Best Practice: Spotting the WRMB on AUDUSD
WRMB is the most popular technique in Best Practice
What is WRMB? It is one of the strategies which is revised in Best Practice classes and stands for Wash & Rinse Many Boxes. Students love to use WRMB!
@terraseeds usdjpy/gbpjpy/audjpy all chionging well, 1st pot in, each pair >100 pips! WRMB rocks agn!
— tengchew (@tengchew82) March 6, 2014
Criteria of WRMB
So what’s the criteria of WRMB?
- WR of a minimum of 2 H4 boxes about the same high or low.
That’s it? So simple?
Yes! It’s easy to use and easy to spot. However it is versatile and can be used in either trending or reversal situations. In fact it is sometimes the herald of a reversal.
Example Using AUDUSD
Let’s take a look at AUDUSD to see how we can spot a WRMB step by step.
- We’ll always be looking for at least 2 H4 boxes that is about the same high or low.
- If price can close above these H4 boxes high (in the case of AUDUSD) then a subsequent close below would be a confirmation of WRMB.
- Look for a min. H4 close, however a D1 close is preferred.
How to TP?
So we know how to find a WRMB and we know how to enter. Now we want to know where to collect our $$ :)
- Find out the Height of the Range. At the bottom of this range will be your TP level.
- If price can close below, then the next level to look for will be the Height of the Range once again.
Fitting WRMB into our analysis
So how can we fit WRMB into our analysis with a 1234 pattern and a big picture?
There is a saying in mandarin, “天下武功出少林”. This means all martial arts can trace its origins to the Shaolin Temple.
It’s the same thing here, regardless if you’re using BigMove, WRMB, H4R or H4T etc, it is all part of Tflow®.
Big Picture Look
Looking at AUDUSD through the higher timeframe charts, on the D1. We see a familiar pattern.
Look out for the next support levels.
Updated Q&A (17 March 2014)
Q1.) Where is the trigger?
A1.) Per the above blog post. “Look for a min. H4 close, however a D1 close is preferred.”
Q2.) After a WRMB, when should one look for a 1234 retracement in H1 chart versus in the H4 chart?
A2.) If price closes too far from the WRMB point, then look for a retracement to the boxes high in the form of a 1234 as entry.
Q3.) How will we know if the next TP can be acheived?
A3.) There is no 100% certainty to know if it will go on to the 2nd TP. However if it can close below the boxes low (after TP1 in this example) then there is a greater chance of the trade to reach TP2.
Q4.) How to deal with the supports or resistances between entry to TP1.
A4.) If the WRMB is with the trend, these trades have a better chance to reach the TP levels despite intermediate support/resistance levels. However if it’s a counter of the trend then more care is needed when encountering support/resistance levels along the way.
Last time, many things that I wanted were just dreams, now I see them as possibilities. I’m looking forward to own pent-house suite in Manhattan overlooking Central Park because forex trading with Tflow® makes it possible. Find me on Google+