Trade plan question

[paddycal]

hi

quick question in relation to setting up a trade plan........

don't have a chart to represent this , it's more of a trading strategy question

for example, daily trend was up and 4 hr trend was up with no serious resistance above us
so we were looking at buying dips on the 1hr chart for example.

the one hour chart has a slow retracement back to a support SK.
Our trade plan has us entering long at the support SK ( based on 1 hr chart ) when 1hr TRSI crosses back up.

supposing the 1 hr retracement was a slow retracemet and as a result the 4hr TRSI crossed down.
( daily is still up ) but we did not generate lower highs on the 1 hour chart.

My question:
Do we still have enough setup to go long when the 1hr TRSI crosses up, even though 4 hour TRSI has
crossed down. ?

The reason i ask is that i'm trying to put together a trading plan and going thru the scenarios , i came
across this one and wanted to get other people's opinions.

my intial feeling is yes it is a valid entry but should be a cautious one and we are against the 4 hr trend.
so we should monitor it very closely.
Ideally you would like the 4 hr to stay up, but it depends on how well you want your ducks lined up before
you enter.

any comments welcome

thanks

patrick

[Graham_S]

Seems we're all on trading plans, Paddy:-) If I'd had mine written and kept to it i would have been spared a lot of pain in the eujpy this morning. (gmt) As it happens the disaster bit of my as yet unwritten plan bounced me back into a good profit - with just a little luck or was it luck:-) ?

Anyhow, my answer to your question is probably not much help.
Maybe if you're asking the question in the first place there is doubt in your mind so you should dismiss the entry as void - certainly on those t/frames.

I can see wot u mean, but without a scientific back look at the trsi, presumably if the 60m was up but the 4h started to turn down, it wouldn't hav been strongly up in the first place?
It could also depend on whether the 4h trsi is down below40 or up at 60. Is it an unconfirmed dip before the close of the bar? These often disappear on close when price turns within the bar. (Answers not required -rhetorical questions for u to define)
If you still want to enter in this scenario, perhaps your rules should tell u to drop down t/frames to say the 60/15, or if the 1h isn't moving up with momentum to the 30/5 or lower.

Besides that, to me - and this is part of your definitions in your plan to dictate how u line up your ducks.

1. It would depend on how you line up your dual or more timeframes in your rules.
2. Whether you are totally rule based or at all judgemental. Rule based is easier to write and follow:-) If rule based you will need x,y, and z to line up and be satisfied before you enter. If they don't line up, trade void, plan B (which could be examine lower t/fs or just move on). If you are at all judgemental you may decide you need x and y to line up, but z depends on s/r, momentum or other things you ping on the chart. Even if judgemental you may decide a set of sub criteria for z... and so on.

It's good to write - it's helping me with my plan:-)


How's your coming on Toyo?

Cheers.

Graham.

[toyogo00]

Hi Graham,

I've already got my plan drafted - objective, trading method, money management etc. Indeed, I've carried out the plan over the last few weeks. Of course with some mistakes - such as impatient to get in -- just did one on USDJPY with FibMaster using twitter on 17Mar09; managed to get out with -5pips.lol

FibMaster@Toyogo00 I'm wondering why you enter long at 98.90 on USDJPY rally, instead of buying the retracement? #FOREX

FibMaster@Toyogo00 Respectfully, I do not like your late entry USDJPY. However, that is already done.10:32 PM Mar 17th from web in reply to Toyogo00

Toyogo00@FibMaster Cut @98.85 for -5pips! sideway market now! goto bed - get ready for the next better trade tomorrow! lol!12:14 AM Mar 18th from web in reply to FibMaster


I'm still finalizing the "high probable trade based on FibMaster method" and find it very useful as a guideline to the trading rules - as Mark Douglas said, "We have to be rigid in our rules and flexible in our expectations". With the rigid rules, you know the odd is on your side in the long run. Once you get into the trade, you must be flexible on the outcome (expectaton) as you don't know how the market will react - trade what the chart shows and get out if it doesn't go your way (according to the plan). Having said that, I would admit that the exit rule is much more difficult to implement than the entry rule, you want to let your profit runs but you really don't know how it will run - Fib Exp 100 or 161.8 or it may retrace to near your entry point before it runs - lots of experience needed.


Regards,
Toyogo

[Hussam]

Hi Patick,

My view is:

(1) If only the fast (grey/blue) 4 hour TRSI crossed down, then no problem, because the 4 hour main/slow trend is still up (and the daily is up as well).

(2) If we have a full TRSI cross down on the 4 hour, then I personally would stay out, because the intra-day trend has been put into question. I would like to see if we have a deep pull back on the 4 hour or it is the begining of a change in the main trend.

Good luck.

Hussam.