The price move on M1 Chart (19 Pips):
Price Action on M5 Chart:
Above picture; Right is H1 and Left is M15
Reading the price action we could see that the current bearish move is the 4th wave (elliot wave), this could travel until the Resistance - 1 or Resistance - 2 (two green dash lines strike through the middle of the 3rd wave)
Above picture; Right is M5 and Left is M1
Cyrcle-1; Just right above the Resistance - 2 on H1 chart is a Demand Area on M1 Chart and right on Bollinger Band. Analyze using YTC PAT and its clearly seen the momentum slowing down (slope of the candle, deep of pullback) then a failed test to the lowest pointCycle-2; At the same time it create two hammer on M5 chart.
Cyrcle-4; Stochastic made bullish divergence
So I place 1 buy after a break of a trend line on M1, SL just right under the pin bar (about 10 pips) and TP right under the Supply area on M1 chart. SL later move to the 2nd last pullback.
Cyrcle-3; Price reach right exactly in to the TP for 19 Pips then lazily resume bearish. This is the power of Supply and Demand.
Thanks for your nice tutorial. I would like to know learn how to draw good trendline. Any recommendation tutorial will serve me better
ReplyDeleteNo worries,,,
DeleteWell, there are several tutorial on drawing trend-line either automatic indicator such as "Gan TL" which draws trend-line automatically connecting the latest two low / high no matter how strong / weak the move is. Or you can watch "Hector Trading - Trend Collapse" which is posted some where in other post here. Or else you can draw trend line by your self connecting two high / low and asses how strong and how significant the peak / trough is (more on trend line trading is here: http://trading-price-action.blogspot.com.au/2015/06/trend-line-trading.html)
But remember,,,
All of these methods (trend-line, Moving Average, Stochastic, Divergence) are tools for you to assess the tendency of the market. None of the guarantee a success of the trade. They are all, like price action trading, meant to assess the tendency of the market by averaging the most likely of the direction of the move.
There are other factors which contribute (such as Support / Resistance, supply / demand area) but the most important thing is TREND it self). Generally believed that most of the time the TREND will resume (but which trend ???)
After all, no matter how accurate we predict the market, no matter how align the assumption of the majority of traders thought which drive the price, the final direction will always be dictated by the sum of buy / sell which can be manipulated by a single trader (institutions, market maker, fund manager).
You have to understand this playing field and ACCEPT it in your trading exercise. Mature in trading is not about predicting the move more precisely, but to surf within the low and high tide while applying those skills and catching fishes.