There are a number of pairs evidencing the above structure—where the daily trend line is reversing direction to realign itself with the weekly trend line. They include NZDPY, which is turning south at 69.44; NZDUSD, which is doing the same thing at 0.6579; EURUSD at 1.1728; and EURAUD, which is turning north at 1.6493 The pairs I'm actually attempting to trade are AUDJPY, AUDUSD, EURJPY (all hooking south) and USDCHF, which is turning north.
Of the four pairs I decided to trade, at this point, only USDCHF has begun to follow through on heading in the anticipated direction. So, I have pocketed the gains it's offered thus far in case it turns against me, and reentered a long position.
EURGBP has finally been falling over the last five hours, but I made a mistake when I identified the yellow moving average—it is primarily the maroon moving average that fills the above-described role. EURUSD has also made a big move. Too bad I didn't select this asset instead of AUDJPY or AUDUSD.
If I wish to collect profits on a daily basis, better that I stick to intraday trades on lower time frame charts.
Yes, go straight back to this methodology! CAN I MAKE USE OF A WEEKLY BASELINE? No, you cannot. There is way too much "play" in price action once you go this far out within the temporal context for you to be able to plot an accurate course relative to the (larger) units of distance involved.
BE IT RESOLVED: I have recently switched my take on the Forex market so that I now view the two-hour price flow (i.e., the domain within which the values of a given asset are likely to fluctuate within a specified window of time) rather than the four-hour price flow as the framework on which hangs, or as the foundation on which is constructed, the typical intraday behavior of currency rates/pairs. Not two-hour charts mind you, but the two-hour price flow. I conceptualize it as akin to the backbone of the Forex realm, around which the rest of the market "anatomy" unfolds or develops. I have also come to regard day trading Forex with optimum success as analogous to microsurgery, best performed using one-minute charts and possibly even lower time frames (if available) due to the required level of precision and attention to detail. The goal is to apply principles similar to those associated with the numerical weather prediction used by meteorologists to forecast weather. Accordingly, as is the case with the latter, Forex market forecasts are significantly inhibited by intrinsic predictability limitations that lead to error growth with time, further recommending the use of the shortest time frames possible. So then, one might gather that the level of accuracy attributable to a given market forecast is also governed by the (Christian) principle of subsidiarity, which holds that operations conducted in immediate proximity are accomplished with much greater efficiency and efficacy than those handled more remotely. In the case of Numerical Price Prediction (NPP)—the trading system being referenced here—an 85% daily success rate or better is the goal, with a 5% diurnal return on investment (ROI) being ideal while still abiding by the 1% rule with respect to risk/money management. Again, the focus is on a temporal context that stretches from one minute to two hours. And whereas the general intraday price flow is suggested by the two-hour baseline, it is believed that the more immediate direction of the intraday trend is communicated by a 30-minute moving average. So then, other than when there is a full-fledged reversal in two-hour price flow, the most profitable setup follows pullbacks where the slope of the two-hour baseline had been pointing in one direction and the slope of the 30-minute baseline had been pointing in the opposite direction, provided a position is entered as the 30-minute baseline reverses direction to realign itself with the trajectory of the two-hour baseline. Moreover, generally speaking, a successful trade can also be made when the short-term trend adopts a temporary trajectory headed in the direction opposite the slope of the 30-minute baseline (especially if the 30-minute moving average is also aligned with the slope of the two-hour baseline), but then reverses direction to rejoin the 30-minute moving average. Hence, a trader should be monitoring the slope of the 30-minute baseline and noting when the short-term trend is going out of and coming into alignment with it. And at least one other potentially profitable trade setup consists of entering short positions when rates reverse direction after having climbed above the typical 30- and/or 120-minute price range, or entering long positions as rates reverse direction after having crawled below the typical 30- and/or 120-minute price range. So, in compiling a checklist based on the above, let's start with the following: Are the 30-minute and 120-minute baselines on the same, or opposing, trajectories? What is the positional relationship of the 30-minute baseline to the 120-minute baseline (is it above it or below it)? How much distance is there between the most recently formed candlesticks and the 30- and 120-minute baselines? Can you identify a pullback in the short-term or 30-minute moving averages? Friday / October 2, 2020
So then, rather than trying to memorize a checklist, just ask yourself these four questions: Do you see any pullbacks—at whatever level(s)? Where is each moving average located in relation to all the others from a positional point of view (above, below, or on top of)? What is the slope of each moving average/trend line (up, down, or basically horizontal)? Where are candlestick painting (located) in relation to the 30- and 120-minute price ranges?
As I continue analyzing how to best trade the NPP system using its recently "settled" configurations, I'm almost regarding daily analysis, at least for the moment, as just about entirely pointless. The price action I anticipate taking advantage has virtually nothing to do with where an asset is headed from day to day. If I continue to feel this way as I trade throughout next week, it's going to free up a significant amount of prep time to do other stuff from now on.
END OF THREAD My contributions to this thread/journal are over in that I've determined daily analyses with respect to this intraday approach to Forex trading are not truly relevant.
Interesting. I think there are some similarities to my approach of predetermined levels in that they are determined using technical and statistical methods, but I only take intraday movements based on them, even though they are derived from longer timeframes. No indicators used though.