AHG - Profitable Strategy for Struggling Traders

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Identifying chop .vs. trend

I prefer Market Profile... but I understand MP is a taboo subject so ...

...years ago we used 1 minute volume thresholds, as ES volume fell below the threshold we would stop trading, but I recall volume analysis is also off the table for discussion...

...hmm... price action only, ok... try a 45 degree trendline ! Congestion cannot hold a 45 degree trend angle....it's a technique we used 10+ years ago combined with the volume stuff and other stuff for multiple independent confirmation... simple but effective ... combined with the 2 higher highs and 2 higher lows criteria (page 1) should provide additional confirmation of the trend or lack thereof...might be worth a look-see on your volume charts... :cool:
 
Quote from TrendPro:

Identifying chop .vs. trend

I prefer Market Profile... but I understand MP is a taboo subject so ...

...years ago we used 1 minute volume thresholds, as ES volume fell below the threshold we would stop trading, but I recall volume analysis is also off the table for discussion...

...hmm... price action only, ok... try a 45 degree trendline ! Congestion cannot hold a 45 degree trend angle....it's a technique we used 10+ years ago combined with the volume stuff and other stuff for multiple independent confirmation... simple but effective ... combined with the 2 higher highs and 2 higher lows criteria (page 1) should provide additional confirmation of the trend or lack thereof...might be worth a look-see on your volume charts... :cool:
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TP,

For the record, I don't label anything in this journal as a taboo except for the following five concepts.

- Large losses

- Calling tops

- Calling bottoms

- Bigger risks than rewards

- Trading against the trend

Anything else is up to the trader. The fact that I am for the most part a pure price action trader does not mean I consider everything else harmful. I just cannot recommend what I have failed to find advantages on.

Many traders in ET send me private messages that they can be faster than price with "special" setups using commonly known indicators.

However, all of them, always fail to back up their edge claims, by explaining the setups.

Since my edge is my skill I have absolutely no problem sharing my experience or my knowledge.

Anek
 
Quote from Anekdoten:

What leads price to congestion ?

please post your conclusions in the journal so everyone can benefit from everyone.

Anek
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Well, one of the things i noticed was that support and resistance levels were turning into non-factors...meaning they really stopped being support and resistance.

Also, i could kind of feel that there was much fear coupled with mild euphoria. Every rally was quickly squashed, and every big pullback was follwed by a brief upswing. Easy to see in hindsight.

And, there weren't many "normal" trends with the usual surge, minor pullback, resume surge. Very difficult for entry.

Correct so far?
 
Quote from TrendPro:
...hmm... price action only, ok... try a 45 degree trendline ! Congestion cannot hold a 45 degree trend angle....it's a technique we used 10+ years ago combined with the volume stuff and other stuff for multiple independent confirmation...
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I've always found the 45 degree trendline thing to be problematic, 45 degrees on which chart? The same price move occuring on different time or volume scales changes the slope. If it's a visual slope, the axis scaling changes it too.
 
Quote from notam:

I've always found the 45 degree trendline thing to be problematic, 45 degrees on which chart? The same price move occuring on different time or volume scales changes the slope. If it's a visual slope, the axis scaling changes it too.
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That's why it's a good idea to set your base chart to a fixed y value, say 1 point es and 4 points nq, not only it helps with the slope of your trendlines but it also gives you a constant parameter to visually estimate the range of the day and the span of a move.

I have to thank Mr. J.Hershey for this valuable suggestion
 
Quote from Anekdoten:

Decisively Broken Areas

Trading noise and volatility can make you see things that are not really happening.

For instance, in order to determine when a point of interest is broken you need to ask yourself the following questions.


1) How meaningful is this point ?

Your anchor chart should be able to tell you. Remember your entry chart has many areas that are unknown to the anchor chart. You must learn what is meaningful and what it is not.

and

2) What kind of price action developed after this event?

I'll give you two examples.

If price has been bouncing off a downtrend resistance line in order to consider this area broken, price at the very least, must create an up swing ABOVE the resistance area. Anything else is suspicious. Price simply passing through this is not enough, this is stop hunting, nothing else, unless the above forms.

If price has "broken" support a downswing below support must be created and that previous support must become resistance. Anything else is suspicious as well. Price simply passing through this is not enough, this is stop hunting, nothing else, unless the above forms.


Ever heard traders say, "OMG the Dow lost 13000?" This is newbie talk, nothing is lost until the battlefield has blood scars on it. Just because a scared bull ran away does not mean the bears won the battle.

A combination of both answers should be your guidance.

Hope it helps.

Anek
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Anek,

Would u mind sharing a screenshot of the upswing or downswing your talking about? I assume you are referring to a higher low (upswing) and a lower high (downswing) after a trend break.

thanks

J
 
J,

Sure, this is from ER2 last friday.

Remember, the name of the game is not to catch it all but a good chunk with minimal risk and good reward.

Keep that in mind.

In the screenshot I included one of my personal price action tools to smooth out the action so you can see how those highs and lows develop.

Hope the screenshot helps.

Anek
 

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This seems to keep coming up over and over while I try to hone skills in analyzing trends.

If you see a LH followed by LL and then an equal H followed by a second LL is it reasonable to assume you still have a downtrend (in effect- a possible double top?)
 
Quote from Avgdownking:

Anek,

Interesting tool you got there. Judging from that screenshot it looks like you enter on circles and exit when they change. Is this correct?

ADK
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ADK,

Well nothing replaces price. This is just a representation to aid myself with the highs and lows visuals and filter some of the noise so I don't have to calculate the micro level constantly.

It's not just buy the blue and sell the red. I only do it with the trend and I make sure I got the correct trendline backing me up. If those align, it's a money machine but then again that is what AHG teaches here so no real big deal. Perhaps with the blue and red dots it becomes obvious to the naked eye, but in the end AHG is the engine providing those profits.

Anek
 
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