Thank you volpri, very very much appreciated. I respond after work tonight to your two posts.You might consider practicing this on a sim. When price is in a range 70% (some might even say 80% of any attempt by the bulls to break out of the top of the range fails. The bears push it back into the range and/or move it towards middle and lower part of the range. 70% to 80% of attempts by the bears to push price south out of the range fails and bulls push it back up and/or move it towards the middle or top of the range. That is pretty good odds. Here is a tactic to practice. It is counter intuitive but try it. ONLY ON A SIM NIT A REAL ACCOUNT. Divide the range into 4 equal pieces. When price trades up into the upper quadrant begin shorting. Add as it keeps going up shorting even more. Do this regardless of whether the bar is bullish or bearish or doji. When price reaches near the top it has a 70% to 80% chance it is going to reverse back down towards the middle and perhaps even the bottom of the range. Start exiting if price stalls around the middle of the range. As price moves towards the center, if is doing so on bear bars with gaps (close of present bar is lower than the low or the close) of the prev bar and/or the prev two bars, then you might consider holding on to some of the position for bigger gains.
Now do the opposite when price is at the bottom 1/4. Start buying (regardless of bar.. bullish or bearish or doji) and adding (averaging down) as it trades further south (if it does) and start exiting on moves towards the center or upper quadrants locking in profits. Hang on to some of the position for bigger gains if move up is with successive bull bars with gaps (between the close of the present bar and the close or high of the previous bar or two bars also.)
Basically, your signal to buy or sell is when price is in the upper or lower quadrant. And average in or down..LOL. Yes break the cardinal rule of 95% of the guru’s. The averaging down will render greater profit as price subsequently begins to trade towards the middle. This factor (averaging down) is KEY for making the tactic profitable.
Warning #1 the range must be broad enough for a scalp. That means at least 3 times the size of a min scalp. In the ES I consider a scalp to be 1 point. So I would employ this tactic on ranges 3 points or taller. In fact in broader ranges you can get two legged moves towards the top or bottom and can thus hold some for larger profit.
Warning #2 SL should be placed a points or two outside the range. Sometimes price will BO above the range a point or two before trading back into the range. That is normal. So, some traders might even want to use a 3 point above or below the range SL. That is up to the traders taste for risk.
As price Breaks out of the range I am generally averaging down. Why? Chances are even in a an actual BO (as opposed to an attempt that reaches in the upper or lower quadrant)of the range top or bottom, that the actual BO will also fail and price will go back into the range within 3 or 4 bars and start trading towards the middle or further up or down (depending if your position is bullish or bearish ) into the range.
This is a tactic to trade what traders call “chop”. It ain’t easy for a newbie (or even a somewhat seasoned trader ) as price can race up from the bottom of the range on successive bull bars ..even larger than average bull bars and all the newbie can think...is BO and big $$$ and so he/she is frantically buying right at the top of the range because of FOMO (fear of missing out). He should be selling not buying. When it races to the bottom he should be buying not selling. Newbies tend to do the opposite of what they should do.
Warning #3 eventually there will be a BO from the range that will in fact succeed. So, if you get caught loaded up in a BO that has follow thru then exit immediately ..double up on your previous position size ..and go in the direction of the BO. Price will have to move less and you will be back at BE.
View attachment 202625 Enlightenment concept: a sideways movement to be a range must have at least 10 bars (for a mini range) and 20 or more for a normal range. Anything less is probably just a flag ( bull or bear) and said flag can be in many shapes...triangles...pb’s..wedges...etc ad nauseam...Best not to use this tactic on your simulator in such cases. And NEVER on your real account.
FINAL WARNING: THIS IS ONLY FOR TRADING ON SIMULATED ACCOUNTS NOT REAL ACCOUNTS! YOU CAN AND MAY WELL LOSE MONEY. IT IS NOT EASY TO EXECUTE. MISTAKES CAN AND WILL BE MADE. THIS POST IS NOT TRADING ADVICE BUT JUST FOR PLAYING AROUND ON A SIMULATOR. I CANNOT HELP WHAT YOU DO WITH YOUR REAL MONEY BUT THIS POST IS FOR EDUCATION ONLY!!
WARNING ..WARNING ..FUTURES ARE DANGEROUS. STOCKS TOO. ANY TRADING IS. EVEN TRADING DOLLARS FOR A USED CAR OR A NEW CAR.
Good day.
Your chart below marked up. A waste of time according to poster laissez faire if I understood him correctly. You may wish to make haste and heed his thinking on markup charts..
PS use sim charts in all the tactics!
ROFLMAO
View attachment 202619
I'm having trouble with my trading
- Thread starter Xzhi
- Start date
Thank you volpri, very very much appreciated. I respond after work tonight to your two posts.
Hello volpri,
I read your tatic above and I really appreciate your time and effort. Yes, that sounds pretty challenging for me to repeated average buy and selling in ranges. I am not sure I can handle that type risk emotionally at my stage. I will have to hold off on that tactic for now, and just buy and sell within ranges. I am trading one contract now, and working on my trade management skills. I would like to the 2 contracts eventually.
Well, here is a range I traded today. Trade #2 I am happy with myself on this one.
Trade #1 Long
light blue arrow entry
red arrow initial SL
green arrow exit
Trade management. I removed the PT limit order betting on higher prices and a breakout, but once I saw selling I bailed out for $80
Trade #2 Short
light blue arrow entry after rejection and follow through
red arrow initial SL
green arrow exit
Trade management. I exited after seeing buying doji bar.
Trade #3 Long
light blue arrow entry
red arrow initial SL
orange arrow exit
My PT was at the top of range, BUTTTTT, market had another plan and started to reverse.
The old me would have thought "NOPE, I am going to respect my stop loss placement, hopefully some more bulls come in and pushing up higher,maybe I am just in too early, leave the stop loss alone, let the trade work, be patient. sit on your hands, etc etc etc"
This time I saw with my own eyes, 3 red bars in a range after my entry, making a 3rd reversal, and possible lower high coming here. I manually exited the trade. This actually lost was only -$40. Compared to what my initial loss would have been of -$130. I saved $90 on this trade.
Thank you for the response volpri.
Sounds great! Enjoy your trip and stay safe and have fun.
I be here when you get back.
Learn from your loss. Stop overthinking. Do not try to revenge. You can not fight with the market. Market wanted you to pay and you did.
Use stop-loss all the time... You have lost due to lack of risk management. Learn managing risks. I bet you had huge stop loss and running after small profits. Yes you can maybe win 95% of time but 5% is enough to wipe your account.
Use stop-loss all the time... You have lost due to lack of risk management. Learn managing risks. I bet you had huge stop loss and running after small profits. Yes you can maybe win 95% of time but 5% is enough to wipe your account.