How do you Enter a Run Away Market ?

Quote from kevinqc:

Meaningful Retracements ?

Look at these 60 minute charts. I am purposely not disclosing the names of instruments to avoid any bias. But they are highly traded very liquid markets.

Would appreciate any strategies that would help get in these runaway markets.

Kevin
More...

kevinqc,

You also purposely removed other important information from the chart that relates to the FOMC Announcement. :mad:

When asking for help and asking for traders to reveal their personal approach to trading a specific type of price action/event...

It's not the appropriate time for you to be removing information from your charts.

Therefore, can you at least annotate your charts to show the time the FOMC Announcement occurred along with putting back the dates and times??? :cool:

In addition, if the FOMC occurred on those charts anywhere in the last 10 - 20 bars via the 60min chart...

One strategy would be not to use the 60min chart all by itself if your looking for meaningful retracements.

Thus, you will need to lower your time frame and watch one additional chart of the trading instrument (ex. 15min and 60min) to look for meaningful retracements.

The main reason why using an additional chart interval that's a lower chart interval is that we are talking about retracements or price pullbacks.

These tend to be lower in volatility and small range intervals.

That in itself implies you need to inspect or analyze the price action that's occurring within the 60min chart and the only way to do that is to also be watching a lower chart interval side by side with the 60min chart.

Simply, no specific strategy is really needed.

You just need to make some adjustments in how your viewing your charts when looking for retracements or price pullbacks.

For example, I'm mainly a day trader even though I do swing trading/position trading...

I tend to use the 2min, 3min and 5min chart intervals.

However, on FOMC trading days, when I'm looking for meaningful retracements or price pullbacks after the rate announcement...

I'm also watching the 1min chart interval to go along with the 2min, 3min and 5min chart.

It works very well especially during high volatility trading conditions when looking for trade signals in the low volatility price actions that occur soon after the high volatility trading conditions when looking for the second price surge.

Another example, when I'm looking for a position trade via the weekly chart...

I also analyze the daily chart and they are side by side on my monitor.

Once again, without that info (FOMC, date and times) on your charts...

It looks like you've intentionally shown a few bars that occurred after the announcement on the right side of those charts instead of showing all the price action that occurred between the FOMC and the time of your question.

Hopefully that's not what you did.

Mark
 
Quote from NihabaAshi:

kevinqc,

You also purposely removed other important information from the chart that relates to the FOMC Announcement. :mad:

When asking for help and asking for traders to reveal their personal approach to trading a specific type of price action/event...

It's not the appropriate time for you to be removing information from your charts.

Therefore, can you at least annotate your charts to show the time the FOMC Announcement occurred along with putting back the dates and times??? :cool:

In addition, if the FOMC occurred on those charts anywhere in the last 10 - 20 bars via the 60min chart...

One strategy would be not to use the 60min chart all by itself if your looking for meaningful retracements.

Thus, you will need to lower your time frame and watch one additional chart of the trading instrument (ex. 15min and 60min) to look for meaningful retracements.

The main reason why using an additional chart interval that's a lower chart interval is that we are talking about retracements or price pullbacks.

These tend to be lower in volatility and small range intervals.

That in itself implies you need to inspect or analyze the price action that's occurring within the 60min chart and the only way to do that is to also be watching a lower chart interval side by side with the 60min chart.

Simply, no specific strategy is really needed.

You just need to make some adjustments in how your viewing your charts when looking for retracements or price pullbacks.

For example, I'm mainly a day trader even though I do swing trading/position trading...

I tend to use the 2min, 3min and 5min chart intervals.

However, on FOMC trading days, when I'm looking for meaningful retracements or price pullbacks after the rate announcement...

I'm also watching the 1min chart interval to go along with the 2min, 3min and 5min chart.

It works very well especially during high volatility trading conditions when looking for trade signals in the low volatility price actions that occur soon after the high volatility trading conditions when looking for the second price surge.

Another example, when I'm looking for a position trade via the weekly chart...

I also analyze the daily chart and they are side by side on my monitor.

Once again, without that info (FOMC, date and times) on your charts...

It looks like you've intentionally shown a few bars that occurred after the announcement on the right side of those charts instead of showing all the price action that occurred between the FOMC and the time of your question.

Hopefully that's not what you did.

Mark
More...

Hey NihabaAshi,

Let me apologize if some relevant info was left out & I assure you it wasn't done purposely.

You have been more than kind to respond to many many threads with valuable insights & I really aprreciate all the help.

Using 1,2,3,5 or 15 min charts would be probably helpful but unfortunately I do not have the access to those timeframes. The best I can do is to post 1 or 5 min charts for each individual day because my data service provides only each sessions data starting fresh each morning without any previous data.

Let me see what I can do & will try to post them here.

Once again thanks man.

Kevin
 
Hi NihabaAshi,

I am attaching some Intraday 3 min charts with 60 min chart of one instrument. This was the same chart # 1 that I posted earlier.

I do see some retracements on 3 min but not significant in terms of percentage on 60 min or Daily chart.

Please comment.

Thanks
Kevin
 

Attachments

You play them with a reduced position size.

It's like any other form of high volatility trade. You play it at a reduced position size, with a predetermined stop. Trail the stop up.

Greater move = greater rewards. That is where you will balance out the gains.
 
Quote from trend_guy:

Stock ABC

Portfolio Value = $1,000,000

Risk = 2% of portfolio or $20,000

Entry point A = Stock at $100

Stop = $95

Runaway entry point B = Stock is $107

Position size A = $20,000/(100-95) = 4000 shares ... 4000 shares x $100 entry = $400,000 position size

Position size B = $20,000/(107-95) = 1666 shares ... 1666 x $107 entry = $178,262 position size

Basically... if you have to get in late, you keep the same stop, but you size down accordingly so you can still manage your risk... another way to do it is... move the stop up, but I prefer having the stop where it's most effective and having smaller size.
More...

say you execute both of these example trades you have described:

how would you exit them? would you unload all shares [5666] at one predetermined price? or scale out? If so, what would be your criteria?

thanx for the advice.
 
I generally scale out (if the trade moves my way). I like to take 20-30% off when the stock is up 15-20% ... then I ride the rest for as long as I can, generally scaling out on the way up... really long term traders like to use a trailing stop.
 
Quote from kevinqc:

After Fed's decision many markets are running away without any meaningful Retracements.

Even going to lowest time frames like 1 min & 3 min do not offer the shallow Retracement.

So how do you enter such markets where there is constant threat of a sharp correction. Verticle markets also drop vertically.

Any ideas ?
More...
Runaway markets are the easiest to enter, wherever you enter you make a profit...These are the only markets, stocks, commodities I enter...
where is the problem.
Are you saying you don't like to be profitable immediately after entry???
:confused:
 
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