[FrankC]

Good morning TimV & duckfu,

Sorry for the late reply, and thanks for joining this thread. As TimV pointed out, candle patterns are not exact science, and you must allow some degree of flexibility to it. In the case of gaps, I did exactly as TimV mentioned, just omitted the "gap" part, and look for patterns resembling to morning/evening star. As a matter of fact I made some good trades with the patterns, and if I found those trades in my MoneyTec's thread, I will try to attach it to this thread, or perhaps when I see one in my next trade, I can post it here, and see how reliable they are.

Regarding my last trade(short usd/chf @1.2602, exited @1.2570, +32 pips), I saw three shooting stars hanging on 200EMA in 30min. chart, and took the short trade. Too bad I can't attach any chart, so could explain the trade more clearly, but you can go to my last page in MoneyTec's thread, and see the trade.

I hope Stephen can shed some light on the "gap" part in forex trading, and correct me, if I am wrong.

[duckfu]

TimV & FrankC,

Thanks for your replies. This is what I was thinking, but its always good to get others opinions. Do you find that this works with all patterns or do some translate to forex better than others?

[TimV]

Hi Guys,

I find it works with most patterns. The key for me is that there is an engulfing candle following the pattern confirmed by the stoc cross. If that does not occur I pretty much don't take the trade. Although sometimes the engulfing candle occurs 2 or 3 after the pattern on the 15-min chart.

[FrankC]

Very good Observation...it makes a lot of sense:

"engulfing candle following the pattern confirmed by the stoc cross. If that does not occur I pretty much don't take the trade. Although sometimes the engulfing candle occurs 2 or 3 after the pattern on the 15-min chart."

However, to give it a bit more sanity, I add 15 minutes more. For me, the 30-min chart will do.

Thanks for your insight TimV.

[FrankC]

TimV,

What do you think about this trade:

Perhaps, I will wait for a retrace to the point of downside breakout at around 1.2625, before selling.

To add to this trading idea, according to you: "Although sometimes the engulfing candle occurs 2 or 3 after the pattern." And if you notice the chart, the engulfing candle has occured at 3 candles after the shooting star.

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[TimV]

Frank,

I am very vary of placing trades on a weekend especially with the large spreads. But here goes anyway. I would either wait for the next engulfing bear candle, or as you stated, wait to see if it retraces a bit and then look for another pattern and engulfing candle.

What timeframe is that chart showing and when was the snapshot taken, I assumed it was very recent.

I have to leave for work so will not be reading the thread again until probably Monday afternoon.

Good Trading Tommorrow,
Tim

[FrankC]

Tim,

It is the 30-min chart of today: Sunday at 8:20AM Eastern time. The last bar is at 4:30PM, on last Friday(9/24).

4x begins at 10PM tonight. I'll never place any order before 10PM on Sunday. As you said, the spread is too large at 10 pips. It's not worth it.

[TimV]

Frank,

One last thought before I go. There is a possibility that it may make a retrace back to the resistence line forming a double-top. An engulfing bear candle coming off the rejection at the resistence would be a good signal. However, if this happens during the asian or London sessions is anybodys guess as I have in the past seen the entire asian session completely flat. My guess is that it would happen before the NY session though.

Tim

[FrankC]

Well, hope to see the retrace during early US session...no desire to stay up all night(during Asia/London) to see the retrace, if any.

Happy trading.

[FrankC]

5 more minutes to go, and a hammer is forming in the 3hr. chart, right at the mid-band.

No trade alert until prices start touching upper/lower bollinger band at 1.2650/1.2580 in the 30-min chart.

1.2625-50 is area to watch for.

[TimV]

9/27 4:02AM short chf @ 1.2630 SL@1.2656

engulfing candle on 30-min chart after a bounce off the 1.2646 R, looking for 1.2598 which is the daily pivot.

[TimV]

closed above at 1.2627 for a +3, 5:46AM

have to go to work, figured I would take the few pips rather than leave it open.

[FrankC]

Consumer Confidence report is due at 10AM EST, so no trade before the news.

[FrankC]

Short 1.2603 SL 1.2630 (target open)

A shooting star(9AM bar) hanging on 200EMA, followed by a bearish engulfing line(9:30 bar).

[candlestick1]

Yes, use the concepts of the signals, not the signal to the absolute tee description, and combine it with the stchastics , they will work effectively