Video 11 Quasimodo Reversal QMR Rev2 Bystra Legacy

Summary

This video tutorial explains the Quasimodo Reversal (QMR) trading setup, an advanced price action pattern used for identifying trend reversals. The instructor details both buy and sell setups, highlighting the importance of the 'over and under' structure, correct entry points at the left shoulder body, and quick retests. High-risk patterns are also covered, emphasizing shadow extremes and delayed retests to avoid. Multi-timeframe analysis and confirmation via engulfing candles are stressed to lower risk. Practical chart examples using GBP/JPY, XAU/USD, and other pairs illustrate QMR identification, structure marking, and entry strategies, culminating in an assignment to practice screenshots for mastery.

Takeaways

• 😀 The Quasimodo Reversal (QMR) is a common and profitable trading setup, often used by supply and demand traders.
• 😀 QMR is inspired by the hunchback character from *The Hunchback of Notre Dame*, with an over and under pattern resembling a hunch.
• 😀 QMR typically occurs after a significant trend reversal, either from uptrend to downtrend or downtrend to uptrend.
• 😀 The setup consists of a structure where higher highs and lower lows are interrupted, followed by a reversal pattern.
• 😀 For a sell setup, mark the entry point at the body of the left shoulder, and for a buy setup, also mark at the body of the left shoulder.
• 😀 It's crucial to ensure that the setup occurs with a quick retest, rather than a slow, extended retest.
• 😀 QMR setups can be risky if certain patterns emerge, such as when the shadow of the left shoulder touches or exceeds the previous high/low.
• 😀 Multi-timeframe analysis is important to confirm the pattern, especially by identifying an engulfing candle on a higher time frame.
• 😀 The ideal QMR entry point is at the body of an engulfing candle, not at its wick or shadow.
• 😀 Risk management is key: avoid setups with long wicks, slow retests, or those that touch danger zones, as they are high risk.
• 😀 For QMR trade entries, always monitor price action closely and ensure that the price reacts in line with the setup and confirmation from higher time frames.

Q & A

What is the Quasimodo Reversal (QMR) pattern and where did its name come from?

The Quasimodo Reversal (QMR) is an advanced price action trading concept, often used in forex trading, that signals a potential reversal of a trend. The name 'Quasimodo' comes from the hunchback character in the animated movie 'The Hunchback of Notre Dame,' as the pattern resembles a hunch, with one side of the price structure being higher than the other.

How is the QMR pattern formed?

The QMR pattern is formed when a significant trend reverses. For example, in an uptrend, price moves upwards, breaks structure, and then returns to retest a key area before continuing in the opposite direction, such as a downtrend. The pattern consists of a high, higher high, lower low, and the over-and-under formation.

What does 'over and under' refer to in the QMR pattern?

In the QMR pattern, 'over and under' refers to the formation of two price levels. The 'over' refers to a peak or high point, while the 'under' refers to the valley or low point that follows. This structure creates the hunchback-like appearance, where the price action 'overextends' before reversing.

What is the primary goal when identifying a QMR setup?

The primary goal when identifying a QMR setup is to spot a reversal after a significant trend change. Traders look for the setup to occur at a retest of the previous high or low, allowing them to enter the market at a more favorable price before the trend continuation in the opposite direction.

What should traders avoid in high-risk QMR setups?

In high-risk QMR setups, traders should avoid situations where the 'left shoulder' wick extends above the previous higher high, where the retest takes too long, or when the lower low touches a 'danger zone.' These conditions can signal potential manipulation or an unreliable reversal.

Why is the quick retest important for QMR setups?

A quick retest is important for ensuring the setup's reliability. The price should break the structure and return to the retest area quickly, confirming the reversal and offering a low-risk entry. A prolonged retest may indicate a weaker setup or a potential failure of the pattern.

What role does multi-time frame analysis play in QMR trading?

Multi-time frame analysis is crucial for validating a QMR setup. Traders should examine higher time frames (e.g., H4 or daily) for confirmation of the pattern's strength. This includes checking for engulfing candles in the setup's body, ensuring that the trade has a higher probability of success.

How can traders use engulfing candles for confirmation of a QMR pattern?

Engulfing candles on higher time frames provide strong confirmation for a QMR pattern. For example, a bearish engulfing on the higher time frame can confirm a selling setup, while a bullish engulfing supports a buying setup. The setup should be within the body of the engulfing candle, not at its wick, to reduce risk.

What is the primary take profit (TP) target for QMR setups?

The primary take profit (TP) target for QMR setups is typically the previous lower low (for sell setups) or the previous higher high (for buy setups). This provides a logical exit point where the price action is likely to reverse or stall after hitting these levels.

What is the key takeaway for trading with the QMR setup?

The key takeaway for trading with the QMR setup is to ensure that the setup aligns with a clear trend reversal, confirmed by multi-time frame analysis and a quick retest. Traders should avoid high-risk conditions, such as prolonged retests or setups that touch the danger zone, and always confirm the trade with engulfing candle patterns on higher time frames.