Pete's Weekly Candles

PetaDollar

PetaDollar

Candles and Candles Only!
You are welcome to comments on the entries and also post your own.

Entries are divided up into: Winning Longs, Winning Shorts, Losing Longs, and Losing Shorts.

The actual entry is marked with a yellow diamond. Remember the candle with the diamond was forming when I entered the trade.
 
Quote from peterfigliozzi:

Candles and Candles Only!
You are welcome to comments on the entries and also post your own.

Entries are divided up into: Winning Longs, Winning Shorts, Losing Longs, and Losing Shorts.

The actual entry is marked with a yellow diamond. Remember the candle with the diamond was forming when I entered the trade.
More...

Hi Pete,

Why are you using a 11min chart interval?

Doesn't that offset the info in the last bar of the trading day?

Also, can you post the specific date of each of those trades because not every data vendor has the exact data...

Therefore, its impossible to correlate a few of those charts with the overall candlestick pattern unless we know the specific date and time of trade.

Yet, a few of the charts I was able to line up with my data vendors charts.

Also...when you enter your trade via the 11min chart while the chart is still forming...

is it after you got a trade signal in the prior candlestick interval or are you entering the trade in the candlestick that had a trade signal prior to its completion?

Last of all...I highly recommend not to get into the habit of analyzing and trading via candlesticks all by themselves.

Confirmation via the minimum like volume analysis, pivot point analysis, support resistance analysis, market breadth analyis or something...

is absolutely critical to prevent focusing on candlesticks all by themselves.

NihabaAshi
 
Quote from peterfigliozzi:

NQ trades from last week.

WL: 1-2
WS: 3-6
LL: 7-10
LS: 11-13
More...


peterfigliozzi,

Do you monitor floor pivot levels?
I think it might be interesting if there was/was not a correlation of W/L entries in the area of a prior S/R, and or floor pivot area.

I cannot see the price on your chart here, so I cannot check for myself.
 
In your image...

http://www.elitetrader.com/vb/attachment.php?s=&postid=416775

I'm commenting on #7, #2 and #11 based on your 11min chart setting...

On Jan 21st Weds you probably saw that nice looking Bullish White Hammer that completed @ 1014am est...

reason why I think you went long during the next chart interval without hesitation and without waiting for that interval to complete itself...

Here's the Volume Analysis on that trade...

That white hammer had increasing volume in comparison to the prior white candlestick...

this is something I like and one of my criteria for a trade.

However...I've mentioned in a recent prior post here at ET about candlesticks...

Arguably the most powerful single candlestick line (not pattern) is a wide range body candlestick...up or down...especially one that contains a volume spike.

(Note: Be extremely careful about taking trades in a wide range body candlestick...best to wait and see what happens in the next 1-3 candlestick intervals...something you didn't do in image #11 on Jan 23rd Friday when you Shorted...resulting in a loss)

In image #7...the prior candlestick line was a down wide range body on lower volume in comparison to the prior down candlestick (the first 11min interval of the trading day)...

Simply, I would have either ignored that Bullish White Hammer or reduced my position size to control the risk because there was a good chance for more downside....

In fact...eventhough I don't know what your trade management rules were for that particular Long position...

It was profitable for a short period and I'm assuming you didn't chase the signal and got Long no more than 1539.00

Leads me into this question...

When NQ tested 1540.00 price area...what's your trade management rules when your at about a +1 point profit or more?

Specifically...at what point do you move your initial stop into a trailing stop.

When it comes to trading via candlesticks...the critical aspect is trade management.

I mean...at worst...you should have been stopped out at breakeven on that trade if you got Long @ 1539.00 or better...

not a loss.

Next...the 11min interval after your entry interval was another down wide range body candlestick line...

This one was special...it had rising volume in comarison to the 2 prior down candlesticks...

a possible sign of seller exhaustion unlike the prior down wide range body candlestick.

Next, via Market Breadth Analysis...specifically the VIX and its 11min chart interval...

that entire day on Jan 21st was screeming Long positions via your 11min chart interval.

The odds were high that this was a good time to take a jab at another Long position...

That's what you did in image #2...

Simply...you didn't give up on what the market sentiment was (bullish) eventhough you took a loss in image #7...

that's good and implies you were following a trading plan.

Hopefully, you took ionly a small loss in image #7 and made it all back plus more in image #2...

resulting in a very nice trading day.

For example...I know someone that took similar trades as you did in almost the same interval (via the 5min chart)...

He got +1.50 in the first Long via an entry around 1538.00...and I think a +12.50 in that second Long.

Therefore...both you two enter in that first trade near about the same time...yet one was profitable and one wasn't...

reason why I say that trade management is key...all that stuff that happens after entry.

NihabaAshi
 
Here's the time and date of all those entries. In the future i'll put it in the graphic.

(1) 20 Jan 10:59 (CST)
(2) 21 Jan 9:38
(3) 22 Jan 8:51
(4) 20 Jan 13:00
(5) 21 Jan 14:03
(6) 22 Jan 11:48
(7) 21 Jan 9:14
(8) 23 Jan 10:11
(9) 23 Jan 11:38
(10) 23 Jan 12:12
(11) 23 Jan 9:07
(12) 21 Jan 11:25
(13) 22 Jan 11:24

11 Min chart: superstition. Just to be a little different. I don't see any harm in it at least.

Quote from NihabaAshi:

Hi Pete,

Why are you using a 11min chart interval?

Doesn't that offset the info in the last bar of the trading day?

Also, can you post the specific date of each of those trades because not every data vendor has the exact data...
More...
 
Quote from NihabaAshi:


Also...when you enter your trade via the 11min chart while the chart is still forming...

is it after you got a trade signal in the prior candlestick interval or are you entering the trade in the candlestick that had a trade signal prior to its completion?

Last of all...I highly recommend not to get into the habit of analyzing and trading via candlesticks all by themselves.

Confirmation via the minimum like volume analysis, pivot point analysis, support resistance analysis, market breadth analyis or something...

is absolutely critical to prevent focusing on candlesticks all by themselves.

NihabaAshi
More...

My trade plan is to look for a pullback or reversal pattern on the 11 min chart then drop down to the 2 min chart for the actual entry. For example if I see a hammer forming on the 11 min i'll drop down and enter when/if a higher low starts forming on the 2 min. This keeps me out of a lot of trouble to say the least.

Point well taken on looking at candlesticks out of context. At this point, i'm still learning about the price patterns though. When all of my entries make sense just looking at the candles, then I will work more on supporting evidence. That being said, I am monitoring the TICK and A/D and use it to filter out some entries, also to clue me in to others.
 
Quote from sulong:

peterfigliozzi,

Do you monitor floor pivot levels?
I think it might be interesting if there was/was not a correlation of W/L entries in the area of a prior S/R, and or floor pivot area.
More...

No, but I do monitor previous s/r levels. I'm on the lookout for reversals or pullbacks to previous failures. I also monitor the 200 SMA, yesterday's high, low, and close.

Yes, there is a very strong correlation to previous s/r.
 
NihabaAshi, thank you very much for the in-depth analysis.
As it turned out I broke even on the combination of the loss from 7 and the gain from 2. (It was a bit of bad luck on #2, as I stopped out my second half at the low tick of the next pullback. But I got 4.5 pts from the first half.)

Re: entry #7, I was long at 1537.5. Right now my plan for the initial phase is completely mechanical: I trail 5 points till I get to breakeven. I will add discretionary rules in the future, but right now that's the best I know how to do. So I ended up taking -2.5 on this trade. Needless to say, if anyone wants to share some better ideas on the initial phase, i'm all ears.


Quote from NihabaAshi:

In your image...

http://www.elitetrader.com/vb/attachment.php?s=&postid=416775

I'm commenting on #7, #2 and #11 based on your 11min chart setting...

On Jan 21st Weds you probably saw that nice looking Bullish White Hammer that completed @ 1014am est...

reason why I think you went long during the next chart interval without hesitation and without waiting for that interval to complete itself...

Here's the Volume Analysis on that trade...

That white hammer had increasing volume in comparison to the prior white candlestick...

this is something I like and one of my criteria for a trade.

However...I've mentioned in a recent prior post here at ET about candlesticks...

Arguably the most powerful single candlestick line (not pattern) is a wide range body candlestick...up or down...especially one that contains a volume spike.

(Note: Be extremely careful about taking trades in a wide range body candlestick...best to wait and see what happens in the next 1-3 candlestick intervals...something you didn't do in image #11 on Jan 23rd Friday when you Shorted...resulting in a loss)

In image #7...the prior candlestick line was a down wide range body on lower volume in comparison to the prior down candlestick (the first 11min interval of the trading day)...

Simply, I would have either ignored that Bullish White Hammer or reduced my position size to control the risk because there was a good chance for more downside....

In fact...eventhough I don't know what your trade management rules were for that particular Long position...

It was profitable for a short period and I'm assuming you didn't chase the signal and got Long no more than 1539.00

Leads me into this question...

When NQ tested 1540.00 price area...what's your trade management rules when your at about a +1 point profit or more?

Specifically...at what point do you move your initial stop into a trailing stop.

When it comes to trading via candlesticks...the critical aspect is trade management.

I mean...at worst...you should have been stopped out at breakeven on that trade if you got Long @ 1539.00 or better...

not a loss.

Next...the 11min interval after your entry interval was another down wide range body candlestick line...

This one was special...it had rising volume in comarison to the 2 prior down candlesticks...

a possible sign of seller exhaustion unlike the prior down wide range body candlestick.

Next, via Market Breadth Analysis...specifically the VIX and its 11min chart interval...

that entire day on Jan 21st was screeming Long positions via your 11min chart interval.

The odds were high that this was a good time to take a jab at another Long position...

That's what you did in image #2...

Simply...you didn't give up on what the market sentiment was (bullish) eventhough you took a loss in image #7...

that's good and implies you were following a trading plan.

Hopefully, you took ionly a small loss in image #7 and made it all back plus more in image #2...

resulting in a very nice trading day.

For example...I know someone that took similar trades as you did in almost the same interval (via the 5min chart)...

He got +1.50 in the first Long via an entry around 1538.00...and I think a +12.50 in that second Long.

Therefore...both you two enter in that first trade near about the same time...yet one was profitable and one wasn't...

reason why I say that trade management is key...all that stuff that happens after entry.

NihabaAshi
More...
 
First, I notice a stark contrast between my winning shorts (3-6) and my losing shorts (11-13).

For the winners 3-5, there was already a red candle on the board, and there was already a classic bearish candle pattern. Bearish engulfing for 2-4, and three-inside-down plus a shooting star on #5. Even #6 had a really nice long upper shadow that matched up with a failure earlier in the morning.

To sum it up, for the winning shorts, the uptrend was *over*. Moreover this was shown by the candles already on the board.

For the losing shorts 11-13, there was a big fat green bar immediately to the left of my entry. Actually in #11 as NA pointed out I shorted in a big green bar.

To sum up the losers, the uptrend was clearly not over. I was top picking, shorting the first weakness on the 2 min chart.

For the losing longs, i'd say #7 and #10 were legitimate entries.

Numbers 8 and 9, fogettaboutit. Some signs of selling exhaustion, MAYBE, but these don't really correspond to any reversal patterns I know of or have seen.
 
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