Strategy

In this section, I explain  the method I use.

Most of the indicators described below have been made by my friend Steve based on the Bill Williams indicators and strategy. Please visit his website: 

www.for-exe.com

If the brains think it, he can code it!


Video 1: The Indicators

Video 2: The Entries

Video 3: The Exits

 

Video 4: How to count the Elliott waves, how to analyze any chart within 30s  (new version)

Video 5: What is a valid entry setup?



Video 6: Where to get the indicators





Former Videos:

Video 1: The Indicators (1st Version)

Video 2: Entries (1st Version) 

Video 3: The exit (1st Version)

Video 4: How to count the Elliott waves, how to analyze any chart within 30s (1st Version)

 

Sources:

In my trading research as a newbee, I came across the "Chaos Theory" applied to trading. Having always been interested in Chaos Theory, I was very intrigued by how it could be applied to trading. So I watched many threads and posts on Forex Factory forums dealing with this method. Chaos applied to trading has been developped by Bill Williams.

Bill Williams has now over 40 years of trading experience, is multi-millionaire and has trained with her ​​daughter Justine, thousands of successful traders. 

Bill Williams, a trained psychologist, studied the psychological behavior of traders, their effects on the market and has developed an original theory. For him, the profits on the market are determined by psychological data and he believes that anyone can become a successful trader if one can understand the internal  structure of the market governing these seemingly random market events. 

For Bill Williams, the markets are not a linear model and therefore the fundamental or technical analysis can not capture the reality of the market. They can not provide results in a sustainable manner. 

Trading is essentially a psychological game and succeed in trading requires a personal quest of self-knowledge to adapt its strategy to its own internal structure. Therefore, there are two aspects: Self-knowledge and understanding of the internal structure of the market 

To understand the internal structure of the market, you should be aware that the market has some particular fractal dimensions (phase space), and momentum  (phase energy). Bill Williams also captures the Elliott Wave principle: 

http://en.wikipedia.org/wiki/Elliott_wave_principle

These waves begin and always end with a fractal. The Fractals constitute the internal structure of the Elliott waves.

Overview of the method and indicators:

I am now trading a method coming from those sources with a group of experienced traders. I mainly use the H1 Charts and make entry  when the trend is confirmed on the H4 chart. 

This strategy, based on the Science of Chaos, is perfectly adapted to changing market conditions and applicable to both the smaller and higher time frames

It has three simple rules with three indicators.

Indicators: 

* The ewave (based on the Awesome Oscillator): It allows to analyze the Elliott Wave in less than 10 seconds! It also helps to identify entry points and finally it shows the momentum. It shows us quite clearly what is happening to the market driving force at the present moment.

* Fractal Box: This is the area between the upper fractal and the lower fractal. Fractal on a graph is a set of five bars where the third bar is preceded and followed by two lower bars (for high fractal). This frame shows clearly  the levels of resistance and support, as well as  entry and exit points 

* The Alligator Created By Bill Williams. It consists of three moving averages shown in green, red and blue lines- lips, teeth and jaws. It is intended to help spot trending and rounge-bound markets.  It is our compass.

Method in brief: 

*  Trend following strategy: You enter the market when the trend is confirmed in the higher time frame (for example M5 for trades on M1, H4 for trades on H1) 

* Valid on all time frames

Principle: 

We enter the market when the price breaks through the fractal Box and when: 

* Entry is ok compared to the 4 time higher time frame (It means that the alligator must be open on the higher TF)

* The Stop Loss, on the other side of the  fractal box, must be close to the entry level (about 10 pips on M1) 

* Entry must be while the Alligator is asleep (lines are flat and intertwined) or starting to open (2nd break after a sleeping alligator break)

Entry:

You take the break of the box of a sleeping alligator (after watching 4 times higher TF for direction) or the second break after the first break of a sleeping alligator. Fractal box must be tight (1st entry), green line must be close (2nd entry) as this is where your initial SL will be. An entry on the 3rd break will depend of how close the AO is from the Zero Line

Exit:
For exit: You have to consider:
Fast move: Exit would be candle trailing or break of box in opposite direction. Choice would depend also of how look the chart 4X TF; 
You may also lock some profit.
Normal move: close of green line if divergence between AO and price, red line if no divergence or break of box in opposite direction. Choice would depend of how look the chart 4X TF;
Other thing to consider if you trade H1 and lower TF: Red news. You may bring your SL to BE or self half or more of your position. 
BRN (Big Round Number) number, you may take some profit
For wave 5, you may also use fibonacci numbers.
If entries are mechanical, exits are much more subjective 

  I invite you to see some examples of trade: 

Examples of Trades