Price Action Momentum: Recognize it, Joi

EAcpu | 3 reads | 0 comments | 2026-05-03

Welcome all colleagues in the foreign exchange factory:

The trade here is about looking for momentum first, but it has nothing to do with the momentum indicator. In fact, I don't use charts or any other fancy method to tell me when I should take a trade. The trade here is about pure price action and how it moves in and around the previous bar. Wow, I can't believe it's been over 8 years since I started my Forex trading journey, but it's now 2015. In fact, it’s been a journey that I don’t regret, not even for a minute, because I now have the freedom I only dreamed of years ago. However, I can't let my guard down or get complacent in trading because it's much easier to take it away from me than it is to earn it...that's the answer to why I'm here.

I'm here to share how I trade, learn new things from others to better improve what I'm doing, and hopefully by sharing with others and putting some of my trades on the forum, remember the importance of not rushing things but waiting to set up, even if a few bars don't happen.

So I'm going to give you two types of systems that I trade, and the types of setups that I look for that can translate into trades if everything goes right. Both systems are best used in trending markets. I prefer to be in the market less and make fewer but safer trades. I prefer not to trade when the market is not trending to preserve my capital, and come back when the market is back trending, when I know I will be safe, things will react the way I expect, and I can safely enter the market with a higher than normal lot size. So let's get started.

The second system I trade on can be found here: http://www.forexfactory.com/showthread.php?p=8482362#post8482362

Because both of my systems use the same metrics and templates, I will use this thread to update anything about the templates or metrics on both threads on this thread so I don't need to do this in multiple places. Thank you for your understanding.

Momentum Bar Trading

Currency pairs I trade: With slingshot trade and zipper trade, there is no need to limit themselves to any particular pair. I find they trade best on the 4 hour tf.

My template:

30M:

appendix

[TPL] W_B-Damon_30m.tpl 159 KB | 551 downloads | Uploaded at 2:31 on September 14, 2015

4Hr:

appendix

[TPL] W_B-Damon_4hr.tpl 81 KB | 495 downloads | Uploaded at 2:31 on September 14, 2015

D1:

appendix

[TPL] W_B-Damon_D1.tpl 3 KB | 460 downloads | Uploaded at 2:31 on September 14, 2015

My indicators:

No lag:

appendix

[EX4] nonlagdot_alert_v01.00_[DamonLiebscher].ex4 17 KB | 1,455 downloads

Channel:

Attachment

[EX4] channel.ex4 9 KB | 1,222 downloads

Things to help you with your trading:
First, all trades are made based on the 4-hour bars. However, it is important to make sure that placing the trade in the first place is a good idea, so there are a few things you should verify every time you go into the chart to view a new 4 hour bar.

1. Does the non-lag point on the 4 hour bar match the non-lag point on the D1 bar? If yes, then it is better to trade only in the direction of the points. If one point is red and the other is blue, it may be wise not to trade that bar. If both bars are red, then you will be looking for short trading opportunities on that bar.

2. Are the non-lag points on the first two 4-hour bars the same color? If so, then the deal is probably fine. If not, it could mean that the market is very volatile and unpredictable, and placing any trades on this bar is probably not the best idea.

Trade Type 1: Slingshot Trade

1. Slingshot trading is best done in the direction indicated by the non-lag points on the 4-hour chart and the D1 chart, when they are the same color. If one time frame has blue non-lag dots and another time frame has red non-lag dots, it is best not to trade the slingshot. Select some currency pairs and you actually need a few minutes every 4 hours to decide if you should wait to trade.

2. This is a picture of my chart. From this view, I can easily tell if my 4-hour and D1 non-lag points are consistent. As you can see, my screen also shows a 30M chart, this is related to the second system I'm trading on, which is on another thread, this also requires more work, which I also hope to have done in the near future. I have this set up for all the currency pairs I trade, so all I have to do is click three buttons and I have a good idea of the market conditions for every pair, every trade type.

Attached picture (click to enlarge)

Click to Enlarge

Name: SlingShot.png
Size: 41 KB

3. Be careful about trading on new bar openings as spreads tend to be quite high and can be a headache for any short-term trading strategy.

4. The trade itself : Once you decide you want to trade, if the previous bar has a blue body, you will look to go long; if the previous bar has a red body, you will look to go short. Does it make sense so far? Let's take a long example because I think people naturally find it easier to be a buyer than a seller. Okay, so the previous bar body is closed in blue. What is waiting to happen next is for the current bar to fall back, more than 1/2 down from the previous bar. Waiting until it went 3/4 or all the way down is even safer. Once this milestone is reached, you can set the trap and place a stop buy order at the top of the blue bar and set the stop loss at a safe distance. Now, if your order does not fire during this bar, you should delete it. Additionally, you should also delete open trades once the 4-hour bar closes. This is basically a one-bar trade. The swings from one bar to the next can be too big and you could easily lose all your profits if you hold it until the next bar.

Attached pictures

Price Action Momentum: Recognize it, Joi

As you can see from this recently cropped chart. The most recent bar reversal was at least 1/2 of the previous blue bar. So you could set a BuyStop at the top of the previous blue bar so that it would trigger if the price reversed, hopefully on the way up. However... at this particular time, the 4 hour non-lag point is blue, but the D1 non-lag point is red, as I marked it with the red downward arrow on the chart you're looking at. So, I probably wouldn't take the deal at all. The only approach I might consider taking is if the current bar drops all the way below the previous blue bar and back. With 4 hours in combat and no lag in D1, I wanted to wait for an opportunity where I was more certain of winning and didn't feel like a gamble.

5.This also applies to D1 charts! Proceed as I described on the 4 hour chart, but due to the strength of the daily bars, there is no need to look at the W1 chart to confirm non-lag. Accept them as they come.

I hope the first trading method makes sense to you and you have a good time. Please feel free to ask me any questions and I will be sure to post something about it when I actually trade on this style.

Trade type 2 : zipper trade

1. Zipper trade is actually very simple. I used the 4 hour bar chart again and I got the best results when the non-lag points were the same color for the 4 hour chart and the D1 chart. In fact, this is one of my favorite deals! I love it when it comes out. Unfortunately, I missed almost every opportunity to make this deal this week. It has a very good win rate.

2. Here's how the setup works: Let's say I'm looking for a long trade because the non-lag points on both the 4-hour chart and the D1 chart are blue. In order to place a long trade, we must first have a candlestick that closes in red. Simple right? Once we get a candlestick that closes in red, on the next bar, we simply place a buy stop order at the top of the previous bar and a stop at the bottom of the previous bar (or wherever you are most comfortable) and see what happens. Come back after 4 hours to see if your trade triggered and if you ended up with a nice profit. To me, it might also be a good idea to set a take profit, trailing stop, or manage your trades as needed. Does it make sense?

Attached pictures

Price Action Momentum: Recognize it, Joi - 2

If you look at the chart above, you'll see that non-lag is in red. Then, there is a candle that closes bullishly. Therefore, below the body of the previous candlestick, I would place a stop-loss sell order. As you can see, this is a great zipper deal.

I hope my explanation has been clear. If you have any questions, please feel free to send them to me and I will try my best to answer them.

Trade type 3 : Trade in-house gold bars and/or smaller types of gold bars

1. Coming soon!

Trade Type 4: Reversal Trade

1. An example of using these indicators for reversal trading can be seen in post: #29, but this is a dangerous type of trade and I don’t recommend it without much practice!

That's all for now... I'll come back and finish this later... maybe... For now, I have to go to bed because I need to refresh myself for tomorrow's trade.

I hope everyone will like this theme. But if for some reason you don't, it's your own fault!