Click on the chart to enlarge it.
Here we see a 360-minute chart of the EURUSD, where each bar spans a six hour period, thus offering four bars per day. We had previously looked at the daily chart, where we found a valid NMC setup had develop on Sept. 14th. That event has now given us the opportunity to zoom in on the market to see if lower time frames can be utilized to enhance the case for taking a trade.
Here we find that the NMC2 had offered sell setups as early as the 8th and 9th of Sept., as shown by the red arrows in the second sub-graph. We also see that NDX and NST (two of the Bounded tools, displayed in the bottom sub-graphs) are well below zero, indicating a market in a downtrend.
This is further substantiated by prices having crossed below both of the Ocean moving averages (shown as thick green and magenta lines on prices). When taken together, all of these conditions signify a market embarking on a significant downtrend.
The reason that we have dialed down to this intra-day time frame is to examine what's occurring on the 14th, because that's when the daily chart generated the Zero Hit sell setup.
Now notice that during the 14th, NMC generates a Zero Hit sell setup (as shown by the A in the first sub-graph). Actually, the first of the two back-to-back Zero Hits occurred late on the 13th, but using the entry rule taught to Ocean Masters, no trade would have been triggered prior to the second Zero Hit that occurred on the 14th.
Note also that at the time of the Zero Hit, prices were trading below both Ocean moving averages, and had briefly come back to the Fast moving average (the thick green line), where the market encountered resistance.
The NMC sell setup here on the 360 minute chart offers us a good indication that the trade that was first identified at the daily level is likely to be a high quality signal. Now let's try to roll down to another lower time frame to see how Ocean is interpreting the price action.
(This is the end of Part 2. Go to Part 3.)
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