TheStrategyLab.com Free Support Forum

Forum for price action traders that want to learn WRB Analysis basic tutorial chapters 1, 2 and 3 prior to purchasing our advance trade methods
It is currently Wed Aug 23, 2017 5:09 am

All times are UTC - 5 hours




Post new topic Reply to topic Bookmark and Share  [ 4 posts ] 
Author Message
 Post subject: How can WRB analysis improve my strategy
PostPosted: Sun Feb 21, 2010 1:02 pm 
Offline

Joined: Fri Feb 19, 2010 11:51 am
Posts: 2
The attached chart is a 4 hour GBPUSD spot forex chart, 3rd December 2009.

On the chart:

1: A strong move down and price rebounded at 2.
1 becomes 'A' my sell area when price returns to it, and 2 becomes 'B' my profit area. I am selling at supply levels in a down trend (and I would buy at demand levels in an uptrend).

My stop loss is the top side of the congestion of area of the previous move down at '1' and the entry is the lower side of this congestion area.

My target is at B because that is where price turned back up previously.

My risk is the number of pips between entry and stop loss and my reward is the target area. I never risk less then a 2:1 reward:risk.

Please tell me how WRB analysis can improve my trading. I notice that the way I have learnt to interpret areas of supply and demand on a chart are different to how WRB analysis interprets supply and demand areas. With regards to trading multiple time frames is it valid to trade a technique (not just mine but any) by identifying WRB supply/demand zones on a higher time frame and then moving down to a lower time frame to take entry signals only when price returns to WRB supply/demand zones, eg. I might use 4 hour for analysis of WRB and trade entry signals off the 5 min chart?

Thank you.

Pete


Attachments:
GBP Traders Strat.jpg
GBP Traders Strat.jpg [ 89.66 KiB | Viewed 348 times ]
Top
 Profile  
 
 Post subject: Re: How can WRB analysis improve my strategy
PostPosted: Mon Feb 22, 2010 10:03 pm 
Offline
Site Admin

Joined: Sat Jan 10, 2009 1:06 pm
Posts: 2933
Location: Canada
Hi Pete,

Your chart shows good use of supply/demand analysis from entry to exit (profit target). Thus, there's not much WRB Analysis Tutorials can do for your method except for the fact that the price action on your chart from point A to point B contains a key change in supply/demand as shown on my attached chart. That key interval qualifies as a WRB S/R Zone via one of the advance tutorial chapters 4 - 12.

In fact, if you go back to you data vendor charts and review the impact that the highlighted WRB S/R Zone had on the price action of GBPUSD...you'll see that it declined to a low around late Dec 2009 and then counter-thrust back upwards until Jan 19th 2010...that's where it reached that WRB S/R Zone and headed south again to deeper lows around Feb 19th 2010 after not being able to travers throught and above that zone.

That's one of the benefits of WRB Analysis...it's not about trade signals. Instead, it helps you isolate key price areas that you should not ignore when price returns to the WRB S/R Zone. Also, in tutorial chapter 3 that's part of the free trial...it explains how to use your trade signals as WRB S/R Zones.

As for your question about multiple time frames. I don't recommend using a time frame for a WRB S/R Zone that's different than the time frame of the trade signal for new users of the tutorials. Thus, I recommend that the WRB S/R Zone and the trade signal should occur via the same time frame because it's less work in trying to monitor zone and trade signals on different time frames. However, my opinion is different for veteran users of the WRB Analysis Tutorials...they can do whatever they want as long as they understand the risk because I think the odds are higher for a trade error when mixing time frames.

Thus, as soon as you identify a WRB S/R Zone...you just sit back and wait to see if price returns to the price areaa of the zone and then wait for a trade signal if/when such occurs while testing the zone.

so that your trade signals will determine if ithat doesn't involve your trade signals or involves your trade signals.

Attachment:
Porkpie_GBPUSD_4hr.png
Porkpie_GBPUSD_4hr.png [ 108.87 KiB | Viewed 301 times ]


Best Regards,
M.A. Perry


Top
 Profile  
 
 Post subject: Re: How can WRB analysis improve my strategy
PostPosted: Tue Feb 23, 2010 1:57 am 
Offline

Joined: Fri Feb 19, 2010 11:51 am
Posts: 2
Thanks. The way I have been using demand and supply is to look for the origin of the move, the consolidation period where price is in equilibrium (consolidation) with the breakout showing the likely place where price go if it returns to that level (my profit point B was a first profit target but I didn't elaborate to keep my question short) . However, many times price may never quite make that area again but turn in the direction of the original breakout but within a WRB supply/demand area. So my understanding, is that sometimes, many sellers or buyers will congregate near the origin of the original breakout of the move, and at other times, the 'fight' would take place within the area of the larger breakout candle itself of the original move (the WRB).

I know one can't always be accurate with placing an entry within these zones but my difficulty would be to understand whether, when price comes back to a previous level of demand/supply imbalance, if price is more likely to reverse within the WRB zone or or within the zone of consolidation (equilibrium).

I understand that WRB does not indicate directional bias but rather a 'heads up' to potential reversal. Where as supply/demand imbalance at the origin of the move is more likely to imply a reversal depending on the strength (and other factors) of the original breakout move, away from the consolidation area.

I used to trade pull-backs from swing highs/lows (see Ross Hook, traders trick), and I am exploring the potential to use this method within WRB areas (similar to your example VTR trade shown in one of the other questions I believe).

You say to use an entry method within the WRB, which I could also use for the consolidation zones also, and if a set up occurs either within the WRB or at the area of consolidation the chance to get in will be there. I agree with you that multiple time frames could make the method more complex and open to mistakes. But with the consolidation entries the larger time frames are usually much stronger zones, but waitiing for a confirmation signal would get you in late and expose yourself to greater risk. So zooming into a smaller time frame from a higher time frame analysis would minimise that risk. [ec18] [ec35]

I am not sure whether your material considers the above scenario or whether your strategies consider this need for multiple techniques depending where price finds itself on the return to a WRB area, I suspect they do? [ec45]


wrbtrader wrote:
Hi Pete,

Your chart shows good use of supply/demand analysis from entry to exit (profit target). Thus, there's not much WRB Analysis Tutorials can do for your method except for the fact that the price action on your chart from point A to point B contains a key change in supply/demand as shown on my attached chart. That key interval qualifies as a WRB S/R Zone via one of the advance tutorial chapters 4 - 12.

In fact, if you go back to you data vendor charts and review the impact that the highlighted WRB S/R Zone had on the price action of GBPUSD...you'll see that it declined to a low around late Dec 2009 and then counter-thrust back upwards until Jan 19th 2010...that's where it reached that WRB S/R Zone and headed south again to deeper lows around Feb 19th 2010 after not being able to travers throught and above that zone.

That's one of the benefits of WRB Analysis...it's not about trade signals. Instead, it helps you isolate key price areas that you should not ignore when price returns to the WRB S/R Zone. Also, in tutorial chapter 3 that's part of the free trial...it explains how to use your trade signals as WRB S/R Zones.

As for your question about multiple time frames. I don't recommend using a time frame for a WRB S/R Zone that's different than the time frame of the trade signal for new users of the tutorials. Thus, I recommend that the WRB S/R Zone and the trade signal should occur via the same time frame because it's less work in trying to monitor zone and trade signals on different time frames. However, my opinion is different for veteran users of the WRB Analysis Tutorials...they can do whatever they want as long as they understand the risk because I think the odds are higher for a trade error when mixing time frames.

Thus, as soon as you identify a WRB S/R Zone...you just sit back and wait to see if price returns to the price areaa of the zone and then wait for a trade signal if/when such occurs while testing the zone.

so that your trade signals will determine if ithat doesn't involve your trade signals or involves your trade signals.

Attachment:
Porkpie_GBPUSD_4hr.png


Best Regards,
M.A. Perry


Top
 Profile  
 
 Post subject: Re: How can WRB analysis improve my strategy
PostPosted: Fri Mar 05, 2010 12:16 pm 
Offline
Site Admin

Joined: Sat Jan 10, 2009 1:06 pm
Posts: 2933
Location: Canada
Quote:
...I understand that WRB does not indicate directional bias but rather a 'heads up' to potential reversal. Where as supply/demand imbalance at the origin of the move is more likely to imply a reversal depending on the strength (and other factors) of the original breakout move, away from the consolidation area...


Hi Porkpie,

Your analysis is almost correct except for one thing...as tutorial chapter 1 explains, we're interested in a very specific type of WRB and that particular WRB gives us a 'heads up' to a change in volatility. That change in volatility could result in a price reversal, strong price continuation or contracting volatility where the price range gets smaller and goes sideways.

Another way to look at...when that special type of WRB appears, it's not a good time to ignore the market.

Best Regards,
M.A. Perry


Top
 Profile  
 
Display posts from previous:  Sort by  
Post new topic Reply to topic Bookmark and Share  [ 4 posts ] 

All times are UTC - 5 hours


Who is online

Users browsing this forum: No registered users and 1 guest


You cannot post new topics in this forum
You cannot reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum
You cannot post attachments in this forum

Search for:
Jump to:  
cron
Powered by phpBB © 2000, 2002, 2005, 2007 phpBB Group
Translated by Xaphos © 2007, 2008, 2009 phpBB.fr