Found this, which is good for one way of providing an audible alert when the currency pair price reaches a given level of profit/loss.
You’ll need to download audioplus.mq4 file below, and save to your MetaTrader\Experts\ directory.
Continue reading »
The particular divergence of interest to forex traders is when a pair price and its associated indicator(s) start going in opposite directions. Commonly, indicators such as RSI or MACD are the likely candidates.
Continue reading »
Here’s – what I would think is – an instructive chart where everything does what it’s supposed to for once. Doesn’t matter what the pair is, or indeed what the x- and y-ranges are, except to say they’re standard enough.
We should all be reasonably familiar with the Bollinger Squeeze and Bounce – here’s the Bollinger Walk – (the Bollinger bands are 20-period 2 std deviation – ie. what your software will usually give you by default).
Don’t confuse RSI with other “relative strength” indices, which you’ll find in discussions of stocks etc. – these refer to relative strength as a comparison between 2 or more different stocks – and so not what we’re doing here in forex…
The RSI plots the magnitude of recent gains versus the magnitude of recent losses – so again, it’s an oscillator, ranging from 0 to 100. It takes a single parameter, the number of time periods used – 14 periods is common, (and was the recommendation of J. Welles Wilder, the popularizer of this indicator – like so many others).
Continue reading »
Twin peaks return… here’s a chart, a real life example.
The price has reached a level of resistance, bounced back off it… and then returned to test the idea one more time for luck… It didn’t work and now there’s a pronounced downtrend forming.
This is the double top, and, as usual, what holds true for the double top will also be so in reverse for the double bottom, which is even less polite.
Continue reading »
Wolfe waves are interesting patterns – that they might be used in forex trading implies something about harmonics and equilibrium in price movement – as if there’s a push and pull effect going on. For example, a drop through a trend may produce an “energy” that propels the price up significantly on the next wave (or the converse) – think about springs, compressed, expanded etc.
Five waves - showing supply and demand (resistance/support) and tending towards an equilibrium price. The bullish formation is shown in the diagram.
This simple chart pattern forms the basis for a simple “system” for recognizing trend initiation – system is probably too strong, more a rule-of-thumb….
Bearish - a chart pattern that consists of a small open/white candlestick with short shadows is followed by a large black candlestick that engulfs the previous, open and close are greater/lower than the total body of the previous candlestick – (and the converse for a bullish engulfing pattern) – see also harami crosses for the opposite of this pattern.
Continue reading »
Inside Day = the entire price range for a period is contained within the previous period’s range.
(Referring to days as the time period, but the principle is universal.)
- So, 2 days when the price range hasn’t shifted implies indecision in the market.
If at the end of a pronounced trend, that trend would appear to be complete…
Continue reading »
Colinear indicators = indicators originating from identical market indices
So look at RSI and MACD (moving average convergence/divergence) and let’s say they give the same signal – so what? These have both been derived from closing prices, without any other data input.
What they can’t do is truly confirm each other.
If they do produce different signals, then it’s largely entropy and inherent imperfection of the indicators themselves.
Continue reading »
They’re the end of the trend – and the beginning of reversal, perhaps… The hammer and hanging man look very similar, with long lower shadows, short upper shadows and small bodies (open or filled). They look similar, but:-
A Hammer occurs in a downtrend = bullish reversal, the market’s going up again
A Hanging Man occurs in a uptrend = bearish reversal, the market’s going down…
Continue reading »
Comments(0) 
Loading ...