Don`t read this thread..Make Money with it.

[SIMBA]

Originally Posted by RickW00716

I bought this book and it is GOLD!

I probably won't use all the patterns but the ones I have looked at seem to work very well.(Iuse some at sup/res areas)

Simba, I am curious about hte fractal pattern(5 bar)...one of the examples in the book doiesn't seem to match the description(page 68 to be exact)

1-Rick,

You are right,the example is not absolutely 100% as per the definition...but it is a 5BF,I hope my next explanation will help

the 5 bar fractal is either a 2-3 or a 3-2 combination of higher highs and lower lows or lower lows and higher highs...It is an extremely visual pattern,very difficult to explain(unless you use the wide definition I just wrote) and code,but easy to recognize once you have seen several of them.

The important thing ,at least in my case,when I see a 5BF,as long as it meets the wide definition,is not to be strict with the definition,but to be absolutely disciplined with the rules for entry...so,lets explain the pattern(keep in mind my previous wide definition )

1-A Fractal 5BF,consists of 5 bars,after a prolonged move.

2-After a down move a 5BF has 3 bars with higher highs and 2 bars with lower lows...or 2 bars with higher highs and 3 bars with lower lows

3.After an uomove a 5BF has 3 bars with lower lows and 2 bars with higher highs...or 2 bars with lower lows and 3 bars with higher highs

4-Rules for entry Short

4-1:After an upmove,wait for a 5BF to form(1,2,3,4,5 in the chart)
4-2:Wait for a new bar to CLOSE below the bar number 5 low:trigger bar(T in the chart)
4-3:Entry short below the LOW of the trigger bar(red entry line)
4-4:Place a stop order slightly above(3/5 pips +spread ) EITHER the HIGH of the Trigger bar OR the HIGH of the fractal formation
4-5:Target a major swing low prior to the fractal formation.

5-Rules for entry Long

5-1:After a downmove wait for a 5BF to form(1,2,3,4,5 at the bottom of the chart)
5-2:Wait for a new bar to Close above the bar number 5 High,trigger bar(T)
5-3:Entry long above the high of the trigger bar(red entry line)
5-4:Place a stop slightly below(3/5 pips)EITHER the LOW of the trigger bar or the LOW of the 5BF formation
5-5:Target a prior major swing high area.

I believe that a picture is worth a thousand words...so,please see attached chart.

2-Linuxser:Yes that would be a good idea

[RickW00716]

Originally Posted by SIMBA

1-Rick,

You are right,the example is not absolutely 100% as per the definition...but it is a 5BF,I hope my next explanation will help

the 5 bar fractal is either a 2-3 or a 3-2 combination of higher highs and lower lows or lower lows and higher highs...It is an extremely visual pattern,very difficult to explain(unless you use the wide definition I just wrote) and code,but easy to recognize once you have seen several of them.

The important thing ,at least in my case,when I see a 5BF,as long as it meets the wide definition,is not to be strict with the definition,but to be absolutely disciplined with the rules for entry...so,lets explain the pattern(keep in mind my previous wide definition )

1-A Fractal 5BF,consists of 5 bars,after a prolonged move.

2-After a down move a 5BF has 3 bars with higher highs and 2 bars with lower lows...or 2 bars with higher highs and 3 bars with lower lows

3.After an uomove a 5BF has 3 bars with lower lows and 2 bars with higher highs...or 2 bars with lower lows and 3 bars with higher highs

4-Rules for entry Short

4-1:After an upmove,wait for a 5BF to form(1,2,3,4,5 in the chart)
4-2:Wait for a new bar to CLOSE below the bar number 5 low:trigger bar(T in the chart)
4-3:Entry short below the LOW of the trigger bar(red entry line)
4-4:Place a stop order slightly above(3/5 pips +spread ) EITHER the HIGH of the Trigger bar OR the HIGH of the fractal formation
4-5:Target a major swing low prior to the fractal formation.

5-Rules for entry Long

5-1:After a downmove wait for a 5BF to form(1,2,3,4,5 at the bottom of the chart)
5-2:Wait for a new bar to Close above the bar number 5 High,trigger bar(T)
5-3:Entry long above the high of the trigger bar(red entry line)
5-4:Place a stop slightly below(3/5 pips)EITHER the LOW of the trigger bar or the LOW of the 5BF formation
5-5:Target a prior major swing high area.

I believe that a picture is worth a thousand words...so,please see attached chart.

2-Linuxser:Yes that would be a good idea

Thanks for the explanation...it is much appreciated!
Bar 4 in the picture seems to be an inside bar...it doesn't have a higher high.

[SIMBA]

Originally Posted by RickW00716

Thanks for the explanation...it is much appreciated!
Bar 4 in the picture seems to be an inside bar...it doesn't have a higher high.

Yes,but it has a higher low....and,for me -with my wide definitions- It doesn´t make much difference...probably I chose it because it has 2 lower highs(1,2).. and 3 higher lows(3,4,5)... ...and,for me ,it is a good example of a tradable 5BF pattern,as long as the entry rules are met and the reward to risk looks right...

[RickW00716]

Originally Posted by SIMBA

Yes,but it has a higher low....and,for me -with my wide definitions- It doesn´t make much difference...probably I chose it because it has 2 lower highs(1,2).. and 3 higher lows(3,4,5)... ...and,for me ,it is a good example of a tradable 5BF pattern,as long as the entry rules are met and the reward to risk looks right...

Thanks for the clarification...I believe this is a good tradeable pattern at possible sup/res areas...What does the author think of your definition of this pattern? Does he trade it the way you do?

thanks for your contributions here and everywhere else.

[SIMBA]

Originally Posted by RickW00716

Thanks for the clarification...I believe this is a good tradeable pattern at possible sup/res areas...What does the author think of your definition of this pattern? Does he trade it the way you do?

thanks for your contributions here and everywhere else.

Thanks for your comments..I don`t know what the author thinks of my interpretation of this pattern,since this one I haven´t checked with him,but you can do ask him directly,he is a very nice guy and he likes to receive questions from his readers.

Basically,I will ,a few times,explain how I see the pattern appliability to FOREX..Forex is a symmetric market,selling usdchf is the same as buying eurusd and then selling eurchf,so the patterns that Suri explains with a slight bias(indexes and stocks usually have a built in bias),I tend to make symmetrical,with equal conditions for both buy and sell,I told him about this interpretation when I checked the MSH/MSL pattern,and,as a concept,he thought it was interesting.

I try to explain the pattern as explained in the book,then give my personal view of it,usually they are the same,the main differences are either when the author uses non symmetrical rules for longs and shorts due to him being an(exceptional) index and stocks trader,and indexes having a long term directional bias...in these cases I tend to make it symmetrical..or when I have been trading that specific pattern(though with other rules),as per 5BF,where I post what I think IS the most helpful view of the pattern(2,3 or 3,2..highs,lows or lows,highs...in any combination..PLUS HIS entry rules which are really exceptional to keep you in a good reward to risk ratio).

Additionally if you see his examples,you will end up extracting the same conclusions I did,for example,the 2 options for stops of the 5BF that I posted were extracted from his examples at the book,since he uses both methods.

Hope this helped.

[SIMBA]

First week:+146 pips

Second week(no trades):0 pips

Net total:+146 pips

Let´s do the following..I will open a demo account were I will post the pattern based trades,exclusively,so that there are no interruptions or mixes with other kind of trades.

I will forward test,demo,the patterns,as I see them,post the trades here,and post an investor password so that everybody interested can check them and we can have a clear and exclusive evaluation of their "behaviour".
This will not prove nor disprove anything,not even a Montecarlo simulation can do that ,just will help us see if we think they are useful as additional tools in our trading toolbox .

For the moment we have 3 patternsragon,MSH/MSL and 5BF..I will trade them and try to explain additional ones during this coming week.

BTW:I don´t know if you noticed at the last chart posted that the second 5BF is also part of a Dragon pattern...

[RickW00716]

Originally Posted by SIMBA

Thanks for your comments..I don`t know what the author thinks of my interpretation of this pattern,since this one I haven´t checked with him,but you can do ask him directly,he is a very nice guy and he likes to receive questions from his readers.

Basically,I will ,a few times,explain how I see the pattern appliability to FOREX..Forex is a symmetric market,selling usdchf is the same as buying eurusd and then selling eurchf,so the patterns that Suri explains with a slight bias(indexes and stocks usually have a built in bias),I tend to make symmetrical,with equal conditions for both buy and sell,I told him about this interpretation when I checked the MSH/MSL pattern,and,as a concept,he thought it was interesting.

I try to explain the pattern as explained in the book,then give my personal view of it,usually they are the same,the main differences are either when the author uses non symmetrical rules for longs and shorts due to him being an(exceptional) index and stocks trader,and indexes having a long term directional bias...in these cases I tend to make it symmetrical..or when I have been trading that specific pattern(though with other rules),as per 5BF,where I post what I think IS the most helpful view of the pattern(2,3 or 3,2..highs,lows or lows,highs...in any combination..PLUS HIS entry rules which are really exceptional to keep you in a good reward to risk ratio).

Additionally if you see his examples,you will end up extracting the same conclusions I did,for example,the 2 options for stops of the 5BF that I posted were extracted from his examples at the book,since he uses both methods.

Hope this helped.

This helps alot! Thanks again!
The more you teach about applying these patterns to forex the better.
I am basically just looking for a few good patterns to use for confirmation of support/resistance areas either from pivots points, camarilla or the service I recently subscribed to that gives s/r numbers in advance(they seem to be pretty accurate and I would like to use the patterns for confirmation).

Have you ever heard of a pattern/system called PULSAR?
I was recently re-introduced to it and it seems to do well in forex...I have been visually testing it on 30 min to daily charts.

[mpower]

Originally Posted by RickW00716

This helps alot! Thanks again!
The more you teach about applying these patterns to forex the better.
I am basically just looking for a few good patterns to use for confirmation of support/resistance areas either from pivots points, camarilla or the service I recently subscribed to that gives s/r numbers in advance(they seem to be pretty accurate and I would like to use the patterns for confirmation).

Have you ever heard of a pattern/system called PULSAR?
I was recently re-introduced to it and it seems to do well in forex...I have been visually testing it on 30 min to daily charts.

I received the book a few days ago, and I must honestly say that it is probably the best $60 I have spent in my life. It is something that every trader must have. You can develop at leat 20 profitable trading systems from it. You have precise rules on how to use every pattern described.
Thanks Simba for introducing this topic and the book!!!!

[SIMBA]

Originally Posted by mpower

I received the book a few days ago, and I must honestly say that it is probably the best $60 I have spent in my life. It is something that every trader must have. You can develop at leat 20 profitable trading systems from it. You have precise rules on how to use every pattern described.
Thanks Simba for introducing this topic and the book!!!!

mpower:Thanks for your kind comments,please feel free to contribute with your experiences using them.

Rick:I don´t know anything about PULSAR,please feel free to explain it here if you think it can be of interest,and yes,using the patterns near support and resistance,fibonaccis,trendlines,cyclical turning points,after or at divergences ,etc...IMHO is the way to go.

[RickW00716]

Originally Posted by SIMBA

mpower:Thanks for your kind comments,please feel free to contribute with your experiences using them.

Rick:I don´t know anything about PULSAR,please feel free to explain it here if you think it can be of interest,and yes,using the patterns near support and resistance,fibonaccis,trendlines,cyclical turning points,after or at divergences ,etc...IMHO is the way to go.

Setup for long: a 4 bar low followed by an upclose, then a down close that does not take out the 4 bar low.
The upclose can be on the same day as the 4 bar low and the down close does not necessarily have to be on the next bar.

When this setup is met you look at the last 2 bars and enter long a pip above the highest of the 2 previous closes.

Reverse all for short.

When visually testing this pattern you will see better setups than others.(not all of these patterns would be tradeable in my opinion...some filtering and discretion should be used.)

The system version of this pattern calls for exit on the first profitable close but I think a better exit could be used.