We are going to study over the weekend how this pair moves. We have a 4H - 30m - 5m chart opened. We are going to study how price moves around our 50/100 sma We are going to watch how the macd moves around the macd 0 level line and the stoch 20/80 levels - blue dotted lines The 4H is in-between the 50 and 100 sma. This I call an inner range. it has no real direction or momentum. When price breaks out of the inner range it will have direction and momentum. Watch this pair over the weekend and make copies of your chart with the camera in the lower right corner. The 4H macd is above the 80 level. Price can go half way across to the 100 sma and fall back to the 50 sma because the macd is above the 80 level. Let's watch and see if it does. Price may just go across to the 100 sma so let's watch if that happens and what the macd looks like during that. If price does come back to the 50 sma two things can happen. It can break below the 50 sma and retest the swing low on the 4H. or price will try a second time to make it across to the 100 sma. Watch how the macd looks like during all of this and make sceenshots. We are not trading here we are just studing and educating ourselves how to use this indicator. As the 4H is doing all of this you want to be watching and documenting how the 1H and 5m charts look and how they are acting in these different situations. This is a great pair to teach you all of the ebb and flow of price and how the indicator reacts to it. You are watching on the 30m and 5m how price moves around the 50/100 sma and how the macd is moving around the 80/20 levels and the 0 level line.
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4H price did go half way towards 100 sma and then fell back to the 50 sma. Now price will either break below the 50 sma and fall to the previous swing low or it will stay above the 50 sma and held back up towards the 100 sma.
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How to intra-day trade from a 4H trade setup Price was at 50 sma heading to 100 sma Mostly price will only go 1/2 way and fall back to 50 sma Short trades during that fall back to 50 sma 4H trade setup shows price falling back to 50 sma 30m chart is over-bought on Stoch blue dotted lines Watch the 5m chart - follow the red arrows for trade entries.
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This is how price may move between 50 sma & 100 sma
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Price did not bounce bullish at 4H 50 sma Price on 30m and 5m had a short breakout at the 4H 59 sma 15m candles showing a break-hook-go candle pattern 30m & 5m macd oversold so consolidation or bullish pullback possible
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4H Macd did not break below the 0 level line This opened up the possibility of a long trade setup on 30m A RSI 80-20 Pullback Strategy developed - rules listed on chart Buy stop hit and target price was 30m 100 sma 5m chart show buy stop enter - a break-hook-go candle pattern confirmed long trade
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4H Trade Setup - Macd is still above 0 level line bullish bias. 2 long body green candles followed by red pullback making higher lows. 2nd breakout of 50 sma. 30m Timing - macd crossed below 0 level but crossed back above it and Red line bullish bias. 1st higher low from swing low at 17:00 created trade setup 2nd entry for breakout of 4H 50 sma. Take profit from recent resistance point. 5m Entry point - The higher low setup a RSI 80-20 trade on 5m. 1st entry buy stop at 5m 1st swing low breakout level. Take profit from recent resistance point.
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4H Bullish Continuation Trade Setup 30m Timing - Macd to fall and then reverse bullish 5m 2 Entry Points - Macd to fall to 0 level line possibly and then reverse bullish Entry Points listed on chart
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Look at 5m chart for 2 entry points
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Here is a summary of trades found using 30m timing setups
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1st 1 to 2 risk/reward take profit hit - there is room to go to the top!
@desil, This is a educational post to study how the macd and the 2 ma's responds to price. It is also to learn how to use the 4H chart for finding trade setups. use the 30 m charts to find the right market timing -over sold/bought.
The 5m to find good risk-reward entry points. This helps you also feel the ebb and flow of the market. i feel a trader needs to be like a chameleon and be able to change colors or directional bias as the market decides it's direction. These are more of an intra-day trade setups. So yes it is up and down. But since the 4H macd is above the 0 level line it is longer term bullish & when the 30m Macd is above the 0 level line it is more currently bullish bias. I have made a dual indicator with a macd crossover indicator overlaid on top of a stochastic. The macd is used for direction and trend bias as it crosses both the red line and the 0 levelline. i only use the 20-80 blue dotted level lines from the stochastic to show me when the macd is over sold/bought. If you are interested in how to setup that dual indicator PM me. Visit our website for tons of free strategies and training -
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