Price Action Swing Trading - The PAST Strategy

[Nigel Price]

1. Preceding Trend: Was more like a retracement consisting of only 2 Bear candles inside a longer term up trend.

2. Reversal Signal: Strong Bullish Rejection Bar 2 weeks ago. Still valid for upcoming week.

Action:
Will be looking for longs on a break of the downsloping trendline I've got marked or any new trendline that forms throughout the week.

Any thoughts, critiques always welcome as I'm new kid on the block.

Hi Victor, welcome to the thread. Thanks for your kind words, I'm glad you got some value out of the ebook.

Your analysis on USDCAD is top notch, by the way. For my report this week it was a toss-up between USDCAD long and AUDUSD short - both are showing very similar setups. I'll be looking at both during the course of the coming week.

Keep the posts coming! Any questions don't be afraid to ask!

Good luck!

 

[Nigel Price]

Really relaxing mindset to be at the point where you could care less in which direction price moves.

IMHO, no one really can say with 100% conviction which way the market will move next week and I'll be very happy for price to show me the way.

Two very intelligent comments above

 

[Olu]

EurCad

This might qualify for the PAST strategy. Mind the gap though...

 

[VictorFX]

This might qualify for the PAST strategy. Mind the gap though...

Hi Olu,

I've read through all your posts and you seem to have a very good handle on the PAST method.

Can I ask for a bit further clarification on what you are seeing here with this pair?

Only if you've got time, otherwise good luck with your trade.

 

[VictorFX]

AUD USD SELL

Hi,

Just thought I'd leave a few notes here on my first attempts to establish a position short on AUD USD.

1st attempt: Stopped (-20pips) Used a Sell Stop on the close of a H1 break candle. I was away from my computer on the break of the trendline so I decided to place a sell stop to see if price would keep on moving down. My stop just got spiked by 1 pip.

2nd attempt: At market entry. Basically same price entry as first after seeing the spike candle retest the underside of trendline.
(This one got stopped as well) (-20 pips)


So down 40 pips on this trade idea. See what happens Tuesday.

I'll only make 2 attempts to go short here as we have RBA meeting tomorrow as well as retail sales figures.

 

[Olu]

Hi Olu,

I've read through all your posts and you seem to have a very good handle on the PAST method.

Can I ask for a bit further clarification on what you are seeing here with this pair?

Only if you've got time, otherwise good luck with your trade.

Hi VictorFx

I am looking for a reversal in the strength of the euro compared with the cad. We have a weekly that put in a hanging man and then another bearish candle and on the 4hr chart there is a trendline which if broken I want to short. The one thing I would like to happen though is I would like the gap on the chart to be closed before the break and retest of the trendline. Gaps sometimes act as magnets. That is what I am looking at.

Also the aud. I am sooooo bearish too. And will be looking at that one too.

Thanks

Olu

 

[Nigel Price]

Hi,

Just thought I'd leave a few notes here on my first attempts to establish a position short on AUD USD.

1st attempt: Stopped (-20pips) Used a Sell Stop on the close of a H1 break candle. I was away from my computer on the break of the trendline so I decided to place a sell stop to see if price would keep on moving down. My stop just got spiked by 1 pip.

2nd attempt: At market entry. Basically same price entry as first after seeing the spike candle retest the underside of trendline.

I'll only make 2 attempts to go short here as we have RBA meeting tomorrow as well as retail sales figures.

Morning VictorFX

Just thought I'd add my 2 cents here! I'd now call that action last night a false break to the downside and wouldn't be looking at AUDUSD now again until I saw it under the trendline again. It seems as though it needs to work off a bit of energy to the upside before it is minded to fall.

False breaks are pretty common on in the Asian session on Monday mornings too, because the market is thin. That's not to say you shouldn't trade then, it's just something you should be aware of and factor it into your trading.

Today is the last day of the month and the 3rd quarter of the year too, so things could get a bit whippy. Big traders might be more concerned about squaring up positions rather than looking to open up new trades.

If you took a loss this morning, don't worry, you'll get it back soon. Do you play poker at all? If you do you'll know that every round two players have to pay the big blind and the small blind, whether they are betting on their hand or not. It's a small payment you have to make if you want to stay in the game. Maybe you just paid a small blind this morning. But soon enough you'll get dealt a good hand and then you know you can bet more aggressively. Until then it's a patience game.

Good luck!

 

[VictorFX]

Morning VictorFX

Just thought I'd add my 2 cents here! I'd now call that action last night a false break to the downside and wouldn't be looking at AUDUSD now again until I saw it under the trendline again. It seems as though it needs to work off a bit of energy to the upside before it is minded to fall.

False breaks are pretty common on in the Asian session on Monday mornings too, because the market is thin. That's not to say you shouldn't trade then, it's just something you should be aware of and factor it into your trading.

Today is the last day of the month and the 3rd quarter of the year too, so things could get a bit whippy. Big traders might be more concerned about squaring up positions rather than looking to open up new trades.

If you took a loss this morning, don't worry, you'll get it back soon. Do you play poker at all? If you do you'll know that every round two players have to pay the big blind and the small blind, whether they are betting on their hand or not. It's a small payment you have to make if you want to stay in the game. Maybe you just paid a small blind this morning. But soon enough you'll get dealt a good hand and then you know you can bet more aggressively. Until then it's a patience game.

Good luck!

Comments much appreciated Nigel.

My risk is well managed so small losses like these, although not welcome, have minimal impact on my account balance.

I don't play poker or blackjack, maybe I should but I understand what you are saying for sure.

Patience is something I do need to work on, especially Monday mornings. I live in Australia and markets open on my Monday morning here and I seem to often come out of the gate after a weekend's analysis a bit too hard. Will need to watch this.

 

[Nigel Price]

I don't play poker or blackjack, maybe I should

Maybe poker, but definitely not blackjack! It's too difficult to win at!

Poker is a great example though of how traders minds ought to work though.

If you watch big poker tournaments, you'll see hugely successful players being very philosophical after being beaten. They recognise that it's a game of probability - there will almost always be a chance of someone at the table having a freak hand which will beat yours.

There is no shame in getting beaten by a freak hand - it is no reflection on their poker playing abilities. What matters is that their play reflected the chances of them winning, and that they were conservative when their cards were weak and aggressive when their hands were strong. They know that as long as they keep doing that, over time they will come out on top.

I hope the analogy is very clear in relation to what we are trying to do here in the markets.

 

[VictorFX]

Monthly Charts

I'm going to take a spin around the monthly charts either today or tomorrow.

Anyone care to join me.

I'll post up anything I see and perhaps we can share some thoughts on how we'd individually go about trading such a long term timeframe.

Here's one just to get started.

AUD JPY

Bears look like they taken control towards the end of the month but the monthly close is still higher than previous 2 bear month opens.

I've made a few other notes on the chart. Might be worth watching a H4 downsloping trendline perhaps and see if we get a break up.

 

[VictorFX]

AUD CHF Monthly Chart

Just something I'll throw on to the radar for now.

I think I've noted the most important things on the chart
so will now watch a H4 downsloping trendline to see if price wants to move up from here.

The wicks to the upside are not that appealing but who knows, maybe they have exhausted the sell orders just above and we could get a small retrace.
Say perhaps 600 pips or so, we are talking a monthly timeframe.

Would love to see a break up then a retest and rejection of a trendline.

That would give me confidence to take a long for sure.

 

[Nigel Price]

I love the AUDCHF pair VictorFX. Positive carry and really well-defined long term ranges. It might take a few attempts, but at some stage this will be a cracking buy for a long-term position trade.

Nice chart

 

[VictorFX]

EUR AUD Monthly & H1

Hi,

Sorry to be completely bombing this forum but here is another one I think I'll be very patient with and keep an eye on.

I won't be chasing this break.

The monthly looks like it could be due for a retracement
and there is a very obvious upsloping trend line that has been broken
on the news today that RBA will keep rates on hold.

If we get a retest and a rejection of this trendline I'll attempt a short
for sure. However, if it's going to happen it could potentially happen in a week or two.

 

[Olu]

Hi,

Sorry to be completely bombing this forum but here is another one I think I'll be very patient with and keep an eye on.

I won't be chasing this break.

The monthly looks like it could be due for a retracement
and there is a very obvious upsloping trend line that has been broken
on the news today that RBA will keep rates on hold.

If we get a retest and a rejection of this trendline I'll attempt a short
for sure. However, if it's going to happen it could potentially happen in a week or two.

Hi VictorFx

You are not bombing the thread imho. Great trade but I didnt see it and therefore made 0 (nada) from it. I like looking at the monthly charts so I will join you

I like the monthly time frame because I am trying to turn these trades of ours into well managed position trades. Reducing the jump ins and jump outs and just have well managed long term trades that initiated from PAST trades

Olu

 

[Nigel Price]

If we get a retest and a rejection of this trendline I'll attempt a short
for sure.

I think you just made a great trade call there VictorFX - that looks like that was an almost textbook break/retest on EUR/AUD today. Price didn't quite manage to tag the underside of the line but it put in a lovely long wick, right underneath the broken trendline.

I hope you got in there, looks like it could be a cracking trade.

If not, there'll always be another coming along soon.

Kudos, great contribution to the thread, thanks

 

[VictorFX]

I hope you got in there, looks like it could be a cracking trade.

If not, there'll always be another coming along soon.

Thanks Nigel.

That H1 rejection bar printed at midnight my time so unfortunately I missed it as I was sleeping.

This is one of the challenges for me trading from Australia and looking for trades on H1 time frames. Just need to accept it and move on. Or change my sleeping habits

Anyone who took it would have probably moved stop to B/E by now so that would be nice.

Like you said, there'll always be another one along soon.

Hi VictorFx

I like looking at the monthly charts so I will join you.

I like the monthly time frame because I am trying to turn these trades of ours into well managed position trades. Reducing the jump ins and jump outs and just have well managed long term trades that initiated from PAST trades

Olu

I agree Olu. If we can take trades based on a monthly analysis and then exit them on a monthly analysis, even if the trade only moved in your favour for a few months, could be the difference between a mediocre trading year and a great one.

 

[Nigel Price]

Just an update on what I am seeing here this week so far, we got a false break on AUS/USD before the rate decision which propelled it higher. We adjust the trendline slightly, but I will be looking for shorts still if we break below.

USD/CAD is coiling and looks like it is getting for a move - I will be looking for a break to the upside. No clear trendlines yet though.

A new month and the last quarter of 2013 is underway - so draw a line under any trading to date and start afresh. Keep your stats for the month of October and review them at the end. I've harped on about this before but it really is so important - profit or loss, it doesn't matter, keep your stats!

Good luck for the month ahead

 

[Olu]

Just an update on what I am seeing here this week so far, we got a false break on AUS/USD before the rate decision which propelled it higher. We adjust the trendline slightly, but I will be looking for shorts still if we break below.

USD/CAD is coiling and looks like it is getting for a move - I will be looking for a break to the upside. No clear trendlines yet though.

A new month and the last quarter of 2013 is underway - so draw a line under any trading to date and start afresh. Keep your stats for the month of October and review them at the end. I've harped on about this before but it really is so important - profit or loss, it doesn't matter, keep your stats!

Good luck for the month ahead

Hi Nigel

About the audusd I have my trend line in the same place looking for a break of 9300. Is that roughly what you have?

Olu

 

[VictorFX]

AUD USD Aggressive Sell

Hi,

I think perhaps it's better for me to start a journal here at Earn Forex rather than clog up this great thread with personal posts like this but since it's a set up we are discussing just thought I'd post how I'm trading it.

I've taken an M30 break of an upsloping trendline and news has been kind to me this time. Funny how that happens time and again in the forex market. One day huge news spike one way, next day price starts to move the other way on different news. I'll be looking to move to B/e soon to cover risk and then let the trade play out.

I admit I'm an aggressive trader by nature, to me the word "aggression" holds a positive connotation. I'm pretty sure it's Latin origin contains the meaning "to move towards" and that's what I believe I'm doing. Moving towards success in my trading.

 

[VictorFX]

EUR AUD Sell H1 Rejection of Trendline after Break

Hi,

Following on from monthly analysis I did yesterday, price has made
it all the way back up to the underside of the higher trendline I've drawn.

Will see how this pans out.