Ross Hooks (or other patterns) entries based off of stop loss distance

[Xela]

It makes sense, but I'm guessing you're trading stocks, perhaps? I trade only futures.

I don't trade the first 15-20 minutes of a session, anyway. (I wouldn't determine direction from gaps. 1-2-3 formations, and Ross Hooks following them, are only a small part of what I trade. Sorry - my answer isn't very helpful to you.)

 

[trademan1]

It makes sense, but I'm guessing you're trading stocks, perhaps? I trade only futures.

I don't trade the first 15-20 minutes of a session, anyway. (I wouldn't determine direction from gaps. 1-2-3 formations, and Ross Hooks following them, are only a small part of what I trade. Sorry - my answer isn't very helpful to you.)

No problem, I find it interesting contrasting ways of trading price action.

I tend to trade a certain market direction based on a bias, except I have found that I don't do that with 123 reversals because usually a bias (ie MAs) are too late and I will always miss 123 reversal if I wait for bias confirmation.

Regarding 123s, hooks, etc. I tend to only count corrections or swings when price action has some "space" between the swing highs/lows. I find that if I trade without the "space" between the swings it is too congested and not as a good a signal. (hopefully that makes sense)

 

[Xela]

I tend to trade a certain market direction based on a bias, except I have found that I don't do that with 123 reversals because usually a bias (ie MAs) are too late and I will always miss 123 reversal if I wait for bias confirmation.

Yes - that makes complete sense, of course.

Regarding 123s, hooks, etc. I tend to only count corrections or swings when price action has some "space" between the swing highs/lows. I find that if I trade without the "space" between the swings it is too congested and not as a good a signal. (hopefully that makes sense)

Yes, very much so. I hear ya'.

 

[trademan1]

Do you follow Joe Ross's way of identifying trends and his congestion areas while trading hooks?

Just curious because there are a couple of instances, particularly in his book on Ross Hooks, that he says are not Ross Hooks but I can't figure out how that isn't the case. (page 58 for example at point R- not sure if you have his book). Seems like you have a good grasp on Ross Hooks so thought maybe you would know.

 

[Xela]

Do you follow Joe Ross's way of identifying trends

He's published several different ways of identifying trends, in various books, over the decades, and I can never remember which is which, now.

One of Jack Schwager's interviewees describes, in one of the Market Wizards books, a neat way of identifying a trend, the spirit of which - if not the exact technique - rather encapsulates my own attitude to them: print off the chart on your screen, pin it on your wall and stand ten feet away from it - if you can see a clear trend at that distance, then there is one; if you can't, there probably isn't.

(You can also identify trends for potential Ross-hook-entry purposes by indicators, if you wish. An example: bearing in mind that a trend exists only within a specific time-frame, and that it's normal for an instrument to be trending in one direction within any specified time-frame while either ranging or even trending in the opposite direction in a different time-frame, draw 15-period and 50-period simple moving averages - if the fast one is above the slow one and both are rising then there's an uptrend within that time-frame; if the fast one is below the slower one and both are falling then there's a downtrend within that time-frame; if neither applies, then there isn't a trend within that time-frame. And you can even substitute the addition of a "higher time-frame" by adding 60-period and 200-period averages and looking at those two as well, thereby taking only trades that are also in accordance with the "higher time-frame trend", but doing it all on one chart - that's a perfectly workable substitute for the method recommended by Marcel Link in his classic book High Probability Trading. Ultimately, though, one can take this too far: the more "confirmations" you require, of course, the lower your trading-frequency becomes, albeit with a higher overall strike-rate.)

and his congestion areas while trading hooks?

I avoid trading hooks in congestion, certainly.

And I close trades that run into congestion (I can always re-open the position later, which I then think of as a Volman-style "box breakout").

(page 58 for example at point R- not sure if you have his book).

I do - but not here: my copy is actually in another country at the moment, sorry!

I don't think it's necessary to follow Ross's (or anyone else's) definition of "congestion" to the letter, anyway (I know he describes it in accordance with numbers of bars, and differentiates between "congestion" and "consolidation" this way, too), as long as you know congestion/consolidation when you see them - but this isn't too difficult?

Sorry, probably not a particularly helpful response.

 

[trademan1]

Good points, thanks.

I don't think it's necessary to follow Ross's (or anyone else's) definition of "congestion" to the letter, anyway (I know he describes it in accordance with numbers of bars, and differentiates between "congestion" and "consolidation" this way, too), as long as you know congestion/consolidation when you see them - but this isn't too difficult?

That is exactly the thing that was confusing for me, Ross talking about a certain amount of bars (4) and closing bars taking place before or after correction bars. etc. etc.

as long as you know congestion/consolidation when you see them - but this isn't too difficult?

Haha well I'll take some helpful tips! LOL

 

[wrbtrader]

Joe Ross still alive ?

 

[speedo]

I don't caught up too much in identifying "trends". I prefer to think of my trades as momentum impulse signals although my methodology is based on "trend pullback". Congestion is simply another form of corrective action as is the more obvious and clean pullback. I have signals which I enter in consolidation patterns, based on the same principles as simple pullbacks. None of us see charts in the same way and have to develop PA cognizance which is meaningful to each trader. Trading would be easy if all patterns looked like textbook examples.

 

[speedo]

Joe Ross still alive ?

He'd be pushing 90 if he is.

 

[Xela]

Joe Ross still alive ?

I believe so (simply because I haven't heard that he died, and would expect to have, if he had) but he must certainly be a fair age, by now, for sure.