Looking for my next Forex trade
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Just got my AU short entry. Let's see what she does next. This will be my first time catching an entry right at the 71.6 on a Wave 4 termination move.
Maybe this ACAD chart will give you some idea of what UCAD is going to do. They do track together to some degree but the Aussie portion means it doesn't really correlate well with UCAD.
Right now, the Wave 4 retrace on the TDI seems complete as price action has just gone sideways in this ledge.
A break to the downside with such a shallow consolidation after the first drop off of the highs is likely to see it go straight down to the FE 100 but the FE 61.8 is still always a good target to shoot for initially.
UCAD has a really confusing wave count Jav on the lower time frames but I'll do my best.
The weekly, daily and 4 hour are all I've been able to put any kind of decent count on so far. Here are the 3 charts, weekly first, then daily and then 4 hour. The lower you go on the time frames, the more confusing the count gets. It's best to just stick to the large time frames on this puppy.
The daily basically shows that Wave 3 down is complete but it hasn't bottomed just yet. We've gotten an initial move up on the daily after the 3rd wave bottom but it still has to come back down to retest the TDI lows.
No, the Wave 3 are the large candles that occur before the ledge consolidation occurs, Qui. The consolidation that we call the ledge is just what happens initially after the large candles. They occur while the market is dealing with what just happened. Most likely, ledges are formed during some profit taking. Then, the next move sets up.
I actually just posted an ACAD 4 hour chart for Jav. The big red candles during the drop would be considered the spike. The sideways channel that has happened since then would be the ledge.
Here's the hourly chart again with the detailed wave count on ACAD. Notice where those big, high volume downside candles popped up...during Wave 3, which is normal in a TDI count. The entire downward movement is considered a single spike. It's only when the ledge pops up (consolidation) that we can say that particular spike is finished.
Now, it's going sideways during a Wave 4 movement. This is one Wave 4 movement that may not make it back up to the 71.6 fib. It may consolidate right in here and start falling again. Once it breaks the ledge to the downside, the drop should continue.
There's another name for this type of setup. It's called the drop-base-drop configuration. It's where the market experiences a sharp drop but shows very little bounce afterwards. Those patterns normally occur in 3's before any type of meaningful rally can take place.
And here's another interesting note...not only is this ledge important now, it will also be important in the future when price eventually moves back up to revist this area. Price action tends to stall on retests of these key ledge areas. And, if the retest happens during a Wave 4 completion move on the TDI, the chances of a big downside drop are really good.
That's always a good bet Jav. But with that really bearish daily candle yesterday on ACAD, I think we're do for a good bit more downside once the TDI count advances a bit more.
The 4 hour ACAD chart shows a class spike and ledge setup and the TDI count is currently sitting on a Wave 4 retrace, getting ready for Wave 5 down.
What I'd like to see at some point soon is a break down of that ledge to the downside and then, later on, a retest of the ledge to short it again.
Good job Jav!
I'm waiting on a bit more on the ACAD retrace before I add to a short position I already have running.
We're working on Wave 4 right now. I can count 5 waves up in the current progression but the minor wave pullbacks can actually service to drive it up higher.
Waiting patiently to see if it gets hit...looking for a move to 1.0005.
GJ 4 Hour Chart Update
There's an alternative count at work here that's gonna make me take profits earlier than expected.
Wave 4 needs to retrace to at least the 61.8 to be a valid setup so I'm looking to get out just above the 61.8 retrace. That'll give me a TP of 158.
The low end shows a possible hit at 157. So we may need to look for longs around the 157 area. Have to wait and see how it plays out.
LOL! Heck, I pass on trades all the time Heavy and then kick myself in the butt later.
Too many trade setups and not enough time or money to watch em all.
I hope if we get other folks on the board looking for these setups, we'll be able to make lots more money. The more eyes, the better.
I'm leaving it up to you to train them on the spike and ledge setup. It's your baby...LOL!
I'll work to confirm the spike and ledges with the TDI counts since that's my cup of tea.
Together, we're gonna beat the crap out of the retail trading industry.
Took 102.8 pips profit on my GJ flipper position I opened earlier near the highs. Holding the other 2 trades for my 156 TP level.
362.7 pips profit for the day so far. Got the new public account moving in the right direction now.
https://www.myfxbook.com/members/nettechs/waves/1539708
ACAD Hourly Wave 4 Example
Here's a smaller one that happened earlier Qui. I was actually in this trade but I waited too late to enter and I was expecting more downside. But the overall trend was up so it only made it to the FE 61.8 as expected.
Minor Wave 4 count peak coincides with the entry level at the 71.6 retrace. Notice the really big red bear candle that popped up on the first move down earlier. That's a Wave 3 move.
The characteristics of Wave 3 is that is almost always involves high volume candles. When you see big bull or big bear candles in a given direction, you can pretty well bet that's a Wave 3 movement somewhere in the count.
That's a key part of the spike and ledge setup. Once you see the video, you'll understand how that ties in with the Wave 3 TDI rules list.
The characteristics of Wave 3 is that is almost always involves high volume candles. When you see big bull or big bear candles in a given direction, you can pretty well bet that's a Wave 3 movement somewhere in the count.
That's a key part of the spike and ledge setup. Once you see the video, you'll understand how that ties in with the Wave 3 TDI rules list.
Same deal, Jav. Always keep an eye on the large time frames first to keep the bigger picture in mind...at least on the daily chart.
But the setups occur all the time on lower time frames. I'll post another example here in just a sec...
Yep, Heavy's contribution was extremely valuable in helping to nail these Wave 4 entries, Qui.
This will also help with the counting from a historical point of view. If you can identify those 71.6 retraces on a chart, chances are good that's a Wave 4 termination point with a Wave 5 afterward that travels to the FE 61.8 or the FE 100.
Once you label the Wave 4, the rest of the count becomes much easier.
Here's a UJ 4 hour chart with the same setup, Qui, but this is what a long position Wave 4 looks like. Since this one was considered a counter trend move, a TP at the FE 61.8 was about all that was expected.
It just missed the 71.6 level by a small amount before moving back up. The easiest way I know of to trade these is to take the trade right at the 61.8 with expectations of a hit down to the 71.6. That's usually only a very small difference.
Popped the FE 61.8 head on before tanking.
And here's the same AU 30 minute chart to show what happened using the FE tool. It dropped to the FE 61.8 very quickly and then moved right on down to the FE 100 without batting an eye.
So if you had entered at the 71.6 fib retrace using the TDI Wave 4 as a guide, you would have only experienced 5 or 6 pips of drawdown at most before price moved to your targets.
AU 30 Minute Chart
Yet another example here Qui.
Yes, in the case of these Wave 4 peaks with the expected hit at 71.6, your stop would go above the last high on the chart. So in the case of this AU 30 minute chart, you would have risked a little over 20 pips on a stop loss and your TP would give you 40 pips average. So basically, it's a 1:2 risk to reward ratio.
Same setup. Wave 4 peak and the 71.6 got hit...went about 4 pips over and then dropped like a rock.
GJ 4 hour candle about to close with a bad case of ugly attached to it...LOL!
Man I love this setup.
It occurs multiple times per day on pretty much any time frame you look at, Qui.
Take 5 minutes...watch the video. It's well worth your time. I've posted several example charts, especially from last night, showing how the setup looks in real time.
I noticed that too on AU last night. Even the small spike and ledge formations on the small time frames seemed to have relevance. Pretty neat stuff.
Here's one I'm watching for a short entry now, Qui.
The TDI wave count shows that we're in a larger 3rd wave down and we're working on a minor 4th wave retrace.
If ACAD manages to get back to that dotted red line, that will be the prime short area for a Wave 4 retrace at the 71.6 fib.
The TP would then be a minimum of 0.9902 and more likely a TP of 0.9850, give or take a few pips.
I just posted another example on it Qui on the NJ daily chart. It retraced to the 71.6 level which seems to be very common on the Wave 4 peak setups and it's dropping like a rock.
The combination of the TDI waves, the spike and ledge, and the 71.6 fib retrace is gonna help us nail our trades almost exactly with very little drawdown in the future from what I can see.
That's part of the spike and ledge pattern Heavy brought to us. Technically, it would be a stop loss on the trades. Watch the video and you'll understand it better but basically, it's just a box drawn around the consolidation area highs and lows after the last big drop. Once the consolidation area gives way to the downside, a box drawn around that entire area gives you an idea of where the next area is to short it.
Very good point Heavy.
There's a couple of old sayings that I like to use when trading...
"Everyone else can keep the top 20% and the bottom 20%...just give me the 60% in the middle."
"If IFS and BUTS were candy and nuts, we'd all have a Merry Christmas."
Food for thought...LOL!
The spike and ledge setup that Heavy describes is a good way to trade, Qui. And it validates the TDI wave counts very well, so they both work hand in hand from what I've seen so far.
Did you watch the video that Heavy posted on the spike and ledge? If not, you really need to see it. It's only about 5 minutes long and it really gave me a lot of insight into the TDI wave counts. It solidified what I was already seeing on the charts.
Here's Heavy's post with the link to the YouTube video on it.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=121081601
It's all a learning curve, Qui, even for us salty old dogs...LOL! The larger time frames are still the best by far to trade from overall. One problem I've had is that I keep going back to the smaller time frames and losing sight of the larger TDI wave counts. The big ones are really all that matter in this game. So if we take our trades on the daily and weekly charts, we'll get some swings but the orders will be light enough to where those won't bother us so much.
Yep, another HOT list item checked off the list. That's one of the reasons I added at 162.35.
Geez, EA still kicking here. Now up over 300% on ADR...wow! Definitely gonna find a retrace later for the larger move up. There will be one before it hits that upper level. This is only the beginning of the minor Wave 3 up on the weekly chart.
TP on the GJ shorts adjusted up from 155.50 to 156. I'm quite sure I'll bail out earlier than that though because I have chicken feet...LOL!
Yep, that there is.
GJ hourly candle going severely bearish here.
One thing I still haven't figured out yet. Wave 4 retraces almost always go to an area right in the middle between the 61.8 and 78.6 retraces. They don't stop at one or the other for the most part.
The GJ here is a classic example. This seems to be a constant with Wave 4 TDI patterns for some odd reason.
Closed out my other too-early EA long or a few pips here on this burst up. I'll be looking for any retraces later to get back in. A big move up like this is usually met with some kind of kickback.