Cycle Trading

I'm short both pound and euro pretty much from the top on both. Holding until I get confirmation the cycle is up.

On my blog I have a post that talks about creating a Gann Grid from the stock tools in MT4 on a 30 min. euro chart. The grid starts way back on a swing low on June 13. Up to this day two and a half months later, the grid is still relevant to price and time.

Attached below are two charts showing another method I use for trading cycles of time. About 5 years ago I noticed that trend lines I had on my charts were still relevant even after the move they defined was long gone. And when these lines intersected.. sometimes way in the future... price would react. So now I keep them up and use them for timing. The first chart shows some normal channel and converging type patterns. The second chart shows how price reacted when it ran into a division of time and then reversed hard on the intersection (magenta). I wasn't around to see it or I would've added to my short position.

Hi, JR I noticed in your other thread on Acuma's forum, that you corrected yourself in your formula for the grid placement. In this grid here on the pound using MT4, did you use 1/4 i.e.(+.25) or did you use 1/8 i.e. (+.125), to produce the 45 Degree angle? Of course I am assuming you fixed the scale to 1 to 1.

The correction post was a little unclear to me.. thanks much, sorry for the intrusion.

Not an intrusion at all and sorry for the confusion. 45° is 1/8 of the circle, but the corresponding degree factor is .25. In other words the degree factor for 360° is 2. 180° is 1 on down the line.

The Gann Hexegon uses a 360° degree factor of 1 and that's where I made the mistake in the post.

btw, in my blog I go over some other ways to create a Gann grid using ranges of price and ranges of time.

http://4xcycletrader.blogspot.com

Thanks, I see it now.

Last week was a heavy news week and my shorts got stopped out with some profit, but not much.

My outlook is still to the downside and I have a target date of 9/7/07 based on a natural cycle.

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http://img74.imageshack.us/img74/571...ep02cy2.th.gif

Nesting geometric shapes can provide turning points and vectors that define a path for price. A vector differs from a trend line in that a trend line usually defines consecutive highs or lows of price whereas a vector defines 2 points; a high to a low, a low to low, or a high to high.

The chart below starts with selecting a range which is highlighted by the red line. That red line defines one side of an equilateral triangle. Two lines are created from the angle of that line. One of them is 60° difference to define the second side of the equilateral triangle. The other is 30° difference to define the apex of the second nested equilateral triangle. Each circle is defined by the perimeter of the triangles or the interior of the triangles.

Some key things to note is how price bounced off of the 60° triangle line and ran straight up the 30° angle vector and terminated at the apex of the 2nd triangle. Also notice how price also ran down the outside of the outer circle reversing at the apex of the primary triangle.

Just to update the 32nd bar fib count ended up being a minor low. My price target was off by about 44 pips.

Not too bad for a forecast a month ago. I didn't expect the run away drop right out of the gate but looking back at some other analysis, there were quite a few signs.

Almost exactly a year ago I had calculated some cycles of 45 and 144 calendar days from a point in December of 2004. I had totally lost track of this chart and found it tonight. I wish I would have been using it the past year because it has held up extremely well. Notice the aqua lines cherry picking tops and bottoms. Trading nothing but those lines alone could have paid off handsomely. Off course it's all hindsight and I took most of this year off from trading. But fate would have it that there is a blue line coming up in later this Sept. I've got some other cycles in that general area as well.

There's also a triangle forming, so we'll see how it pans out. Triangles are hard to judge but whatever price is doing at that line, I'll be watching it to reverse the other way.

The first two shots were taken a year ago showing the cycle behavour back then. The third is the current standing situation.

http://img508.imageshack.us/img508/7...1441hy5.th.gif
http://img508.imageshack.us/img508/4...1442ar1.th.gif
http://img508.imageshack.us/img508/3...1443jf7.th.gif

The Euro manual grid from 2 months ago is still holding up. One of the things to watch for with this method is to see how price reacts at the diag. lines. They act as support or resistence and when price touches them it's a form of price and time squaring. The target is based on a trendline and a Wolfe Wave type line target intersection. Also, dropping down to a 4 min. chart shows the target at a 1.618 fib extension area. However, there's only about 8 more bars to get there so another possibility is price rising up for 8 bars and reversing on the timeline. Eitherway, my long term targets are to the downside and every rise will give another short opportunity.

First chart is the Gann Grid. Second is a 4.min chart. Third is a grid based off of a range of time. Price is at the diagonal on that one. It's also a 1h chart, so it holds a little more weight than a 30 and a 4.

http://img50.imageshack.us/img50/249...ep04co9.th.gif
http://img50.imageshack.us/img50/780...ep04aw1.th.gif
http://img50.imageshack.us/img50/332...ep04xs7.th.gif

The latter has happened and price has risen right up to the trend line and square line and peaked right on the time line. No choice but to short some more.

Short at 1.3607. Stop at 1.3632.

Trading "time" is not about predicting the future. It's knowing when the future has arrived. All I can do is trade what I think is now if I believe there is enough reward and limit risk.

Had to wait out some cresting there. The last entry was not the best entry as far as timing goes, but it's working out now.

First chart shows an update the manual grid. Second chart shows a 1h chart with a forecast that is playing out so far. The forecast doesn't show magnitude, just general direction unless it inverts and also shows possible turning points or at least price reation points.

Cycles off the daily charts are pointing to 9-7 and 9-16 through 9-20. Hopefully, price stays to the downside so I can get my stops into profit.

Well, completely opposite of what I was expecting. Stopped out at b/e on some and stopped out in the minus on the add ons. Profits gone and turned to losses. I"m not in sync. Need to reset. The red "time" line proved true, but not strong. I should have been paying attention and trailing stops on the profit.

I shorted the top on both euro and pound earlier with tight stops and a shorter targets. After these trades are done I'm probably done for the week. I got back into the bad habit of trying to nail tops of the longer time frames using intraday charts. I'm getting good entries for intraday, but I can't be hanging on to these as swing trades because the swing isn't official yet. Either that or just sit aside. I've really deviated from the plan I had going a short month ago. Attached is getting the top on the pound. Or at least the top for now. Things are shaping up for a table top type pattern. I've made a lot of pips on this type of pattern over the years. The tell tale (or is it tale tell) sign is the divergence to an oscillator. Any oscillator will do.

Also note the magenta divergence from earlier. I drew that and thought about locking in profit with a tighter stop. But alas... I did not. Divergence precluding a monster move right in my face. Just goes to show that the actual act of trading is acting correctly on the information at hand.

The above post is pound. This one is euro.

The rise up on the Euro provided a 2nd point of contact, not counting the origin, to what I believe will be a mated ellipse. The two yellow ellipses are identical and both are in direct proportion to the red.

http://img64.imageshack.us/img64/879...ep06vd5.th.gif

Forgot to add that if you look at the above picture, the middle ellipse has a relationship to the red ellipse that shows about 90% of the time with ellipses.

I also wrote up a pretty detailed expanation of why I like ellipses and where I got the concept from in my blog for those that interested.

nope. back to the drawing board.

Ok. I've hit the books, my notes, and anything else I could find and pulled out most of the techniques I use regularly and came up with a date range of 9/13-9/15 for pound and 9/13-9/19 for euro. 7 days is a pretty big window, but it will narrow quick once a few things play out.

Smallest chart is 4h and largest is monthly with some cycles going all the way back to 1980. No more trying trade daily cycles with 15 min. charts.

No charts until it pans out or doesn't pan out.

Sell stops at 2.0262 for pound and 1.3763 for euro.

sell stops never triggered. Raising them up to 1.3815 for euro and 2.0278 for pound.

omg. right in front of my face and i was looking for something else. No shorts until 9/13. I need to stop trying so hard.