A-B-C-D Trade - page 11
You are missing trading opportunities:
- Free trading apps
- Over 8,000 signals for copying
- Economic news for exploring financial markets
Registration
Log in
You agree to website policy and terms of use
If you do not have an account, please register
Applying the fib channel tool to the EUR/USD 1-Hour chart.
Pull from the first peak (1) to the lower peak (1).
Reposition the second line (dot) #2 to next peak.
The expansion diagonally hit both the FE 100 and the FE 161.8 (can't see ratios on chart). What you need to do is move the 2nd dot up the chart while keeping the line on the 2nd peak. This will bring the fib ratios back into you chart.
---------
The blue ABC was potted upward and the extension hit both the FE 100 and FE 127.
The black ABC was plotted downward and profited at the FE 100 and a bit more thus far.
Let's take a look at how one can stay in a large extension. As shown on the attached 15-min, the Asian session was in a very tight range (yellow box).
Please note that I had modified the indicator and posted it recently as "Time_modified2".
I adjusted the end of each session using the 59th minute. We can see the difference this made with the last breakout, which started at the 08:00 GMT candle. The old setting would have had the low at that candle and rob us of 40 pips on the breakout.
The attached chart utilizes the Heiken Ashi candles in blue and red. It also has the Heiken Ashi smoothed in pink and green.
Added were the Fractal (black hatch marks) and the ADX Crosses (red and black arrows) indicators. Both assist in identifying turning points.
After moving our stop-loss to break-even we can take partial or majority of profits at the FE 100, and trend the balance.
Riding the Regular Heiken Ashi, we exit after the first blue candle closes at the bottom of that run after it bounced off of the FE 236.2. The fractal also appeared after that same candle closes.
The Heiken Ashi Smoothed was still pink. If one was to exit after that changes to green, this particular scenario would have been about the same. However, the Heiken Ashi Smoothed (HAS) often eats up profit as there can been considerable "lag" in the turning point.
MTF Freedom Bars red.
And last, we have the FX_Sniper's Ergodic_CCI_Trigger crossover during the entire breakout tell us to exit with an opposite crossover at the bottom.
Attached are the indicators.
Edit: Note that the Heiken Ashi Smooth is not programed to reflect actual price value/location. It sits on top/below the regular candles for us to visualize trend.
Attached is 5-min chart. Notice the diagonal fib channel line also acted as support and a clue to exit at the FE 161.8
A to B was only 42 pips, thus I trade to the FE 161.8. 45 gross pips profit on this one.
Late Asia sold off Euro as support broke around 1.2278. This left 28 gross pips on breakout once European session started.
The second ABC did not hold. We can see Point C being breached, so no trade of course.
This is a continuance of my chart. It's a little hard to read but if you lok at recent action, the light blue and orange ABC and FE levels have been hit perfectly. Always monitor the 1-hour.
Looks like another pull back for a Point c, but we must be careful since there is strong support at 1.2143 from last week (see weekly chart).
Both the Asia and European stock markets were under pressure (as well as North Korea making noise again) and I expect that "flight to safety" into USD continues.
Let's review some basics. Attached is the 15-min on EUR/USD. We pull the retracement fibs from the low of that session to the high. I use 08:00 to 15:59 for the European session (blue box with Time_modified2 indicator).
The horizontal lines are the retrace levels and the fibo fan, pulled from the same hi/lo, also will provide us with some support and resistance.
After the move up, the pair retraced to the 23.6 minor fib. With strong moves, it can re-continue it's thrust up. Usually it will channel first, after a significant move. This is the case now.
To anticipate any move up, above the European session high, we draw the ABC. My ABC has the FE100 at 1.2330.
Experienced traders can trade/scalp between fib lines. When it breaks one fib line, it will go to the next. We wait for "confirmation", which can be in the form of looking for the candle to close below the 23.6% fib.
The Multi-Time Frame Freedom bars have longer term charts still with a down bias.
Attached 5-min chart shows entry after break of Euro session high.
With 3-pip spread on tht Buy, filled at 1.2302.
Stop-loss set 1 pip below 1-min pivot of 1.2280 for 1.2279 and a 23 pip risk.
Take Profit set just below FE 100 1.2331 at 1.2329 for a 27 pip reward.
Just hit the profit target.
Here's the same chart showing profit target at the FE 100 hit and bounce. Trade lasted less than 5 minutes.
Notice the channel after Europe closed. We then captured the breakout.
Now trying to rise above last high. We draw the ABC again and see the FE 100 at 1.2374 (Red). This is not a breakout, but might be a continuance of the last ABC extension (Blue on 2nd chart).
Notice on 2nd chart that the common fibs of both ABC is at 1.2348 and 1.2373. This is fib in action and adhering to fib ratios.
O.K., despite lower volume after New York closed, the extension did hit the FE 161.8 price of 1.2374 (blue lines on last chart) exactly.
Whether a trader entered on the ABC pattern or some other trade entry, we can use the pattern to ascertain where the market is going, with precision.
Practice, practice, practice. Fibonacci is the foundation. The ABCD patterns are one facet of this. Understand the and you will have more confidence in reading the market as well as maximize your profits.