GJ GU London open 26 May 2016

Only got to the computer now but for the record the blue rectangles on GJ highlight the areas we are interested in trades. Higher lows and lower highs crossing the 20lwma and GU agreeing.

GJ GU 25 May London open

In terms of the simple idea behind the set up. Look for crosses of the ma (candles that have opened one side of the ma and closed on the other side) that are higher lows/double bottoms or lower highs/double tops in their own right or the HL/LH that follows these crosses.

GJ has several trades highlighted. The first trade being the arrows where the ma crossed. Any subsequent arrow in trend direction would be a continuation trade. All of these would have been trades in terms of the rules as GU was agreeing. Depending on your stop/take profit strategy 2 perhaps BE or small profit and two winning trades.

Why not sell GU.

I was asked why I wasn't selling GU see the blue rectangle on the chart.

Two reasons, first it was difficult to get a sell entry and get to break even before the obvious resistance level at todays open. Second and more importantly GJ was not agreeing on the sell.

I really want to see some form of confirmation that either G or U has some across the board family strength/weakness. When GU and GJ agreed a nice move followed.

3 bar reversal with stochastic filter

Another good job done by the (price based) indicator. When GU and GJ agreed after LO (green line) there was a nice move up.

Higher lows lower highs using 20lwma

The 3 bar reversal alerts (note the arrows refer to the previous candle close) working really well with solid timely signals.

The simple idea as posted below:

Look for crosses of the ma (candles that have opened one side of the ma and closed on the other side) that are higher lows or lower highs in their own right or the HL/LH that follows these crosses.

3 bar reversal with stochastic filter

The indicator has been posted here http://www.forexfactory.com/showthread.php?p=8878722#post8878722 and is intended to show higher lows and lower highs based on price action i.e. candle closes.

Higher lows, lower highs using 20lwma

The 20lwma provides an easy visual for higher lows and lower highs.

Look for crosses of the ma (candles that have opened one side of the ma and closed on the other side) that are higher lows or lower highs in their own right or the HL/LH that follows these crosses.

See the charts with some trades highlighted.