BIll Williams Chaos trades on EUR/USD
These trades can be entered in advance as Stop entry trades, where you cancel whichever trade does not trigger.
1. Go LONG above 1.1241 + Spread - ONLY if entry triggers above the red moving average (between the blue and green moving averages). Otherwise do not take this Long trade. Stop Loss 30 PIPs.
Reasons as follows:
a. Price bouncing up off lower diagonal trend line , drawn based on fractal Lows.
b. Price bouncing up off 78.6% Fibo level.
c. Price bouncing up off 1.12000 BRN .
d. 14:00 candle is Bullish Divergent, a bullish sign.
e. Entry level is 1 PIP above the highest fractal of the current trading range.
Exit on trailing stop loss, based on a Close - not just a touch - below the red moving average line.
Conservative Take Profit Level = 1.1305 (around 23.6% Fibo level), which would yield 63 PIPs, a Reward:Risk Ratio of 2.1.
Ideal Take Profit Level = 1.1396 (around -27.2% Fibo level), which would yield 154 PIPs, a Reward:Risk Ratio of 5.1.
2. Go SHORT below 1.1189, ONLY if entry triggers below the red moving average (between the blue and green moving averages). Otherwise do not take this Short trade. Stop Loss 30 PIPs.
Reasons as follows:
a. Price hitting well below lower diagonal trend line , drawn based on fractal Lows.
b. Price below 78.6% Fibo level, almost at 88.6% Fibo level.
c. Price below 1.12000 BRN .
d. Price is below the current Chaos Alligator , signifying a downtrend.
d. Entry is 1 PIP below the lowest fractal of the current trading range.
Exit on trailing stop loss, based on a Close - not just a touch - above the red moving average line.
Conservative Take Profit Level = 1.1120 (around 127.2% Fibo extension level), which would yield 70 PIPs, a Reward:Risk Ratio of 2.3.
Ideal Take Profit Level = 1.1058 (around 161.8% Fibo extension level), which would yield 131 PIPs, a Reward:Risk Ratio of 4.4.
___________
Why a possible entry either Long or Short?
Chaos trading is a trend trading approach that always aims to go with the flow of the market. Right now it is not clear which way the market will decide to go when it re-opens on Sunday evening. Hence I am highlighting where and at what level I would choose to go either Long or Short, for the reasons stated above.
Potential exit points shown are based on a trailing stop loss, and assumes this single trade.
In practice, if the trend develops in either direction, there will be clear opportunities to add additional trades to capitalise on the trend, and increase profits, in line with the Williams’ Trading Chaos theory.
For more details, read the book, Trading Chaos - Second Edition (ISBN 9780471463085), by Bill Williams and Justine Gregory-Williams.
1. Go LONG above 1.1241 + Spread - ONLY if entry triggers above the red moving average (between the blue and green moving averages). Otherwise do not take this Long trade. Stop Loss 30 PIPs.
Reasons as follows:
a. Price bouncing up off lower diagonal trend line , drawn based on fractal Lows.
b. Price bouncing up off 78.6% Fibo level.
c. Price bouncing up off 1.12000 BRN .
d. 14:00 candle is Bullish Divergent, a bullish sign.
e. Entry level is 1 PIP above the highest fractal of the current trading range.
Exit on trailing stop loss, based on a Close - not just a touch - below the red moving average line.
Conservative Take Profit Level = 1.1305 (around 23.6% Fibo level), which would yield 63 PIPs, a Reward:Risk Ratio of 2.1.
Ideal Take Profit Level = 1.1396 (around -27.2% Fibo level), which would yield 154 PIPs, a Reward:Risk Ratio of 5.1.
2. Go SHORT below 1.1189, ONLY if entry triggers below the red moving average (between the blue and green moving averages). Otherwise do not take this Short trade. Stop Loss 30 PIPs.
Reasons as follows:
a. Price hitting well below lower diagonal trend line , drawn based on fractal Lows.
b. Price below 78.6% Fibo level, almost at 88.6% Fibo level.
c. Price below 1.12000 BRN .
d. Price is below the current Chaos Alligator , signifying a downtrend.
d. Entry is 1 PIP below the lowest fractal of the current trading range.
Exit on trailing stop loss, based on a Close - not just a touch - above the red moving average line.
Conservative Take Profit Level = 1.1120 (around 127.2% Fibo extension level), which would yield 70 PIPs, a Reward:Risk Ratio of 2.3.
Ideal Take Profit Level = 1.1058 (around 161.8% Fibo extension level), which would yield 131 PIPs, a Reward:Risk Ratio of 4.4.
___________
Why a possible entry either Long or Short?
Chaos trading is a trend trading approach that always aims to go with the flow of the market. Right now it is not clear which way the market will decide to go when it re-opens on Sunday evening. Hence I am highlighting where and at what level I would choose to go either Long or Short, for the reasons stated above.
Potential exit points shown are based on a trailing stop loss, and assumes this single trade.
In practice, if the trend develops in either direction, there will be clear opportunities to add additional trades to capitalise on the trend, and increase profits, in line with the Williams’ Trading Chaos theory.
For more details, read the book, Trading Chaos - Second Edition (ISBN 9780471463085), by Bill Williams and Justine Gregory-Williams.
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