How To Spot A True Reversal

How To Spot A True Reversal 

• Look for the Possible Swing Candle

This is the 3rd candle in the 5 candle Pattern. A Swing High = 1candle. Higher with 2 candles lower on each side. A Swing Low = 1 candle Lower with 2 candles higher on each side.

       

• Look for Consolidation at a Fib Level

Consolidation is 2 or more candles in a given area

• Look for Reversal Candle (RC) Pattern and Break

- Pin Bars 
- Inside Bar
- 2 Bars Reversal
- Failure Swing Top / Bottom
- Reversed Pivot Top / Bottom
- Naked Reversal
- CPR (Closing Price Reversal)

• Last Swing will be between 30-60 pips if No News is Attached

• Slow Stochastics (SS) Agreement

12:00 – 2:00 Angle for a Long
4:00 – 6:00 Angle for a Short

If a trader is doing the above correctly, the trader should be winning more than they are losing.To be more consistent in picking winning trades, there are Other Factors that require a Live Mentor.
Proper Trend Identification, Time of Day, Session being traded, News, Daily Range, and Recovery Strategies, are all techniques that you will first need to understand. 

There is no substitute for face time and continued practice, once these techniques and strategies are understood, a mentor can greatly reduce a traders learning curve.

       
       

GBP/USD Today November 20 2012

GBP / USD is consolidating in the area of ​​1.5880 - 1.5920, we are waiting for clear signals for entry today. Expected in the U.S. session there will be a more definite movement.
1.5920 price level should be examined carefully because this is a fairly strong resistance today.
Above 1.5920 likely prices will continue to the next resistance at 1.5975 area, while below 1.5880 price will retest support at 1.5830 area.

EUR/USD Today Outlook November 20 2012

We have resistance at 1.2820 after bouncing and forming a 4H candle bearish CPR (Closing Price Reversal) to retest 1.2700.
If Resistance 1.2820 broke, the price is likely to try to survive in the area of  next resistance around 1.2880

Closing Price Reversal

A closing price reversal is one of the easiest patterns to spot. Price makes a new high/low but gets pushed back strongly and reverses, closing beyond the previous candle’s close.

In the chart below, of the EURUSD H4 chart, I indicated all CPR’s with an arrow.

If you traded in the direction of the overall trend, you would have made some nice money, as you can see. But even when taking ALL trade setups, out of 9, 7 setups would have reached at least 1:1, following the trading and money management techniques.

Just to show you these patterns work on all timeframes, take a look at the EURUSD 5M chart.

I bet you like what you see….. If you now understand you really don't need a whole lot of fancy flashing indicators in order to make an INSANE amount of money in the market, the goal of this strategy has been reached.