SHTP - Simple Hidden Trading Patterns (SHTP - Simple Hidden Trading Patterns)
Dear Trader,
I want to show you some trading techniques that I have figured out on my own over the years (+10 years), most of which I use to back up my trades and set appropriate take profit and reversal areas. I'll do some separate posts to highlight everything I have, and maybe we can find some more hidden market clues.
I must mention a very important disclaimer, everything I present has zero theoretical background, meaning I have not seen a single book or anything that can support my ideas, only the fact that I have tested this stuff on many charts, many different timeframes, stock and forex charts, and cryptocurrencies. And they work very well. Some can even be used for price predictions, but more on that later.
Let's get started, I'll comment on the rest later. I will fill the thread slowly.
1# Technique - Finding the "Real" Trend Line
Let me give you a great example using the chart below. GBP/USD W1
Some would place a trendline on this currency pair, as shown below:
However, I think exactly the opposite:
For me, the following happens:
1: First trend line
2: The second trend line appears
3. The third trend line appears
4. The third trendline breaks, but without a proper uptrend forming below it, there are signs of an actual multiple swing structure with higher lows. This means to me that this is a false breakout. Anywhere above the trendline breakout is an absolutely great place to look for shorts, as the price target is seen as the low of the third trendline. Marked with an orange circle.
After reaching a new low, I can establish my channel there by getting the first major reference point in the trend. This is where I would close the position because it could be where a correction occurs.
5. Marks for preparing shorts.
6. is the area where the pair is oversold, so if you are still trading, this is a good place to start thinking about closing your positions and planning a reversal.
7. was the first uptrend to form, it actually got broken, meaning the trend had failed, technically the current downtrend should have made a new low, but we see it failed to do so as the next wave made a new high.
8. Marks a new “fake” uptrend
9. is the point where the downtrend ends.
To me, the above analysis means that point 7 is key to me. This tells me that any rally we experience is a failure and eventually price will need to correct it back! So technically, anywhere above the end of the actual downtrend is already a good place to start looking for entry points.
About this, I know it's like, "DUUUUDE, it's still going up for weeks or months..." because it can do that because of the "fake" uptrend, which is still a push to new highs. But it holds the key, which is that we have found the point where the upcoming downtrend will drive the price.
The next screenshot shows how this works:
10. There are “errors” that need to be corrected
11. Is this the new low we’ve been waiting for?
I'll post the next example on this chart, which I hope will help you realize the power of this information:
The next uptrend also failed, marked with an orange circle. I will check the price levels and dates there.
The mistake happened in 1985!
Now see how and in what way it is corrected:
Here is the hourly chart of the same pair: September 26, 2022 - 37 years later! ! ! The pair corrected the missing low with just one candle!
To me, this means that any wrongs that have happened to the two so far will now begin to be corrected. So I would say the long-term fact for this pair is that GBP/USD will head north.
Qucik reflects on what happened to the pair. While some of you are looking for the ratio of 1/3 to 2/3:
Basically, anywhere in the red zone (the breakout point of the first false trend) is this ratio.
Now I know this is a very long time. But this also works on smaller time frames. The reason I like to do this on the weekly chart is to give me an idea of where we are, which is the primary direction, and from there I can capture corrections on the daily chart, as well as smaller hourly movements.
When trying to find a historical trend, it's always wise to review a chart to understand its absolute lows and highs.
I'll make another interesting discovery using the same chart. See you in the next comment!
I want to show you some trading techniques that I have figured out on my own over the years (+10 years), most of which I use to back up my trades and set appropriate take profit and reversal areas. I'll do some separate posts to highlight everything I have, and maybe we can find some more hidden market clues.
I must mention a very important disclaimer, everything I present has zero theoretical background, meaning I have not seen a single book or anything that can support my ideas, only the fact that I have tested this stuff on many charts, many different timeframes, stock and forex charts, and cryptocurrencies. And they work very well. Some can even be used for price predictions, but more on that later.
Let's get started, I'll comment on the rest later. I will fill the thread slowly.
1# Technique - Finding the "Real" Trend Line
Let me give you a great example using the chart below. GBP/USD W1
Some would place a trendline on this currency pair, as shown below:
However, I think exactly the opposite:
For me, the following happens:
1: First trend line
2: The second trend line appears
3. The third trend line appears
4. The third trendline breaks, but without a proper uptrend forming below it, there are signs of an actual multiple swing structure with higher lows. This means to me that this is a false breakout. Anywhere above the trendline breakout is an absolutely great place to look for shorts, as the price target is seen as the low of the third trendline. Marked with an orange circle.
After reaching a new low, I can establish my channel there by getting the first major reference point in the trend. This is where I would close the position because it could be where a correction occurs.
5. Marks for preparing shorts.
6. is the area where the pair is oversold, so if you are still trading, this is a good place to start thinking about closing your positions and planning a reversal.
7. was the first uptrend to form, it actually got broken, meaning the trend had failed, technically the current downtrend should have made a new low, but we see it failed to do so as the next wave made a new high.
8. Marks a new “fake” uptrend
9. is the point where the downtrend ends.
To me, the above analysis means that point 7 is key to me. This tells me that any rally we experience is a failure and eventually price will need to correct it back! So technically, anywhere above the end of the actual downtrend is already a good place to start looking for entry points.
About this, I know it's like, "DUUUUDE, it's still going up for weeks or months..." because it can do that because of the "fake" uptrend, which is still a push to new highs. But it holds the key, which is that we have found the point where the upcoming downtrend will drive the price.
The next screenshot shows how this works:
10. There are “errors” that need to be corrected
11. Is this the new low we’ve been waiting for?
I'll post the next example on this chart, which I hope will help you realize the power of this information:
The next uptrend also failed, marked with an orange circle. I will check the price levels and dates there.
The mistake happened in 1985!
Now see how and in what way it is corrected:
Here is the hourly chart of the same pair: September 26, 2022 - 37 years later! ! ! The pair corrected the missing low with just one candle!
To me, this means that any wrongs that have happened to the two so far will now begin to be corrected. So I would say the long-term fact for this pair is that GBP/USD will head north.
Qucik reflects on what happened to the pair. While some of you are looking for the ratio of 1/3 to 2/3:
Basically, anywhere in the red zone (the breakout point of the first false trend) is this ratio.
Now I know this is a very long time. But this also works on smaller time frames. The reason I like to do this on the weekly chart is to give me an idea of where we are, which is the primary direction, and from there I can capture corrections on the daily chart, as well as smaller hourly movements.
When trying to find a historical trend, it's always wise to review a chart to understand its absolute lows and highs.
I'll make another interesting discovery using the same chart. See you in the next comment!
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