I closed my EURUSD long. Got a TDSEQh13 sell signal in the hourly with overnight spike up. Expecting a short bounce then more down in EURUSD. USDJPY ready to turn.
DeMark notes that if one is aggressive and wants to enter at the end of a 13 count, a good way to set stops is either 1x or 2x the range of bar 13 above the high(low) of bar 13 and adjust your bet size accordingly, and if price exceeds that level then conclude that price is "recycling" and get out. However, he also suggests that waiting for a price flip avoids a recycle situation.
Since you are using the T&S sequencer, it is helpful to review what Tom said in his books. He suggested that the TDSEQ signal is confirmed best for trade entry when it is immediately followed by a "price flip" (current bar close Higher/Lower than close 4 bars prior). The studies on using the TDSEQ in commodities used that price flip default as their trigger for entry.
This is a good example of how Elliott and DeMark can be used together. In the case of EWY that daily 13 print turned out to have hit at the top of a minor iii. It was followed by an 8 day consolidation which included a TDSEQ buy set up in the hourly chart which suggested that the 13 print in the daily chart hit at what was a lower degree wave inflection in the overall structure and warned one to exit, especially since the buy set up (which the Sequencer should have printed ) printed at a higher low than the low immediately after the TDSEQ 13 in the daily printed, or that one at least tighten the stop.
At the time of the post, it was possible to count what turned out as a iii as the end of a 5th wave as it had 5 waves and a cycle high was projected.
So during the consolidation, one can watch the wave structure for clues as to how to manage one's stops. If one is extremely aggressive and didn't wait for a price flip to enter, one could have moved their stop to just above the 23.44 top of wave iii after the TDSEQ buy set up printed in the hourly or exited. 23.44 was tested twice before EWY moved upward), confirming that that the prior top was at a lower degree count, Elliott wave wise . Ironically when the price flip occurred, it was at the very end of the consolidation, and a little late and clearly at the end of a corrective structure, and the print that day had a higher low than any during the consolidation.
EWY now appears to be tracing out a choppy, overlapping diagonal in which the low of iv of the diagonal was on 4/11. There are no TDSEQ signals at this point in the hourly chart, but a sell set up has initiated with a price flip yesterday afternoon.
The interplay between Elliott and DeMark can be very helpful in one's analysis. In Elliott terms TDSEQ signals can hit at the end of any wave. It is extremely helpful to use both together as DeMark is so mechanical. One can help you interpret the other, it seems.
For example, I concluded late yesterday that Elliott wave wise that one minor wave more down was required in ES and exited my long with a profit. As it turned out, ES did spike slightly lower (1 point) this am with a buy set up 9 print in the hourly and reversed so I entered long again this am. That spike down may have concluded this consolidation, and at a higher low than the low on March 11, and if so we could be at the very start of wave 3 of 5 of the final intermediate degree 5th (or third, depending on one's count) wave up from the Jan 2016 low. That a 20 day cycle low hits here is also suggested cycle wise.
If it didn't, it's now possible to move the stop up to almost break even, given the small degree wave structure.
What is really fun is to catch the start of a major move, or as the Beach Boys say, "Catch a Wave and you're sitting on top of the World"
https://www.youtube....h?v=gFDRqnq_ob4
It's just that often it takes a few attempts and one must stay alert and monitor things --nothing's easy--but that's part of the charm. Otherwise, anybody could be a trader..
Edited by Geomean, 13 April 2017 - 10:28 AM.
