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Chapter 23, Part III. Some Rules and Advanced Talks. Page 2

Discussion in 'Complete Trading Education- Forex Military School' started by Sive Morten, Dec 24, 2013.

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  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Advanced comments – trend compounding


    Commander in Pips: If you have worked a bit with multiple time frames, you probably have some questions about trend estimation and combination. I mean how to combine MACD on Daily time frame and hourly time frame. We assume that we work at the same Daily-hourly-5-15 min selection.

    1. Our context and our trend is a daily trend indicator, let’s say MACD. It tells us where we want to go – Long or short. For simplicity let’s assume that we want just to ride the trend and no patterns are forming currently on the market. It is preferable, that the market stands in thrusting mode. Look at chart #1:


    Chart #1 | EUR/USD Daily
    [​IMG]

    So we see all that we want from perfect move – market in thrusting down move, MACD shows bear trend, hence we want to enter short. Now market has reached Fib resistance and we want to estimate where we could jump in.



    2. For that purpose we use hourly chart:


    Chart #2 | EUR/USD 60-min
    [​IMG]

    Here we see that MACD in Buy mode, but we know that market stands at resistance. Here we have to watch over two events. First, look at the daily trend that it will not turn bullish. In this case our context for short selling will vanish. Second is to watch over the hourly trend – when it will turn bearish, we can use the nearest hourly Fib resistance to enter short. Now, it’s still bullish. This is tells us that the market could show deeper retracement and currently is not the time yet to enter short.

    So, our task is to wait for when hourly trend will turn bearish, while the daily trend will hold bearish all the time:


    Chart #3 | EUR/USD 60-min
    [​IMG]
     
    #1 Sive Morten, Dec 24, 2013
    Lasted edited by : Oct 1, 2016
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