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Forex Price Patterns, Trading Setups and Mechanical Trading Signals

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Day trading and trading are like playing chess or poker at the professional level. You need to know the odds you are facing in every scenario you may encounter. Some people can master a few themselves quickly while others take longer time to discover these useful tactics. Smarter way, of course, is to gain expertise by learning these useful concepts directly from the experts.

Following is the compilation of various statistical biases (i.e. your odds) in various situations you may encounter when trading the forex majors.

To utilize the information you need to study them so that you are familiar with the concepts. It is not necessary to memorize all the details because the daily reports will remind you which one is in play for the next trading day.

This list is updated regularly to include the latest research articles published here.


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Forex Swing Bias: Loonie Counter-Trend Pinball (At TraderPlanet)

I have created a Canadian Dollar trading model that takes advantage of Loonie's unique statistical behaviour. The article is now available at TraderPlanet.com. You can read the full article on the trading model at TraderPlanet.com This model will b ...

2 comments


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Forex Swing Bias: UK Official Bank Rate Bearish Play (At TraderPlanet)

I have created a British Pound trading model that exploits the UK official bank rate announcement event. The article is now available from TraderPlanet.com. You can read the article at traderplanet.com. I will add the model to the Forex Signal repor ...

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Forex Weekly Bias: Bullish Mean Rejection  premium content

Another simple forex trading signal that exploits the weekly mean reversion property of Euro. The strength of this system is in its simplicity. For those who have read the classic Taylor Trading Technique (from George Douglass Taylor), this setup i ...

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Forex Weekly Bias: Bearish Mean Reversion  member only

A simple forex trading signal that exploits the mean reversion behaviour of Euro and its Monday weaknesses. Do not underestimate a simple system like this. It is a very profitable system by itself and a strong mechanical filter for forex day traders ...

2 comments


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Forex Weekly Bias: Bullish Wednesday  premium content

Expectation after Bullish Wednesday.

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Forex Weekly Bias: Bearish Wednesday  premium content

Expectation after Bearish Wednesday.

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3 comments


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Weekly STOPD Pattern: Forex Bearish Midpoint Cross  premium content

I often mention that when a major pair crosses its previous week midpoint, certain bias is triggered. Somehow many readers find it difficult to follow the concept. This is a simple example model showing how it works. Following is a 4 hour chart of B ...

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British Pound Price Action Biases At Weekly Extremes  member only

If you have not read the article on Euro Dollar Price Action Biases At Weekly Extremes please do so as I will not go over the basics here again. Swing Bias In Terms of Previous Week Range Although similar to euro dollar, pound demonstrates subtle d ...

2 comments


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Euro Dollar Price Action Biases At Weekly Extremes  member only

2 studies are presented in this article. Let's get started. It is well known that the range of a trading period (i.e. a month, a week, a day), is highly correlated to the range of the trading period right after. The lesser known fact is that the ext ...

10 comments


Seeking Alpha - Bankable ETF Strategy: Festina Lente

Article published at Seeking Alpha, Bankable ETF Strategy: Festina Lente ...

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Why You Shouldn't Long Euro On Monday

Many traders who took the plunge into trading forex do not know about many basic biases that are very useful but not very obvious. Not buying euro on Monday is definitely on the top of this list. I will explain why you should be aware of this and how ...

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Forex Intraday Bias: Inside Down  premium content

Expectation after Inside Down Day.

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Forex Intraday Bias: Inside Up  premium content

Expectation after Inside Up Day.

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Forex Intraday Bias: Higher High Pivot Failure  premium content

Expectations after Higher High Pivot Failure.

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2 comments


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Forex Intraday Bias: Lower Low Pivot Failure  premium content

Expectations after Lower Low Pivot Failure.

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2 comments


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Weekly Bias: Forex Monday  premium content

Forex price actions on Mondays provide very important clues on what to expect for the rest of the week. Most of the time, day traders tend to focus so much on the series development in their charts they have forgotten that structure matters. Mondays ...

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Forex Trading Open Secrets: Euro Dollar Bull Putting  premium content

Bull Putting is the concept of taking advantage of a strong up swing to catch some profit from the remaining part of the move. The idea is sound but most people would not participate in this kind of trades. Many traders think that they can do better than just collecting scrapes. Well, what they fail to see is that these scrapes add up to a lot of money.

The Daytrading Models

Following is a euro dollar 24 hour chart with dollar gain per $10K lot in the lower panel. The models only stay in the market 7% of the time. It is mutually exclusive with the daytrading version of Simplex Trading System, meaning that their trades do not share the same trading days.

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Forex Trading Open Secrets: Euro Dollar Apex (Type 2) Trading Model  member onlypremium content

No market moves in a straight line. Most of the time strong directional moves will result in pullbacks. Euro Dollar Apex (Type 2) Trading Model is a counter-trend strategy taking advantage of that fact with very good consistent results. With about two third winners and low drawdown, it is a very reliable trading setup to lean on.

The Performance

Following is the 24 hour chart of euro dollar with bottom panel showing the net dollar gain based on a small lot ($10000) since early 2003. 2 pips spread discount is taken into account for all trades.

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2 comments


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Forex Trading Open Secrets: Euro Dollar Simplex Trading Systems  premium content

Simplex was created along with several other models long time ago to provide daily guidelines to a group of forex traders who worked with me long time ago. These models are still working fine through the turbulent years since 2008. I think this set of trading models a good starting point for all traders to understand what mechanical bias is all about.

The Daytrade Model

Following is EURUSD 24 Hour chart with dollar gain per $10K lot (small lot size) in the bottom panel. The amount of money made is not that much on the first glance. But if you know that it only traded 93 times over 2500 trading days, with almost 70% winning rate, you would understand why it is a superior trading setup all by itself.

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One comment


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Forex Trading Open Secrets: Euro Dollar Bear Putting  premium content

Bear Putting is the concept of taking advantage of an established down move to capture a part of the move from its remaining momentum to the down side. Similar to the Bull Putting concept, many traders simply ignore this part of the swing if they are not in a short position already. Some will even try to pick bottom against the prevailing down trend. This article will show you that the correct approach to situation like this is to join the side that is still in control.

Bear Putting Models

Following is 24 hour euro dollar chart with dollar gain per $10K lot in the lower panel. The models are in the market 5% to 6% of the time only.

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Forex Trading Signal: Bearish Discharge  member only

Bearish Discharge is a day trading system designed to work with Euro and British Pound. It is a very consistent trading model for many years. The trading setup does not happen that often but it is a good example of applying the STOPD principles in da ...

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Forex Trading Signal: Quid Piker  premium content

Quid Piker is a mechanical forex trading system designed to trade British Pound. It is profitable consistently since it was created more than 10 years ago. It is not a complex strategy and can be followed quite easily. Quid Piker is a trading strateg ...

6 comments


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