A simple price action approach
- Thread starter metal
- Start date
It's one of those things that I can see but can't program. I'll try to post some examples later. I'm posting from my phone now. I think somewhere on my computer I still have every screenshot and example from back in the day. I use sierra charts for the moving averages and have them colored based on slope, which is necessary because sometimes slope changes subtly but you can't see it on your chart. But I don't still have my sierra chart subscription running so I cant get any new examples.
BTW if you guys are profitable with this I should get 10% royalties for handing you a complete system without any bullshit or ambiguity
No. It's not discretionary if it's not ambuguous and can be quantified.
Discretionary = trading by feel, no real quantifiable rules. Maybe some rules as general guidelines, but not 100%. Cannot be programmed.
HH and HL can be programmed, I just don't know how to.
The method I listed is the opposite of discretionary.
Finally, a good question, which I will answer.
Ninja Trader already has an indicator which will create HH. LH, LL, and HH for you. This is extremely important for me since I don't have to depend on my own human judgment to create them. Also, since its already on the chart, I don't have to waste time labeling them.
However, like they say in the Matrix:
Morpheus: "I've seen an agent punch through a concrete wall. Men have emptied entire clips at them and hit nothing but air, yet their strength and their speed are still based in a world that is built on rules. Because of that, they will never be as strong or as fast as you can be."
So how does this apply to the indicator? It means that some of the labeling while not wrong does not take into account the major trend, since its based on the rules of the indicator. For example, lets assume the ES makes a low of 1262 in the morning. Now in the current trend lets assume the market made a LH, and then a LL. However, this LL while correct in the afternoon wave or swing down, never made it below the mornings LL, so it can then be perceived as a possible HL, compared to the morning and if supported by a fib line, may be a possible support level to take a long trade.
Or to take another example, let's say 6E is making LH, and LL, and is in a trend sloping down. Now most of you will not go long. However, like Jack may have said, it is possible to pick a bottom, and go long because yesterday we had support at this LL.
Now I still will use stops since we need to then confirm if trend down is being driven by breaking news which will override a support, or if its just in a normal trend which wants to respect the support. Now a support can give you a trading profit even if the market later on breaks it. A support does not mean the market will reverse all the way back to a major resistance, but it should go up to at least a minor resistance.
Ninja Trader already has an indicator which will create HH. LH, LL, and HH for you. This is extremely important for me since I don't have to depend on my own human judgment to create them. Also, since its already on the chart, I don't have to waste time labeling them.
However, like they say in the Matrix:
Morpheus: "I've seen an agent punch through a concrete wall. Men have emptied entire clips at them and hit nothing but air, yet their strength and their speed are still based in a world that is built on rules. Because of that, they will never be as strong or as fast as you can be."
So how does this apply to the indicator? It means that some of the labeling while not wrong does not take into account the major trend, since its based on the rules of the indicator. For example, lets assume the ES makes a low of 1262 in the morning. Now in the current trend lets assume the market made a LH, and then a LL. However, this LL while correct in the afternoon wave or swing down, never made it below the mornings LL, so it can then be perceived as a possible HL, compared to the morning and if supported by a fib line, may be a possible support level to take a long trade.
Or to take another example, let's say 6E is making LH, and LL, and is in a trend sloping down. Now most of you will not go long. However, like Jack may have said, it is possible to pick a bottom, and go long because yesterday we had support at this LL.
Now I still will use stops since we need to then confirm if trend down is being driven by breaking news which will override a support, or if its just in a normal trend which wants to respect the support. Now a support can give you a trading profit even if the market later on breaks it. A support does not mean the market will reverse all the way back to a major resistance, but it should go up to at least a minor resistance.
