Rule of 10 Journal

Quote from Pekelo:

He said:

"reaction low 10 points below last retrace on yesterday afternoon's rise."

He is refering to the low at 3:35 pm yesterday. (I think)

Since this would be a low to low entry and I usually don't use the previous day's chart, I would have missed it...
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There have been numerous swings since then, one of which went thru that point this AM and would have stopped out (I can't locate his first trade so maybe that's what the did). But why do it again, when clearly there are other points to look at in terms of R10? Either way, it worked out...I just don't think it's a demonstration of R10.

OldTrader
 
Quote from OldTrader:

There have been numerous swings since then, one of which went thru that point this AM and would have stopped out (I can't locate his first trade so maybe that's what the did). But why do it again, when clearly there are other points to look at in terms of R10? Either way, it worked out...I just don't think it's a demonstration of R10.

OldTrader
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I agree. I think it was a good trade, but not in the context of r10.
 
Quote from jagmot:

I agree. I think it was a good trade, but not in the context of r10.
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By the way, I wonder if you will adjust your target somewhat higher to reflect the latest 10 point swing from the high? 1272.75? Or leave it in place?

OldTrader
 
wow.........a whole thread devoted to rule 10....wait until pekelo invents & informs everyone of the rule of 10 x 2,3,4 &5 during whipsaw/volitlity times.

rule of 10 + multiples there of ,are measuring tools for dow/S&p & provide occasional entry....but when rule of 10 (x) coincides with other techs like fibs,fib confluence,TL`s,coast to coast move,etc is when you want to be all in or close to it with size.
i believe that taking the rule of 10 entry just for the sake of doing so with a 3 point stop is a losing proposition over time......support of other techs is when odds are skewed in your favor & the better bet.
 
A question about when you enter a trade.

For example using today’s action

A swing low was made this morning @ 1271.25.
A short entry would have been made @1281.25
A stop placed @1284.25.

A swing high @ 1282.75 didn’t take out the stop.
Price finally dropped and made the 10 point target of 1271.25
This price is below the long entry that would have been triggered @ 1272.25.

My question is do you close out the trade and then wait for the next set-up ignoring the price action that occurred while you were in the trade?
 
Quote from jagmot:

Once the trade got stopped out at 8:30AM EST, I start looking for the next r10 signal. In this case, I would looking to get short at 1286.75 (which did not hit). Then the market moved as low as 1271.25. Now the signal would be 1281.25 short which should have been taken at 10:20AM EST.

(Edit: As you can see some people called out the short of 1281.25 in advance even though I was not)

Short 1281.25
Stop 1284.25
Target 1271.25

Jagmot

I will do my best to post real time, however I have to sleep and trade my real money strategies (with a lot of work being done in the open)
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Unfortunately I was away from the computer when the target was met. However, you would still take the trade. Part of why I made the rules so simple is that I could easily automate this trade if I was trading it real money.

Trade closed out at target 1271.25
1 for 2
+6.75points total
(remember I am counting commisions with the slippage on stop outs of .25)
 
Quote from deaddog:

A question about when you enter a trade.

For example using today’s action

A swing low was made this morning @ 1271.25.
A short entry would have been made @1281.25
A stop placed @1284.25.

A swing high @ 1282.75 didn’t take out the stop.
Price finally dropped and made the 10 point target of 1271.25
This price is below the long entry that would have been triggered @ 1272.25.

My question is do you close out the trade and then wait for the next set-up ignoring the price action that occurred while you were in the trade?
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Yes I ignore the price action while once in the trade. Once I place the trade, the target is either hit or I get stopped out. I don't expect the ES to turn on my tick but think 3 pts is enough room along with a good rr of at least 3:1.

To answer the next question, I will post shortly on how to enter the next trade.
 
We are currently flat with the r10 and just had our first success. Remember that one of the rules implemented is 2 stop outs in a row and we stop trading for 24 hours. This is to guard against multiple stop outs on a trend day.

At the current chart and time frame, we have a reaction high of 1272.25. I would (or an automated system) would enter in a buy at 1262.25 and a stop at 1265.25.

For a short, we have a reaction low of 1263.50. I would (or an automated system) would enter in a sell at 1273.50 and 1276.50. Once one of the trades is hit (some sort of alarm) I could then cancel the other trade. Of course an automated system would do this much better, hence why I made the rules very simple and easy to program (and would of course put the associated target buy or sell in place as well).

On a side note, I am glad to see so much excitement for this thread.
 
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