Price Action Swing Trading - The PAST Strategy

stuart1984

Master Trader
Mar 22, 2014
362
0
52
Scotland
Quick trade update:

I was stopped out of my NZDUSD trade again at BE and I have once again entered long on the break of another trendline. This latest trade is not ideal as price has already moved a fair amount without retracing onthe hourly chart and so I have opted to place a smaller position size to allow a larger stop loss, see chart:


I also took a short position on GBPUSD yesterday as per my analysis on the pair over the last few weeks. Stop loss is now at BE so it is now up to the market to show its hand, see chart:



Happy trading everyone.

Stuart
 

anukrh

Master Trader
May 16, 2014
56
0
47
INDIA
Hi Anukrh

I don't really use trailing stops as such. Obviously with this strategy, I aim to get to BE as soon as possible. Once I am at BE I can relax a little because I have no risk left and the worst thing that can happen is I will be stopped out for no loss.

Once the trade has moved a considerable amount in my favour (at least a couple of hundred pips, I will consider moving my stop to lock in some profits.

This is a matter of personal preference, but I personally would not trail my stop to swings on a timeframe any less than the daily chart. These trades are meant to be long term swing trades where we can be holding positions for a few months and so we have to allow for the normal stair step type price action that can be expected on any trend.

Hope this helps. Looks like NIgel is busy creating a video course for this strategy, something I look forward to seeing.

Stuart

Thanks Stuart!

One more query - from trend line break once entered in trade how much PIP away i should assign my stoploss ? is it fix stoploss size (in PIP) for all currencies ? since various currenies having different volatility.

Anu
 

blackcat

Trader
Jun 3, 2014
6
0
12
Thanks Stuart!

One more query - from trend line break once entered in trade how much PIP away i should assign my stoploss ? is it fix stoploss size (in PIP) for all currencies ? since various currenies having different volatility.

Anu

Personally I set SL to the last swing before the break. If the swing is more than 30/40 pips I set a fixed stop loss to 30 pips. I'm thinking about to use the ATR daily range.

Waiting for Stuart answer :)

Bye
 

readyforex

Official Advertiser
Jun 5, 2014
30
0
22
Personally I set SL to the last swing before the break. If the swing is more than 30/40 pips I set a fixed stop loss to 30 pips. I'm thinking about to use the ATR daily range.

Waiting for Stuart answer :)

Bye


Use Average True range, it is a good indicator to know the price action in terms of pips. Like how many pips on Average a currency pair is moving per trading day.
 

anukrh

Master Trader
May 16, 2014
56
0
47
INDIA
Thanks Blackcat about your idea, i also some where read that use ATR(14) as SL but since its daily based ATR its range differ from different currencies , some time 150 pip also, 150 pip setting as SL i am feeling not at all ok. but it can be good for a big size account (may be :))


Stuart need your idea on this.


Anu
 

stuart1984

Master Trader
Mar 22, 2014
362
0
52
Scotland
Thanks Blackcat about your idea, i also some where read that use ATR(14) as SL but since its daily based ATR its range differ from different currencies , some time 150 pip also, 150 pip setting as SL i am feeling not at all ok. but it can be good for a big size account (may be :))


Stuart need your idea on this.


Anu

Hi guys

Some good discussions today about SL placement. This topic is covered in the PAST strategy E-book and in the e-book Nigel advises a stop at the most recent swing or if that is too far away, just above/below the trendline that you are trading the break of.

ATR is a good indicator to guide you about the distance price is likely to move over a certain period of time but for me using ATR for SL with this strategy would not work. The reason being, we are trying to keep our stop losses very tight. Our trade entries are our way of testing the water to see if the market is ready to move in our direction quickly. If it moves in our favour, we get to break even as soon as possible, if you have a wide stop to begin with, then the logic behind that SL is not going to change very quickly and therefore you would struggle to justify moving to BE after the trade moves in your favour only a little way.

We need to remember that the very nature of this strategy is trying to pick tops and bottoms, allowing a trade room to breath should not be on the agenda for a counter trend trade, it is either going to work or it is not, if it doesn't I would personally like to find out quickly so that I can protect my capital and use it to trade a different set up.

For me the tight stop loss is also psychological, I hate having a trade that sits in negative territory, Nigel once compared this to ripping a band aid off, its best to do it quick and get it over with rather than prolonging the pain, I think this is a good analogy.

I like to place a stop at the most recent swing point before the trendline break, if it is too far away, I will either not take the trade or I will try and find another logical level of S/R, possibly horizontal.

I think using wider stop losses should be left to trend following strategies.

Hope this helps guys.

Stuart

P.S not having a great week with my trades this week, hopefully the latter half of the week will prove more lucrative.
 

stuart1984

Master Trader
Mar 22, 2014
362
0
52
Scotland
Hi guys

The trade ideas I highlighted at the beginning of the week are not working out at the moment. I have therefore been having a look through the daily charts for some inspiration. I can't post my charts at the moment but I would recommend looking at some of the Aussie crosses, nice preceding trends and reversal candles on the daily charts today with some nice looking hourly trendlines that look ripe for breaking to the downside.

I'll try and post some charts later.

Thanks

Stuart
 

anukrh

Master Trader
May 16, 2014
56
0
47
INDIA
Thanks Stuart for ur clearity on SL placement.

Two more queries -

1) when trade move as per our wish about how many pips in profit i should move my SL at Breakeven point ?
2) As you shared that you try to quickly bring SL to Breakeven point ( if i m right its trade open price ?) and if later trade reverses and hits SL , no LOSS for that particular trade, but i think spread+swap (if its running more than one day)+ commission (if any- depends on Brooker) will be charged, correct !
 

anukrh

Master Trader
May 16, 2014
56
0
47
INDIA
Hi stuart!

can u pls. reply my previous two queries.
additionally one more query - I taken 4 trades yesterday , trade gone 20/40 pips as per my wish, I moved SL to Breakeven and waited for trade running for more pips, fiinally all trades hitted SL

what to do this kind of incidences since profit came but gone with sptread charges and broker commision



Anu
 
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stuart1984

Master Trader
Mar 22, 2014
362
0
52
Scotland
Thanks Stuart for ur clearity on SL placement.

Two more queries -

1) when trade move as per our wish about how many pips in profit i should move my SL at Breakeven point ?
2) As you shared that you try to quickly bring SL to Breakeven point ( if i m right its trade open price ?) and if later trade reverses and hits SL , no LOSS for that particular trade, but i think spread+swap (if its running more than one day)+ commission (if any- depends on Brooker) will be charged, correct !

Hi Anu

Please understand that I have a full time job and therefore cannot respond to your queries immediately. I also have to do my own trading analysis and manage my trades and so unfortunately, the time I can spend on the forum is limited. I will try and answer your queries:

1. I usually move to break even once the profit equals the initial risk. For example, if my initial stop loss is 25 pips, I would wait until the trade goes 25 pips(plus spread) in my favour and move to Break Even. A Break Even stop loss is simply the level where you will not lose any money of the price reverses, this will probably not be your exact entry point as you have pointed out the spread needs to be taken into consideration.

2. I don't think you should worry too much about swap/rollover. Especially on a small account, this is going to be pretty tiny and sometimes it works in your favour. For example if you are currently long NZD, you should be earning a positive swap because of the higher interest rate. I have never traded with a broker that charges commission over and above the spread and so unfortunately I cannot comment as to how this will effect the strategy.

3. It will happen lots of times where your trade moves in your favour, is looking great and then suddenly turns around and stops you out. This is unfortunately what trading is all about, you need to be in control of your emotions to make sure that these swings in price do not cloud your judgement. From time to time, you will catch a big move and it will wipe out all your small losses and break even trades before you know what has happened.

Patience in this business is key.....just keep plodding along and it will eventually happen for you. The idea is to protect your account capital and only take small losses so that you still have money in your account when the big move finally arrives.

I have had a very frustrating week myself. I was long NZDUSD for a few trades this week and kept getting stopped out at BE. The last attempt was stopped out at BE and the price turned around again and rocketed North but I wasnot able to catch the move. This is just something you have to deal with. I did take a trade last night on GBPAUD. We had some very positive interest rate news in the UK last night which meant the GBPAUD closed with a bullish engulfing candle. A quick check of the lower timeframe chart and I could see we had just broken a very nice looking trendline and so ientered long,my Stop loss is now at BE, here are the charts:

Daily



H4



Thanks

Stuart
 

Abercrombie

Trader
Jun 13, 2014
46
0
22
California
Greetings All!

I am getting up to speed on PAST. After looking over historical charts, I have to say I am quite impressed with the potential.

Stuart - Thank you for taking the time to provide real-time analysis and charts. That really helps to see the finer details.

Abercrombie
 

stuart1984

Master Trader
Mar 22, 2014
362
0
52
Scotland
Greetings All!

I am getting up to speed on PAST. After looking over historical charts, I have to say I am quite impressed with the potential.

Stuart - Thank you for taking the time to provide real-time analysis and charts. That really helps to see the finer details.

Abercrombie

Greetings Abercrombie

Welcome to the forum, great to havr you on board and look forward to seeing your posts.

Stuart
 

blackcat

Trader
Jun 3, 2014
6
0
12
Hi all,
my analysis for the next week

AUDJPY > buy (there's an important resistance @96.117 - if price break up i think it can go up faster)

GBPUSD > sell (from d1 anchor chart)

GBPJPY > buy (ascending triangle formation on H4)

GBPCAD > sell (from d1 anchor chart)

b34d2f710d38e3a11a702ae7629a11d9.jpg


6ccf14bc887d345f8d044e7fb30fa981.jpg


337a4a8eed1e21e4a38e7a912f50bebd.jpg

63a77b44f208c0e50f913eb70eb03171.jpg



Any comment will be appreciated

Feel free to use these analysis

blackcat
 
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stuart1984

Master Trader
Mar 22, 2014
362
0
52
Scotland
Hi all,
my analysis for the next week

AUDJPY > buy (there's an important resistance @96.117 - if price break up i think it can go up faster)

GBPUSD > sell (from d1 anchor chart)

GBPJPY > buy (ascending triangle formation on H4)

GBPCAD > sell (from d1 anchor chart)

b34d2f710d38e3a11a702ae7629a11d9.jpg


6ccf14bc887d345f8d044e7fb30fa981.jpg


337a4a8eed1e21e4a38e7a912f50bebd.jpg

63a77b44f208c0e50f913eb70eb03171.jpg



Any comment will be appreciated

Feel free to use these analysis

blackcat

Hi Blackcat

Thank you for sharing your analysis, looking good. I will post my charts later to compare.

Have a great trading week.

Stuart
 

stuart1984

Master Trader
Mar 22, 2014
362
0
52
Scotland
Hi Folks

Not a great deal to be seen for me on the charts this week and so I am not going to force trades for the sake of it. I closed out my GBPAUD long this morning with a profit of 88 pips. Price has broken down through an hourly trendline and so I felt it was time to take my profits considering this was taken on a daily anchor chart signal, here is the chart:



I am also still short AUDNZD since Friday and I am holding this position for the time being, not at BE yet but price has started to move in the right direction for me.

The only pair I am keeping my eye on this week is EURAUD. I exited my shorts the week before last and in hindsight it looks like I was premature. Price is at an important juncture and I want to see what happens next, see the weekly chart below:



Happy trading everyone

Stuart
 

stuart1984

Master Trader
Mar 22, 2014
362
0
52
Scotland
Ok I have decided to take a shot at the GBPUSD short discussed in Nigels weekly report as for me, it is now looking more appealing that it was first thing this morning. I entered short at 1.6984 with SL @ 1.7000 aim to get to BE asap. this was the break of a trendline on the 5 min chart. Because the anchor chart is an h4 chart I am not looking for a huge move, I aim to take profits if price gets down to the 38% fib retrace or 100 period MA (hourly chart) whichever comes first.