EUR/USD model hours

[Paul Koszarny]

Apart from the necessary explanation that model hours are CET I would like to mention that you may find out that Bill Williams has been marking his fractals in some way. But as it is crearly seen all his markings are ex post, whereas the model I use enables to pinpoint future hours (ex ante) with an intention to bet against the market. Whoever has seen his profitunity system will observe that his marked fractals are buy signals on highs and sell signals on lows. In my system I am doing quite the opposite. That is, my fractal model's low is to go against the market and buy, my fractal high is to go against the market and sell. If you step back a little you will understand this kind of positioning.

[wise]

Paul,

I stepped back to have a look, but didn't see anything different.

I have been trying to understand but haven't got the idea of it yet.

Appreciate you trying to "educate" us to look at things differently, but I am having trouble seeing it.

"not so wise"

Wise

[Paul Koszarny]

Wise,

I will come back to you later. I know that you may be confused.

[wise]

Thanks. I would appreciate that.

wise

[waka]

There might be a problem with: PROFITUNITY and FRACTALS.

Cheers
waka

[Paul Koszarny]

Hi there for whom the bell tolls,

Today's first model hour was 9:00 with hourly resistance 1.0541 and support 1.0517.

Now look for the candle opening at 13:00.

[Paul Koszarny]

EUR/USD model hours

If you look back to yesterday charts you will notice that the 13:00 model hour opened at 13:00 and closed at 13:59 was a low, though one hour later the market was selling off further. Going with the blind force of the model one had the following choices for a new position:

Take a long position near the end of the indicated hour (stop placed a little below the lowest low)
Take a long position one hour later using rule ‘buy the second low’ (placing a stop slightly below the lowest low)
Take a long position near the end of the indicated hour without a stop (as it happens when time is short).

I did not advise to go long in that place for various reasons of which one was my wrong assumption that we will see a new low on Friday.

However I did advise to close all shorts and I did warn about the operators and their misleading and treachery quotes. At least the model issued a warning that sth wrong was going on with the pricing. The market settled near 1.0371, its attractor of falls for a short while and then rapidly reversed.

As you know from market reports there were no new reasons for such a sudden upward movement. I mean no new information was being digested. Here I quote forexnews.com

The dollar snapped out of its morning calm during midday New York trade, recoiling sharply to its Monday lows as pessimistic earnings reports rocked Wall Street. Traders attributed the sharp drop to a rush to square EUR/USD positions and a report from bond fund PIMCO calling for a weaker dollar. Whether the PIMCO piece triggered the large move remains doubtful, however, considering the report was first released last Friday.

However the market reversed according to the model hours. And for model reasons it should and it did.

The same applies to this morning’s model hour. I don’t pay attention to why it should change its direction. EUR/USD has retraced 30 pips from the high of 9:00 candle. It did exactly what I would normally expect from it. No matter whether it is for a market breath or for a major reverse.

No doubt yesterday cut a lot of shorts leaving an army of unprotected sellers with much less margin than before. Wednesday was a bloody day indeed.

I would like to point out to an intriguing fact that the rapid change in currencies was not the only event of the day. Look at the charts of some stocks indices, DAX for example, and also at Warsaw FW20H3 futures contracts. You will understand that equally devastating changes occurred there exactly on the same market hour as on EUR/USD. Within two hours from 13:00 wrong positioning on FW20H3 lead to losses of about 50% per contract. You may attribute it to the blind force of nature or to you may attribute it to some names. The answer I am leaving up to you.

[Paul Koszarny]

No problems with fractals. Incidentally you've got fractal lungs and kidneys for maximum profit to your body.