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Thread: My Trading Journal - Wolfe Waves

  1. #11
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    26/-3 Trade Set Ups

    Good morning folks!!

    Yesterday was an amazing day for the Euro. To update.. I closed one trade and currently there's only one trade for the EURUSD that is running at 0.1 lots. Let's wait and see if the Euro will indeed touch 1.27 tomorrow 12PM.

    Today's trades are AUDCAD. We have the Wolfe waves formed, and price is currently heading to the EPA line. The pair however has to get through some key levels though.

    Price basically bounced off Daily Support level 1 at 1.0662. We have our sell stop at 1.065 with take profit at 1.05. Its going to take quite some time for this trade to be filled. Wolfe ETA shows 6th of April.

    For such lengthy trades, we'll try to take profits at key levels and move stops to a few +pips and let the last 0.1 lot run its course, this way there won't be any risk at all to the trade.

    My Trading Journal - Wolfe Waves-audcad-h4-2603.jpg

    USDCAD - Pending BUY Order

    Price is getting close to the pending buy order at 1.0196, co-inciding with the daily support line. We're looking at 29th March as the ETA for price is reach the upper levels of 1.0285. But from the current set up with resistance levels at 1.0238, 1.0260 and 1.0285, it seems difficult to cut through all these levels just within 3 days. So this trade will be closely monitored.

    My Trading Journal - Wolfe Waves-usdcad-h4-2603.jpg

  2. #12
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    Updates 27/03

    USDCAD - Trade Lost

    The USDCAD trade got stopped out. Looking at the trade set up, it seems like the entry was a bit too early. We currently have the Wave 5 formed just outside the 'sweet zone'.

    On the daily chart, USDCAD is turning out to be bearish so this pair will be left alone for now.

    Update on EURUSD Trade

    The trade was closed so as to ensure that there won't be overheads such as swaps eating into the trade. Today is the 27th so let's see if the Euro will touch the 1.27 level.

    Other trades are running as is. AUDUSD and AUDCAD

    Won't be trading anymore this week as markets will be closed from Friday onwards. Have a good weekend.

  3. #13
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    EURUSD Now Trading in 1.27 level as expected

    So here we have it. Another successful price projection and time estimate provided by Wolfe Wave. In my earlier thread here I mentioned about the Euro touching the 1.27 levels. Price is currently at 1.277.

    Once again, its just amazing how Wolfe Waves can predict prices.

    What needs to be done though is to analyze why some WW predictions are so right while some fail (ex: USDCAD).

    More to follow.

    As of now, AUDUSD, AUDCAD are in the trade and positive. There won't be any new trades taken until this Tuesday, April 2nd.

  4. #14
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    Lightbulb NZDUSD - Going Long

    Good morning folks.. I know I said there won't be any more new trades being taken, but I just couldn't resist a nice wolfe wave formation on the Kiwi Dollar 30 minute chart. While I won't be waiting for price to reach take profit, I will be closing this trade towards end of day. I'm trading the Kiwi Dollar purely out of boredom (AUDUSD is still in the trade and it gets boring to watch the trade unfold), so here goes.

    Below is the NZDUSD 30 minute chart and we see a bullish wolfe wave being formed, the same which is confirmed by stochastics as well. I have also plotted the daily pivot points to identify key price points.

    Entered long just a few pips (0.83733) near the daily pivot level of 0.8368.

    Price has currently moved out of the 'sweet zone' and we are trading wave 5.

    My Trading Journal - Wolfe Waves-m30-nzdusd-bullish-wolfewave.jpg

    What's interesting is that pivot 5 was much lower than pivot 3, which doesn't happen that often (or perhaps my analysis is wrong). Anyways, it doesn't hurt to experiment different wolfe wave formations.

    So the stop loss is set to the 38.2% Fib level plotted from the most recent swing high to swing low. 0.8362 is also a couple of pips below the daily pivot. Take profit level is set to a couple of pips (0.83894) below the daily resistance 1 (0.8394).

  5. #15
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    Thumbs up NZDUSD Bombed

    So clearly something went wrong. The long trade on Kiwi Aussi got stopped out.

    Now's the interesting part of analyzing failed trades because they offer something interesting to learn all the time.

    The grey rectangles are the wave points. I assumed the 'light shaded grey area' to be wave 5. Price does indeed move up, but falls short of the projected price line and drops all the way down through the pivot line (cutting across the stop line).

    My Trading Journal - Wolfe Waves-m30nzdusd-correction1.jpg

    One reason I can think of could be that the trade was entered prematurely before the waves were formed.

    If you look at this chart, we see that wave point 3 is actually what I assumed to be wave 5.

    Below is the same chart now plotted with the adjusted wave points.

    If I compare this with Stochastics now, it looks a bit more clear in terms of price action. So going short on the Kiwi dollar, price is likely to reach the 'sweet zone' (shaded area) before commencement of Wave 5.

    My Trading Journal - Wolfe Waves-nzdusd-corrected.jpg

    Let's wait and watch!!

    An interesting observation made is that when you are unsure if price will reach the projected price, then you can set profits to key levels of the waves (1 through 5). In the picture below I have marked these levels with the red line. These price points can help to lock in your profits if price seems to go against your analysis.

    My Trading Journal - Wolfe Waves-wolfe-hor-lines.jpg

  6. #16
    Wizard
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    interesting...
    one suggestion from my Harmonic trading experience - maybe you can add to your analysis situation from one or two degrees higher timeframe. Use it as a filter. There are lots of this Wolfe Wave patterns around, filter some so to stay with better ones.
    I do not use Wolfe Wave, but I use XABCD diagonals. These are very powerful patterns, in structure similar to WolfeWave. Fo my XABCD diagonals we defined the best chart location. Not sure if it's going to help you in anyway, but take a look -> XABCD Diagonal pattern definition

  7. #17
    Wizard
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    interesting...
    one suggestion from my Harmonic trading experience - maybe you can add to your analysis situation from one or two degrees higher timeframe. Use it as a filter. There are lots of this Wolfe Wave patterns around, filter some so to stay with better ones.
    I do not use Wolfe Wave, but I use XABCD diagonals. These are very powerful patterns, in structure similar to WolfeWave. Fo my XABCD diagonals we defined the best chart location. Not sure if it's going to help you in anyway, but take a look -> XABCD Diagonal pattern definition

  8. #18
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    derago,
    You may want to use the following filter on WW. It will save you from situations like the one on NZDUSD. As far as I know that is one of the rules by Bill Wolfe- I could be wrong and I have been wrong before!

    W5>W3>W1 for bullish
    W5<W3<W1 for bearish
    TLs connecting W1-W3 and W2-W4 should be converging.

    This filter will essentially make it into a Diagonal pattern that Kor talks about.

    Kor, what else do you look for in your Diagonals?

    Good luck!

  9. #19
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    Duggils/Kor thanks for chipping in. I guess it takes a failed trade to get members to start talking

    Anyways, in regards to the rules, yes I primarily look for W3 shorter then W1 and W4 less than W2. However, in most instances I noticed a good WW set up when W5 breaches the 1, 3, trend line. In a way its more like a confirmation of the strength for the 'Wolfe wave'. I go by Linda Raschke's logic of requiring atleast 4 WW's before even thinking of entering a trade. Will pay more attention to this in forthcoming trades.

    To better understanding my trading, I make use of ZigZag to plot the price/swing high/low points and then follow up with a manual visual confirmation (not all ZZ high/lows are accurate for WW formations).

    I guess I took the Kiwi dollar trade a bit too early as I recall now that W5 was shorter than W3, which should have invalidated the WW in the first place.

    I'm currently short with just 4 waves being formed. I will share the analysis of the trade here once its closed, makes for some interesting observations.

    Kor4x: Do you mean, look for wolfe wave patterns on higher time frames and take on trades that only confirm with WW's on lower time frames? Btw, I don't see any difference between XABCD and Wolfe Waves (Gartley butterlfy if i'm correct??)

    On another note, I took on a long trade for XAGUSD (on a demo account). Below is the chart. Stochs show a bearish formation, but wolfe waves seem to be perfect. The blue highlighted areas show waves 1 through 4 with 5 almost being formed (but current price action is a bit conflicting). Anyways, the whole idea of Wolfe waves is to forecast price and in terms of waves, I think wave 5 has reached the bottom. Let's see how this goes.

    My Trading Journal - Wolfe Waves-xagusd.jpg

  10. #20
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    Hello Folks.. I'm back again. Been quite a while and lots has changed. For starters, I got hooked to Fibonacci (after reading Constance Brown's Book).. Seems to work well but average trade period is about 4 - 7 days (i'm using the H4 charts).

    Besides that, I continued using Wolfe Waves with commodity futures and Wolfe waves seems to work amazingly well. Just last week I managed to make some decent pips for crude oil, wheat futures and soybeans. Also discovered that riding both Wave 5 and the wolfe wave can be really profitable to both short/long (or vice versa).

    Anyways, i'm back and hope to continue this thread.

    P.S: There are some very very interesting 'tips' i'll point out in due course.

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