How to use Support and Resistance Effectively - page 14

nosam
103
nosam  
bubble:
mas0n,

one minute ,thats not how i operate, it would take me hours to got through all of those charts

bubble

bubble, so how do you backtest, or you just forward test ?

if I can guess, you might come with this method by reading book or article etc, and put it into practice and add some knowledge, but at least you must test it, either back or forward test.

Those hours you spent in analyzing charts, does it include pair correlation and fundamental (long-term news but not spikes) ?

sorry for more questions, I just need to keep up with you.

RickW00716
733
RickW00716  

Looking at the GBP/USD today I noticed that price continued its decline from resistance (6/26 4hr chart pinbar) until 8:00 GMT...then it advanced up from there.

The resistance has been in place all week(4hr chart) and price has been unable to sustain any move above it.

The decline reversed at a prior resistance top that is now support(6/20 4hr chart 16:00).

My 4hr trend indicator showed downtrend briefly but turned back up and now shows uptrend...I also show uptrend on daily and weekly charts.

My concern is that price could reverse at the resistance again so I am hesistant to play this long unless i get a pullback into prior support.

Please...comments welcome

karmizi
23
karmizi  

just to keep up with u guys.

bubble,

Hope u can give a comment base on a chart below. My prediction, there will be a good short 50+pips trade for today. But my instict tell me that u will not agree with me ). Thanks in advance.

nosam
103
nosam  
bubble:
Chrislee, thanks for your comments,

mas0n,

there is no secret to using s/r, you have to practise, even i get it wrong ,the usdchf trade has been stopped out but thats only a loss of 6 plus the spread so its not a disaster even though the trade was 32 pips in profit at one time, there are some people on this forum giving stops of 50,100 even advocating using no stops i know which i prefer.

I have given you enough info to learn to use s/r and have said i am willing to answer any questions ,that should be enough apart from what i have written here ,to learn this subject takes practise, a lot of it which you will have to do until you are confident enought to go live thats how i learnt.

Why are you asking me about correlation and fundamentals ive explained to you many times where and how to begin.

bubble

well, thanks again bubble, I guess the answers already laid in your previous posts, and I didn't do my due diligence to re-read again, I am sorry for that, and you ignore TL,ZZ,Fundamentals and correlations, that's what I get from you.

No more Qs from me, as I better keep quiet and be a good student.

steveshutts
49
steveshutts  

Bubble,

A few questions if i may?

Do you operate mainly from the 240 chart for trend direction?

How many currencies do you observe?

How many trades do you average a month with this strategy?

So basically, you always wait for the second touch of an S/R area and then you take a position without waiting for price action to confirm. The second touch is your confirmation and if it carries on through then so be it, wait for the next setup.

The advantage of this method is that you get a nice entry with a tight stop compared with waiting for price confirmation. I suppose waiting for the second visit is confirmation, if it holds that is. So once you have seen price visit an old resistance area, now acting as support, and it moves away, will you then set a limit at this area to take an entry if it comes back down? Unless, of course, price action before the return to S/R shows potential for a bigger move against the trend?

Steve

RickW00716
733
RickW00716  

I know you have mentioned that you can use any indicator to confirm s/r, but can we use price patterns alone?

Sometimes I notice that at turning points (example EUR/USD this week) that price rises into resistance(on 4hr and 1 hr) but doesn't close above it and instead forms pinbars or bars with long "tails"...This seems to be a great place to risk a sell...I know that you don't follow trendlines but there is a downtrend line that begins 4/30 on the daily chart that price recently rose and stalled into.

Just curious what your opinion is on this....thanks

Sundowner
76
Sundowner  

Hi Bubble

Thanks for this thread, it's brilliant really...thanks as well for the help; very decent of you to take the time.

Question about the usd/chf trade.

If I am correct about the time of your entry on the chart (please see the chart I posted) did you take this trade because of the number of bounces off resistance?

Your decision was ultimately correct, but being new to this I'm curious about the thinking you went through at the time of the trade.

I see the HTF was in agreement, so I'm wondering if you always determine your trades based upon a specific number of bounces from resistance, or if there's something else. I have studied the thread, looked at charts this weekend, but I'm still unclear.

According to my understanding of what you have said, you wait for the price to be rejected at least once or twice and that, along with agreement of the HTF is how you enter a trade. yes? Is that why you entered this trade?

Another question..

If I understand correctly, you set s/r levels on the trading tf and look for confirmation on HTF.... from which you also determine trend. Do you begin to set up your charts by setting s/r levels on the higher TF?

Thanks

Cheers

Files:
usdchf.gif 18 kb
XKR1962
60
XKR1962  

Thanks Bubble

Hi Bubble, I just had to say thank you for this great thread. I have read and re-read it many times, studying all your example charts and applying your formulas / rules to my own.

I have a long way to go yet but this has helped me enormously. Thanks again.

Sundowner
76
Sundowner  

Thanks for your reply, Bubble. The charts are a particularly helpful and I appreciate the clarity of your response.

Cheers

Guyver
1152
Guyver  

Great

great trade i must say bubble great trade