32. TechnicalAnalysisforDayTraders
Problemet med Teknisk Analyse
1. MACD – RSI – Stochastics – works fine in non-trending markets.
2. Moving Average – why are you having extra lines on your chart? Is it because
you can’t see the trend unless you are looking at an extra line?
3. The problem is we are looking for a “recipe” that never fails. We avoid failure
because it makes us appear weak, and it means we have to accept we are
wrong.
4. Many have looked for it, but none have found the holy grail of trading. The
Holy Grail is the tool/technique/indicator that works all the time and it never
fails.
37. CurrencySpeculation
Trading currencies
1. I don’t consider currency trading harder or easier than index trading, but I do
believe that it requires a different tool box to trade currencies well.
2. There are certain things I will also look out for when taking a trade in currencies
3. First: I will never take a trade in a currency for a few pips. I want to look to build a
good position.
4. Second: I want to look at signals on longer time frames.
45. CurrencySpeculation
Entry Techniques in FX
1. Aggressive Bars (after news for example)
2. Failed Bars (failure to follow through)
3. Correlations with Equity Market – If I see a big move in the currency market like
the Dollar Yen, I can easily be persuaded to take a position in the Stock indices
such as the Dow Jones
47. CurrencySpeculation
Entry Techniques in FX
1. Aggressive Bars (after news for example)
2. Failed Bars (failure to follow through)
3. Correlations with Equity Market – If I see a big move in the currency market like the
Dollar Yen, I can easily be persuaded to take a position in the Stock indices such as
the Dow Jones
4. I like Mechanical signals. They are easy to use.
49. 4 – Bar Fractal
49Tom Hougaard Pro Trading Course 2014
4-Bar Fractal Mechanical Entry
50. 50Tom Hougaard Pro Trading Course 2014
1. The 4-Bar Fractal Reversal is an attempt to QUANTIFY a reversal.
2. It is a measure of WHEN the market has reversed.
3. The 4-Bar Fractal Reversal is essentially a bar-chart pattern. It consists
of 4 bars or candles. It works well on all time frames, even down to a
tick chart. It has its advantages and it has its disadvantages.
4. Before we discuss its strengths and weaknesses, let’s focus on the
definition.
Idea Behind 4-Bar Fractal
52. 52Tom Hougaard Pro Trading Course 2014
The 4-Bar Fractal Reversal consists of the following components:
1. 4 consecutive price bars
2. Price Bar 1 is the current price bar
3. Price Bar 2 is the previous price bar
4. If Price Bar 1 closes ABOVE the high of Price Bar 2, and if Price Bar 1 closes above
the HIGH of Price Bar 4 = BUY SIGNAL
5. If Price Bar 1 closes BELOW the low of Price Bar 2, and if Price Bar 1 closes below
the LOW of Price Bar 4 = SELL SIGNAL
Rules for 4-Bar Fractal
53. 53Tom Hougaard Pro Trading Course 2014
On the chart below I have highlighted a 4-bar fractal. Can you spot any others?
Can you spot them?
55. 55Tom Hougaard Pro Trading Course 2014
1. Are there short-comings to mechanical techniques?
2. YES. For example the 4-bar fractal technique can become messy if the market is not
trending.
3. It can be slow to detect the change.
56. BestAdviceIevergot
ANY KIND OF SPECULATION
1. I keep an eye on the market
2. I use a name to remind myself of what kind trader I am
ATHBO