Wednesday, 31 March 2010

L.Crude update

What a cracker! straight off the UMLP and down like a stone to the centre line and now a short covering rally to a decent 61.8%Fib level.

Crude Oil/May

10 min time frame on CL cont and 30 min CLK.


Gold... 120 and 60 min chart with various ML sets ('normal' Andrews and Mod Schiff). No trade planned at the moment but possible resistance level on the green and blue down sloping UMLP (and divergence). Will watch the next few bars.

Tuesday, 30 March 2010

Aussie$ fails at UMLP and 92.00

These two 240 and 60min charts of AUD/USD speak for themselves

Monday, 29 March 2010

USDX on the ML (centre line)

This is an update of the same ML on a daily USDX chart i posted back in Jan/Feb. Price has reached the centre line.


ABOVE: E-Signal 60 min and E-Signal 5 min at 3.15 Euro/9.15am EST.

There is no doubt that price has lost energy and found resistance here on these two median lines (see earlier posts 28/Mch/2010). Personally i think that if we make a new swing low and take out 86.64 then i would look for another short position. There continues to be much bearish divergence with the RSI,CCI,MACD and stochastics in multiple timeframes but the bottom line is that this will take time to unroll. If we are in the process of a reversal than there will be plenty of downward energy to make price fall and plenty of profit providing i get a good entry and do not rush in ..... i was always taught that the top 10% and the bottom 10% of any market move are the most dangerous. I am looking for not only a reversal but also a confirmation of reversal/change of direction.


Divergence in RSI, CCI, Macd and Stoch ( multiple settings) in multiple timeframes. Market gaps up on Asian opening (centre chart) after 30 mins i short 2 lots Chf/J-Yen (87.19 &87.16)
stop@87.30 .Market falls almost immediately. stop to B/E
Before i even got back from taking my daughter to school in Bordeaux and i am stopped out at break even! There might be another opportunity but for now i will watch and wait.

Sunday, 28 March 2010

It's getting more complicated..Swissy/J-Yen

Long Term/daily ChfJpy( left) shows in my opinion a current ML set where you can see price oscillating around the plum/violet coloured centre line like a human pulse/heart beat on a hospital monitor. Centre chart shows E-signal 240min chart (as per the Metatrader chart from earlier today)with also the up sloping ML set in red. Finally there is the Ensign windows daily chart (Right) with Reaction lines and a simple Fib retracement from the previous swing high/S low ( plus the same up-sloping ML set/red in e-signal).

In the centre 240 min chart the long term plum coloured daily centre line is exactly where price closed on Friday 26th March, just a fraction below the blue down sloping UMLP. This is an area of confluence and it increases probability that with the plum centre line there that price could stop and reverse at this level. Infact to me this shouts out loudly RESISTANCE as we also have an important Physc level of 87.00! Only a fool would dismiss the possibility of a zoom through the plum centre line as per Andrews laws and also i am not blind that the recent trend is up and we have been making higher-highs and lower lows in this recent move ....but if you look on the daily chart we have actually made one lower swing high and two lower lows and we could be on the downward side of the mountain from the top at 91.55. Then there is the Red up sloping centre line. If price fails to reach the centre line it should accelerate in the opposite direction. OK so that's enough about the ML sets...the problem is how to trade any reversal/change in direction/correction without having to put a stop so far above the market that you could drive a bus through the stop level and short entry point.
Now look at the close up from the 60min chart from Friday below. Price has already touched the Plum centre line/Blue UMLP at the point of confluence (87.00) and as the market closed at 86.81. A restest? Perhaps.........More to come on Asian market opening

Keeping it simple...Swissy/J-Yen

Here's my favourite chart of the weekend. A 240 min Metatrader CHFJPY chart. A simple down sloping MLset and there is no doubt about P0 because there are no other possible candidates, so i can be pretty sure this is the dominant ML set in this time frame. What makes this such a sweet chart apart from price action on the centre line and LMLP and UMLP are the Action-Reaction lines drawn in red.They seem to describe perfectly the swing lows and swing highs the market has made in the past weeks/months. Now price is sitting bang on the Aqua-Blue UMLP.......It's a crucial point.....either price breaks through this level and continues to the yellow centre line or fails and reverses.......Of course if it does go though the aqua/blue UMLP it will probably retreat first and how easy it would be to get sucked into going short. I am sure there's a trade here one way or another but i am in no hurry and will wait to see where price wants to go and then try to have a piece of that move. I will try to put together a pattern and indicator based confirmation for a trade one way or the other and also check P0,P1 & P2 and the whole ML set in E-signal and in Ensign but i do not have Reaction Lines in these two packages hence showing the MT chart here.

Saturday, 27 March 2010

I hope you are taking me seriously !

What are you doing this weekend? I am spending time going over a trading concept i originally came across 3 years ago and spent several months' looking under the bonnet/hood' and then dismissed ....but have been back for a second look and wonder if there is anything i can take from this trading discipline and use in my synergistic confirmation approach to Andrews/Pitchforks/Median Lines.
' Volume Spread Analysis'.........I would be interested to hear from anyone who uses (or has used) this method of T.A and especially if it is suitable in higher time frames such as 30/60/240 mins. There is no doubt that Volume is a much neglected issue.
Have a great weekend.

Friday, 26 March 2010


Sell on a break of the blue trendline. Its a 1-2-3 setup or 240min MSH
Below is an Ensign 377 tick chart of $Jpy current at 17.50hrs Friday 26th March.

Crude Friday 26th March

Another beautiful touch nearly on the UMLP after price was pushed up in the Morning (Europe) and then dropped like a stone in early US trading. I would not be surprised at new lows before session end and to see price heading back down to the blue centre line next week.

Euro$ finds support &........

Euro$ 240 e-signal and 60min MT

Euro$ 5 min

Nice potential for a manic and rapid late Friday short covering rally as the session draws to a close but perhaps we have now found our new swing low and let's be honest only a fool would be short Euros at 1.3400. $/JPY also looks very toppy......all to be played out over the coming hours of Friday.

Thursday, 25 March 2010


Two different charts a MT 60 min with a pretty neat ML set showing support on a LMLP and ...

A far more complicated map of ML's is on the E-signal chart on the RHS........The red Modified Schiff shows right price on the LMLP and there is also the a down sloping ML set that shows us right on the centre line. Under the scrutiny of a 60 min TF price dances between these lines in a very pleasing way. I am watching for a reversal pattern as we already have divergence on Macd & long and short Stochastic's

Crude update

Here is an update on Light Crude re my short position (CL #K) from yesterday. After price fell away it found support on the LMLP of the brown ML set in the MT chart(RHS). A short covering rally has pushed price up to the inner roof of the 'mountain'. On the May contract chart this brings us again to the UMLP. I am not so sure that price interacts better on the May chart ( MT) rather than the continuous E-signal chart. It is difficult to understand which ML set is dominant and are we descending in the green set with lower s-lows and lower s-highs or are we now in the brown up sloping ML set. I suspect it is a combination but the brown LMLP certainly worked like a dream but to get to the brown centre line would be an uphill struggle...literally!
I have decided to move my profit stop down to 81.25$ but am not inclined to resell this retest of the UMLP because of the messy resistance from the previous encounter with the UML. However if price got to the equivalent level on the esignal chart then i would watch closely.
Result..stopped out on proft stop at 81.25 +370$

Wednesday, 24 March 2010

Short $ ¥,,right here/right now?

Possible Double top plus huge divergence (Macd& Stochastic's) and is this another high prob trade setup? Or foolishness?
This one is pretty obvious but its' the entry point that worries me....We have not successfully penetrated the previous swing high at 92.15 and a potential 'blind' entry at these levels looks risky..Do i wait for a "poke" bar with a sell stop? Maybe for a last resort but i am watching the US session close bar by bar, and will post my trade (if any.... and it's reasoning -should i take a position) in the coming bars/hours.

Market Structure High

Light Crude...My setup on the UMLP

Here are two different charts of Light Crude..Both 60 mins from last night Euro time

The E-signal chart is a continuous chart (CL #F) and the Metatrader chart is May 2010
(CL #K).......This presents various problems as the data and hence the Median Line sets rarely match perfectly. I use the more reliable e-signal chart for confirmation but both of these charts share the same P1 & P2. The E-signal chart ML set is a Mod Schiff and works like a treat! The same P0 in Metatrader is a disaster so i choose an obvious recent swing high for P0 (83.00$ on 3 March). Price had already interacted very nicely with this May chart in MT( and also well in the e-signal chart) and i was waiting for a chance to see if price tested the green down sloping UMLP.
I am extremely wary of trading Crude as it's an expensive contract to screw up and get wrong but i have a fascination with this market (and also its relationship the the precious metal Gold).
As i have mentioned in this blog i am always learning and practicing and it is simply madness to sell 'price' simply because it touches the UMLP or LMLP and have been trying to put together various trade setups /confirmation techniques that have been used by other more experienced traders but not in conjunction with ML's to produce a higher- high probability trade.
Price approached the UMLP on the Metatrader chart and did not hesitate to punch straight though the UMLP & the phyc level of 82.00 and making a high of 82.19$...the Metatrader chart simply looked messy and the UMLP was severely compromised as price continued to trade above it for several 60 min bars. However no new bar made a new high and all bars traded within the range of the first two high bars. On the other hand the E-signal chart look sweet as a nut. Price literally 'kissed' the UMLP and retreated. OK, Now to the reasoning for the trade- In two time frames ( 30 & 60 min) we had obvious and very pronounced divergence on the Macd (12,26,9 & 8,17,9) and also on the stochastic (slow & fast) and also on the RSI. So 3 out of 3 indicators all showing that although price was making a higher high (viz a viz the high made at 81.86 on 23/March) all indicators showed lower highs ( see chart below). We also had stochastic crossovers but i am wary of any crossover interpretation on any indicator so we will ignore that, but so far so good......

Next comes the setup. This is a setup called "Market Structure High and MS Low" i originally saw on Michael Jardines trading website (but i am not sure it is there now) but is reproduced below and on several sites and in many books (and apologies for any infringements on copyright). Remember this method is simply another 'string in the bow' of the trade entry confirmation. I have been shafted many times by divergence and you can pretty well get an indicator to show you what you want to see especially if you have already taken a position in your mind as to market direction and not remained objective.
Market structure High & Low are based on closing prices not traded highs and lows so candlesticks are used to illustrate my interpretation of this tool. This is a multi bar pattern but must have three consecutive candles and anything after that must remain within the range and be inside bars. So you need:
Bar 1. A new high.
Bar 2. A higher high ( remember it's the close that counts here)
Bar 3. A Lower high ( close px)
This is not an easy pattern to miss as you see them everywhere in every time frame and they can be broken through a few minutes/hours or whatever later. However, I have Median lines to give me what are KEY support and resistance levels so i hope that a new MSH formed on the UMLP will last long enough (in relation to whatever time frame you are trading) to give you a more than profitable trade and will remain a swing high of considerable importance for some time.
Bar 4 & after. All bars after these three should be mostly inside bars and the pattern would be instantly broken and null & void if we had a closing candle that took out the first closing highs.
So...there is was with all my indicators bubbling away and watching bar by bar ( yawn) as my dinner was going cold on the table and my wife getting seriously ****** off. price did maintain this pattern and i was itching to get short but what about the trigger rules for your short entry?
The trigger bar is a lower closing bar than the 3rd bar (with the blue tick) and the trigger point for a short entry is marked in a dotted white line just below the word pivot. Sadly i was hungry and would have been facing a divorce if i did not get short before midnight so took a position on the 7th bar (with the down arrow) with a nice tight stop of 26pts ( tight for Crude) above the 3rd bars highest traded point of 82.05. The stop should have been placed above the highest point of bar 1. So there you have it. Overcomplicated? I think not....a way of incorporating Median Lines & indicators and a pattern setup to give a higher-high probability trade. The trade objective is the 'O' on e-signal and i have now moved my stop down to 81.37 ...update on trade objective/market to follow (& the MSH scanned page)

Tuesday, 23 March 2010

update USD Swiss

Two more general views of UsdChf using 240min and 120 min

two more detailed views of UsdChf ..both 60 min the the last has a blue simple trend line and small ML set added.

Even lower time Frame with one last ML set Red/ far inconclusive

Monday, 22 March 2010


Here are three Usd Swiss charts ( from left to right) a daily, 240 min and 60 min.
This pattern is a nice bullish chart pattern and although i am not entirely sure what the correct name is now (inverted ascending scallop?) the name in the office back in the late 1980's was the 'Horny Hump'! I guess many similar patterns were also included in the same general description(but not any rounded tops where retracement was 80% or more) but this current pattern caught my eye. In fact there is already a similar pattern below the current pattern but on a smaller scale and the new more recent rounded 'egg shaped dome' can be more clearly seen in the daily bar chart. Price has rallied to a high at 'B' at approx 1.0900 on the UMLP then retraced 50% to the LMLP and so far found support there and rallied up to the .382 Fib RT level and fallen back
I am looking to go long $(-Chf) having missed the retouch of the LMLP and will try to find an entry level using the 'Slingshot' trade setup.
The old rule for finding the objective of the 'Horny Hump' was
BC+50% of AB but i will make my objective the centre line of the ML set shown here. The 'Sling Shot' trade setup is one of the tools in my armoury and is especially useful for trading when using ML's as it is designed to give you a trade entry after a retracement in a trending market. I guess i should also mention what's called the 'MOF' (Money On Floor) trade setup which goes hand in hand with the Sling Shot. This MOF setup is to catch the first lower high in an uptrend. I have tried to learn and practice both these two setups that in particular lend themselves ( in my opinion) to Median Line trading. These two trade setups are in part the work of Judy MacKeigan(known as Buffy). At the time i started looking at these setups i did not have Ensign Windows or the template that is used in the educational material available on the web but with a bit of tweeking and common sense was able to reproduce the same study windows in Metatrader.
I find these setups more reliable than using other entry methods such trend lines and Moving averages / Bollinger bands or a break up through of the Fib.382 level.