Rule of 10 Journal

I have a question for volente or jagmot .... or anyone else ...

Say you're flat, and you're waiting for your next entry at 10 pts from the last reaction low/high. Within any 10 point move there are usually several wave/retracement cycles. When does the reaction high/low from one of these "internal" waves qualify as significant enough to be your new start point from which to measure 10 points for the next entry?

Thanks.
 
Quote from volente_00:

Are we higher or lower than the 75 signal ?

Jagmot is not trading my rules. It really is simple. Can you not see a reaction high or low on a chart ? This strategy is all about fading extremes, i don't know how to make it any simpler. FWIW, I know for a fact there are at least 5 people on ET who trade my variation profitably but they have yet to post on this thread and I doubt they ever will as they have nothing to prove. On a side note, I have seen others play with numbers on the rule and they have actually came up with different numbers that work profitably as long as the right risk and money management is adhered to.
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I think you make this stuff up as you go along. Again, you refuse to state whatever "rule" it is that you're using. We're waiting.

Let me give you an example. You gave a 1294 as a reaction low from yesterday. I gather that would have put you long at 1284. Did you get long there?

We had a reaction high of 1293 last night. That would have put you long at 1283. Did you get long there?

Like I said, it all looks good in hindsight.

Better yet, IF we go above last night's reaction high of 1293, do you plan to get long for the move to 1303?

OldTrader
 
Quote from tomahawk:

I have a question for volente or jagmot .... or anyone else ...

Say you're flat, and you're waiting for your next entry at 10 pts from the last reaction low/high. Within any 10 point move there are usually several wave/retracement cycles. When does the reaction high/low from one of these "internal" waves qualify as significant enough to be your new start point from which to measure 10 points for the next entry?

Thanks.
More...

Thank you for the question. You can see my previous posts as discussion as well.

I have stated in the past I ignore price action while in a trade. The reason for that is otherwise, unless you hit the nail on the head (ie. the exact low tick or high tick) you will have to reverse the trade before you get 10 points. On the last trade, we got long at 1276 with a stop of 1273. ES went down to 1274.50 and reacted from there. If I was long at 1276 I would need to cover at 1284.50 and reverse. I would not get my required 3:1 rr. This is why I ignore price action in the trade.

Today's chart is a good example for internal waves. This is my logic behind reaction points. (I use the 5min chart)

At 9:35AM EST, we see a reaction at 1287.25, and we see a quick move down. So we would use 1277.25 as a limit buy. However before we reach that area, we have a move to 1286 at 10:00AM EST and price swiftly reacts lower. I then move my limit buy at 1276.

Why don't we use the bar at 10:20AM EST then? To me this is not a reaction high, because the bar is only 2.5 points. This is where I think the logic is tough and is somewhat discretionary. I didn't realize this before I started the journal.

We could make hard fast rules, such as the bar must be 4 points or something like that...but we really start complicating the system.
 
Quote from tomahawk:

I have a question for volente or jagmot .... or anyone else ...

Say you're flat, and you're waiting for your next entry at 10 pts from the last reaction low/high. Within any 10 point move there are usually several wave/retracement cycles. When does the reaction high/low from one of these "internal" waves qualify as significant enough to be your new start point from which to measure 10 points for the next entry?

Thanks.
More...

I use the extreme moves, volume can confirm.
 
Now we are looking for our next setup, long or short, my r10 system has no preference.

Currently we see a reaction low of 83.75 so we would place a short at 93.75. With the market making a new high now, we don't have a reaction area yet for our buy. Our previous buy was at 1279.25 but that has been invalidated by new highs.

Edit
Short 1293.75
Stop 1296.75
Target 1283.75
 
Quote from OldTrader:

I think you make this stuff up as you go along. Again, you refuse to state whatever "rule" it is that you're using. We're waiting.

Let me give you an example. You gave a 1294 as a reaction low from yesterday. I gather that would have put you long at 1284. Did you get long there?

We had a reaction high of 1293 last night. That would have put you long at 1283. Did you get long there?

Like I said, it all looks good in hindsight.

Better yet, IF we go above last night's reaction high of 1293, do you plan to get long for the move to 1303?

OldTrader
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RULE OF 10

Are you smarter than a 5 th grader ? apparently no, but the verdict is not in

Yes, was it profitable ? Yes Did it make jag's 10 point target ? no


Did this just hit 90 plus like i said it would do ? yes

Do I really care what a critic of a proven strategy thinks ? No



Hindsight ?

I told you 75 before we hit it, I just exited the long at 91.25.
 
Quote from jagmot:


Today's chart is a good example for internal waves. This is my logic behind reaction points. (I use the 5min chart)

At 9:35AM EST, we see a reaction at 1287.25, and we see a quick move down. So we would use 1277.25 as a limit buy. However before we reach that area, we have a move to 1286 at 10:00AM EST and price swiftly reacts lower. I then move my limit buy at 1276.

Why don't we use the bar at 10:20AM EST then? To me this is not a reaction high, because the bar is only 2.5 points. This is where I think the logic is tough and is somewhat discretionary. I didn't realize this before I started the journal.

We could make hard fast rules, such as the bar must be 4 points or something like that...but we really start complicating the system.
More...

Thanks .. yes, today is exactly what I was talking about. Before we went 10 points from the first obvious reaction high of 87.25 (RTH), there were also peaks at 85.75, 83.50, and 81.75.... so, 4 possible choices of where to measure from. Some were more obvious than others, but unless there is an exact definition for what is a "reaction low/high", any ROT system would have to be considered largely discretionary.
 
Quote from jagmot:

Now we are looking for our next setup, long or short, my r10 system has no preference.

Currently we see a reaction low of 83.75 so we would place a short at 93.75. With the market making a new high now, we don't have a reaction area yet for our buy. Our previous buy was at 1279.25 but that has been invalidated by new highs.
More...

Why would your system not have reversed on the 86 ?
 
Quote from jagmot:

Now we are looking for our next setup, long or short, my r10 system has no preference.

Currently we see a reaction low of 83.75 so we would place a short at 93.75. With the market making a new high now, we don't have a reaction area yet for our buy. Our previous buy was at 1279.25 but that has been invalidated by new highs.

Edit
Short 1293.75
Stop 1296.75
Target 1283.75
More...

i hope this trade fails just so the critics can find peace.


:p
 
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