ThirdWaveUp

How I used Heiken Ashi bars to trade a long USD ETF

INDEX:DXY   U.S. Dollar Index
704 8 11
Recently I watched a youtube video on a successful trader's system. He uses Heiken Ashi bars as a triggering mechanism. I applied this with my knowledge of Elliott waves .

First, Elliott waves unfold in progressions of 5 waves. Three of those waves (1,3 and 5) are price movers, known as motive waves. The other two (2 and 4) are corrective waves. In this chart I observed a triangle (commonly known as a wedge) in the 4th wave correction. Suspecting that a 5th wave would follow, I waited for the trigger (a GREEN Heiken Ashi bar). Waves 1 and 2 are not within the window if this chart.

Heiken Ashi bars are range bars. Green bars indicate an upward range and red indicates a downward range. When you switch to Heiken Ashi, notice how nicely all the green and all the red bars group together. The basic approach is to use a bar color change as an entry trigger. When the bar changes color again, take your profits. Pretty simple. Check out my comments on the chart. I hope this helps :)
gbgglenn
2 years ago
Interesting.
Reply
againstthegrain
2 years ago
Well done.
I have the same counting as you do. What I like here is that the corrective 4th wave is an abcde/triangle while the corrective wave 2 appears to be a zigzag. This fulfills the alternating rule of Elliott Wave giving us more confidence that what we are seeing now could be a 5th wave of a minor degree.
The idea of using Heiken Ashi as entry/exit point is clever; however, I like to use some other confirmation along with it. Specially when riding wave 3 and 5 I usually wait for tops breakthrough of wave 1 and 3 respectively.
Reply
ThirdWaveUp PRO againstthegrain
2 years ago
Yes alternation is a good indication. I like triangles because the breakout is a good confirmation. I've had more luck trading after a triangle than any other formation. As for Heiken Ashi, that to me is only a triggering mechanism. One should certainly have some sort of confirmation mechanism as well. The person who had a video on this likes to use MA lines with a nice slope as well as MACD tools.
Reply
ArekJP
2 years ago
Well done! Very good trade – well thought thru.
Arek JP
Reply
paulo76
2 years ago
Well done! Now I'm interested in Heiken Ashi. Do you remember the youtube video you mentioned?
Reply
novimon paulo76
2 years ago
I'm also interested in this!
+1 Reply
ThirdWaveUp PRO paulo76
2 years ago
Here ya go: https://www.youtube.com/watch?v=FyAeujRwLxM&list=PLYDCtATh9MHxCGbvhL5tIbi9quze_NCn3
I had to search youtube on it and I found other videos that other people have done as well. I may check them out later.
Reply
ThirdWaveUp PRO paulo76
2 years ago
Heres another good one I just watched: https://www.youtube.com/watch?v=zN712u1Ma5s
Reply
Ideas Scripts Chart
United States
United Kingdom
India
España
Italia
Brasil
Россия
Türkiye
日本
한국
Home Stock Screener Economic Calendar How It Works Chart Features House Rules Moderators For the WEB Widgets Stock Charting Library Priority Support Feature Request Blog & News FAQ Help & Wiki Twitter
Private Messages Chat Ideas Published Followers Following Priority Support Public Profile Profile Settings Billing Sign Out