Trade Sheet – enhance your Forex trade odds

The Odds Enhancers Simplified. Forex Odds Enhancer for Forex Trade Qualifications.

To do: This post is work in progress.

Instructions:

1. Select Forex Pair / Market Symbol from ORDERS sheet

2. Identify and Enter “Sell at Supply Zone” levels

3. Identify and Enter “Buy at Demand Zone” levels

4. Input  the Entry Type (Line 6)

5. Input the Entry Price (Line 7)

6. Input the Stop Price (Line 8)

7. Input the Target Price (Line 9)

Risk, Reward and Ratio will be automatically calculated

8. Input Odds Enhancers (Line 10-15)

(Ratio? Not proper) Reward / Risk Ratio is not proper

Pair Selection

(8) ATR – Volatility, Spread and Range

For income – Is ATR 50-to-100

Wealth -IS ATR between 100-200

(9) Candles (Body Size)

Big Candles (Body) strong trend

Small candles= Normal to weal trend

(10) Wick Sizes

Big wicks -Volatility

Small wicks

There are 7 basic ‘odds enhances’ grouped together, in form of Questions you ask yourself when you see price action on chart:

(1) Strength of Leg-out: Max score 2

How strongly price is moving away ? is it a strong move away? What are candles type and size? Score of 2 if First candle out of zone is strong. Allocate a score of 1 if first candle not strong, but has continuous follow through bars. Lastly, a score of 0 if move out is mixed.

Strong candle: If the body of the first bar is at least twice the width of the zone.

Two candle (price bars) types: Narrow Range Candle(NRC) and Extended Range Candle(ERC). ERC with long wicks are called exciting candles. Stick to the following criteria for the ‘price move’:

  1. Explosive 90 degree angle, Proximal to first NRC is 3:1 and same color ERC will gets a score of 2. Price action move away from the level’s ‘strength analysis’ results in max score is of 2. If there is a Gap (micro or big) it is an automatic 2 score!
  2. Strong less than 110 degrees angle, here proximal to first NRC is 2:1 with same color ERC gets a score of 1
  3. Weak greater than 110 degree angle, the proximal to first NRC is 1:1 with same color ERC is unwanted score of 0.

(2) Risk to Reward Ratio the RRR : Max Score is 2 at Higher Time Frame

Reward to Risk Ratio analysis gets a max score of 2. The big idea behind this price action is the initial move and how far did price travel before reversing.

Reward to Risk Ratio is measured as the distance from current entry point zone to the opposing zone. Don’t forget that a swing high or swing low is a supply zone until it is broken. Also known as profit potential distance 

  1. RRR at least 3:1, means a score of 2
  2. RRR less than 3:1, but better than 2:1, means a score of 1
  3. RRR less than 2:1 means a score of 0, Obviously if your profit potential is about 1 to 1 don’t do this trade.

(3) Trend Analysis: max score of 1

Selling at Supply Zone, and Buying at Demand Zone? What is ‘CURVE’ and ‘TREND’ levels at?

  1. Trend is in the direction of the trade and your zone doesn’t violate trend rules within previous swing low and high, if this statement is true than give a score of 1.
  2. Trend is sideways and your zone is at the absolute peak top or bottom, means a score of 0.5.
  3. Counter Trend your zone will not stop the trend, or it is outside of the current swing highs or lows, means a undesirable score of 0.
  4. Counter Trend: Your zone will not stop the trend, or it is outside of the current swing highs or lows leads to a undesirable score of 0.

Tricky Trend –

  1. Does the zone you are picking violate ‘trend rules’? Meaning is it outside the Higher High and Higher Low area for Demand. Or is it outside the Lower High Lower Low are for Supply. If not then it is a 2, otherwise it is a 0.
  2. If on the time frame you are trading it is an uptrend and you are trying to short?
  3. Is this Supply Zone strong enough to reverse the trend? If not then score is 0.
  4. If on the time frame you are trading it is a downtrend and you are trying to go long?
  5. Is the Demand Zone strong enough to reverse the trend? If not then score is 0.
  6. What is strong enough to reverse trend?

How does Dashboard determines trend automatically?

  1. EMA 20/50 crossover?                        
  2. Slope up or down ?                        
  3. EMAs distance wide or narrow?                        

(4) Curve Analysis- find the ‘Curve’ position : max score of 1 at only at Higher Time Frame

Curve analysis should get one answer from three possibilities: High, Middle or low as under:

  • High on Curve -Supply Zone (Sell). Also check for Counter Trend area ?
  • Low on Curve – Demand Zone (Buy). Is there a counter Trend area ?
  • Middle of Curve?
  1. Good curve location is considered within a higher time frame level, to get a highest score of 1.
  2. Curve is in middle? If yes, give a score of 0.5
  3. Bad curve location is the Demand Zone in a Higher Time Frame Supply Zone or vice versa, or curve is too close to opposing higher time frame zone. It is undesirable, hence a lowest score of 0.

A zone that is inside a higher time frame! It is that simple, the higher time frame zone will help the smaller time frame zone reverse trend. Always? No, that is why again, you need a stop loss!

(5) ‘Retracements Analysis’ max Score is 2

  1. If Level is fully fresh give a score of 2
  2. If the Level has been touched only one time and the penetration has been less :
    1. Than 25% give a score of 1
    2. If the Level has been penetrated deeper than 50% or there is more than one touch give a score of 0

For our trade to work out, institutional unfilled orders have to still sit there, if they are not sitting there, there is nothing there to make our trade work. Though on some time frames this is not true, there is no unfilled orders sitting for years, but price has memory. If someone bought or sold there once and left a foot print, there is a chance they are going to do it again when price returns to those levels.

(6) Time at the Level : Max Score is 1

This Odds Enhancer score is analysis of the freshness. The question you asking (to chart) How many times the zone has been tested? Score of 1 if fresh, Score of 0.5 if tested 1 Score of 0 if tested twice & above.

Time spent in the zone. Number of boring bars the zone

  1. Score of 1, if 1 to 3 boring bars in the base.
  2. Score of 0.5, if 3 to 6 boring bars in the base.
  3. Score of 0, if 6 or more boring bars in the base or if opposing zone less than 3 times the width of the zone.

Remember the continuation pattern rule? 6 touches and the 7th is the breakout, hence the rule.

(7) Arrival – Opposing zone (Profit potential) : max Score is 1

  1. Very Crazy – Profit Margin based on Opposing Level greater than 3:1, Score is 1 . Simply stating, opposing zone more than 3 times the width of the zone.
  2. Fast but not Crazy – Profit Margin based on Opposing Level is 2:1, this means score 0.5. The opposing zone just 3 times the width of the zone.
  3. Slow Pace – Profit Margin based on Opposing Level less than 1:1 will get a score of 0. Here, opposing zone is less than the width Of the zone.

Will there be a violation of trend when price reaches your zone? No = 1

Is my time frame at a trend reversal area? Yes = 1

Did price bounce off a higher time frame zone to get there? Yes = 0

(8) Extras

Level on Level ? If yes, then take the higher zone. If 3 zones take the middle zone. If 2 or more zones are broken the trend has changed.

These exist in a higher time frame zone, hence the reason you need to know that price can reverse at either one of these, stop always goes above the highest one. If 3 then stop has to go above the 3rd one

All Star entry ? If Bollinger Band is pierced on the side opposite to trend and price enters a high quality zone. You would have to be there to see this, but if you are waiting on a #3 or #2 entry, then this is an odds enhancer. For a #1, well you don’t know if it will be pierced or not.

Total Odds Enhancers score, and decision making:

‘Odd Enhancers Total Score’ will be calculated, setting the Trade Status flag according the the legend below:

  1. Proximal Entry: Score is greater than or equal to 9/10. A total of 10, enables No 1 Limit Entry. No.1 is the ‘Limit Entry’
  2. A total score of 9, 8 or 7 mean No 3 ‘confirmation entry’. Some traders ( Tracy Hubbard) call it a ‘chicken entry’
  3. No Trade: If score below 7/10. Any zone with a total score of 6 and below is to be discarded.
The following two tabs change content below.
Avatar

jsmahay

I feel ethereal! Storm inside me!
Avatar

Latest posts by jsmahay (see all)

Avatar

jsmahay

I feel ethereal! Storm inside me!

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: