PowerTrading/The River - page 32
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Tonight
Here is what I am looking at to determine where we could place an order later. I pulled a Fib from previous move and in this case it was high to low. We have retraced back to 23.6 and a little past. If we are going to continue downward we could turn at the 38.2 or 50% level. I am looking for a continuation of the downward move but, based on history from the last several weeks, we are in that ranging area where we could go right back up. If you look at my posts you will see I have been living on short positions this entire month. So, with all this knowledge and information what do we do.
We wait for Price Action to determine our next move. I have a limit order in place for a short at the 50% level which is also just under the 2.0400 area but I may pull it once I watch price. Most likely I will not take a long position tonight although there may be a good move that direction. If I miss it I will simply catch the short on the way back down.
Now this is my trading thoughts and I respect that others may be looking for a long position.
In the Zone
Using the River and the Zone you could have made some great pips already this morning. However as I have said I am living on sell orders this month so I am looking for a place for a reversal.
This will give you an idea though of how you can judge when to take a River trade. We broke out of consolidation long. Notice we broke out at the 38.2 fib level. We are still in this range and it allows us plenty of room to make pips.
Current
I found my place to take another short position. It was right at the 61.8 fib level. This was an excellent place for this to turn. It could still turn on me but I will hold this order until I get the pips I want. Up 21 now but it could take a while.
PowerTrader
Is the zone the area where there is consolidation? Looking back in the past, its always easier to tell where consolidations have occurred, do you have any set rules that prices must be within a particular range in order to validate it [sometimes a consolidation could even span over 30 PIPs]? Does this mean you do not trade based upon the river, but are looking for a breakout instead?
Great Question
PowerTrader Is the zone the area where there is consolidation? Looking back in the past, its always easier to tell where consolidations have occurred, do you have any set rules that prices must be within a particular range in order to validate it [sometimes a consolidation could even span over 30 PIPs]? Does this mean you do not trade based upon the river, but are looking for a breakout instead?
You are correct about knowing consolidation. What I have found is we were getting false signals on the River so it was a good system based on the cross but if you could filter out some of these false signals, it could be better. So now I still use the River or 62 cross but with a break of a fib level or the Zone which usually consolidates around fib levels. This has worked for me and I have much fewer losses.
PT
I found my place to take another short position. It was right at the 61.8 fib level. This was an excellent place for this to turn. It could still turn on me but I will hold this order until I get the pips I want. Up 21 now but it could take a while.
Can you explain me how you drew fibo for this chart. GBPUSD is still flying up.
I am wondering and always was about how you know it stoped and will fall and how you draw fibos.... it can stop and then fly up again??
Fibs
Can you explain me how you drew fibo for this chart. GBPUSD is still flying up. I am wondering and always was about how you know it stoped and will fall and how you draw fibos.... it can stop and then fly up again??
The fib in my chart was drawn from the high to low of yesterdays move. You are right the Gbp/Usd is moving upward again. It broke my consolidation and was primed for a good long position but as I had said in my previous posts I am only looking for short positions. I put in one sell position when price turned at the 61.8 and will put in another one when it settles down. You have to understand where price is most likely to turn and then be prepared if it goes the other way. Because we are close to the top of this range I am not worried about taking a short position or two.
PT
So you draw from yesterday HIGH to LOW not from LOW TO HIGH?
Drawing Fibs
So you draw from yesterday HIGH to LOW not from LOW TO HIGH?
I draw Fibs in the last direction of major price action. For example, if we had a drop in price, I would draw from high to low. If the last big move was a long, I would draw from bottom to top, leaving the zero on the top. This way you can see at what percentage you retrace. I respect that others may draw differently.
After the days move I would draw from bottom to top.
PT
yes, i think that is what PT is saying. Apparently the fibonacci gives an indication of sup. and res. now i think he uses these for entry and take profit.