FLIP Setup

For example in UPTREND -------> FLIP TRADE SETUP ------> In Higher Time Frames, we identify the Trend by looking a price 'identical patterns', so at first we identify the Troughs. We must start with the Troughs (T). Then we look at first significant resistance that is first peaks (P) after troughs. This resistance peaks (P) may have single or multiple bounces. As general rules, the more the bounces at peaks (P), the resistance is stronger. And due to strong resistance, price will do pullback and we will see formation of 'rising troughs' - (RTs). Price will try another attempts to breaks resistance at P, if the price successfully do breakouts, we will see new high or new resistance so the rising peaks (RPs) is formed. If we see significant new high, that means this breakouts suggest the current trend is continues in uptrend. Why? By definition, the trend is UP if we see 'series of rising troughs and rising peaks'. After breakouts, new resistance (RPs) will retrace or do pullback due to profits taking. What we see here is identical price patterns forming Troughs, Peaks, Rising Troughss, Breakouts, Rising Peaks and Pullback for profits taking. Once price start to do 'pullback' - this the currency i want to monitor closely.  

Previous resistance (P) may FLIP her function and act as support. During Pullback from Rising Peaks, if the price 'bounce' near the 'previous resistance (P) FLIP Line, this will confirmed the role of (P) as resistance now FLIP it function as support. However, during pullback, if the price breaks 'previous resistance (P) and formed significant 'low' and beyond the 'expected zone' - let it be. That means, we see 'NO FLIP' and its better to 'wait' another 'FLIP' setup. Just remember that, we want to see 'FLIP PHENOMENON' exists before we enter the trade. If we plot 'FLIP' horizontal line started at previous resistance (P), if the price 'bounces' near this FLIP LINE either normal, inside or outside bounce line, THE FLIP is valid. This FLIP LINE or ZONE maybe a new 'rising troughs' (RTs). This previous resistance (P) now FLIP it function to act as support (RTs). In uptrend - we will look for opportunity to buy here at FLIP LINE. If the price breaks and make a significant 'new low' from FLIP LINE; than the 'FLIP ROLE' is not valid. So lets the chart speaks to you. By the way, we don't enter the trade based on first bounce during Pullback. Flip Line act as important 'filter' for this 'flip' setup.

One of important trading rules is always buy at at support and sell at resistance. Buy Low & Sell High.My best definition for entry at support or low in uptrend is at FLIP LINE once the FLIP is confirmed by first swing point at FLIP ZONE. Remember, in uptrend, the FLIP is valid once the 'P' horizontal line is tested. If the price 'bounces' from this horizontal line, then the previous resistance (P), confirmed FLIP as support now. Once the price bounce from this FLIP Line or Zone, then i need to wait for entry at the same 'price' level or 'near' the FLIP line once the price test this zone again either on 2nd or 3rd attempt as long as price never test new resistance (RPs) level. If the price 'test' rising peaks first before 'test' FLIP LINE on 2nd or '3rd' attempts - the SETUP is not valid as the price is making 'double top' might be a sign of topping. 

1. In summary, in uptrend, buy at flip zone on 2nd or 3rd test as long as price never touch the rising peaks. In uptrend, after identify troughs, i will look for peaks. Once the price start to retrace & formed rising troughs. I will wait for breakouts at 'peaks', wait for significant 'new resistance' or rising peaks. I will plot FLIP LINE at 'peaks'. I will wait for price to retrace and bounces near 'FLIP LINE'. Once the price bounce from this FLIP LINE, we look for 'swing point'. The FLIP role confirmed. I will use swing point as filter and set PO at this line or zone. I will set stop loss just below the flip zone & with first target profits below the rising peaks. I will take 'the trade' as long reward is double than the risk. So if the trade offer good risk reward then i will take it. If i have time to monitor, i will monitor each time the candle die to see opportunity to enter at best price 'near' flip line. I will use higher time frame to identify the trend and flip line. I will use 'trading time frames. to identify pullback and first swing point. I will use trading time frames to timing the entry, set a stop loss and target profits.


If the pullback from rising peaks is strong and price cross far away from this FLIP LINE - let it be, we will wait for another FLIP TRADE setup. The FLIP maybe single line, but most of the time its a zone with 'certain' pips ranges. Its an art to learn to identify this FLIP zones. 

To optimize this FLIP METHOD, i will continue doing research 'in identifying' the best 'SWING POINT' at FLIP ZONE. In future, i hope i can enter trade - based on price action at FLIP LINE during First Bounce.

Some ideas are:-

1. During pullback, I will identify first bounce 'near' flip line by using fibo sequence number. 

2. During pullback, I will identify first bounce 'near' flip line by using 'round' number.

3. During pullback, I will identify first bounce 'near' flip line high or low; wick or body bounce.
4. During pullback, i will use 'price patterns' confluent with 1,2 & 3.

All entry is by 'using' stop order. I decide the trade 'once' the candle 'die'. Stop Loss is based on price action in 'trading zone'.

PRAKTIS TO MASTER THE SETUP

I'm using MT4 platform. In each time frames, i will label the price trend label using symbol P as Peaks, T as Troughs, RPs, RTs or FTs or FPs. I must have a discipline to label price action on chart every time the candle die or at least, we update the PA on chart everyday in each time frames.

Trend PA is the main core the technique... habit of label PA on chart, will train you well in making the decision and identify the setup.  

Once i identify the trend & flip line - i will monitor this 'currency' on trading 'time frames'. I will look for 'pullback' and 'first swing point'. Once the setup is 'complete', i will pull the trigger using PENDING ORDER. I then continue to 'monitor' at higher Time Frames.

Note: Please label all PA Trend 'according' to time frames. So i can't view that 'label' if you flip to other time frames.