All posts tagged Band Shades

Forex Trade Management: Forex Live Trading Room 2015-03-26 EURUSD break even

Categories: Live Forex Trades
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The main aim of uploading all these trades is not necessarily just show you how good we are, and yes we are good 🙂 but as well as teaching the strategies to provide learning tools so that you can see how professional scalpers trade and how they manage trades. Thus, we will continue to put up break even and losing trades as well because you can often learn a lot more from these and ultimately how you handle these trades will go a long way to making you a successful trader.

Another busy day trading but the early London Session produced an excellent example of how to manage a trade. Although the trade ended break even is provides a textbook example of how you should manage a trade. Chris took an Orange To White trade short after EURUSD made a break to the upside. He identified an area of resistance, indicated by the band shades, on the Tiger Time Lanes forex software, and went into the trade with clearly defined goals. As the trade moved in his direction he manually manipulated the stop settings to first reduce his risk then to bring the top to a break even position after the trade went +5 in his favour, this effectively providing him with what we call a “free trade” where uless something very unusual happens he can’t lose and the trade has only upside. In this case price rebounded back taking him out at break even but it is good practice to try to manage your trades so that you are continually looking to minimize risk.

Live Forex Trading Room 2015 03 24 #GBPUSD +7 pips

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Similar to Paul’s trade in the morning session, in Sam’s New York segment a L3 White Zone trade set up developed. GBPUSD had just made a new low for the day and then retraced back to the endge of the white zone. It bounced off it beautifully to make Sam a quick +7 pips. Again it is a great example of how powerful this particular set up, “edge of the one minute white zone” is. The Tiger Time Lanes forex software allow you pick these entries with pinpoint accuracy.

Forex Live Trading Room 2015 03 24 #GBPUSD +7 and +24 pips

Categories: Live Forex Trades
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The New York session was again action packed with Kash taking multiple trades. The trade that stood out was the a short GBPUSD (cable) trade. Cable had had an up and down day but had found support around 1.4900. However, in the aftermath of the US inflation figure cable broke through the support. Kash watch for it to come back to close to the previous support level in the 1.4890’s and using the bases that support becomes resistance went short on cable. The trade was very profitable bringing in +7 and +24 pips

To experience live trading you can come and try the trade room .

Today’s London session saw EURUSD make an assault on the 1.10 level, moving up 60 pips quickly. 1.10 proved to hold strong resistance but the strength of the move indicated to Paul that another attempt might be made. He waited for price to retrace to the L3 disk and edge of the White Zone as EURUSD had made a new high. When price hit the L3, Paul jumped into the EURUSD long. He planned his trade so he had room to add lower down but this didn’t prove necessary with the trade Yielding +6 ang +12 on the remaining part.

It is another good example of how accurate the Tiger Time Lanes forex software can be in being able to pin point entries. It was a great example of an L3 edge of the white zone trade.

How You Use the Tiger Time Lanes band shades to create effective forex strategies

There are a number of setups that are derived from the Tiger Time Lanes  band shade formation and the white zone phases. Here we will look at the three most common.

Revision To The Mean Trade – Orange To White:

As we all know price doesn’t move in straight lines. It either moves within a range or it trends in either a long or short direction. But eve when it trends it tends (unless there is some major news event) to do so in a zig zag fashion, moving to a new high / low, then retracing back before continuing its trend and establishing another new high / low.

Why does this happen? Well as mentioned earlier, price is determined by the volume of buy and sell orders. Many traders place orders in the market at various points or levels that they think are important* so when price reaches these areas price can stall or reverse (depending on the number / size of orders). As price retraces or when it has retraced to a certain level, those traders who have been caught with positions on the wrong side of the move, often liquidate their positions, creating second / third wave of buying or selling momentum, pushing price to further highs / lows .

The Tiger Time Lanes grids are so good because the demarcation of the band shades predict, with stunning effectiveness, where these changes of direction will take place.

The most common trade is the Orange to White. It happens on the initial breakout or subsequent secondary move of price. The further the way price is from the white zone and the I minute L1 discs the greater the chance of reversal. The best way to think of it is as if price were attached to a piece of elastic, the further the stretch the more likelihood of it to come back unless the elastic breaks, which would then signify a significant breakout

*It you want to know why they cluster in specific areas you need to understand the concept of collective psychology to know why they cluster in specific areas.

The White Zone Trade:

As emphasized in the explanation of Orange To White trades, price reverses. But at what point does price stop reversing and the second / third wave start? Again the band shades are invaluable because what was once support often becomes resistance and vice versa. The most powerful level of all is the edge of the white zone. For scalping, the edge of the 1 minute is particularly important. As price breaks out and then retraces back to the white zone this has the effect of pushing price way again. Think of an analogy of refueling. The below video demonstrates this effect in action:

For it to be most effective it usually requires a new session high or low to have been made and that it is the first time that price has come back to the white zone from its break out. Think of a ball bouncing on the ground, the higher it is thrown the bigger the likely bounce.

Pre-emptive Reversal Trade:

This trade looks for clues of an ending of the move and a possible more substantial reversal. As pointed out above the white zone goes through a number of phase as it recalculates. More often than not when the white zone collapses, that is a signal that price, at this moment has finally stalled for the time being and that a possible retracement could happen. There are of course several courses of action that you could take. If you are out of the market you could consider this the moment to enter it against the trend. Alternatively, if you are trading with the trend you could take the opportunity to close your trade or to lighten you position (take some profit) obviously, this would be dependent upon your risk reward and your trading plan.

The tiger time lanes forex signal software is made up of several components. As you look at each matrix you can see the back drop to the levels is a series of coloured bands, referred in the live forex trading room as band shades. These band shades are determined by assessing the dynamic price movement using fibonacci ratios. They predict future support and resistance levels with the distance in between being shaded.

The first zone is called the white zone as in the most important zone on the grids. It represents what is “fair value”. What do I mean by that? Bear in mind that ostensibly forex is a relatively free market, where price is determined by the demand and supply for a currency pair (buyers and the sellers). “Fair Value” represents what the calculation has determined to be the natural range that price should be in on a given time frame. This is established using the historical data from that particular time frame (remember this natural price will be different on each time frame). However, price is constantly changing and so therefore the white zones are recalculating on every candle close. This means that when the market is quiet , i.e. where the price range over the time frame is small, for a protracted period, you will find that the white zones on all the time frames line up and the other indicators sit within the whites zone which gives the appearance of a congested area.

The zones either side of the white zone are coloured in various shades of orange. These orange zones get progressively darker the further away from the white zone they are from the natural price. On the basis that price always returns to its natural level (although is by definition the natural level must always be moving) the darker the colour the greater the chance that price will return to the natural level. The demarcation points between the levels, being based on fibonacci ratios, are the places with the highest probability of price change. If on a currency matrix several of these levels are in or close to alignment then that indicates strong areas of support and resistance.

As the white zone is always recalculating when price does move away into the orange zones it reacts and increases in size and follows the price. If or when the momentum of the price stalls for a reasonable period the white zone can collapse (quickly reduce in size) before expanding again to a more normal size. Thus the white zone can be deemed to go through a series of phases in any price move.

 
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