FMCBR 3.

0
PREPARED BY BI0FX
LAST UPDATED 01 AUGUST 2018
COURSE OVERVIEW

• Background
• Introduction
• Basics
• Standard Operating Procedure
• Fibonacci Retracement
• Entry Levels
• Pullback
• Awesome Oscillator
• Epilogue

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BACKGROUND

• Started trading in 2015 by using EA, and manual trading since 2016
• A part-time trader, primarily trading based on Intraday & Swing trading
• A local partner for HotForex

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INTRODUCTION

• FMCBR is one of the techniques that is applied in trading as part of technical

analysis
• FMCBR was founded by Mohd Zulkifli & Baha in 2011
• The definition of FMCBR
• Fibo Musang – By using the Fibonacci Retracement to determine the Take Profit (TP) levels
• CBR (Candle Break Retest) – By using Entry Levels to determine a strong entry position

• Do note that trading is a risky investment, and there are no such things as ‘Holy
Grail’ techniques

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BASICS

• There are 9 different types of Timeframes (TF) in Forex, from M1, M5, M15,
M30, H1, H4, D1, W1, and up to MN
• Based on the TF that you are trading on, you can define the trading style or
the type of a trader
• Swing Trading – Trader who trades based on H1 and above TF
• Intraday Trading – Trader who trades based on H1 and below TF
• Scalp Trading – Trader who trades based on M15 and below TF

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In Forex, there are two types of Candlestick (CS)

Bull CS Bear CS
Top Shadow

Body

Bottom Shadow

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For every CS, market moves in a pattern, following the direction of the trend

• In FMCBR, a trend is identified when there is no CB1

• During a movement of a trend, if CB1 is present, it indicates a change in trend
or pullback
• Always refer to higher TF for the direction of the trend

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Bullish trend Sideway Bearish trend

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For every direction of a trend, there will be the presence of Support and
Resistance

Support Resistance

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For every direction of a trend, market will make an ABC pattern

Bearish Trend Bullish Trend

B C
A
A
C B

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Now, let’s recap what we have learnt so far
• Bullish trend is upward and Bearish trend is downward. Sideway has no
directions
• When a Bullish movement is stopped by a Bear CS, it is the Resistance Level
• When a Bearish movement is stopped by a Bull CS, it is the Support Level
• ABC patterns are present in all TF

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STANDARD OPERATING PROCEDURE

• With FMCBR, the SOP is very simple and easy to follow

• Initial Break (IB) or Dominant Break (DB)
• Candle Break 1 (CB1)
• Retest
• When the 3 conditions are met, the SOP is complete. Entry with confidence while taking into
account of Money Management (MM)
• The probability of a successful trade is in the high percentile ( >80% ) if this simple rule is
followed – SOP & MM
• Never trade against the trend of the market. Always wait for SOP

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Initial Break (IB) is the condition when a CS is break by one or two opposing CS

IB - Sell IB - Buy

IB Zone

IB Zone

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Dominant Break (DB) is the condition when a CS is break by three or more
opposing CS

DB - Sell DB - Buy

IB Zone

IB Zone

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CB1 is the point after an IB or DB is formed, the previous B is break. The
formation of CB1 is the key of change in trend

CB1 - Buy CB1 - Sell

IB Zone
C
B a
CB1
A
A
a CB1
B
C
IB Zone

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• The last SOP is the Retest. In FMCBR, the Retest can be determined by using :-
• Fibonacci Retracement (Fibo)
• Entry Levels (EL 1- 9)

Now, let’s recap before we proceed to the next chapter of the course

• FMCBR SOP :-
1. IB or DB
2. CB1
3. Retest

• Never trade against the trend of the market. Always follow the trend, wait for SOP and give
emphasis to MM

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FIBONACCI RETRACEMENT (FIBO)

• In FMCBR, Fibo have two main functions

• To determine where to Take Profit (TP)
• To determine where to enter a position during Retest

• Before we apply Fibo into our chart, we first need to identify the presence of
• Dominant Break (DB)
• CB1

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The settings for Fibo are as the following:
• Base = 0 • TP 2 = 2.618
• Major Entry = 0.236 • TP 2 Extended = 2.88
• Minor Entry = 0.382
• Setup = 1

• TP 1 = 1.618 • TP 3 = 4.23
• TP 1 Extended = 1.88 • TP 3 Extended = 4.88

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• As mentioned earlier, there needs to be a presence of DB or CB1 before applying
the Fibo into the chart
• If either one is present, to apply the Fibo to determine the TP
• Setup is the body of the CS that breaks the DB or CB1
• Base is the highest or lowest shadow in the cluster

• Once Fibo is applied to the chart to determine the TP, either TP1, TP2 or TP3 for the
TF that the Fibo is applied to
• TP1 or TP2 is usually the ending of a Pullback of the TF Fibo is applied
• TP3 is the ending of a Trend; Complete Cycle of the TF Fibo is applied
• If a CS breaks and close outside a TP zone, market will target the next TP zone
• If TP1 is break, market will target for TP2
• If TP3 is break, refer to higher TF for the TP zone

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When a DB is formed, you can put Fibo into your chart to determine the TP

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When a CB1 is formed, you can put Fibo into your chart to determine the TP

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• The other purpose of the Fibo is to determine an entry point
• If either the DB or CB1 is present, to apply the Fibo to determine the entry point
• Setup is the shadow of
i. The CS that breaks the DB or CB1 if the next CS stopped the movement
ii. The CS that stopped the movement
• Base is the highest or lowest shadow in the cluster

• Once Fibo is applied to the chart to determine the entry point for the TF that the Fibo is
applied to
• Major Entry is the best entry point during a Retest
• Minor Entry is the regular entry point during a Retest
• If a CS does not reaches both the entry point during a Retest, continue to apply Fibo until the
entry point is reached.
• More of this will be covered in the Chapter on Pullback.
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When a DB or CB1 is formed, you can put Fibo into your chart to determine the entry point

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Now, let’s recap what we have learnt so far

• Fibo is used to determine the TP

• If TP1 is break, next target is TP2 and so on
• If TP3 is break, next target is the TP at higher TF

• Fibo is also used to determine Entry point

• Major Level is the best entry point
• Minor Level is the standard entry point

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ENTRY LEVELS (EL)

• In FMCBR 3.0, there are 9 EL

• All EL can be confirmed at the current or lower TF with the formation of IB &
CB1 at the EL Zone
• The optimum TF for the EL are
• EL 1 : Daily & above • EL 6 : H4

• EL 2 : H4 • EL 7 : H4

• EL 3 : H4 • EL 8 : MTF

• EL 4 : MTF • EL 9 : H4

• EL 5 : MTF
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EL 1
• Only applicable to Daily and above TF
• Identify the ABC pattern
• Mark the shadow of B
• Monthly => Weekly => Daily => H4
• Go to the lower TF
• Daily => H4
• From the marking zone of the higher TF, go to the lower TF and highlight the body in the marked
zone
• The highlighted body is the Entry zone for EL1
• Enter when market goes back to EL1 zone
• A low risk entry is after IB & CB1 is formed at H4 or lower TF in the EL1 zone
• A medium risk entry is after IB is formed at H4 or lower TF in the EL1 zone
• A high risk entry is when market enters the EL1 zone with no IB & CB1 formed yet at H4 or lower TF

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EL 2
• Optimum TF apply at H4
• IB/DB & CB1 break
• Mark the IB zone
• The IB zone is EL2 zone
• Enter when market goes back to EL2 zone
• A low risk entry is after IB & CB1 is formed at the same or lower TF in the EL2 zone
• A medium risk entry is after IB is formed at the same or lower TF in the EL2 zone
• A high risk entry is when market enters the EL2 zone with no IB & CB1 formed yet at the same or lower TF

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EL 3
• Optimum TF apply at H4
• IB/DB & CB1 break
• CB2 also break
• Mark the IB zone
• The IB zone is EL3 zone
• There are two Modes of EL3
• Mode A : IB & CB1 break, retest at IB zone (EL2), break CB2, then retest again at IB zone (EL3)
• Mode B : IB & CB1 break, no retest at IB zone, break CB2, then retest at IB zone

• Enter when market goes back to EL3 zone

• A low risk entry is after IB & CB1 is formed at the same or lower TF in the EL3 zone
• A medium risk entry is after IB is formed at the same or lower TF in the EL3 zone
• A high risk entry is when market enters the EL3 zone with no IB & CB1 formed yet at the same or lower TF

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EL 4
• Can be applied to any TF
• Identify the ABC pattern
• A must be 3 or more momentum CS
• B & C can be as many CS

• Mark the highest/lowest body of B

• The highest/lowest body of B is EL4 zone
• Enter when market goes back to EL4 zone
• A low risk entry is after IB & CB1 is formed at the same or lower TF in the EL4 zone
• A medium risk entry is after IB is formed at the same or lower TF in the EL4 zone
• A high risk entry is when market enters the EL4 zone with no IB & CB1 formed yet at the same or lower TF

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EL 5
• Can be applied to any TF
• Only happens after EL4
• Identify the ABC pattern after EL4 retested
• Mark the highest/lowest body of B after EL4 retested
• The highest/lowest body of B that retested EL4 is EL5 zone
• Enter when market goes back to EL5 zone
• A low risk entry is after IB & CB1 is formed at the same or lower TF in the EL5 zone
• A medium risk entry is after IB is formed at the same or lower TF in the EL5 zone
• A high risk entry is when market enters the EL5 zone with no IB & CB1 formed yet at the same or lower TF

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EL 6
• Optimum TF apply at H4
• Usually at the starting point of a pullback
• Identify the ABC pattern
• Mark the body of B
• The body of B is EL6 zone
• Enter when market goes back to EL6 zone
• A low risk entry is after IB & CB1 is formed at the same or lower TF in the EL6 zone
• A medium risk entry is after IB is formed at the same or lower TF in the EL6 zone
• A high risk entry is when market enters the EL6 zone with no IB & CB1 formed yet at the same or lower TF

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EL 7
• Optimum TF apply at H4
• One CS breaks IB & CB1
• Enter market once CS close or wait for Pullback

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EL 8
• Can be applied to any TF
• IB breaks IB
• Enter when market goes back to EL8 zone
• A low risk entry is after IB & CB1 is formed at the same or lower TF in the EL8 zone
• A medium risk entry is after IB is formed at the same or lower TF in the EL8 zone
• A high risk entry is when market enters the EL8 zone with no IB & CB1 formed yet at the same or lower TF

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EL 9
• Optimum TF apply at H4
• Identify the previous ABC pattern
• IB/DB & CB1 break
• Mark the shadow of B
• The shadow of B is EL9 zone
• Enter when market goes back to EL9 zone
• A low risk entry is after IB & CB1 is formed at the same or lower TF in the EL9 zone
• A medium risk entry is after IB is formed at the same or lower TF in the EL9 zone
• A high risk entry is when market enters the EL9 zone with no IB & CB1 formed yet at the same or lower TF

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Now, let’s recap what we have learnt so far
• EL 1, 4, 5, 6 and 8 is an ABC pattern entry
• EL 2, 3, 7 and 9 is an entry after IB /DB and CB1 break
• Enter a position when market goes back to the EL zone
• A low risk entry is after IB & CB1 is formed at the same or lower TF in the EL zone
• A medium risk entry is after IB is formed at the same or lower TF in the EL zone
• A high risk entry is when market enters the EL zone with no IB & CB1 formed yet at the
same or lower TF

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PULLBACK

• In a trend movement, there is always a pullback movement

• There are two types of pullback
• Pullback with CB1
• Pullback without CB1 – Temporary pullback

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Pullback with CB1

• At the current TF, CB1 must be present during the trend

• When CB1 occur, apply Fibo to the chart to look for the ending of the pullback
• TP1 is the normal ending of the pullback
• TP2 is the max ending of the pullback

• At the TP zone, look for IB & CB1 for entry to continue trend

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Pullback without CB1

• If at the current TF the CB1 is not present, go to a lower TF

• Look for CB1 at the lower TF. If CB1 is also not present, go to the lower TF

• When CB1 occur, apply Fibo to the chart to look for the ending of the pullback
• TP1 & TP2 is the normal ending of the pullback
• TP3 is the max ending of the pullback

• At the TP zone, look for IB & CB1 for entry to continue trend

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AWESOME OSCILLATOR (AO)

• AO is used with the chart to give a signal of market movement

• There are two types of signal
• Divergence
• Convergence

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EPILOGUE

• Always wait for SOP before entering a market

• Once SOP is invalid, exit the trade and wait for a new SOP
• Always take care of your MM and enter at a Risk level that you’re comfortable
• Know the trend of the market, sideways and pullbacks
• Never trade against the trend of the market
• Make use of Multi-Timeframe for decision making
• Daily upwards => H4 => H1 downwards
• Use historical support & resistance for decision making. The higher the TF, the stronger
the support & resistance
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