ES Journal Archive (2006 - 2008)
- Thread starter Buy1Sell2
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yes, although you have been generous in your angles. It looks much more like a class A on your chart and certainly the result today has been very good. However, I think this was more of a class B or a minor class A. One downside on this one was that there really wasn't a second MACD peak. I generally don't like that. The pluses were the look of a double top and then also the continuation pattern of lower RSI peak that I demonstrated yesterday. This lower RSI peak had more immediate results as is generally the case since the tide has already turned. You'll notice that many times , divergences show up well before the turn and a trader has to be patient and perhaps take heat and/or add positions. This is indicative of divergence trading. However, this is an indicator and perhaps the only one, that does not lag, or at worst, just slighty lags. It is a leading indicator and that's why I have made it the centerpiece of my strategy.
Divergence ends when a divergence or reversal without divergence occurs on the other side. --or perhaps you are stopped out. If using stop, they should be placed above the previous reaction high or low on the chart that you are trading. This is nearly the same as using the trendline. This will cause traders , especialy newbies to panic and get out. This is the time when you should most relax! You're on a winner, just let it ride until it shows trend the opposite way. If you can't stomach letting the trade go all the way back to the reaction point on he same chart, then use shorter term charts and look at their reaction points and trail the stops down. Do not take 2 points and run! You will need the extra money for when you are wrong the next time. Embrace the movements of the market---Retracements are necessary--in fact retracements will be something you will be extremely happy to have around sometimes. Don't press the refresh button on equity at any time during the trade--it means nothing and will cause you to bail because you have counted money that you don't actually have yet.
Quote from hpeganz:
Could you please explain why I am generous with my angels?
B1S2 thanks in advance for your patience - I appreciate your posts .....
The angles are too sharp. I believe you should use more gentle angles when drawing so as not to trick yourself into seeing something that is not there. It's best to err on the side of caution.
B1S2 do you use any other indexes as indicators? I always have the YM always up on my screen, I rarely trade the es off of what the YM does but it does give me a confirmation.
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