Quote from IronFist:
Ok I'm gonna try to type up a bunch of rules or things based on comments people have left. There's a ton of info in this thread and I need to get it all organized somehow. I'll post it in this thread for comments later.
IF- since you are trying to nail down your strategy may i throw a couple of ideas into the mix which i hope aren't too far off topic?Apologies if i am repeating stuff already mentioned as i have not read the entire thread.
It seems to me that any strategy you design must be in harmony with recent market conditions and with consideration to the bigger picture and i dont see you taking any of that into consideration (correct me if i am wrong)
For example sp500 has this week failed to close above the 920 area after 3 attempts.We are in a bear market so resistance levels are stronger,support weaker.The low for the year is in unless we crash 140 points in a week which could happen but not likely.
I would put all the above in terms of 'the smart money' and be attempting to always stay on the same side of the market as them.To me it seems the sm bought at at 741 nov 21 after a rapid and steep decline from 1000 level. Look at the high vol bar on the daily and where the bar closed tells you serious buying at that level which resulted in a V shape reversal. Only big money has the power to reverse trends and comparing vol (effort) with result (bar/candle) is the clue to the sm 'footprint' and this should work on most timeframes.You are attempting to spot signs of strength at bottoms/signs of weakness at tops.
Since daytrading means we are dealing with much smaller timeframes we are by definition mostly dealiing with 'noise' and thereby placing smaller stops which are easy to hit more often hence the unacceptable (to me)number of losing trades. I prefer to trade the smaller timeframes within the context of holding a larger swing position which is in profit which is a more relaxed way of trading rather than wiping the slate clean with each new trade-but that's me.
Since you're attempting to draw trend lines and placing entries/exits on those lines may i suggest you investigate squaring price and time for a more accurate picture which others may not be seeing? In any event, to be a winner in this game to me means you absolutely must think outside the box even if you end up using something that is so simple most people reject it.
Lastly, on any given trading day you need to determine what kind of day it's likely to be and within the context of the bigger timeframe before deciding whether you are a buyer or seller today.Suggest you also keep and study 5min intraday charts and take note of the key reversal time zones.
For example if you have determined we are in an all day down trend it seems pointless to me attempting long entries on the lower trend line.
If you do make the above mentioned study you will find that intraday patterns repeat just as all patterns repeat.You will also find they repeat in a cycle (sometimes they reappear 'inverted'-upside down) Pm me if you want further details on this stuff. Sometimes a good clue that you're on to something is when lots of people tell you its crap (in any walk of life)and as we know most people are wrong in this game. good luck
