Market Rhythm

The market has a rhythm that if recognized can make trading so much easier. It is

something that must be learned over time and take a while to master. But when that is

achieved the resulting effect on trading is enormous. So look at the next video and make

sure you understand the concept. That will also help you to stretch some profit targets

when trading the MLTS. You can set the moving average as the profit target if that is

better then the Secondary level Profit target. When the secondary level profit target is

breached the moving average according to the market rhythm will then be the next target.

Please copy this link to your browser to play back your recording:

http://www.gatherplace.net/play?25198708

Recording Name: 4Hour Rhythm

These videos are not part of the selling price but were added as a bonus. They

are hosted on the www.gatherplce.net servers and are therefore depended

on their server availability as well as server loads. Check your firewall

settings in case of difficulty viewing. We have found some overload at times.

Just try again. Sometimes the video starts without voice. Just exit and retry

again. The videos have been tested and they are working when all is going well.

SOME CAUTION

I have to tell you this. The smaller the timeframe is used the more false breakouts

occur. As we are trading breakouts in the direction of the overall market condition

the smaller the timeframe the more percentage false breakouts occur. I have

spoken to some hedge fund traders and they do hunt stops. That is what I have been told.

There is however a very good way to trade these false breakouts. I will show a few. If this approach is traded the success rate is very high although much less trades.This is how it works.

1. We don’t take any breakout trades. We wait for a pullback into the pattern (in

our example a triangle) and enter at point “a” with our stoploss at point “b”.

2. The stops of those that took the breakout trade is normally at point 1,2 or 3

depending on how aggressive or conservative they approach the trade.

Sometimes there will only be one stoploss place and sometimes there will be

two. We will look into some examples later on.

3. Our take profit targets is set at those stoploss places that are under attack.

4. Our Risk:Reward ratio needs to be at leas 1:1.2 minimum.

5. First determine the stoploss size and then determine if we can get a R:R ratio

that is better then 1:1 to the stoploss placement of those that took the breakout trade.

6. Secure a breakeven situation as soon as 50%-60% of profit target is reached.7. If the speed is quick and it goes on then ride the tide or take some profit after  50%-60% and give the remainder a chance to ride. Waiting for a news announcement and there was an attempted break to the

downside before the news and must not be seen as a false breakout but rather an attempt



to get the trigger happy to enter before the time. The real breakout came at the black



arrow with the stops most likely at no 1, 2 or 3. Then the price retraced back into the



pattern with our entry at “a”, stop at “b” and profit target at “c”. Stoploss 2 and 3 falls



outside our 1:1 risk/reward ratio therefore we only have one profit target and that is at



stoploss number 3. Look how the price tested the upper trendline exactly and then break



the bottom trendline. That is now the correct direction as the hunting was over and now



you can enter and use the gain you made as a stoploss.



That was a 25pip up gain and a 30pip down gain.

Profit target was reached with the Multi Level System as discussed.

Look at this setup. 25Pips trading the hunting and 40pips trading the MLS after the true



breakout.



Another handing out of balls just to collect them again. They can see the depth of



orders and they knew that there were some orders at the bottom of the channel and



price will always move to where the demand is lying. They were not worried as there



stops are way below the bottom channel. If you see something like this on a 4Hour chart



you know that there is something big coming and you can position yourself to take
advantage of it.

Look how there was two attempts of a breakout at “Z”. Stops was most likely at

“X” and “Y”. There were breakout orders picked up on 2 occasions and both stoploss



levels were taken out. That was a golden opportunity to get some hunting pips in the bag.

Lets see it on the 15min timeframe.

1hour chart

False breakout to the bottom and then a true breakout to the top. +90 Pips.




Caution



Look for patterns that has some sort of length in terms of candles. Don’t use a short



pattern formed over only a few candles. Give it a fair chance to build up.

This pattern on the 15min chart is worth 13pips so don’t even consider it. Make sure you

have enough pips to have a fair chance and if there is a lot of emotion build into the



pattern formed over some time. There is no rule to determine that. With time you will see



the building up and know that they might do some shaking out. If you spot one on the



1hour it is worth looking at it on the 15min as your secondary level setup and take it from

there trying to get the hunting portion as well as the true breakout part.

READ MORE - Market Rhythm

1min strategy Attacking Support and Resistance

The Method:

The main aim of this strategy is to allow the user to use
1 min strategy price chart and enter at predefined areas determined
when the trader starts his/her day of trading on different
currency pairs.
This 1 min strategy ASR strategy (ASR-Attacking Support and
Resistance) has the advantaged that those areas will be
known beforehand and is only entered when the specific area
are approached and the setup criteria is met.
The amount of pips obtainable with the ASR are in the region
of 10-100pips depending on the strength of the move
especially when it is news driven. The trader will also know              when to close the trade.
This also fits nice into the MLTS as discussed up to now. If
you have missed a trade in the MLTS you can always
captures some pips as the price moves towards the Profit
Target using the1 min strategy to attack that level. The main thing to
take into account is that the Risk:Reward must never be less
then 1:1. As long as that ratio is maintained you will make
money.
Never use more then 1,5% of your capital as
risk with the 1 min strategy ASR strategy until you are
comfortable trading it.This 1min strategy also satisfy the need for trading. We are human and

when we sit to trade we want to trade. Patience is one of the destroyers of an
account. We don’t want to wait so we look for trades and get burned more
then often. This 1 min strategy gives us the opportunity to satisfy that
need while our risk remains small enough not to get wiped out.
This strategy is exactly what the title is saying. It is all about
determining some support and resistance levels and then to attack
those levels. It differs in the sense that we are not going to trade off
the support and the resistance but rather towards them.


That means that we are going to determine before the day


starts where support and resistance is likely going to occur. Then we mark a


price range 30-50 pips away from the support/resistance.


What we are then looking for is for the price to move into that price range


and then we look at the 1 min strategy chart to enter at a certain setup we will discuss


later on. We then stay in the trade and exit the trade according to the rules as


explained later.


We are going to use a 4hour chart to determine the support


and resistance levels that might be tested and then mark our areas,


then change to the 1 min strategy chart and WAIT for action.


All indicators used is standard indicators found in most


software used for trading Forex. We can make use of an alert setup


to warn us when the price is nearing the marked area so we don’t


have to be in front of the computer all the time. We can be in the


vicinity doing other things and only draw closer when the alert goes


off. We then watch for the setup and finish the trade according to the rules.


We also don’t want to overtrade by watching to many pairs and


entering to many trades. I have only used the EurUsd and the


GbpUsd and I will decide on one of the two when the trading area is approach.


Sometimes the EurUsd will be there first and sometimes the GbpUsd first. I


have tried to only trade 3 trades per day.


You as a trader may test this on any pairs you would like to trade as the


support and resistance levels works the same for all pairs.
The INGREDIENTS:



On a 4H chart plot the following Moving Averages


1. 200 simple moving average


2. 89 simple moving average


3. 21 exponential moving average


On a 1 min strategy Chart plot a 34 simple moving average

 
 
 
 
 
 
 
 
 
 
 
 
 
If you haven’t watch the video yet please do so now before going



further.


Please copy this link to your browser to play back your recording:


http://www.gatherplace.net/play?25198708


Recording Name: 4Hour Rhythm
THE METHOD:



Now for the method to determine the support/resistance we


must understand the role the 3 moving averages are playing in the


4Hour timeframe. You will find that the price is finding support and or


resistance on and against these moving averages quite amazingly.


Lets look at some examples of it.

 
 
 
 
 
 
 
 
 
 
 
 
 
If you look at the chart you will notice how many times have the price



moved towards those moving averages. This is where the key to this


strategy is nested. Because the price is going to those moving


averages very often we can mark a price area 30-50pips away from


those moving averages and then use the 1 min strategy to enter a trade with


our initial profit goal round about the moving average. At this stage I only


want you to see the potential of the price moving towards those


moving averages as I have not marked everyone on the chart included.


The idea was not to show every move towards


support/resistance in the examples but rather to gave you the idea of


the concept.


Lets do some more examples
Example 1:



Here you can see that the price is moving towards the moving averages


quite often in a span of 4 weeks. That creates opportunities for trading


using the 1 min strategy ASR strategy                    
 

 
 
 
        











Example 2:
Here is a video link to the 1 min strategy ASR strategy that you can watch
Please copy this link to your browser to play back your recording:
http://www.gatherplace.net/play?47083658
Recording Name: 1Min ComboBox

Lets look at areas marked A – F individually.

A. The downtrendline was broken and the odds were good for


the price to move towards the 21ema creating an opportunity


for a long trade


B. When the price reached an area with the price rising just


below the 21ema the signal candle as well as the previous red


candle had tails on them creating a possibility of a retest of the


21ema. An area of 30-50 pips could be marked for a possible


trade.


C. The price formed an inverted red hammer and when the price


moved above the high of that hammer (brown horizontal line)


the odds were high that the price might move up to the 21ema


once again creating an opportunity to trade.


D. After a huge bullish candle the odds were high that the 89sma


might be tested creating yet another opportunity to trade.


E. With the price moving above the 89sma we know that the


price very often comes back to retest the 89sma and when that


tail was busy forming the odds were good that the 89sma


might be tested creating 1 min strategy ASR trade opportunity.


F. Here we had a doji candle as well as a shooting star


indicating a possible downmove which creates ones again an


opportunity for an ASR trade down to the 89sma.


By now you must have grasped what there is to look for when


using the moving averages as support and resistance and the


marking of the areas.


It is very important also to recognize the candle emotion prior to


the signal candle like hammers, morning/evening stars,


shooting stars, bullish/bearish engulfing etc. to determine the


intension of the move to go the way as anticipated.
Sometimes there are barriers for the price to overcome to be able to



reach the desired moving average as anticipated. And they are equal


price levels like 1,3500--1.2900—1.4000 etc. They play a major role as


the price will try to find support and or resistance at those levels as


well. When these price levels are in the way to a moving average the


trader must take that into account that the price might turn around at


those levels or stay there for some time before getting direction again.


Therefore when in a trade then take caution by either securing a non


loss situation by moving the position to breakeven or move the


stoploss to a profit exit at least should the price turn around.


Another barrier are trendlines. Trendlines of supp/res in the way to a


moving average must also be taken into account. Those trendlines


also act as possible profit taking zones. Trendlines is also


oppertunities for some ASR trades.

Look how trendlines can be used to marked areas for possible ASR

trades. Points 1 to 5 is necessary for the trendlines to be defined and


cannot act as possible areas.


See if you can spot some other areas around the different moving


averages as discussed previously on this same chart and see for


yourself how many opportunities does occur and if traded how many


trades can be made.

In the next chart the areas was marked and we will look in more depth

what happens on the 1 min strategy chart at those levels.

At area marked A you can see how the price is interacting at the price

levels before getting direction. Thos red marked areas


But here we have another opportunity coming our way and that is if the


price have a high probability to move to the 4Hour 200sma and


there are some price levels in between we can marked those areas


just as the chart below indicates giving us another 1 min strategy ASR


entries.

                                    4 Hour Chart As you can see that the price went

down to the 200sma on the 4Hour


crossing 3 price levels each one


creating an opportunity to have a


1 min strategy ASR trade. The last 30-50


pips approaching the price level


are ideal to have an area marked


as indicated on the 1min chart


giving as ASR trade


opportunities.
At area marked B you can see how the price is interacting at the price



levels before getting direction. That red marked area

A lot of pages just to get the concept of the areas under the belt.

But now we come to the meat of the 1Min Attacking Support and


Resistance levels and that is the Entry, Stoploss and Exit rules.


Entry, Stoploss and Takeprofit:


The entry is based upon an old entry method called the 123 method.


When the price are at the marked area we start to look for a 123 setup to


form and enter the trade on that bases.


As you can see on the chart below that in a 123 setup point no 3 must be


lower then point 1 for a short trade and the price have to surpass point


2 for point 3 to be formed. Entry is made when the 1 min candle closes


below point 2. Take profit depends on the speed of the market but the


34sma acts as a very good place to close the trade should it being


breached.

Price have to surpass point 2 for point 3 to be formed

Quite surprised that the meat of the system is merely one page. The whole

success of the method is the determination of the areas and needs


some practice.


The entry, exit and profit taking setups for a long entry is just the inverse


of what is described on previous page.


We will now move to some examples of trades and areas marked.


In the example below the anticipation was for the price to bounce off the


bottom trendline and to go to the 21ema on the 4Hour. That area is


then marked on the 1Min chart as indicated on the right hand chart


and entry was made according to our 123 method and take profit was


when the price crosses below the 34simple moving average.

 
Some more examples of entry, stoploss and exit trades.

 

The following few pages will show some areas marked as described



combining moving averages, trendlines and price levels.

Conclusion:

As you can see that by premarking the trade opportunity areas there is


plenty trades to be made on a weekly basis.


This 1min strategy also satisfy the need for trading. We are human and


when we sit to trade we want to trade. Patience is one of the


destroyers of an account. We don’t want to wait so we look for trades


and get burned more then often. This 1min ASR strategy gives us the


opportunity to satisfy that need while our risk remains small enough.


Now that you have worked through this you can see how this method can


also be used to Premark the areas using the Fib retracements and or


extensions on the 4Hour and even Daily charts as discussed on the


MLTS. There are plenty of opportunities to trade this method.

READ MORE - 1min strategy Attacking Support and Resistance