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www.optionsinfinity.com
FOREX MASTERCLASS - Macro Overview
2
1. Intro to FOREX 1. The 3-Principle Method2. Chart Setup3. Executed Trade Example
1. Finding the Trade2. Entering the Trade3. Exiting the Trade4. THE EDGE
PART 2:PART 1: Part 3:
PART 2: Micro Overview
Regression Channels
Measured Moves
Fibonacci Extensions
Setting them up in your charts
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Entry and Exit - The 3 Principles
5
1. Regression Channels 2. Measured Moves 3. Fibonacci Extensions
ManagementEntry Exit
Principle 1: Quick OverviewThe regression line is calculated by taking 50% of the price above the line and 50%
below the line. This may be done over any timeframe. This line become a very
powerful trend line.
Now if you take 1 standard deviation of this line statistics say that 68.2% of price will be
contained within that channel and at 2 standard deviations 95.4% of price will be
contained within that channel. 95.4%!
This is the best principle for determining overbought and oversold markets. I used to
plot this by hand knowing the power of this principle. Nowadays any trading platform
will calculate it for you and place it on your chart. How convenient.
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Principle 1: Regression Channels - Middle Line
8
50%of price action below
Entering during outlier price action.
Creates the Middle Line: Very Powerful Trendline
50% of Price Action Above
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Regression Channels: 1st Standard Deviation (STD.)
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1st Standard Deviation
Statistically: 68.2% of price action will be contained within here
1st Standard Deviation
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Regression Channels: 2nd Standard Deviation
10
2nd Standard Deviation
Statistically: 95.4% of price action will be contained within here
2nd Standard Deviation
Principle 1: ConclusionRegression Channels are
statistically the best way to enter overbought and
oversold markets.ManagementEntry Exit
Principle 2: Quick Overview
A measured move may tell you the trend in any timeframe. The definition of an uptrend is higher high’s and higher low’s.
The definition of a downtrend is lower low’s and lower high’s.
This may be determined by measured moves.
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Measured Moves - Uptrend
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BULLISH MEASURED MOVE | Higher Highs and Higher LOWS.
A
B
C
D
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Measured Moves - Downtrend
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BEARISH MEASURED MOVE | Lower Lows and Lower Highs.
A
B
C
D
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Measured Move within our Regression Channel
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Measured moves within our Regression Channel.
Principle 2: ConclusionMeasured Moves are the
best way to quantify a trend once you’re in a trade.
ManagementEntry Exit
Principle 3: Quick Overview
(.618)^2 = .382 .618Sq. root (.618) = .786 } Used for
Retracements
}1/.382 = 2.6181/.618 = 1.6181/.786 = 1.272
Used for Extensions
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Fibonacci Extensions
24
PRICE: Fibonacci Plotting Point: Fibonacci Extensions:
A
B
C
1.61 EXTENSION (target)
1.27 EXTENSION (target)
2.61 EXTENSION (target)
Principle 3: ConclusionFibonacci Extensions allow me to PRE-SET price targets for my exit.
ManagementEntry Exit
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Executed Trade - USD/JPY
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Enter Thursday 8/30/18 @ 111.74 – Exit @ 110.65 – 109 PIP’s or $97 on $200 margin – 49%
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Chart Setup – Auto Adjust Regression Channel
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Measured mes within our Regression Channel.
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Chart Setup – Regression Channel 1&2 Std. Dev.
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Measured moves within our Regression Channel.
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Chart Setup – Measured Moves
34
Measured moves within our Regression Channel.
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Chart Setup – Fibonacci Extensions
35
Measured moves within our Regression Channel.