A simple price action approach

Quote from Daal:

NoDoji,
considering that a high number of traders using different ways to 'interpret' price action or trendlines and how to trade them will virtually guarantee that some of them will be winners over a certain period of time, what kind of evidence do you have that this is a sound method to use for the long-run instead of short-term luck?

By that I mean statistical evidence that trendfollowing works in intraday data
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Regarding trendiness dependency on the time frame (which in my experience seems true), this was posted by Alan Crary:

"Just finished an analysis of the SP market. For the analysis I used the SP data from 1989 - 2001. Here's my results:

The data from 1min. resolution per-bar through 30min. resolution per-bar is primarily in a trending mode. If planning on building a trend following system or intraday breakout, then these are the bar intervals I'd review.

The data from 60min. resolution per-bar through 1 week resolution per-bar is primarily in a contra-trend mode. If planning on developing reversal systems, then these are the lengths I'd consider.

The monthly data reverts back to trending mode, so if you need something to time long term investments (like mutual fund infusions), then this is the interval I'd use.(ex. 200 day MA).

The data itself proved to be remarkably stable within the time frames. For example, the 30 min. bars had good trends in 11 of the 13 years. Likewise, the 60 min. bars had good contra-trends also in 11 of the 13 years.

I did this analysis to get ready to build a really good daytrading system. Since daytrading is primarily concerned with the shorter bars, I'll have to look to building a system with the 1-30 min. bars using either a breakout or outright trending idea. "
 
Quote from baro-san:

Regarding trendiness dependency on the time frame (which in my experience seems true), this was posted by Alan Crary:

"Just finished an analysis of the SP market. For the analysis I used the SP data from 1989 - 2001. Here's my results:

The data from 1min. resolution per-bar through 30min. resolution per-bar is primarily in a trending mode. If planning on building a trend following system or intraday breakout, then these are the bar intervals I'd review.

The data from 60min. resolution per-bar through 1 week resolution per-bar is primarily in a contra-trend mode. If planning on developing reversal systems, then these are the lengths I'd consider.

The monthly data reverts back to trending mode, so if you need something to time long term investments (like mutual fund infusions), then this is the interval I'd use.(ex. 200 day MA).

The data itself proved to be remarkably stable within the time frames. For example, the 30 min. bars had good trends in 11 of the 13 years. Likewise, the 60 min. bars had good contra-trends also in 11 of the 13 years.

I did this analysis to get ready to build a really good daytrading system. Since daytrading is primarily concerned with the shorter bars, I'll have to look to building a system with the 1-30 min. bars using either a breakout or outright trending idea. "
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let us know how it pans out, ok?

seems like it will take up enormous amount of your time to compute and compare.... more power to you.
 
Quote from macattack:

I need some help.
Here's a typical trading series for me.
Down 47 points.

How do I avoid this?
They look like decent entries to me; if I didn't take one of them it would be the one that takes off for 100 points. I've got plenty of screen time, but it still feels very random to me.

If I take what looks like a good entry I get stopped. If I avoid an entry because it doesn't look quite right it goes 100 points without me.

Some days I can do pretty good, but more often than not I work myself into a 47 point deficit just like this example shows. Not a fun way to start the day.

9i8cd5.jpg
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Thanks everyone for the replies on my chart. The more I look at it I can see that Trade #1 was stupid unless for a quick scalp. Trade 3 the same deal.

But trade #2 looks legitimate to me..........uptrend, retracement, continuation, & enter.

Was there a good reason to stay out of the 2nd trade that I'm not seeing? Thanks.
 
Quote from macattack:

Thanks everyone for the replies on my chart. The more I look at it I can see that Trade #1 was stupid unless for a quick scalp. Trade 3 the same deal.

But trade #2 looks legitimate to me..........uptrend, retracement, continuation, & enter.

Was there a good reason to stay out of the 2nd trade that I'm not seeing? Thanks.
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could not recall, if i ever read about what your profit target is for this trade....

but your stop is around 15t....(?)

it would be nice to know both target and stop. thx
 
Quote from macattack:

Thanks everyone for the replies on my chart. The more I look at it I can see that Trade #1 was stupid unless for a quick scalp. Trade 3 the same deal.

But trade #2 looks legitimate to me..........uptrend, retracement, continuation, & enter.

Was there a good reason to stay out of the 2nd trade that I'm not seeing? Thanks.
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Take a look at the chart I edited for you. See where my arrow is? You could have taken that long and tried to get out at +10 ticks or so. But once price made a lower high and dipped below your MA you would have wanted to exit for a small loss of breakeven and reverse short for a scalp or just wait for your next setup.
<br>
I'll post that chart here again.

also, like a previous poster asked, what was your target and stop loss criteria? Even at a 1:1 r/r of 10 ticks it looks like you would have been ok on each trade. Once price made 10 ticks in your favor move to +1 or breakeven.
 

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the few shorts u mentioned look easy on the hindsight, think as the ticks were moving all the lower highs you mentioned were not there YET, also in a General strong uptrent I would not be shorting the rallies rather buy the dips
 
Quote from jokepie:

the few shorts u mentioned look easy on the hindsight, think as the ticks were moving all the lower highs you mentioned were not there YET, also in a General strong uptrent I would not be shorting the rallies rather buy the dips
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I agree, I was in a hurry when I edited that chart. He said he's got a lot of screentime though, that combined with the ma and the HA bars the lh's can be seen or anticipated a little at least. I used to trade off similar charts using a couple ma's and basic price wave analysis. Going w the trend is always better. I'm a scalper though so I go counter sometimes too. I would have only been looking for 10 tick targets on that chart, closing some out on the longs and letting the rest run. That's why I'm on this thread though, trying to hang in longer and get bigger moves using channels...
 
Quote from jack411:

I agree, I was in a hurry when I edited that chart. He said he's got a lot of screentime though, that combined with the ma and the HA bars the lh's can be seen or anticipated a little at least. I used to trade off similar charts using a couple ma's and basic price wave analysis. Going w the trend is always better. I'm a scalper though so I go counter sometimes too. I would have only been looking for 10 tick targets on that chart, closing some out on the longs and letting the rest run. That's why I'm on this thread though, trying to hang in longer and get bigger moves using channels...
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Yep,

I am also trend follower. Long time ago I realized counter trend trades are ususally too FAST to manage. Instead of channel I imagine MA as a STEEL CABLE. (i guess engineering worms still live in my brain) and price action is force determining the direction (angle and bends) in it. weird han ... !!!
 
Quote from baro-san:

Regarding trendiness dependency on the time frame (which in my experience seems true), this was posted by Alan Crary:

"Just finished an analysis of the SP market. For the analysis I used the SP data from 1989 - 2001. Here's my results:

The data from 1min. resolution per-bar through 30min. resolution per-bar is primarily in a trending mode. If planning on building a trend following system or intraday breakout, then these are the bar intervals I'd review.

The data from 60min. resolution per-bar through 1 week resolution per-bar is primarily in a contra-trend mode. If planning on developing reversal systems, then these are the lengths I'd consider.

The monthly data reverts back to trending mode, so if you need something to time long term investments (like mutual fund infusions), then this is the interval I'd use.(ex. 200 day MA).

The data itself proved to be remarkably stable within the time frames. For example, the 30 min. bars had good trends in 11 of the 13 years. Likewise, the 60 min. bars had good contra-trends also in 11 of the 13 years.

I did this analysis to get ready to build a really good daytrading system. Since daytrading is primarily concerned with the shorter bars, I'll have to look to building a system with the 1-30 min. bars using either a breakout or outright trending idea. "
More...

Can you repost the link?Its not working. This is an interesting study given that my own research has shown a similar conclusion with regards with multiday data(I assume the 60min edge stretches out to multiple days)
I want to know how strong his edge is for the 1 min data
 
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