I use the same settings as Linda Raschke. I figure if it's good enough for her and she can figure out what's going on in the market, then it should be good enough for me. I've never tried anything but her settings.
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Emini divergence journal
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I use the same settings as Linda Raschke. I figure if it's good enough for her and she can figure out what's going on in the market, then it should be good enough for me. I've never tried anything but her settings.
no_pm_please,
You've set a new standard in journaling. Very nice work.
I have a few questions:
1) Raschke uses a 20 period EMA for her Holy Grail trade setup, are you also using EMA ? or SMA?
2) When you look for divergences, what is the maximum and minimum number of bars you consider?
3) You used a percent risk position sizing model. Did you consider a percent volatility position sizing model? Here the number of contracts is increased/decreased in reverse relationship to recent volatility. My impression is that the best position sizing models take into consideration recent volatility.
Richard
You've set a new standard in journaling. Very nice work.
I have a few questions:
1) Raschke uses a 20 period EMA for her Holy Grail trade setup, are you also using EMA ? or SMA?
2) When you look for divergences, what is the maximum and minimum number of bars you consider?
3) You used a percent risk position sizing model. Did you consider a percent volatility position sizing model? Here the number of contracts is increased/decreased in reverse relationship to recent volatility. My impression is that the best position sizing models take into consideration recent volatility.
Richard
Quote from rickty:
no_pm_please,
You've set a new standard in journaling. Very nice work.
I have a few questions:
1) Raschke uses a 20 period EMA for her Holy Grail trade setup, are you also using EMA ? or SMA?
2) When you look for divergences, what is the maximum and minimum number of bars you consider?
3) You used a percent risk position sizing model. Did you consider a percent volatility position sizing model? Here the number of contracts is increased/decreased in reverse relationship to recent volatility. My impression is that the best position sizing models take into consideration recent volatility.
Richard
1). For this method I don't use any moving averages. I learned all I know about figuring out what a market is doing from Linda. I don't trade any of her methods because they're not compatible with me. I could never buy a top or sell a bottom.
2). I don't have any set numbers. I just want to see the divergence clearly. If not, I usually pass on the trade.
3). My stop loss is based on current volatility as measured by the width of the Keltner Channel. The stop loss is then used with the percent of account to figure out the number of contracts. So I think I am taking volatility into consideration.
Quote from no_pm_please:
1). For this method I don't use any moving averages. I learned all I know about figuring out what a market is doing from Linda.
3). My stop loss is based on current volatility as measured by the width of the Keltner Channel. The stop loss is then used with the percent of account to figure out the number of contracts. So I think I am taking volatility into consideration.
no_pm_please,
1) I'm trying to get Wealth-Lab set up with your indicators. The way I understand your set-up is that you have a "Keltner Channel with 20 period and 2.5 ATR's (average true range) based on the close". For me to reproduce this I will need to use a 20 ma based on the closes alone (Keltner uses h, l anc c) to which upper and lower bands are obtained by adding and subtracting 2.5 times the 20 period ATR. Differences will occur if one uses an SMA or EMA. I'm not familiar with the TS setup.
By the way, do you recommend attending any of Rashke's seminars? It sounds like they were a real eye opener for you.
3) Yes, you're right.
Just wondering, what instrument do you play?
Richard
Quote from rickty:
no_pm_please,
1) I'm trying to get Wealth-Lab set up with your indicators. The way I understand your set-up is that you have a "Keltner Channel with 20 period and 2.5 ATR's (average true range) based on the close". For me to reproduce this I will need to use a 20 ma based on the closes alone (Keltner uses h, l anc c) to which upper and lower bands are obtained by adding and subtracting 2.5 times the 20 period ATR. Differences will occur if one uses an SMA or EMA. I'm not familiar with the TS setup.
By the way, do you recommend attending any of Rashke's seminars? It sounds like they were a real eye opener for you.
3) Yes, you're right.
Just wondering, what instrument do you play?
Richard
Oh, I see. I didn't realize what you were doing. I just tried a couple of the moving average indicators and found the middle line of the Keltner is a 20 period simple moving average of the close. So, if you want to get the same results in wealth lab you should use the simple MA. Linda uses a exponential MA.
I think Linda only has one real seminar per-year. The others just get people interested in her site. The one I attended was about $3,000. Most of the people I saw were looking for systems. I was looking for a education on the markets. While others were asking about the anti setup, I was asking what a weak market looks like on a chart. I got a great education.
I play drums, lead guitar, bass guitar, and keyboards. Most of the time I play drums because most bands have drummers that can't play to a clicktrack. Second is bass guitar because they have trouble keeping perfect time. I don't get to do much lead guitar or keyboards.
I waited all day for a setup and now on the last bar of the day the ADX crossed above 30. Maybe we'll have a trade early tomorrow morning. I don't enter new positions after 2:30 CT. Just isn't enough time left in the day for the trade to work. I probably should back that up to a 2pm cutoff but I'm pretty eager to take these setups. If there is a trade early, it'll be a short. Back tomorrow for more fun!
Quote from MarkB:
If I understand your technique correctly, that could have been a nice short developing there..... IF there had been another hour to the trading day, lol!
Kept away from all the ambiguous activity though.
Yeah, another end of day setup. About as exciting as a bowl of leftover oatmeal.
Nice to see the market open above the last bar of yesterday. ADX is above 30. Divergence exists between price and volume. As long as the divergence continues I'll be looking to go short after the first bar that doesn't set a new high.
How much discretion do you use in not taking a trade after it sets up. For example, say that the current 5 min bar does not make a new high but ends up being a strong down bar that takes out much of the range down to the lower Keltner. Would you still enter on the close of the bar or would you pass on the trade knowing that there is probably not much downside left?
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