Price Action Swing Trading - The PAST Strategy

Discussion in 'Trading Systems and Strategies' started by Nigel Price, Jul 1, 2013.

  1. Nigel Price

    Nigel Price Master Trader

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    Hi Basil, thank you very much for your kind words. Indeed, if I find myself around Waterford I will certainly call in, Curraghmore looks spectacular.

    Yes, if we keep focus on the long term charts we are giving ourselves the chance of participating in a large, protracted move. But we want to do so with exposing ourselves to the smallest risk possible. Measure reward on the long timeframe and risk on the short timeframe. For someone who has less time to spend on the charts, combining the weekly/monthly timeframe with perhaps the 4 hour or even daily charts, would be ideal.

    As far as EUR/AUD is concerned, well it was looking very promising early on in the week, as it was falling sharply. However Bernanke managed to reverse trends across a lot of markets and EUR/AUD was not exempt. The move in EUR/USD in particular was astonishing.

    The weekly candle on EUR/AUD, as Basil says, finished as a bullish one, closing near the highs. It does have a long wick to the downside however, which indicates indecision. Although I still think that EUR/AUD is a good candidate for a fall soon, I would prefer to see more evidence of a reversal on the weekly timeframe first, before trying to short it.

    Good luck for the coming week.
     
  2. Nigel Price

    Nigel Price Master Trader

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    Hi Olu - thanks for the comment.

    Absolutely, last week's price action was characterised by dollar weakness across many markets. USD/CAD and USD/SGD (although I have to admit, I have never traded the Singapore dollar) have both posted weekly bearish reversal candles, so if we were going to trade these markets the price action suggests we should be doing so to the downside.

    The only caveat I would add is that the weekly preceding trend isn't very long, only three candles in the case of USD/CAD, but then again no signal is perfect.

    USD/CAD actually would be my second favourite instrument for the coming week, I think personally I will be considering some longs in Gold this week (again, dollar bearish).

    I just took a look at USD/CAD to see if I could get a good trendline - maybe something like the one below perhaps? Let's see what happens during the week anyway.

    All the best
     

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    Last edited: Jul 14, 2013
  3. Olu

    Olu Master Trader

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    UsdJpy

    In my scanning I came accross the usdjpy. The question here is how long should the 4hr trend line be? What do you think about this trade idea?
     

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  4. Nigel Price

    Nigel Price Master Trader

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    Very nice Olu, spot on!

    As we can see, the dollar lost a lot of ground right across the board last week.

    Do any of us know whether the weakness will continue or not? No, no one knows, and anyone who tells you that they do know is pulling your leg.

    Trading is a probability game - we suspect that price might go in a particular direction. If it does, we make the most out of it. But we must always be prepared for the distinct possibility that price will move against us. It happens all the time. When it does, we must be prepared to go on the defensive and lose as little as possible.

    That is the real skill in trading. Too many people think trading is about predicting direction successfully; it's not. It's about managing risk.

    Olaf, say for instance you play USD\JPY to the downside this week and for some reason the yen weakens a lot and the pair rises. Your job in that case is to recognise that it is happening and take steps to control your exposure - i.e. keep any losers small. If your trendline breaks this week and the USD/JPY subsequently collapses, your job is to make sure you keep any positions you have open for as long as possible.

    Good luck for the coming week.
     
    Last edited: Jul 14, 2013
  5. Olu

    Olu Master Trader

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    usdjpy

    the markets have opened and this is the closeup of the 4hr usdjpy and a structure I was asking Nigel about.
    A break below the upward sloping line will be good. However there is support around 98.20. If that is overcome then even better
     

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    Last edited: Jul 14, 2013
  6. fortunatus

    fortunatus Trader

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    Hey Olu,
    The trend lines are well drawn; Of course anything is possible in forex, but dont you think that dropping down to the 1 hour chart on the usd/jpy pair, there have been so many bullish consolidating pattern?. Coupled with the fact that there was a large 2 bar reversal that formed earlier on the weekly chart. While nothing is certain, I would rather go for the Gold, even if the trend is not completely reversing, we can still make something out of a healthy retrace, while i watch how the usd.jpy plays out since what we are seemingly looking for is the big gain. Too much indecision on USD/JPY for me now.
    your opinion would be appreciated, we learn everyday.

     
    Last edited: Jul 15, 2013
  7. basilc

    basilc Trader

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    USDJPY

    Good morning all from Ireland,

    Like Olu I too have been watching USDJPY. After exiting my short position for a 65 pip profit when the market began to retrace on Friday I set an Alert to re-enter if and when the 98.00 support level is breached.

    For what it's worth my view for this pair is to head South to 88.00 medium term and to 82.00 long term.

    Sláinte,

    Basil
     
  8. Olu

    Olu Master Trader

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    Idea abandoned. Usdjpy showed strength not weakness as I was expecting. Thanks all for all your comments

    OLU
     
  9. Nigel Price

    Nigel Price Master Trader

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    Hey Olu,

    If you look at the weekly chart, the bearish reversal candle on USD/JPY is still very much in play - it has completed approximately a 50% retrace which is entirely normal.

    Maybe watch out to see if price falls down to the trendline at a later point during the week and we'll see if it breaks then. I wouldn't totally count out the bears just yet, it's only Monday afternoon. Maybe they had a hard weekend ;)
     
  10. Olu

    Olu Master Trader

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    Hi Nigel Thanks for your comments. I agree with you to take on board that its only monday in this new week. I will keep an eye on this one as price rallied but is now showing signs of weakness.

    The US$ appears to be showing weakness and we could be in for more downside despite the early strength observed. I will post the chart on usdsgd which appears to be clearer

    Olu
     
  11. Olu

    Olu Master Trader

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    UsdSgd

    weakness?
     

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  12. fortunatus

    fortunatus Trader

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    Weakness? Well, I kinda think so, Hope Nigel would give is Opinion on this. I'd be looking at USD/CHF, cos of its lesser spread. Hey, how do you place your entry orders, is it the break of the trendline or a retrace?
    Thanks


     
  13. Olu

    Olu Master Trader

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    Thanks Fortunatus

    I enter on a close below the trend line on the 4h chart. Usdchf is good too but for some reason I missed looking at that one. The $ is taking a beating today generally.
     
  14. basilc

    basilc Trader

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    Hi Nigel,

    Your call on GOLD was spot on. With strong green candles above the 1H trend line I entered the market at 1286.9. Two hours later its heading North admittedly somewhat sluggishly, but I'm in profit with a nice tight stop loss.
     
  15. Olu

    Olu Master Trader

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    PAST In Action

    Find below 2 trades that are working. Even the usdjpy I abandoned is coming back
     

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  16. fortunatus

    fortunatus Trader

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    Very true Olu and thumbs up with the updates,
    I also missed the usd/cad cos i was managing other trades. Right now, im expecting a retracement on a lower time frame, since the candles have been consecutively bearish on the 1h tf, I'd expect price to take a rest; I hope i'll get my way in with the throwback. What about you, any plans?


     
  17. fortunatus

    fortunatus Trader

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    Where art thou

    Mr Nigel, where art thou?. Your trading Fans' are running things here. Where's our evaluation card?:D:D:p:p
     
  18. fortunatus

    fortunatus Trader

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    Dear,
    I think we still have Ample opportunity to enter the USD/CAD trade, this is how i see the chart

    [​IMG]
     

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    Last edited: Jul 16, 2013
  19. Olu

    Olu Master Trader

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    Hi Fortunatus

    I am short the usdsgd. Now watch the usdjpy go. I will post a chart on it. By the way all most all the pairs have the weekly low to contend with now

    Olu
     
  20. Olu

    Olu Master Trader

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    UsdJpy Price Action

    I abandoned this trade yesterday. Price went up and has now cone down to break an extended uptrend line
     

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