the A-B-C move should top out at or near the top triangle line, in our around the 62% Fib off the last major high. I have gone short at the 62% point (11252) with stops above the triangle line. here are the charts: 
  17. Hi JB, Can you let us know the parameters you mentioned, just to have background on your take? You may well be right on EURGBP, can be a tricky market as it really depends on EURUSD and GBPUSD. I prefer to trade USD crosses for that reason. Also I guess because you are bullish EURUSD you might also be bullish EURGBP? As always with these things it could go either way and taking a FX trade close to FOMC is risky. The price did pop a bit to the 82% Fib, which is very high, and then met more resistance there. In addition the Neg Mom Div remains strong, with bearish signals on RSI. I think today will tell the tale on this one and also EURUSD. As previously posted I am berish EURUSD, will update that post in a bit.
  18. Interesting alternative count for the big daily price action on the Dow. I didn't see a potential large triangle, you are going for an A-E count? That would indicate a rally off the E touch to a higher high? I have seen an alternative count of an A-B-C, which would also indicate a large rally to a new all time high but at present I prefer the bearish count. You did better than me in waiting for the turn, I got in too early and am now riding some losses against the turn down, not a good place to be... Nevertheless all the indicator point to a significant drop soon (whether the beginning of something major of a leg down before a larger leg up I don't yet know). One difficult with EW is finding the right count on a long wave and this rally has been very strong, a factor of the current market almost certainly driven by central bank interference in a supposed free market, very annoying! But c'est la vie, one has to trade the market that is there. On which note, I have update my analysis for yesterdays price action and now see a much stronger set up for an ending triangle on the hourly with a good 1-5 count off the Wb and strong negative indicator action. The Dow is also at the 76% Fib. I'm going short again here, let's see what happens next...? As always if someone has a different take I'd love to hear it! Here is the chart: 
  19. I agree with the long term trend assessment down but if you like to swing trade then now is a good time to chance a long. I believe we have had an A-B (Elliot Wave) and now begin a Wc up, which could run for a decent few pips before turning down again to complete the long term motive wave down. At his point the trend will no longer be your friend and we will have to assess likely GBP bottom. Interestingly, unlike some others, I completely ignored the budget statement as I don't think it is relevant. The bounce today came at the always popular 62% Fib regardless of the budget this was my swing target. But will this hold or will there be another leg down before Wc? I'm Long at 14080 targeting the Fib 38% at 14500ish before reversing into a Short. my stop is wide to account for another possible leg down before the rally. here is the chart: 
  20. Another potential rally ending signal emerging on the Dow (see also Shell Oil in Trade of the Month). The whole move up from the recent low could either be a Wa or a completed A-B-C, difficult to tell at present, but either way it looks like it is due a drop and perhaps the FOMC is the catalyst for that. There is Neg Mom Div on the Hourly chart, a good EW count to the overall move and a triangle formation noe completing with 1-5 touches completed. Also a Head & Shoulders top is emerging. The Daily chart is also bearish, hit on a major tramline plus Neg Mom Div. Again, don't know if this is an A-B-C completion or just a big A but time will tell. Short at 17255, here are the charts: 
  21. New trade opportunity! Despite the budget being alledgedly beneficial to Oil companies I can't see that moving the global Oil market and my by analysis I see Shell topping out a 1-5 up to a Wa with an ending triangle formation at the top. Typically I see 1-5 within the triangle with the 5 touch on the line as the high (or low) point. We almost have this now on Shell with some Negative Momentum Divergence on the hourly. I have taken a cheeky short at 1705. If I'm right the Wb could drop to the 1500 mark before a Wc rally to complete the move. Here is the chart: 
  22. With the FOMC coming up at 18.00 today are people looking for this to help them place a trade or just adjusting to compensate for likely volatility? Some people like to ride the pre and post major announcement volatility but I think that is a mugs game. Common sense seems to work less and less with these CB issuances. Take Draghi's last 2 (December and recently). He is trying to devalue the Euro to help Eurozone trading right? So he drops the interest rates (now gone negative) and increases QE. The Euro should fall right? But look what happened, in both cases the Euro spiked sharply. Maybe it will begin a steady decline now but for sure the place to avoid making a trade is around the CB pronouncements. I wonder what Janet will have for us? I'm steering clear until the dust settles and my analysis brings things into a sharper focus. Here is the EURUSD chart: 
  23. Totally agree re discipline and psychology, Mastery is a lifetime in the making on this. I think ones own psychology is paramount coupled with a clear and simple analysis and trading strategy. The market psychology should be caught in the trading strategy and analytical method, how else would you assess it anyway? For me giving in to bad habits driven by psychology ruins a good trading strategy rather than a bad strategy driving bad psychology. That said it is important to come up with a good strategy to make sense of everything.
  24. Totally agree re discipline and psychology, Mastery is a lifetime in the making on this. I think ones own psychology is paramount coupled with a clear and simple analysis and trading strategy. The market psychology should be caught in the trading strategy and anaytical method, how else would you assess it anyway? For me giving in to bad habits driven by psychology ruins a good trading strategy rather than a bad strategy driving bad psychology. That said it is important to come up with a good strategy to make sense of everything.
  25. No worries, I got the point and we are agreed. Everyone has slightly different methods, so whatever works for ya but I also agree with the approach of starting with the big picture and honing in. I prefer Brent to WTI but again it is a personal preference. For me Brent is the global standard but I often prefer to trade Shell as a proxy for oil rather than oil itself as it can be very spiky. Take a look at Shell, you might find it interesting. I think the EWs are much clearer on Shell. Wise to wait and see if the retrace works out but the moves are so big that I can't resist a cheeky swing trade set up - bit of a weakness of mine I must admit, often I'd be better off waiting. In order to get a decent push up to, say, the Fib 50% I do expect an decent drop to a Wb but this market often surprises so let's see. Glad to be aboard, let see if we can get some other EW enthusiasts posting with us, the more brain power the better the analysis.