Very much so. The most effective way to speed the learning curve is to just look at the market as a giant random number generator, then design strategies around that with as few degrees of freedom as possible.
Most Useful S/R Lines for Intraday Trading Levels??
- Thread starter lbhere
- Start date
‘Consistent’ or ‘important’ pivot levels are dependent of your trading timeframe and your goals in this timeframe. Important pivot levels = levels on higher timeframe where relatively large group of traders successfully went long or short and potentially this group will defend this level when price returns to it. This means flash reversals or/and choppy price action for lower timeframe. Key word here is potentially, that means risks around the levels arise for trader operating on lower timeframe.
For me trading timeframe is below 1 hour and my goal is taking 5-15 ticks, which is looking like price swing on short time frame chart like 5 min. So my higher timeframe is hourly and daily and important levels are swing highs/lows on hourly and daily. This is answer on your question – in the morning I use prior days hourly swing points, in the evening I use also morning’s PA, hourly timeframe which can make (and can not make) swing h/l on hourly timescale.
Since my goal is 5-15 ticks, to protect trade from higher risk around important level I use 6 ticks offset from level. This means if I see signal but the distance between entry price and level is less than 6 ticks I do not take the trade. The swing points are objective (when the determination of swing point is objected by trader), 6 ticks offset is purely subjective and came from my trading plan’s goal. If I would be scalper which I am not, hunting for 1-2 ticks I think offset 6 is too much and should be replaced to 3 ticks. If I would be interday trader, which I am not, my higher timeframe would be daily and weekly and the offset would be greater than 10 ticks. And so on.
Point is: important levels are related to personal trading timeframe and trading plan. The idea is avoid to take higher risk associated with levels that can be defended on the higher timeframe.
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Thanks for your input. But, honestly, I find that my S/R lines at the highs and lows are working in my time frames. I would just like to hone my skill more.
If it was all so random, then price would stop all over the place, no? But it stops on one of my lines about 95% of the time. My job now is to go through the charts and determine which ones are the most useful, and which ones I can delete.
LOL. I didn't quote your entire post here. But I wanted to thank you again. Very gracious of your time, and I appreciate all that you wrote. It really helps a lot. I will go back over my charts this coming weekend and get a good idea of which ones are important.
Cheers to you and yours! Happy trading!
Thanks again! I get what you mean, and I will be going over my charts this weekend to really understand which areas are indeed important, and which ones I can let go of. Your posts have been very much appreciated.
I always use a buy stop to enter, and your idea of a "proving itself" channel is interesting. I need to take a look at this style. My initial instinct is that I am losing precious points, but...maybe it will actually improve my entry choices and therefore improve my profit ratio. So thank you for sharing your entries with me .
Cheers!
Still sounds like a shot in the dark, but you’ll get smarter, or go broke. I wish you the best and hope you solve the puzzle.
Thanks dude.
Think of fishing. It is easy for the lone guy to catch good fish with skill and simple gear despite an ocean of high tech high volume industrial participants. But you still need to fish all the time, same waters, for years.
- A guy I know: traded his way to many millions, very good mouse click trader, huge volume in one futures mkt. Then, for his own good reasons, stopped click trading recently to oversee his significant code-driven trading concerns. I have no interest in that debate here. But I will say this: when ever he wants, he can make big coin with a chart, ladder, mouse. That is because he is a life-long trader who demonstrably knows how to trade his focus market. He knows all the advantages of code. But he will never tell you that you can't do what he can do with a mouse click and screen.
You also can use the same logic for other TA tools, the most important IMO are:
1. Trenlines. For example, price is in uptrend, than pullback and approach the trendline. What it is, continuation or reversal? I use this as filter, if I see trading signal, but price is near trendline +-offset this is sign to stay away.
2. Chart patterns, especially head and shoulders and triple tops/bottoms. For example, price is in uptrend, but triple top or H&S is on the way. Is it reversal or continuation? Again to me it is filter, potential risk so no trade.
When I use all filters, 80%+ (usually around 90%) of price action is forbidden zone for my trading plan. Remaining 10-20% is my field and I trade simple pattern only in this field, ignoring so calling ‘money on the table’.
