ES Journal Archive (2006 - 2008)

[Trader273]

Thats why i gave up on divergence trading. It seems that every divergence trade was against the major trend. Good luck and more power to you to try and fight the trend, not for me.


-Nick

 

[BoyBrutus]

Midnight rally crowd will be coming out in force. Might be some coin to be made.

 

[Buy1Sell2]

Quote from Trader273:

Thats why i gave up on divergence trading. It seems that every divergence trade was against the major trend. Good luck and more power to you to try and fight the trend, not for me.


-Nick

Doesn't work for all traders . Best idea with divergences is to be patient and attack the more obvious ones. Romik is doing that well with his use of multiple charts which give him a better chance at the big picture. If divergences are on short frame charts , they are more often than not , good for just a couple of points. (In fact, Romik's call earlier was good for a couple of points. I don't believe it extended itself, because I agree with Spike that the Hourly was still down and my own view was that there was no divergence.) However, the longer the frame, generally the better the return and extended nature of the divergence. This is why I have gone to the longer frames for my short term account. Long term, I still trade the weekly chart and position build etc.

 

[BoyBrutus]

Quote from Trader273:

Thats why i gave up on divergence trading. It seems that every divergence trade was against the major trend. Good luck and more power to you to try and fight the trend, not for me.


-Nick

From what I observe of the guys divergence trading seems to work well on days that are not uptrend or down trend days.

So and exhaustive study of defining and spotting trend days would greatly improve the results of this system. If a trend day is suspected then a more exhaustive criteria to trade against the trend would be needed or else just sit on your hands or trade with the trend.

Todays LOD is the start of basic criteria to use to make sure tomorrow is not a continuation trend day.

Good luck

 

[Buy1Sell2]

Quote from BoyBrutus:

Midnight rally crowd will be coming out in force. Might be some coin to be made.

Ok. I am anxious to see a repeat of this phenomenom that you have mentioned before.

 

[PitchBlack]

Quote from Buy1Sell2:

Doesn't work for all traders . Best idea with divergences is to be patient and attack the more obvious ones. Romik is doing that well with his use of multiple charts which give him a better chance at the big picture. If divergences are on short frame charts , they are more often than not , good for just a couple of points. However, the longer the frame, generally the better the return and extended nature of the divergence. This is why I have gone to the longer frames for my short term account. Long term, I still trade the weekly chart and position build etc.

I personally don't believe in divergences. But if you do trade them i think you need to watch the hourly chart to be sure that at least the basics are OK.

I went short at 1261 and just closed my short.

 

[Buy1Sell2]

Quote from Buy1Sell2:

My opinion is that if and when the Euro fx futures roll over to the downside on hourly charts, that we will get upside in the ES. This is a hunch and that is all. Spike is correct on the hourly charts. There was clear bearish divergence on the hourlies at 10 EST. My time frame is longer and will look to the 240 chart and perhaps the 60 for bullish divergence to add more contracts. We've got a wide range of time frames in here now and this interests me a great deal!

The Euro FX has begun rolling over on the hourly charts. Let's see if my hunch plays out should the Euro FX have a selloff.

 

[MONACO11]

Well I am rebalanced and repositioned LONG avg 1249.25
(12) units..

like the afterhours trading...Love it..

Monaco


EDIT: I will be active and watching the "Midnight Rally".

 

[hpeganz]

Quote from spike500:

I personally don't believe in divergences. But if you do trade them i think you need to watch the hourly chart to be sure that at least the basics are OK.

I went short at 1261 and just closed my short.

Excuse me - Could you please so kind to summarize the basics -
Thank you, Helmut

 

[Buy1Sell2]

Quote from spike500:

I personally don't believe in divergences. But if you do trade them i think you need to watch the hourly chart to be sure that at least the basics are OK.

I went short at 1261 and just closed my short.

Your short there at that price was at a bearish divergence with RSI, Histogram and CCI on hourly charts. I agree that the hourly (or higher) rules. At that point ,you can trade in that direction for large gains or trade against the trend for the couple of points etc. that some like to gain. I believe you are correct that the basics need to be intact so that the system works properly. Romik has recently been using the multiple charts and refining his technique, so I believe he may be in agreement as well. Thanks for the input!