Session Candles

I’ve taken some glances at this thread:  http://www.forexfactory.com/showthread.php?t=359093&page=18

In particularly, Mr. Wolf, or Captain Jack. The short trip to the store reveals the stevehopwood forum, where I end up pretty much at a dead-end. It seems to me that he is a self-proclaimed and proven discretionary PA trader.. which I admire but hate. I believe he’s also stated that no one quite does his methods as well as he, which is understandable… but makes following the rabbit hole a very arduous task. I’ve personally found the “spot the dumb money” game to be very circle driven – if dumb money and retails are too small to move the market, how is it that they continually print wicks on the chart? If the dumb money is so easy to spot and exploit, why isn’t it exploited more than once? (expanding triangle formations) To ‘trap’ the most traders, it seems most profitable to continually poke tops and bottoms and drive them the other way.. This does not appear on the chart however. Perhaps there is a stop to how manipulated proce can be from “the big dogs” where they can’t step over certain bounds without risking too much of themselves.. but that is a question for another day.

Reading through his thread, one ‘tradeable’ pattern that pops up is the following: follow the asian range. Price will be manipulated through an asian level, usually by about 20-30 pips in the London session to bait breakout and possibly trend traders. Then price will reverse and sucker everyone who took the break. If sessions have this data within them, let’s try to find it!

I took this years data and broke the data into 3 candles per day, with each candle end being the beginning of the next session, aka there are no overlapping sessions. I ended up with about 200 days made of 3 swings, H/L per bar, so 6 points of data and many possibilities..so lets see..

If it’s true that price breaks out to bait traders and take it the other way, then there are a lot of ways to go about possible positions of the London and NY highs and lows, but one thing is for sure: the highs and lows of the Asian range have to be engulfed. I found the positions of the highs and lows of the three candles, labeled as follows:

High of Asian: A
Low of Asian: B
High of London: C
Low of London: D
High of NY: E
Low of NY: F

fake break

Not really what I call a tradeable edge (the other way), but this is definitely a confusing result if the hypothesis is to be true. It’s not completely dead, but this is not the start to be looking for..

 

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