Jump to content

trend break identification

Recommended Posts

Hi, @Nelsy-Boy, like I say, I prefer more than one confirmation. The trend line break is the "heads up" , with something this fast , I prefer some of the MAs to be on my side. If price crosses back over them , I know I'm wrong. The 150 EMA is my favourite, for me that usually confirms a change in trend

  • Thanks 1
Link to comment

@TrendFollower,as most of @elle's charts are tick based it is useful to consider the differences between tick and time based charts. 

The x tick charts are not time based at all, like the old ticker tape a tick is notched when a deal is done (contracts traded) so a 200 tick chart means each bar signifies 200 contracts traded but does not reveal the size of the contracts (price roughly does that). So if you look at a x tick chart timeline you can see each hour span is of a different size depending on the number of contracts traded within the hour. During high volatility many bars are stamped within the hour while during low volatility there are few.

This means overnight the hour intervals are tightly packed (fewer bars with fewer contracts traded) while through the day they are expanded (many bars with many contracts traded) so the x tick chart is more indicative of actual price movement negating time and so negating long periods of sideways movement which encourages/demands the inevitable MA lagging that is associated with a normal time based charts during periods of low volatility. 



Link to comment

In view of the previous comments, I would like to say the following :-


I have taken time to study different assets and the way they move and have found that " one size does not fit all"  . An FX pair will move differently to say an individual stock in any given timeframe. Also different types of Technical Analysis work differently in different types of markets. For instance , I have found that Moving averages work better in trending markets ( using them as support or resistance say ( Facebook one minute chart is shown as an example)) whereas they are not so good in tight range bound markets. Conversely oscillators that range between zero and 100 can be useless in trending markets ( they can stay "overbought" or "oversold" for long periods of time), although, they are good for spotting divergence.e

It is essential, in my opinion ( and that is all it is) to be flexible. I do not hop from one set of Technical Analysis to another for the sake of it, but adapt to the market conditions and asset I am trading. 

One person once said , a doctor or someone similar spends years studying to get where he/she is & now earns good money doing their job, if you think you can earn good money trading without putting in years of studying, you're wrong.

Capture fb.PNG

Link to comment
  • 1 month later...
On 29/12/2018 at 22:01, Nelsy-Boy said:

I also trade on the daily @TrendFollower and I note you go down to the four hour chart but do you ever look lower for a tighter entry or even exit price?  Once I’m in a trade I start following on the one hour chart to try and identify the turning point as early as possible.

Hi Thanks for this useful insight. If trading off the daily chart, how do you use the 4H chart for entries? Do you use the daily for identifying trend?

Link to comment
  • 2 weeks later...
  • 3 weeks later...

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Posts

    • Sainsburys full year earnings and Unilever’s first quarter trading update both say the same thing, UK consumers are in for higher prices. The war in Ukraine, supply chain issues and the effects of ongoing Covid all to blame.      
    • US Dollar (DXY) Daily Price and Analysis US Q1 GDP may stall the greenback’s advance. A 20-year high nears for the US dollar. The multi-month US dollar rally continues with the greenback printing a fresh high today ahead of the first look at US Q1 GDP at 12.30 GMT. The US dollar basket (DXY) has been boosted by renewed weakness in the Euro and the Japanese Yen, as investors move from lower-yielding to higher-yielding currencies, while safe-haven flows continue to benefit the greenback. The US growth release later in the session is expected to show a sharp slowdown from the robust Q4 figure of 6.9%. The markets are currently pricing in growth of just 1% for the first three months of this year, with the slowdown mainly due to a reduction in inventory accrual over the quarter. This release is unlikely to move the greenback, unless there is a large miss or beat, as the Fed believe that 2022 US growth will be robust enough to let them tighten monetary policy sharply without damaging the economy. The latest US Core PCE data – the Fed’s preferred inflation reading – is released on Friday and this may have more effect on the US dollar than today’s GDP data. For all market moving economic data and events, see the DailyFX Calendar. The ongoing US dollar rally has been aided by weakness across a range of G7 currencies including the Euro, the Japanese Yen, and the British Pound. The Euro continues to battle with lowly growth expectations, exacerbated by energy concerns, the British Pound is mired by weak economic data, while the Japanese Yen is in freefall as the BoJ continues with its ultra-loose monetary policy.   The US dollar continues to press higher and looks set to break above 103.96, the March 2020 high. Above here the US dollar would be back at levels last seen nearly two decades ago. The March resistance will likely hold in the short-term, especially with month-end portfolio rebalancing at the end of the week, but US dollar strength is set to continue in the months ahead. USDOLLAR (DXY) WEEKLY PRICE CHART – APRIL 28, 2022 {{THE_FUNDAMENTALS_OF_BREAKOUT_TRADING}} What is your view on the US Dollar – bullish or bearish?   Apr 28, 2022 | DailyFX Nick Cawley, Strategist
    • While Tesla has nothing directly to do with Elon Musk buying Twitter - TSLA stock closed down 12% on news that Musk may have to sell stock and use other holdings to stand against the loan to finalise the purchase of the social media giant.        
  • Create New...