ES Journal Archive (2009 - 2010)

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Quote from NoDoji:

He averages at extremes and has a reasonable level at which he exits if it doesn't work out. That's a lot different from selling a bottom or buying a top and averaging in as the trend clearly reverses there.

Although I don't do it live, I tested average-down strategies at extremes in my sim account on both CL and ES for months and had very few losses.
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How did/do you define "extremes"? ... day only?

emg's 8.50 long was at a new low for the day yesterday, but on a small-range day, and well within the bounds of the previous 2-5 days of trading. Could've gotten ugly, but granted, a 1 pt. target is pretty high odds from almost anywhere.
 
Quote from tomahawk:

How did/do you define "extremes"? ... day only?

emg's 8.50 long was at a new low for the day yesterday, but on a small-range day, and well within the bounds of the previous 2-5 days of trading. Could've gotten ugly, but granted, a 1 pt. target is pretty high odds from almost anywhere.
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I define an extreme as a point where price has made 3 or more pushes in a trend (higher highs or lower lows) and then overshoots the upper or lower Keltner channel line by 1 cm :cool: (I call this NoDoji's metric trend exhaustion reversal cue)

So right now on a 5-min ES chart, I consider 1202.75 an extreme and if you were to go long there, with a 5 pt disaster stop and average down once at 2-3 pts further push, it's a pretty high probability trade for getting emg's 1 pt profit (when I did this in sim I always shot for 2-4 pts though)
 
Quote from tomahawk:

How did/do you define "extremes"? ... day only?

emg's 8.50 long was at a new low for the day yesterday, but on a small-range day, and well within the bounds of the previous 2-5 days of trading. Could've gotten ugly, but granted, a 1 pt. target is pretty high odds from almost anywhere.
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i didnt see anything special about 8.5 either.. although it was off 8 points from the high.

im sure the idea of an extreme move can be quantified with basic testing. stdv

i trade reversals based on exhaustion, when a market is making 'new' highs, alot of levels are guaranteed to be retested. you could have shorted every point from 1035 to 1215 the first time it tagged and eventually get in the money if you can stomach waiting.

i hear option traders say that when IV is over 300% they are drooling to write, personally show me an intraday move on EUR > ~170 pips with no significant pullback and its basically free money to take the other side.
 
From my indicator setup points the intraday oversold too much will be somewhere about 98-97 (this is valid for 1-2 hours it is changing). Long entry at that level is safe if no EOW (end of world) news is released. However up to that level it can fall easily. But short entries are unprobable setups for now.
 
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