A-B-C-D Trade - page 329
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GBP/USD Daily
Revisit of Sept 21st high1.6309 occurred on Dec 19th. The FCT plot (blue) uses those 2 peaks for its Plot Line A-C and the Nov 15th low (1.5822) for Plot Line B. This is almost exactly the same as if we were to plot using the retracement fib tool (horizontal).
Price respected the first 2 levels of -68.6 and -50 (mid-channel).
Next, we made a bullish plot using a peak-to-dip for Plot Line A-C (gray color).
A = Dec 4th high 1.6130
B = Dec 27th low 1.6066
C = Dec 19th high 1.6306
This plot allowed us to anticipate resistance at the Plot Line B, which was just touched today during the 15:00 period. Thus far, the bounce down has travels 40 pips.
We can plot mini-retracements for TP levels thereafter.
Here is the chart for the pair AUD/NZD that we commented on, while using a bullish FCT (blue), and as Part 2 advised on PSQ9. MurreyMath1.0 is also on the cluttered daily chart.
The Dec 26th peak met several support levels: PSQ9 Mars 315-degree (red), 4/8th MML (dark blue), and the FCT -50 mid-channel (aqua blue).
The 4H chart contains a better view of the adherence to the FCT levels -68.6 and -50 (mid-channel). This chart also utilized the HAMA_T3, and we can see nice support given. Currently, price just met the lower border of the Ichimoku cloud.
We previously displayed the gains and R/R to each FCT level. We can see the congestion to our left, during November that ran across the 4/8th MML.
Here's a FCT plot (gray color) using A-C on a Dip-To-Peak, to further clutter this chart.
A = Nov 4th Low 1.2524
B = Dec 16th Low 1.2454
C = Dec 26th High 1.2697
This gives us a bearish plot for support TP levels. Yesterday saw price respect the -50 mid-channel, and today we are currently pausing at the -31.4.
A = Dec 17th 12:00 High .9881
B = Dec 21st 16:00 High .9952
C = Dec 27th 12:00 Low .9907
This bullish plot allowed us to produce resistance at Plot Line B, which was met twice during Dec 28th 12:00 and 20:00 periods.
The interior support levels provided potential TP levels. Price declined to the -31.4 marking .9931 during Dec 31st (today) 04:00 period.
Gross gain from a SELL was about 37 pips. Understanding this resistance allows traders to use a tighter S/L and thus increase/maximize reward/risk ratio. In this case a reasonable net R/R was 30/12 and ratio of 2.5:1.
Pulling out our trusty risk calculator, we input that R/R, and a 50% win ratio (5-5) each month, using 2% risk per trade.
The results are sneaky great. On a $10,000 account, we have $1,500 per month (15%). If we allow for monthly compounding (tax-free), we have a year-end result of $43,500, and a 435% return.
Some people trade their 401K and defer tax. We'll elaborate more on compounding, R/R, during the upcoming January on-line meeting. The date will be finalized soon and posted here (date/time repeated on weekends).
Price gapped upon opening Jan 2nd on many pairs, which initially included USD weakness.
1) Continuance of our AUD/NZD daily chart, with last FCT plot in gray color, which used Plot Line A-C positioned to dip-to-peak. Peak was the Dec 26th high.
Jan 2nd's gap down located itself at the Plot Line B to start the day. A dramatic rise from there has taken place, making any BUY position profitable up to 130 pips.
2) GBP/USD 4H Bullish FCT plot:
A = Dec 7th 12:00 Low 1.60009
B = Dec 19th 08:00 High 1.63056
C = Dec 27th 16:00 Low 1.60659
This plot was logical and conformed to our repeated FCT examples. Point C was a precise 78.6% retrace of A-B, which is ideal, but not necessarily required to be exact.
Price gapped up and started Jan 2nd at the Plot Line B resistance. It has since declined to the -50 mid-channel, a gross gain of 125 pips.
c) Can you plot a hindsight "logical" FCT for EUR/USD 4=Hour chart that shows resistance for the Jan 2nd opening gap?
The attached 1-hour EUR/USD plots a FCT based on last two significant peaks as A-C and Dc 28th low.
After that plot, we drag entire channel (use middle dot of A-C) and relocate top of channel to Jan 2nd 21:00 high. We will keep the slope.
This gives us a likely support with the lower channel (Plot Line B) in the event price declines. That area is also a 161.8 horizontal extension level when using Jan 2nd swings.
Right now that support price is about 1.3074, but with a slight slope up, it will increase as time elapses.
If you drag that channel around to other peaks or dips in December, you'll see how price moved in these increments and respected the size of this channel.
We'll go over this on shared desk top mode during the upcoming January on-line meeting. Date/time to be announced soon.
Attached is an update on last EUR/USD 1-Hour chart with relocated FCT.
Price declined after being contained by the HAMA_T3 during pullback 08:00-09:00 periods.
We used a trialing stop-loss EA named ATR Trailing Stop (red), settings 20, 25, 2.5. The initial setting was fitted to conform with the outside HAMA_T3 zone furthest from price.
TP was set at 1.3080, and price just missed it during the 12:00 candle period.
Pair has subsequently been in consolidation between Plot Line B and the -31.4.
We can make any adjustments to our S/L or TP, while also keeping an eye on the HAMA_T3.
We can even change trailing stop-loss EA. We have another that trails by fractal, and is a script. There are many other tools for trailing S/L. We must remember to make a separate thread for this one day.
Note: There also could be new plots based on subsequent price activity confirming S&R. One is
A = Dec 28th 10:00
B = Jan 2nd 07:00
C = Jan 2nd 21:00
We now can see consolidation with support at -200.
Cheers
Here's another tool, the Gann_SQ9 overlaid onto the EUR/USD 1-Hour chart.
We can see the current candle period touched the 180-degree and pause. It may very well drop below this level. Just want to provide more insight.
thanks s ur view on gold ?
Hello James,
Gold bounced off the 0/8th MML on the 4-hour time-frame. on Jan 4th.
Use the HAMA_T3, and keep the MurreyMath1.0.
Wait for possible pullback into the HAMA zone and 2/8th MML ($1656.25) .
Looking left, we can see the previous congestion/support at this level
S/L just above Jan 4th HAMA candle high of 1663.25.
This would be the set-up for a short-term SELL, with maximum TP at 1625.00 (0/8th MML). Add cushion.
to 1/8th MML 1640.50 = R/R 14.00/9.00 ratio 1.5:1
to 0/8th MML 1625.00 = R/R 30.00/9.00 ratio 3.3:1
Partial exit at 1/8th always an option, move stop to at least break-even and trend the balance toward 0/8th.
* 2nd chart adds FCT plot (times are GMT+2 hours):
A = Dec 20th 16:00 low 1635.20
B = Jan 2nd 16:00 high 1694.20
C = Jan 4th 12:00 low 1625.40
For next few candle periods, the -50 mid-channel is at the 2/8th where we would wait for SELL entry.
Alternatively, or in addition to above, trader can wait for a potential revisit of the low at the 0/8th MML, for bounce trade up. The slope down provided by the FCT plot enables stop-loss options at that Plot Line A-C.
Cheers