I feel a lot of you are missing the point with AHG. AHG is a tool in it's essence, a tool that allows you to profit from markets that see increasing demand (go long) and increasing supply (go short). It doesn't work when there's no enthusiasm to go long (no motive that there should be more fresh highs) and it doesn't work when there's no enthusiasm to go short (no motive that there should be more fresh lows). So, Anek showed you a way of trading the HH-HL and LL-LH patterns, BUT the knowledge of when to apply these two setups belongs to you. You need to have a framework of understanding when there's the time to apply them. Either by using a higher timeframe analisys of swing points, or by combining that with fundamentals in order to gauge market sentiment, in effect you NEED to gauge sentiment before applying the two setups forming the base AHG. Good luck.
Hi Anekdoten, your thread has been invaluable for the newbie people like myself. Just wanted to say a big thank you for creating this thread and staying so long. All good things must come to an end. One question, for the whole thread you've been using tradestation for charting and indicators. From your last post about tradestation you were thinking of moving to NT/Zenfire. Would this in your opinion be the best platform to start out now?
Hi alex.samant, I have to agree with you. Number of times, I have seen HH-HL and based on that, thinking it will go up on retracement and lo and behold, it has carried on going down. What do you use to guage the Market Sentiments? Thanks for your help.
geiseb, I sent you a PM--wanted to know exactly what that new Ensign study was that identifies hh, hl, etc. Thanks
That is a good question on how to determine market sentiment. Some days it does change from short to long. I am upset at myself for not taking a perfect setup on my forex trade last night. I waited too long, then I tried to chase it. Once I realized I was violating my rules, I killed the trade at a tiny profit. If anyone has a way to determine range from trend days, that would be good no matter what type of trader you are.
HI oraclewizard77, Well, number of issues that you have mentioned. 1. I do not know what you mean by Long to short!!! 2. Do not get upset, it is always a learning experience. Be positive and always try to find a positive statement, even when you mess up badly. It does not matter as long as you have your health (Mental and physical). 3. The market sentiment: For Index futures, they say that it is good to use TICK to determine trending/trading (Where TICK, I believe, is NYSE Adv/Dcl indicator). If this is between +400 and -400 then it is trading. The other method they state is the wilder's ADX. If below 18 then trading else trending. People vary the numbers from 18 to 30, depending on their study, I suppose. Anyway, that is what I have discovered since questioning it yesterday. If anyone knows anything different, or for that matter, in my writing then please let me know. Regards. NP.
Well, the simplest way, technically speaking is to identify major (higher timeframe) swing points and only trade the AHG when these points are "taken" by price so you know there's going to be enthusiasm... Other than that, intraday, fundamentals are optional, but they do help to form a bias, a sort of filter. So if you know your fundamentals and you believe the EUR has chances to grow because the environment for it is bullish, then you look at only upside swing penetrations and look for HH-HL in that direction, however, i feel this is overly protective and too filtered. If you used sound trade management, you could take more trades and don't have to filter that much. The combination between TA and FA, i believe J. Bollinger used to refer to it as being RA (Rational Analysis) suits higher timeframes better, like daily charts.
Thanks Alex for the explanation. What I have been doing is, one HH is ID'ed (Uptrend determined), I tried to buy a pullback. However, you are saying that it is not enough. Wait until the pullback comes back to previous H (i.e. H prior to HH) and enter at that point. Did I understand your 1st. para. correctly? The problems are two folds. 1) It may never get to that prev. H. 2), if it comes back to that then the stops may be too far away. OK. I will try to answer my own above mentioned issues. 1) This may not happen too often or one can say, 'There are other trades'. So, do not worry about the missing opps. 2) Money management must come into play for this trade. If it does not meet then pass the trade. Thanks for your help. NP.
NO. i did not say what you stated. Read my post carefully. The way anek explained is eaxctly the way you should do it all i am saying is that if you use let's say a 15minute chart for trading the AHG, it would be also nice to have a 1hour chart and note important swings up, down and wait for the market to breach them. when it does, turn to your 15minute chart and see if you have a valid HHHL pattern that you can buy a pullback at 50% or whatever...