Another Very Simple Trading Strategy

Quote from inandlong:



Q's, what time interval bar are you talking about?

:)
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hey inandlong.... im using the the shorter time frame bars - perhaps there is more noise in them... just noticing that in the recent past that instead of honoring a 50% or 62% FIB level, the retracements have been deeper, which is a difficult trade for me to take. not making a big deal out of it, but when i look at the continuation in the original direction after the reversal, i have a hard time trying to make a case for having taken the trade... i havent studied it extensively, just been noticing it more where i hadnt before... i dont weight the FIBS heavily anyway....

i have kinda been working off the axiom if it breaks the +/-62% retracement, then its likely to go all the way... again, added issues within a gap...

worked 'til 1:30 am this morning - DEADLINES... i dont even think about trading on mornings like this - i feel like homer simpson with spittle on the side of my mouth.


hey, maybe its me - thanks for the reply...:cool:
 
Quote from QQQBALL:

i feel like homer simpson with spittle on the side of my mouth.
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That cannot be good!

I am familiar with the axiom you mentioned and understand it to be sound advice. And of course like everything else in this biz, there will be periods where the axioms are not true.

My question of the time interval was not valid actually as i realize that you probably mean a retracement from the established high or low of the day thus far... so time interval doesn't matter. Duh!!

Or for you.. more like... Doh!
 
Quote from inandlong:

Hey big,

I saw you in the chatroom. I don't get there too much anymore.

Interestingly, your [open to high on an up day] idea corresponds to what Crabel calls the stretch, whereby he takes an average of the open to the nearest extreme for the day and uses it for the next day.

If it is not too intrusive of a question, how does this information affect your decision-making? I am thinking it would be useful to help determine a profit target. If you'd rather not say, no prob here.

:)
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Yes, it's absolutely Crabel stuff plus stuff from Active Trader magazine, Thom Hartle articles. I track that plus open to high on + days for the last 30 days to get an idea of whereto put my targets. It some times gets me out too early, because its just an average and on breakout days it'll obviously exceed it. I have noticed the REAL SELLING that at times comes in when a stock has reached it's daily "ceiling".

I'm looking @ KKD right now, and it goes down .76 from open to low on down days. It openned @ 34.55 so 34.55 -.76 = 34.79 low target. Take a look at an intraday chart and you see support coming in @ 34.76 b4 continuing down.

34.76 held for 2 hours.
 
Thanks big. I appreciate it.

I am fairly recently becoming aware of this strategy enhancer. And I am really glad to see that you apply it to stox too. I use Qlink and Excel now for some ideas and you have given me more. Thanks a lot.

Hopefully I can return the service.

:)
 
Quote from ewile:


today was not my type of trading day.
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That's what I thought. You may want to extend your system to buying or selling at 10:05 depending on the market conditions. I suppose that today you went long (you bought) at about the top of the breakout range and the market turned down. About 10:05 TICK and TRIN were suggesting a short position or at least they were not very much in favor of a long one. Stochastics were also in favor of a short. By the same token you could either be buying or selling around the bottom of your breakout range, again depending on the market conditions.

Just some thought.
 
actually I was up against my daytrade limit so I opted to try the QQQ Single stock future. I placed the order at about 10:05 and when I checked back in at 10:45 I was up enough to make me consider closing my position. I decided not to, but I finally closed it at about 2:30 for a teeny tiny profit.
 
Opening range breakouts can be very lucrative when you are correct on your direction. But there are pitfalls. If you go in too early (they don't call the first hour "amateur hour" for nothing), you can easily get whipsawed if your stop is too close. If you go in too late, your may run up against a ceiling that is too low.

As for allowing your trade to go to MOC, it's true you can make up a lot of ground, but with a congestive market, you will be stopped out without being able to make any profit.

Perhaps it would be wiser to trade 2 contracts with a 4 and an 8 point target exit, coupled with bringing your stop-loss to the breakeven price after your first target is hit. In this way, you can profit on just one profitable contract trade, and really come away with a good profit when or if both are hit.

I like the simplicity of an opening range breakout system. If you are right, you can come away with good profits, and all before lunch.
 
Quote from ewile:

This system, that's been posted a bunch here utilizes a method to make sure that your trading vehicle has enough volitility open to close

http://www.tradingeducators.net/3.htm

today was not my type of trading day.
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ewile I have that method coded into Excel. Of course, lamo that am I do not use it... however, have you found the volatility ratio to be worthwhile? For me, that one idea seemed like a good one.

Another way I have considered using that volatility measure is to take a longer period, say like big does and use 30 days, and plot that over a 10 day ratio of the same. I'd like to see if there is some cyclicality of sorts to the volatility. The setup would be an oversold - if you will - 10 vs the 30, combined with an NR4/ID or ID alone etc. Really very similar to raschke /connors but using a different measure for volatility.

Bottom line is that the volatility thingy the system you reference uses is pretty cool.

:)
 
Quote from rjt:

Opening range breakouts can be very lucrative when you are correct on your direction. But there are pitfalls. If you go in too early (they don't call the first hour "amateur hour" for nothing), you can easily get whipsawed if your stop is too close. If you go in too late, your may run up against a ceiling that is too low.

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I agree, you have to be quick, ORB's are especially tough on NR7's and NR4ID's. A lot of people are playing them and that makes it more volatile. I have practically stopped trading NR days unless I know the stock well.
 
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