Page 1 of 5 123 ... LastLast
Results 1 to 10 of 44
  1. #1
    Veteran Member Ronnel's Avatar

    Trading Tips: Naked and Semi-Naked charting J-style. !!!

    Me and David have been talking about exchanging both our studies on naked-charting and we think that the best way to do this is to post here so that others who might be interested in naked charting may also benefit. First let me warn you that this will be a looooong thread and with lots of pictures because a picture speaks a thousand words.

    First let me tell you that I follow what I learned from reading several Japanese candlestick books but mostly I follow my Japanese senior who is a retired pro trader. His approach to candlestick analysis is quite different and relies mostly on feeling and less with the technicality. He said that people or buyers are the ones making the candles move and even though we can see S/R patterns that we can never fully rely on S/R and candle patterns. Many traders spend hours doing their analysis at hindsight's view but what we really should put more focus is on the present. Yes going back in time and plotting lots of S/R and trying to look at candle patterns is very important but a trader should do his plotting quickly and accurately then move on the the present candle ASAP. He said that patterns and S/Rs are made to be broken and this is why we see breakouts and all that we can do is to scratch our heads when this happens, or we can use this breakouts to ride the trend. Just like promising a girl that you'll buy her a house which deep inside you know that you are are only taking BS Candles are unpredictable because candles are only the reflection of human emotions which can never be accurately calculated even by the most sophisticated computers today. He said to put my eyes on the right and less on the left, feel the candles and use whatever candlestick education that we've learned and use this to predict the candles future movements.

    We've all seen this kind of chart setup which looks like a xmas tree. There is nothing wrong with this kind of setup if the trader is really bringing home lots of ITM but if your trading is going down the drain, why not try naked or semi-naked chart analysis for a change. Me and David have been trying to overload our brains with lots of strategies, trying to learn lots of indicators... but we are still losing. One of these weird looking EAs is Ichimoku which may looks like a mess at first sight, then add 3 or 4 more indicators then the chart is full of clutter and is basically garbage because we can hardly see what's happening with the candles.

    Click image for larger version.

Name:	xmas tree chart.jpg
Views:	177
Size:	98.9 KB
ID:	3300

    We've seen this and I'm sure that you know how to use them.

    Click image for larger version.

Name:	Candlestics.JPG
Views:	177
Size:	34.0 KB
ID:	3301

    Lesson no.1 is "Don't be too technical"! There are traders who literally put to practice on what they've learned for example they will wait for a doji candle to appear followed by an engulfing candle with an opposite color. Yes this is a very strong reversal signal but you may end up waiting for days until this patten appears and they may appear far from your S/R lines which will lead you to think if this is a true trend reversal or is the candle just playing tricks on you. Then you'll end up not placing a trade because you took the signal literally and just missed the bus ride. The reason for this is that some traders take thing very literally and just focus on the last two candles. They didn't put much observation on the last few candles signals and what these signals are trying to say.

    Click image for larger version.

Name:	canlde 1.jpg
Views:	181
Size:	85.6 KB
ID:	3302

    Honestly, I don't trade this way because I'm scared but I've seen grandpop trade something very similar to this several times and won because he use the last few candles signals to predict a short downtrend (total show-off, lol). This is way out of my skills but good and experienced traders will use this technique and win. He said that reading the last few candles wicks is a good skill to learn. The longer the upper wicks of the candles, the more they are showing force of resistance. And since we are using M1 chart and our main target candle is located in the middle of the S/R, if you count the candle starting from it's present location to the resistance line, you'll get M5 expiry at most.

    More to come
    Last edited by Ronnel; 06-13-2015 at 01:58 PM.

  2. Thanks Madhawa thanked this post
  3. #2
    Solid Member Davidkitdave's Avatar
    Nice one Ronnel!
    Grandpops really brave to trade that way.
    Haha! But I think trading near S/R level is much more safer.
    I will update my trading here too when I have collected more information.

  4. #3
    Veteran Member Ronnel's Avatar
    Quote Originally Posted by Davidkitdave View Post
    Nice one Ronnel!
    Grandpops really brave to trade that way.
    Haha! But I think trading near S/R level is much more safer.
    I will update my trading here too when I have collected more information.
    Haha! Remember that grandpop got paid to trade so he basically did not use his own money when he was young. I told you that he got into trading again just to play and and he used the same strategy above several times just to show off but he landed ITM always. Yes it is better and safer to trade near the S/R lines especially for newbies like us but it is also good for us to know that this strategy can be done when we have gained that much skill and experience (and bigger balls too, lol!). Remember that the above strategy is not for newbies but it's good to have that in our arsenal, plus if we learn about how to read candles like that, we can detect trend divergence without using other indicators and that will be sooo very awesome
    Last edited by Ronnel; 06-14-2015 at 01:06 AM.

  5. #4
    Veteran Member Ronnel's Avatar
    Before we go to the candles, I think it's best to share how I look at different TF and because you keep on asking why I use M1, lol! The answer is grandpop told me to use M1 because M1 is where PURE PRICE ACTION starts. Yes M1 is noisy but all TF start from M1. M5, M15, M30, H1, etc. wont exist if there is no M1. The good thing about M1 is that if you learn how to use the noise, you can basically use it to enter higher TF just like how I use it. I sometimes use M5 to enter but it is basically the same and all you have to do is to use your crosshair and stretch it to your destination target. Example your target destination is M30. then pull your crosshair around 30 candles and that will give you around 30 minutes. If your target is 1 hour 30 minutes, just count 90 candles to your target zone.

    Like in M5 where you will need 12 candles for 1 hour and around 6 candles for 30 minutes. It's basically the same and all you have to do is count the candles. But If you are in doubt, best to go to the proper TF chart and start from there. Later I'll share with you the reason why grandpop got me to use M1 which is basically for rebound strategy

    Here are some pics on how we plot S/R trend lines for shorter TF expiry use.

    Click image for larger version.

Name:	SR 1.jpg
Views:	174
Size:	89.0 KB
ID:	3303

    Click image for larger version.

Name:	SR 2.jpg
Views:	172
Size:	74.7 KB
ID:	3304

    Click image for larger version.

Name:	SR 3.jpg
Views:	172
Size:	79.5 KB
ID:	3305

    Click image for larger version.

Name:	SR 4.jpg
Views:	175
Size:	79.0 KB
ID:	3306

    And finally M1. Here is also a short visual tutorial on how to count candles using your MT4's crosshair

    Click image for larger version.

Name:	SR 5.jpg
Views:	173
Size:	86.2 KB
ID:	3307

    We've checked different TFs, we know that we have a bearish trend, we are expecting the candles to reach our Resistance line and we know that all TF are aligned. When the candles reaches the top, we will look for tell-tale signs on the candles wicks/shadows and size to detect if the candles will go straight down or will the candles do some bouncing back (retrace) before they finally go down. Once the candle reaches near, or have crossed over the resistance line then we use the bounce for lower TF expiry and trade M5, M15, M30 and H1 all in one go because everything is in line. Yes we can only put one trade only but this is just to show how we can benefit more by entering different TF expiry since we know that everything is in line. We also know that the our target candle is on top of resistance and all we have to do is to ride the trend downwards. I've been using this on demo and got lots of ITM. Hope to also use this strategy in live trading when I have that much cash to play with, lol.

    More to come...
    Last edited by Ronnel; 06-15-2015 at 01:10 PM.

  6. #5
    Veteran Member Ronnel's Avatar

    Try to study as many candlestick patters as you can and learn how to use them. You can do a quick Google search for these patterns easily. Using these patterns can oftentimes be profitable if we use them right.

    Patterns are good but there are times that the candles just breaks out from the pattern. Knowing how to read the wicks/shadows/tails can give early warning signs if the pattern's trend will go through as planned or will the candles do a quick strong reversal or will the the candles slow down and never reach your target. One quick sign that the market will slow down is when you start seeing short candles and dojis, hammers, takekopta, dojis, short candles, etc starts forming up, which we can also use for our benefit if we wait long enough when the market starts to move and just ride the trend. One quick sign that a trend reversal may be coming is when you see lots of long wicks going against the trend (just like how granpop use it in the photo above). One strong sign that the trend will be going as planned is when you see lots of wicks that are pushing or showing force toward the trend. And for newbies, if you can't understand what I wrote read it again and if you still can't understand it, maybe you need to go back learning basic candlestick reading.

    Here are two examples of candlestick patterns. There are lots of them so Google away

    Click image for larger version.

Name:	candle W pattern.jpg
Views:	171
Size:	85.4 KB
ID:	3308

    Click image for larger version.

Name:	M.JPG
Views:	171
Size:	92.5 KB
ID:	3309

  7. #6
    Veteran Member Ronnel's Avatar
    How to trade a ladder.

    Click image for larger version.

Name:	ladder.jpg
Views:	170
Size:	93.4 KB
ID:	3310

  8. #7
    Veteran Member Ronnel's Avatar
    Engulfing Candle Strategy

    Click image for larger version.

Name:	engulfing.jpg
Views:	170
Size:	84.1 KB
ID:	3311

    These are not perfect engulfing examples since the first candle should be totally engulfed but this works well too. Sometimes it's hard to find good examples so we'll just keep this anyway
    Last edited by Ronnel; 06-14-2015 at 07:50 AM.

  9. #8
    Veteran Member Ronnel's Avatar
    Ranging Zone and Covered Candles Strategy.

    Click image for larger version.

Name:	ranging.jpg
Views:	169
Size:	86.6 KB
ID:	3313
    Last edited by Ronnel; 06-14-2015 at 08:37 AM.

  10. #9
    Veteran Member Ronnel's Avatar
    Rebound Strategy

    Click image for larger version.

Name:	rebound.jpg
Views:	168
Size:	91.4 KB
ID:	3314

  11. #10
    Veteran Member Ronnel's Avatar
    Choosing the right weapons for your arsenal...

    Click image for larger version.

Name:	indicators.jpg
Views:	175
Size:	90.0 KB
ID:	3315

    These are indicators that are popularly used. Notice their similarities. Yes you can add all of them in your chart but isn't that a bit overkill? It's like having a mistress who smells like your wife, acts like your wife and looks exactly like your wife, lol!

    I think Stochastic is good and reliable but because it's a bit slow (you can adjust it to work fast...) and the lines K&D crosses over, this can give the semi-naked chartist the tendency to follow the crossovers which destroys the main purpose of staying away with indicator signals. But if you still like to use crossover signals then go for it... Same with MACD.

    Same with Moving Average, notice the angle of our S/R lines showing an uptrend.

    About signs of divergence, all of them does it and it's all up to you to choose your weapon.

    My favorite and the only indicator I use for my semi-naked chart is CCI. I use it for seeing overbought and oversold areas, and also use it as a direction pointer. It's easy to use and very straight forward. The problem is that CCI is a bit fast which can sometimes be misleading.

    If you should add indicators, I suggest that you use indies that have different functions. Example: Stochastic, plus ADX/DMI and moving average. With this setup, you wont have the same functioning indies clotting up your chart. It's like having a black, red head, brown and blonde, lol!

    This is the main chart that I'm using.

    Click image for larger version.

Name:	my chart.JPG
Views:	175
Size:	95.9 KB
ID:	3316

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts