IN THIS THREAD: IronFist learns (the elusive) PRICE ACTION
- Thread starter IronFist
- Start date
Its more likely that the action will change in FOMC week but that might not affect some traders. Its just something to keep in mind as its a very significant day even if you don't trade news.
Today on the YM we traded in a 100 point range for half the day. Haven't done that in a long time.
I am not going to say that FOMC makes price action do this or that, how I see it is not how anybody else should see it. Just be aware of it and make your own judgements.
1st you need to make sure you are not in congestion. Thinking the market is trending when it is congestion will cost you a lot of money.
A very simple way to define a trend is when a breakout of congestion or a swing hi/low occurs.
You can trade the 1st PB (Pull Back) after the breakout.
Your view on stops is not correct. The size of your initial stop is related to the quality of your entry technique and has nothing to do with noise. A good quality entry technique has a small MAE so you can use a small initial stop. You put your initial stop at a point where you know if prices get there, your probability of a successful trade is unfavorable. If you choose to use a trailing stop on a runner then you have to consider what you are calling noise.
Another characteristic of a good quality entry is that prices move in your direction almost immediately. Let's say your average time in a winning trade is 3 minutes. If you are sitting in a trade for 3 minutes and it does go anywhere, it's a good idea to exit as favorably as possible before it hits your stop.
If you're scalping for 8-10 ticks on your 1st target, you don't use a 20 tick stop. I already described to you a simple entry technique with range bars that lets you use close stops.
PA trading is discretionary. That means you use your judgement to select the best trading opportunities. With practice, you will be able to tell when S/R will hold with a high degree of accuracy.
Don't enter trades when reports are being released.
Don't enter trades in fast markets.
Quote from Trader273:
Here is a take on your 1000 tick ym chart.
Realized there should be another sell around 15:02. Depending on your exits, looks like it could be easily 4/5.
1) what is a trader vic 2B?
2) you label some points as obvious entries; how did you know price would reverse at those points and not continue further in the direction of the trend? I see price blast through HOD and LOD all the time. How did you know price would reverse there thus labeling those as "easy trades"?
One tic would send you mad.
If you are following ES look at the RTH volume for the day and calculate the average 1 minute volume, then try half of that.
It will give you a better picture of order flow.
Basically you are building a mental of the velocity of price change and the momentum (acceleration).
regards
f9
iron, did u read my post on pg 53?...you cant time the bottom, its damn near impossible, but you buy when price makes a higher high(even by just a tick or two) of the previous candles high point.
adding to what i just said, on that chart above, where #2 was, signaling a buy, you'd buy around 8633, and place your stop at the low of the last candle...if price is making hh's and hl's, then your stop wont be hit, and you can move the stop to the lows of each new candle reducing risk or locking in gains. at 8673, id either close out the trade, if I had just one lot, or scale out 50 to 90% and put my stop at breakeven.