Point Figure for Forex?

[Pip Rippy]

Does anynody use point figure charts in forex market? I use VTTrader(CMS) they are in the demo. I have been visual backtesting the charts they seem to filter out alot of noise produce some very good trends.
What got me started looking into this is that a new article by the age old Cornelius Luca is located at traders.com. I see people mentioning P&F but I cant get any reall feedback.
What P&F timeframes are good for intraday trading?
I trade with 15min-30min-60min charts based on the nature of PF charts I wonder what would correspond?
If you look at the timeframes on 5min-10min-30-min-60min they are all somewhat similar. Based on the fact that they do nothing if the market is quit or if it does not move more than the "Box amount" they display a small amount of data. I am thinking that 1min or 5min would be more precise than 30min or 60min. Luca mentions the fact that forex is 24hr that P&F is ideal for forex. I also wonder what the buy sell signals look like what the setups are etc.. I searched the forum could not find any good threads. Please help a fellow trader.
. Thanks Pip Rippy

[Triffick]

Hi pip rippy

P&F can be used well in forex can evenbe extended to use on indicators such as RSI etc.
Like time series charts you do have to gather a feel for them but they come with unambiguous buy/sell signals stops very clear reversals. the point to remember is that they function in a very different way because the time element in removed. The chice of box size reversal depends mainly on your capital( drawdown tolerence) your trading timeframe. intraday weekly monthly etc. so you have to make the same choices selections you did when you first started trading. I suggest you experiment with a book on your knee I recommend 'the definitive guide to point figure' by Jeremy du plessis isbn 1-897-59763-0 It is not the cheapest but he covers all the bases in detail. he does not describe forex in detail but you will know so much about P&F it will be a short step for you. like most things P&F is quick to learn but to use well takes a little effort. But it does some amazing things.
Good trading - trif

[Triffick]

Pip

A thought struck me.
Try eurodollar at a 25 pip box with a three box reversal that will filter out anyhtng less that a 75 pip reversal will not move the box unless there has been a 25 pip move over the previous box then try a 25x2 25x1 then do the same at 50 pips again at 10 then you should see a lot of difference in patterns.
you will then be able to compare what you see with what you do now - you may be a monthly 400 pip move trader or a 25 pip scalper. I dont know but you will see what happens. The bigger the box reversal the less columns you get but the bigger the potential drawdown before a reversal is signalled. Do a bit of search engine trawling you should pick up enough to get off the ground but dont trade till you underst the signals price prediction with confidence. Cheers trif.

[Pip Rippy]

Triffick

Thank you for the response. I did not realize how barron the forex market is regarding point figure. I got more responses when I was looking into Chaos Trading by Williams. I do not know if it is a good thing or a bad thing. You would think that something that is used by so few traders would give some good buy/sell signals.
I was looking into that book you mentioned are glad to hear that it is usefull. The other book you hear about in P&F is by Dorsey Wright but I think it is geared more towards the equity market his sector charting. I do not know how much is in his book as far as technical trading with P&F. What other resources are good for P&F.
A main question I have is in what timeframe 10min-30min-60min-4hr is usefull for typical intraday swing trading not scalping. I found that 10 min generates to many whipsaws 60min/4hr sometimes does not give you much intraday. I know it is all time permited by actual price movement by I like trades that I do not have to rollover.
The smallest I trade is 15min for Zero-line rejects with CCI via Woodies setups. Mainly I like 30min to 60 min for breakout trades via trendlines support resistance moving averages basic technical analysis.
I have grown to use less indicators try to focus on just price movement. That is what led me to point figure charting. I like the fact that it shows support resistance so cleanly. So far I have placed a couple of breakout trades that had easy to define profit targets based on past S/R areas. I am going to have to learn how to identify profitable patterns various entry setups etc how to place stops etc.. So any advice on what you have seen that works. My main thought is on what timeframe is ideal to identify good trends early but does not generate that many whipsaws. I guess that is the million dollar question we are all trying to answer !

[Pip Rippy]

I forgot to ask about what setting for box setup. The default with VTTrader is the open setting. You have the option of high close low open. I would guess the close would be correct? I have also been using 3 box reversal.
Also have you looked into Renko charts? They look somewhat similar.

[Triffick]

Pip Hi
to answer your question to the best of my ability I suggest you first look at the market you trade in terms of timeframe pip range guess you have a typical 6 to 10 hour active day look at this in terms of 'how many pips move' cover a swing in that time frame in your zone. it may be that a 5 pip box witha 3 box reversal will do it but to cover other time frames - which is important in P&F the equivalent would be bigger boxes - greater range roughly corollate to a longer time as you might expect. you should use several charts with different box sizes because confirmations in different boxe sizes/reversals strengthen the balance of probabilities. my inital reaction is to go with eurodollar try 5x3 covering a trade you did with a clear signal successful outcome - see if you get a good P&F signal around the same price frame if it looks like you would have gone with it. up/down the box size see if you get confirmation again. Also see how close this box fits with your intra day feelings. I must now drop the bomb on you. P&F price predictions do not have a time element associated with them! so it is really hard to eyeball it time the trade. Actually dont try. P&F is much more - trade on signal wait the outcome.
Just for fun try 5x3 on the 21st (Tue) there was a drop about 8 am your time - good outside day looks like its ok to me but the closeout would cost you 15 pips at least on a 80 pip (ish) move getting in at least the same try a 5X2 may get a better result one thing to remember is the multiple box reversal gives an asymetrical reversal signal - a built in filter so you get a bit of certainty with the reverse. Sorry if I am a bit too conversational with my musing but you do need to play with it to get a feel. Very little experimentation will earn you a lot of interpretation. Cheers trif.
PS.
Updata have fantastic P&F you can get a free trial with forex if you feel like a test.

[Triffick]

Ho yes close is tradditional. cheers

[arco]

Hi All

Interesting topic - I sometimes use P&F as confirmation of other systems
but it can work well on its own.

Here you can see the benefits of P&F used on EOD charting.

Circa 700-800 pips on the first move down.

200 - 600 on the retracement centre of chart.
(SAR or resistance break)

circa 500 on the recent downmove.

If it helps here's a link for a free P&F course.

http://206.155.168.124/cgi-bin/foxweb.exe/fwuniv


GTA - arco