"ABCD" is not a continuation pattern ( our D entry could be or not, in the direction of the trend ). But if we see it like this ( or trade it like this ) we'll spot it earlier and we won't make confusion between this and 1-2-3-4 reversal pattern.

So on the counter trend ABCD pattern, we will have AB = CD and we buy/sell D ( trend direction ).

Ideal ABCD is like this:





Special case 1:

When AB and CD is in the direction of the trend ( and also a powerful trend's impulse ), we might find that AB CD.

So on the trend direction ABCD pattern, we can find that CD = 127.4% from AB ( so not equal in pips ) and we buy/sell D ( as a counter trend direction ).




Practicing this patterns trading while combined with 1-2-3-4 reversal pattern, you will see that these 2 strategies combined with fibs is all that you need most of the time.

* Special case 2: We will study this in "Advanced Strategies".

ABCD Trading Strategy.

Lets say we had the new trend confirmation ( using 1-2-3-4 pattern ) and get the profit between the 2-4 distance. Now we can look after ABCD ( in the direction of the trend/counter trend ).

1. Bought on BO of 2 ( using 1-2-3-4 )
2. TP @ 4 ( using 1-2-3-4 )
3. Use 3 as A, 4 as B
4. C= 61.8% from AB ( we could buy here using PO for fibonacci strategy No 2 )
5. As we going long, we found out that AB=CD (and TP for our buy limit =161.8 % from BC = D)
6. Sell D
7. TP for ABCD = 61.8% from CD.

In this chart we see that we won 2 profits from trading 1-2-3-4 and ABCD. Now we can search for another entries ( in the direction of the trend or counter trend ).
Not longer than 1 swing further we spot something that got our attention again: a powerful retracement that could form AB ( in the direction of the trend ):




* We also could of sold our B as a 50% retracement from previous traded swing ( as ABCD ), but that would have been a counter trend position and we will speak about it on our "Advanced Strategies".
** Also: C is failing to BO lower than 78.6% (yellow fibonacci, candle close above - in case we trade manually). But we would've bought with PO the 61.8%, with SL = previous LL (A).

Now, we have ABC formed:

1. We find that D = 127.4% from BC ( special case ) - we can use a TL and trade it as BO of TL
2. Sell D
3. TP = 61.8% from CD. (olive fibonacci)

Practicing this you will find out that B is sometimes only 50% from AB, or TP is only 50% from CD.
Never the less this pattern, like I said before, is one of the most powerful tool along the 1-2-3-4 pattern and of course Fibonacci retracement tool.


Best regards,
^^_Lord_Ice_^^

First trade short of aud/usd after negative fundamental news. It's not ideal to open such trade pretty much late. I gave it big stop of 77 pips. Target was the same.  Three open trades were just because I was experimenting with sizing in relationship to stop. First stop was 100 pips, when I changed stop I took bigger size for a trade. Yellow mark is average.
That trade didn't really work from the start. I had nice push after being first in negative but then it reversed. I'm thinking that on such trades that from start don't really go in my direction I should take profit if later given in size that was previous negative move. But it's all fluid, I really don't know is that optimal. I didn't touch this trade, or reevaluate it. I just left it to do whatever. Maybe some trade management would be better to exit with smaller loss then full R.
-1R

Entry short immediately after the news, move before the trade was instant. Support held and it moved slowly toward the stop. I wouldn't do much different in this trade. I think that probability was more for down side. Stop and target were 100 pips. Maybe stop should have been lower because if it goes back to 160 resistance it's hardly weak. Maybe in this case stop of 70 and target 70-100.
-1R

Third trade short in eur/gbp.This trade was opened around the same time as previous short in gbp/usd. I didn't believe that previous down break in eur/gbp will so easily fail on gbp weakens. So I shorted with idea that it's now top of the range. It worked that way. When I checked that trade next day I found it not taking my take profit for just one pip, so I closed.

+0.9R

Fourth trade short eur/usd after Spain downgrade. I was early in the move. Two trades because I found out that I don't need 100 pips stop to invalidate my idea of down side. So I doubled the position because I only needed 50 pips R. At first I set up things that one take profit is at 1R and second at 2R. Later after move went in my direction I moved my stop down and widen the take profit. So for first trade it was at 3155 and move only went to 3160. It moved exactly 1R. After it rushed bit by bit back up (I was by the screen scalping) I was mad because of my greed. If I had 1R target all would be peachy. I didn't believe that it was full reversal, I expected some resistance at some point.

Basically it's very hard for me to decide what to do with the trade in between my stop and target. On smaller time frames it's different story from minute to minute and I can't judge clearly.

-0.75R

 

So those were my longer time trades. I don't know will I continue with it. This is only testing and treading water. It's interesting but I feel little bit new and clueless.

-118 pips
-40 %

My trading with nano account  continues in similar fashion. It's now near to paper trading. So monetary it doesn't mean anything so results are easily that bad. Basically I'm just trying out ideas and looking  for style that will suit me.

I started trying out things on longer time frames on even smaller subaccount. This is like first time in my trading history that I made four separate longer term trades. It's nothing spectacular, I basically don't know how to behave on longer time frames but it's somehow interesting for me. On four trades I'm at -2R. More about them in next post. It could have been better, but I managed trades not so good.

April 9.

-7 pips

April 10.
-20 pips
I stayed inside daily stop. Too much momentum seeking trades when there is no momentum. I'm used to trading like this and do it when it's not appropriate. But my first goal is to stop trading when my daily stop is hit, today I did that without resistance.
I believe that when I get to trust myself about daily stops that it will get me relaxed and open up to a whole new level of non anxious trading. Then results will follow. So first step is respecting daily stop. If I managed to get rid of widening my individual stops I can do this also.

April 12.

-16 pips
Sometimes I can say I don't have sightless idea of what I'm doing.

April 13.
+8 pips
Insane how much time for + or - 6 pips move.

April 16.
-19 pips
Losing machine.

April 18.
-6 pips

April 20.
- 12 pips

April 24.
+6 pips

April 25.
-29 pips

April 26.
+13 pips
Stupid to keep scalp stops in situation like this when I'm not scalping. Serious problem is mixing trading styles. 

April 27.
-25 pips
I'm getting angry because I don't take scalp profits. If I'm going against the trend for any reason and have some profit on hand I should simply take it. This is not scalping, nor daytrading.

Fibonacci is one of the most powerful tool for trading. There are many fibonacci tools in trading platforms: Retracement, Expansion, Fibonacci Fan, Fibonacci Arcs and Fibonacci Times Zone.

The beauty of this toll is that work in every markets conditions and on every TF. Ofcourse like all trading strategies, works better on higher TF.

Before I'll start to tell you about strategies using these tools, I want to make sure you will use correctly Fibonacci Retracement:

1. Always draw this tool in the direction of the trend ( we want to see how much the PA will retrace, before continue the main trend - we want to know the possible end of the counter trend ).
2. If trend is short, click top, drag while keep pressing click, until bottom and release click.
3. If trend is long, click bottom , drag while keep pressing click, until top and release click.

Now the chart should look like this:



The HH level used for drawing is not actually HH, but it's a previous High ( LH ). You can use only the previous swing's High for measurements. 

For the importance of Fibonacci you might wanna look this article too: Fibonacci Retracement.

1. Fibonacci Retracement + TL BO.

This is one of the most used strategy using fibonacci retracement. But before we continue, you must look at TL BO Strategies.



Drawing a TL ( on counter trend ) offer us a great entry possibility to enter the market when:

1. PA failed to BO the 61.8% fibonacci retracement level ( golden ration ).
2. BO of the TL
3. Tight SL, previous High, before BO occur ( or 61.8% fib level + spread + 5 pips ).
4. TP is 0.0% fibonacci retracement level ( the start of the counter trend - here PA is possible to fail to break further )

2. Pending Orders on Fibonacci Retracement Levels.

 This is one of the most profitable fibonacci strategy because you always trade with this in the direction of the trend only. ( "the trend is your friend " ).

For this, we will use same example as the previous strategy chart. This strategy works better from H1 to Weekly chart.

1. Draw the fibonacci retracement from top to bottom ( since our chart has main trend short ).

2. Put pending Sell Limit Orders on 32.8%, 50% and 61.8% ( we expect PA will return to short trend at one of those levels ).

3. As SL use 61.8% or 78.6% level ( if PA BO the 61.8% from the big main swing, we might have a change of the trend, from short, to long, in our example ).

4. For our first TP, we will have 0.0% level ( or the LL - we expect this to be BO or rejection from it, when PA will fall down )

5. For the next 2 levels of TP, we can use Fibonacci Expansion. 100% and 161.8% ( drawn same as retracement tool - click top, drag bottom, then click and adjust the retracement line to the correction end - near 50% retracement level, in our example - the red dotted line ).

At this strategy you might wanna consider this:

a) If only 1 pending order hit ( first 32.8% ) and PA follow the main trend down, delete the other 2 pending orders. As TP use TP 3. ( 161.8% - expansion tool red ). If counter trend was so weak to touch only this level, that means stronger main trend down coming ).

b) If 2 pending orders were hit ( 32.8% and 50% ) delete the 61.8% pending and as TP you can use TP 1 for 50 %, TP 2 for 32.8%.

c) If all 3 pending orders were hit, you can use TP 1 for 61.8%, TP 2 for 50% and TP 3 for 32.8%.

d. Also you can use Trailing Stop or move SL manually after each BO, to the previous HL until BE.

3. Fibonacci Retracement on multi Time Frames.

Another profitable way of trading fibonacci is to draw it on a higher time frame and look for entry on lower TF. For example draw fibonacci on Daily chart and look for entries on H1.
For this you need all fibonacci levels for retracement added in the "Properties". To go there, use this way. Here you should have all those levels: 23.6%, 38.2%, 50%, 61.8%, 70.7%, 78.6%.

1. Draw Fibonacci Retracement on Daily chart ( same as previous example ).
2. Lower the TF to H1 and look trades on every level ( buy counter trend or sell correction over ) like Trend Lines Strategies or Support/Resistance Lines Strategies. Careful attention on 32.8%, 50% and 61.8%. In those area correction should end. In case correction is only 32.8% a fast down trend usually occur.
3. TP = next level / opposite TL BO / Trailing Stop.
4. SL = next level / opposite TL BO / Move SL manually on previous HH/LL.




Best Regards,
^^_Lord_Ice_^^