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James16 Forex Trading Strategies

The following are 6 James16 forex trading strategies which I’m going to reveal to you.

James16 is credited for developing these 6 forex price action trading strategies that you are soon going to read here which he posted in forexfactory.

The following are the summaries and my interpretation of the trading strategies he uses and I may not be 100% right and be sure to point that out to me if you believe so.

What Timeframe James16 Uses?: Jame16 prefers to use the daily and the weekly charts. The reason, he argues is that, larger timeframes give more chance/probability of giving successful trades.

Currency Pairs: I really don’t know but I believe its applicable to all pairs

Forex Indicators: simple moving averages 21, 79 and 365. EMA 89. He uses them for dynamic support and resistance levels.

OVERVIEW OF JAMES16 TRADE ENTRIES
James16 focuses on selling rallies in a downtrend market and buying the dips in an uptrend market a
James16 does this by using Price Action by watching levels of Resistance and Support, Fibonacci Levels
Jame16 trade entries are based on 2 to 4 bars reversal patterns clustered near what he calls are “levels/areas/points of confluence”.
JAMES16 HAS 6 MAIN PRICE ACTION PATTERNS
These are the 6 main price action patterns James16 uses:

Double Bar Low Higher Close-DBLHC
Double Bar High Lower Close-DBHLC
Two Or More Matching Highs Or Lows. The condition with this is that they must be within 2 pips of each other. If the low or the high is broken, it indicates that the current trend will continue.
Bearish Outside Vertical Bar(Bearish Engulfing Pattern)-BEOVD–
Bullish Outside Vertical Bar (Bullish Engulfing Pattern)-BUOVB
Pin Bars
PRICE ACTION PATTERN #1: DBLHC

The DBLHC stands for Double Bar Low Higher Close and it is a bullish chart pattern which means you should be looking for this pattern in an uptrend market.
How do you spot this pattern? Well, look for 2 bars that have lows that are on the same price level or within 2 pips of each other, but the 2nd bar must have a close that is higher than that of first bar.
How do you trade the DBLHC pattern? You can buy at market order as soon as 2nd bar closes or place a pending buy stop order just 2-3 pips above the high of the 2nd candlestick.
For your stop loss, place it 2-5 pips below the low of the 2nd candlestick in the pattern.

james16 forex trading strategies,price action trading strategies

james16 forex trading strategies

JAMES16 FOREX PATTERN #2: DBHLC
DBHLC stands for Double Bar High Lower Close and it is a bearish chart pattern which means you should be looking for this chart pattern when the market is in a downtrend.
How do you spot the DBHLC chart pattern then? Look for 2 bars that have highs that are almost on the same price level or within 2 pips of each other but the 2nd bar must have a close that is lower than that of first bar. See chart below.
How do you trade the DBHLC pattern? There are two possible options here: sell at market order as soon as 2nd bar closes or you can place a pending sell stop order 2-3 pips below the low of the 2nd candlestick.
For you stop loss, place it 2-3 pips above the high of the 2nd candlestick in the pattern.

James16 Forex Trading Strategies,price action trading strategies

James16 Forex Trading Strategies

JAMES16 PATTERN #3: TWO OR MORE MATCHING HIGHS/TWO OR MORE MATCHING LOWS
#3a: Two Matching Highs Pattern:

How Do You spot 2 Matching Highs chart pattern?: Well, you look for 2 bars that have highs that are almost on the same price level or within 2 pips of each other
Two Matching highs pattern is considered a bullish forex chart pattern so you should be looking for this chart pattern in an uptrend market.
How do you trade the two matching highs pattern: you have two options… first is to buy at market order as soon as 2nd bar closes or the second option is to place a pending buy stop order 2-3 pips above the high of the 2nd candlestick.
For your stop loss, place it 2-5 pips below the low of the 2nd candlestick in the pattern.
See chart below for what Two Matching Highs Chart Pattern Looks Like:

James16 Forex Trading Strategies,price action trading strategies

James16 Forex Trading Strategies

 

3b: Two Matching Lows Forex Chart Pattern

How do you spot two Matching Lows Forex Chart Pattern? Well, you should Look for 2 bars that have lows that are almost on the same price level or within 2 pips of each other
The Two Maching Lows Pattern is considered a bearish forex chart pattern which means you should be looking for this chart pattern in a downtrend market.
How do you trade the two maching lows pattern? Again, you have two options: you can sell at market order as soon as 2nd bar closes or place a pending sell stop order just 2-5 pips below the low of the 2nd candlestick.
For your stop loss, place it 2-5 pips above the high of the 2nd candlestick in the pattern.
See chart below of what two consecutive matching lows chart pattern looks like:

James16 Forex Trading Strategies,price action trading strategies

James16 Forex Trading Strategies

JAMES16 CHART PATTERN #4: BEOVB
Bearish Outside Vertical Bar–BEOVB is a bearish forex chart pattern so look for this pattern when the market is in a downtrend.
How do you spot the BEOVB Pattern? It is a 2 bar chart pattern, the first bar must be a bullish bar (green) and the second bar must be bearish which overshadows the first bar because its high may be a few pips higher than than that of the first bar and its low may be a few pips or more lower than the 1st bar.
How do you trade the BEOVB pattern? You have two options…first option is to sell at market as soon as second bar closes. The second options is to place a pending sell stop order just 2-3 pips below the low of the second candlestick.
For your stop loss, place it 2-5 pips above the high of the second candlestick in the pattern.

Here’s an example of  BEOVB and how to trade it:

James16 Forex Trading Strategies,price action trading strategies

James16 Forex Trading Strategies

JAMES16 CHART PATTERN #5: BUOVB
BUOVB stands for Bullish Outside Vertical Bar and it is a bullish pattern which means you look for this pattern only when the market is in an uptrend.
How do you spot the Bullish Outside Vertical Bar pattern? Well, it is a 2 bar chart pattern and the first bar must be a bearish bar (red) and the second bar must be bullish (green bar) which overshadows the first bar because its high may be a few pips more higher than that of the first bar and its low may be a few pips or lower than the first bar.
How do you trade the bullish outside vertical bar pattern?: There are two options, buy at market order as soon as 2nd bar closes or you can use a pending buy stop order just 2-3 pips above the high of the 2nd candlestick.
For your stop loss, place it 2-5 pips below the low of the 2nd candlestick in the pattern.
Here’s and example of what a BUOVB pattern looks like:

James16 Forex Trading Strategies,price action trading strategies

James16 Forex Trading Strategies

JAMES16 CHART PATTERN # 6: Pin Bars

Pin Bar Fact#1:

A Pin Bar is “NOT” a doji candlestick or a hanging man candlestick.

A pin bar is a very unique candlestick because it shows rejection of a price level via very long tail or spike and this tail or spike is much larger/longer than the entire candlestick body.

Not all pin bars are created equal. The location of where the pin bar forms is very important. Just because you see a pin bar form on the chart doesn’t mean its a good pin bar that you can trade.

Pin Bar Fact#2:

If you want to trade the pin bar, you trade in the opposite direction of the tail.

For a bullish pin bar, the tail will be pointing down, then you buy.

For a bearish pin bar, the tail will be pointing up, then you sell the tail is pointing up then you sell.

Pin Bar Fact#3:

The probability of success in trading pin bars is higher in larger time frames like the 4hr and daily.

Pin Bar Fact#4:

I mentioned previously that not all pin bars are created equal. If pin bars form in areas of confluence, then you should take notice of such because the chances of taking trades that go successful are good.

You should also look at trading pin bars that form at swing lows in an uptrend

The opposite is also true, look for pin bars in swing highs in a downtrend and if a pin bar forms, take a short trade.

Ideally, if you see a pin bar make a“false-break” or rejection of a key price level then that’s a very good signal to trade.

Pin Bar Fact#5:

You can also watch exponential moving averages for pin bar trading setups. The EMAs that you can use are:

the 8 and 21 periods EMAs
the 9 and 18 periods EMAs
the 7 and 14 periods EMAs
Pin Bar Fact #5:

Did you know that Pin bars can be traded successfully in both range bound and trending market conditions? Guess what? This fact alone makes trading pin bars one of the most versatile forex systems out there.

HOW TO TRADING PIN BAR

For those trades that may find it hard to understand, this is generally how you trade pin bar trading setups:

James16 Forex Trading Strategies ,price action trading strategies

James16 Forex Trading Strategies

FEW TRADING TECHNIQUES JAMES16 USES IN HIS TRADING
To see the big picture, James16 uses moving averages as well as support and resistance levels.

What moving averages he uses? 21, 79 and 365. The Exponential MA is 89. James16 say’s he uses these moving averages as resistance and support levels.

James16 also uses a Keltner Channel with settings of 8, 1.3, 1.3

What is the purpose of jame16 using moving averages? Most likely for:

understanding the big picture and trend direction.
trading price action bounce off moving averages similar to the popular floor traders method most likely using the 6 forex chart patterns explained above.
Hopefully, this post has solved some of the confusions about how to use the james16 forex trading strategies and methods.

Source

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04 Jan 2019 4:16 pm Posted by tamilforex

 
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