Chronicles of an Idiot

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VisionTrader

I wanted to start this thread to discuss my trades and trading style for anyone interested. We started some discussion in another forum, but I did not think it was named properly. I think my metod is a convergence-divergence method, but I am really not sure. I sort of modeled what I do around another "for sale" trading system that I looked into, but I did not purchase it and do not understand it.

Also, I am by no means a professional trader (whatever that is) and do not recommend anyone use this for any actual positions. I do not trade everyday, but most days. I am going to try to post in here as close to real time as I can, but that is not my goal. Just want to discuss things with fellow traders.


Here is an example of one of my techniquesfor a long entry. This was posted in the other forum and I copied it over here.


06-11-03 11:53 AM

Basically...

I use the 1M chart on the ESM. Plot the Stochastic and MACD. If price makes a double bottom, but the Stochastic and MACD make higher lows, this is a signal to go long. The opposite for a double top in price.

I guess I assumed based on the threads I read that this was a fairly well know method. There are a lot of other variables in the "subjective decision" to enter a position but this is the basis premise of the method.

The goal is to capture 2 points per trade. Unfortunately, stop is also at 2 points. There are some variations on signals that represent an opportunity to capture more of a move.

Does this help. Here is a very basic example of a buy signal.
 
06-11-03 12:12 PM
TIMES
I learned the TIMES method through a friend and paper traded it for several months. I could not get it to work profitably. I also found that using the techniques on a 3 minute chart was more rewarding than the one minute. I have since found better trading methods, though I'm still paper trading. If you want something that works, check out Jack Hershey's posts (and his followers) in "The Stochastic Indicator" thread and the "Dawg pound" thread (Journals). That's my 2 cents.
 
06-11-03 12:37 PM

The concept for a long trade just occurred. If you have a minute, take a look at the S&P chart.

At 11:48 price came down to 985.25. Then moved up and formed a double bottom at 12:01. Both the MACD and the Stochastic make higher lows.

I entered the trade at 12:05 at 986.50. SL -2 and TP +2 @ 986.50. Price moved up and at 12:29 my target was hit.

This is the basic trade. It worked this time thank goodness. I try to take this trade in the direction of the trend which I am calling up at this point. You have to be more careful with shorts on a day like today.
 
06-11-03 12:59 PM



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Quote from VisionTrader:

The concept for a long trade just occurred. If you have a minute, take a look at the S&P chart.

At 11:48 price came down to 985.25. Then moved up and formed a double bottom at 12:01. Both the MACD and the Stochastic make higher lows.

I entered the trade at 12:05 at 986.50. SL -2 and TP +2 @ 986.50. Price moved up and at 12:29 my target was hit.

This is the basic trade. It worked this time thank goodness. I try to take this trade in the direction of the trend which I am calling up at this point. You have to be more careful with shorts on a day like today.
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That was a very nice trade. That was a "text book" trade for a divergence.


__________________
If you could do anything and weren't afraid of failing, what would you do?
 
06-11-03 02:09 PM
TIMES
I've been using this method for over a year now, on and off, and I find it excellent: relatively easy to understand and quite profitable if you do it correctly, ie, if you interject the right amount of real-time (somewhat subjective) adjusting that they suggest.

I wouldn't really call it a begginer's method, but, starting next week (schools close) I plan to teach it to my smart 14 year old son, and see how he takes to it.

OK, now, shoot


__________________
Happy here and now!
 
I think you should have success with this method. Sometimes you will get a divergence from the double bottom only to have price make an even lower low. Hey it happens. But overall, the MACD divergence is one of the most poweful signals you can use.

One caveat though, the shorter the time frame, in my experience, the tougher the trading is. But again, I use the MACD as a setup along with MA's and have had very good success.

Oh and one more thing, as far as the ES and NQ go, try not to trade them between 1130-1415 eastern time. You will get chopped to death. Sure once a week there will be a nice move that you might have caught, but the rest of the time is whip city.

Good luck.
 
06-11-03 05:01 PM



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Quote from VisionTrader:

I did not pay to become a member of Traders Intl. Just wanted to do things myself. I am kind of hardheaded when it comes to that. I have done okay so far. I think the biggest thing I like about the system I have developed is the simplicity. I am still fine tuning the "subjectiveness". That's really what I hoped to do hear at ET with the input of some of you more experienced traders. I might start a separate thread and talk about my trades and strategies so that people don't get confused into thinking I am a TIMES person. Hopefully, it will bring some value to everybody.


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I used to trade Div/Conv setups many years ago using the
stochastic indicator. I learned from one on one tutoring from
Mr. George Lane, whom many consider to be the authority on
Stochastics.

Over time, I've come to realize that the indicator you use isn't
that important.

What is important, is keeping your losses small, and try to
make about 3 times the amount you're risking. So, if you're
risking 4 ticks, try to capture 12 ticks.

I don't trade this method anymore, because many times you'll
find yourself trading against the trend, which I don't feel
comfortable doing.

Also, one last warning... seeing setups in hindsight, and seeing
them in real time are two totally different worlds. In other words,
it's a very subjective method.

If you're just starting out, you'll probably be better off just fading
breakouts, which is what you'll soon realize you're basically doing
anyway, just minus an oscillator.

Hope this helps and good luck!

Attachment: diver.png
This has been downloaded 49 time(s).


__________________
The Trend is Your Friend
 
Quote from inandlong:

I think you should have success with this method. Sometimes you will get a divergence from the double bottom only to have price make an even lower low. Hey it happens. But overall, the MACD divergence is one of the most poweful signals you can use.

One caveat though, the shorter the time frame, in my experience, the tougher the trading is. But again, I use the MACD as a setup along with MA's and have had very good success.

Oh and one more thing, as far as the ES and NQ go, try not to trade them between 1130-1415 eastern time. You will get chopped to death. Sure once a week there will be a nice move that you might have caught, but the rest of the time is whip city.

Good luck.
More...

Thanks for the info. I am learning this the hard way. There was just a double top set up at 13:05. I did not take it. Nice move down though. Now at 3 points down. Thanks for stopping in. I am trying to copy over some of the old post. Should be watching my charts:eek:
 
Okay, its 13:26. Thought I would jot down what I have done today so far. Not realtime of course.

I got a set up @ 11:22. Price made a DB and the Stochastic and MACD both made higher lows. I entered 996.75. SL -2 and TP +2. Target was hit successfully at 11:28.

Again this is my classic set up.

Next...I hope RAM reads this. I have put up a 3M chart also. I really did not want anymore info bombing me, but this seemed to make sense. Looking at a longer time frame that is. A textbook double top formed on the 3M ESM chart at 11:30 I got an entry signal at 11:36 and took it. Short @ 996.75. SL -2 and TP +2. Price moved down nicely and my target was hit.

Thanks RAM. Their was no signal on my 1M chart. It seems that the 3M chart also helps me time the entry on my normal 1M trades.
 
Quote from VisionTrader:

06-11-03 02:09 PM
TIMES
I've been using this method for over a year now, on and off, and I find it excellent: relatively easy to understand and quite profitable if you do it correctly, ie, if you interject the right amount of real-time (somewhat subjective) adjusting that they suggest.

I wouldn't really call it a begginer's method, but, starting next week (schools close) I plan to teach it to my smart 14 year old son, and see how he takes to it.

OK, now, shoot


__________________
Happy here and now!
More...
Wow!

I couldn't have said it better myself! :)

Now, is there any reason why this old post was brought here? :D :D
 
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