S/R Emini Journal

[pkts]

Sorry for all the posts!

Just glancing at the Bollinger Bands, they seem a good indicator of a bounce but sometimes (during big declines like the one from 1295-1275) they give a false signal. Are there any other studies you can watch that might confirm the bollinger bands signs? Or is it more to do with the greater trend. If the ES is down big, you don't look to the Bollinger Bands for the bounce?

 

[murray t turtle]

Quote from pkts:

Can anyone comment on the negative factors of using the bollinger bands for trading?

I was looking at the chart for today (posted below) and it seems that if you bought all the touches, you would have made money on 3 of 4. It can't be that easy! Are there other qualifiers?

==================
PkTs;

Its not that easy always as you figured;
dont place too much faith in indicators as Don Bright wrote.

Bollinger or keltner channels dont work near as well in strong trends;
and the 20 ma [green on your chart] would have been a better earlier signal than the bands.For sure, look for more than buying ''touches''.

Or a 13 ema ,[13=fibo number,]also in earlier.
ESpecially when market downtrends, BB,keltners dont work as well;
wisdom is profitable to direct

 

[chaswagg]

Quote from 4re:

Right here on this journal. LOL. Just kidding. I don't know of any books or anything specifically about S&P Emini. I do have a DVD set that I got from Trendfund.com that is pretty good. I don't like their company but some of their DVD's are ok. What is your level of trading education? That would be this biggest help before going much farther.

4re

I have been trading for 25 years. Started out with commodity futures (my futures trading was so long ago I would have to do some studying to get up to speed on them again) and switched to equities then mostly options on equities and indexes the last two years.

I have a good library of option books and videos so I appreciate how much you treasure your DVDs. I would be glad to put up a deposit to assure that the videos are returned in good condition or possibly buy them if they are for sale.

My e-mail address is: chaswagg01@msn.com . Please e-mail me if you would be willing to work something out.

 

[4re]

Quote from EPrado:

Gotta say....most of the time I come on ET is for entertainment value. Most of the Journals on here IMHO are useless. But....I came across yours and have to say....its great. I have been trading since 92 started out in equities and switched over to futures in 2002 after us equity guys got decimalized. Anyways...I trade mostly stock index futures and some fixed income at times. Not sure if my thinking fits in with you guys, but if its cool with you would like to chime in at times.

My style is keep it as basic as I can and try not to over analyze. I basically use daily charts to come up with S/R for big levels.(I use candlesticks). I tend to be a fader and look to get short into resistance/ long at support, especially the FIRST time these areas are hit. If they hold I then load in as the trade works. Not so easy to add on recently with the volatility and whipsaw going on.

Anyways....I got to admit over the years I have had a tough time buying at resistance /selling at suppport. But....I agree bigtime with you if the mkt hits resistance, then returns later its probably a better chance of a breakout.(the more times it hits, the longer it will fly when it does break) I use 15 min charts during the day (used to use 5 min...but too much noise). When I do decide to switch over to the breakout side (which is not so often), I find it best when the price has hit resistance 2-3 times, because when it does break it usually flies.

You probably mentioned some of these questions already, but was interested:

How much profit are you looking for when you get a breakout? (I think you mentioned 2 points or so), and when it does break, how much room do you give it if it heads back the other way? (did you adjust much during the insane moves end of last week into this week?)

Do you adjust position size?

ex...the other day the overnight low was 1246.75......mkt got down there for the first time during the pit session and I put on larger postion on the long side.....I felt the risk reward at that time was much more in my favor then if it was the 2nd-3rd time during the pit session that it was hit. I most likely would have used half pos size if that was the case.


Anyways...keep up the good work....

Eprado,
First of all thanks, I hope you like and we would really like to have you continue to join in here. There are a couple of other faders in here as well. I like having different styles of trading around. It makes things interesting. As long as nobody is trying to impose their way of trading on others by calling names everything stays cool. We have done that so far very well I think. I would like to ask though that you show some charts and be open to answering questions asked of you. This is supposed to be educational for all of us.

Now don't misunderstand my style, I don't by at resistance. I buy on a breakout of .5 or more of resistance. The reason I do this is because I find more momentum going forward than backwards. I like to be where everybody else is. Also I use larger positions and just go for 2 points. If momentum is still going I will ride it until things start slowing down then I bail. I have even been know to double into a strong movement and go for one more point. I NEVER double into a losing trade though.

Once again, while I shoot for 2 points if the market goes in my favor by 1.5 points and starts reversing I will get out with 1 point. I can always re enter if the same target gets hit again. If I re enter I usually only go for 1 more point or 1.25 just to cover commissions.

I hope that helps and welcome to this journal,

4re

 

[4re]

Quote from pkts:

Hey 4RE,

I noticed that the ES hit the long target and popped up a quarter and then dropped. What do you attribute the failure to? Anemic volume? I'll be very interested to see what your S and R is for Tuesday based on this action.

BTW, your recent posts have been very educating. I am just starting out but am realizing very soon how 90% of trading is controlling your emotions and being patient.

How do you enter the trades? Lets say you want to go long at 1283 for 2 pts. I would enter a buy stop limit for 1283 with a bracket order of sell stop for 1281.50 and a limit sell for 1285. However if the ES seems like its running out of steam would you enter a fresh order to sell at limit 1284, sell at market or change the limit price on the already existing sell limit of 1285. Just trying to understand the quickest way of getting out. Seconds count!

Have a good weekend all.

pkts.

Welcome Pkts,
Yes the lack of volume just would not let much happen this afternoon. That is how it goes before a holiday.

Yes, I do use buy stop limit for my entry. That is the only way I have found to enter it using Ninja Trader. I tried a buy limit once and it will fill you at the best price at that time. Not a good thing since I need price to bust through a certain point before I enter. Early is bad. I usually give you the full range of the move as I see it so if I give you a 3 point move you can always enter a 1/4 point late and still be ok. If I give a 2 point move take the entry and think about stopping early if price has trouble reaching target. I do try to give more than 2 points when possible but I can only give what the charts allow.

I am glad you asked that question maybe that will help clear up when and why I might exit a little early.

Thanks,
4re

 

[4re]

Here is my bollinger band theory. I only use it on range days. If we are in a trend it can HELP you determine the end of a trend. Range days it works very well. I like the 5 minute chart and usually get less but better signals with it. If you have learned anything about my style of tradiing I like to trade less with high probablity trading. So here it is.

What I look for is this:
1. Price to pop outside the BB
2. Price to snap back inside the BB and CLOSE inside the BB.
3. Take the direction of the ending movement. IE: if price breaks out above the BB and snaps back down inside the BB short at the close.
4. The longer the needle the stronger the play.

That is it. Backtest it and simulate it, see if you like it. As always nothing works everytime but it is a high probability trade. Works great with stocks and equities as well.

Note: If BB's are very tight this means there is not much volitility and would not be a good play. But if BB's are spread out and wide but we are not in a big trend it is very tradeable. As aways read up on BB and know what they are designed for before just jumping in.

Here is a 5 minute chart showing signals I would and would not take.

 

[EPrado]

Quote from 4re:

Eprado,
First of all thanks, I hope you like and we would really like to have you continue to join in here. There are a couple of other faders in here as well. I like having different styles of trading around. It makes things interesting. As long as nobody is trying to impose their way of trading on others by calling names everything stays cool. We have done that so far very well I think. I would like to ask though that you show some charts and be open to answering questions asked of you. This is supposed to be educational for all of us.

Now don't misunderstand my style, I don't by at resistance. I buy on a breakout of .5 or more of resistance. The reason I do this is because I find more momentum going forward than backwards. I like to be where everybody else is. Also I use larger positions and just go for 2 points. If momentum is still going I will ride it until things start slowing down then I bail. I have even been know to double into a strong movement and go for one more point. I NEVER double into a losing trade though.

Once again, while I shoot for 2 points if the market goes in my favor by 1.5 points and starts reversing I will get out with 1 point. I can always re enter if the same target gets hit again. If I re enter I usually only go for 1 more point or 1.25 just to cover commissions.

I hope that helps and welcome to this journal,

4re

Thanks.....I look forwards to taking part in this ...Dont worry..you wont see me making any "market calls"...I have learned over the years that making bold predictions can be disaterous. The market always humbles those who think they know everything. I might say where I am looking to go long or short, but I wont say "this market has made a bottom......we are going up 10 handles....blah blah blah".

I have no problem posting charts....if I can figure out how to do it (LOL..Im serious). I use esignal at work. And of course will answer any question asked.

I agree with your never doubling down into losing trades. Its a rule I live by. My worst days in the past were when I shorted at a point...added more 2 more times as it got worse. Cost averaging down is a horrible style...Recipe for disaster. An example of a trade that works best for me is:

short 10 sp at 1275

mkt trades up to 1276.25

mkt comes back down to 1274.50....sell 5 more....

use a 1276.50 stop on the whole position....(right above day high)

if mkt heads south look to cover 8 at at 1272.50(2 points from second entry......ride the other 7 down covering them at areas of support(or what looks like support to me)...worst case scenario covering the rest back at 1274.50......to me the worst crime in trading is to turn a winner into a loser...

when initially shorting at 1275 I use a 2 point stop......


NOW....on CPI day last week things got insanely volatile...2 point stops were way too close ...I had to cut down size and widen everything.....How did you trade that day and the following days where the sp's were nuts? The order book was a joke.


On the breakout trades, initially, how much room do you give it against you?

Lets say:

You buy at 1276.50......mkt ticks up to 1277.......then trades down to 1276...at what point do you say "maybe this isnt the best breakout"? Also....how many trades do you find yourself doing on a normal day?.

I usually watch/trade a bunch of mkts (SP,Dow,Nas,Russ,Stoxx, Bund,10 yr,30yr)...not all at once.....but sometimes I might see a good area of support in the dow, which doesnt exactly coincide with the sp, and go long the dow there. My thinking is that even if the SP's head south a bit more, the support will keep the dow from falling much more . Seems to work for me. I am pretty picky/disciplined so I dont do a ton of trades each day.

 

[4re]

Quote from EPrado:





when initially shorting at 1275 I use a 2 point stop......


NOW....on CPI day last week things got insanely volatile...2 point stops were way too close ...I had to cut down size and widen everything.....How did you trade that day and the following days where the sp's were nuts? The order book was a joke.


On the breakout trades, initially, how much room do you give it against you?

Lets say:

You buy at 1276.50......mkt ticks up to 1277.......then trades down to 1276...at what point do you say "maybe this isnt the best breakout"? Also....how many trades do you find yourself doing on a normal day?.

I usually watch/trade a bunch of mkts (SP,Dow,Nas,Russ,Stoxx, Bund,10 yr,30yr)...not all at once.....but sometimes I might see a good area of support in the dow, which doesnt exactly coincide with the sp, and go long the dow there. My thinking is that even if the SP's head south a bit more, the support will keep the dow from falling much more . Seems to work for me. I am pretty picky/disciplined so I dont do a ton of trades each day.

On CPI day the market was just hovering about 1point above my short entry so I had the order in already to go short. I turned off my target in order to let it ride. I was expecting a down move so I got entered very early in the move. I let it ride to the bottom and when the price started going back up I hit the flatten all button. I captured all of the down move except 1.5 points. I think I got 5.5 points. That is a guess right now without going back and looking at my charts.

Best breakout was for me was one that led to a trend. About 3 points into it I reduced my position size and decided to let it ride. I got an average of 16 points per contract on that one. I try not to disclose exactly how many contracts I am using but I will give a % of my account placed on a position. Not that I am a big player because I am not. I just do not want this to turn into a game of who his the biggest dog in here. If you know what I mean. I typically use 25% percent of my account on each entry I take. That is why I only need 2 points. If I get stopped out I can always re enter and recoup my losses. Two busted trades in one day I am out for the day. A negative week gets me 1 one in simulation mode. So far I have done this once since I started trading this style.

 

[porgie]

I have come to this conclusion........the smart guys and i seriously mean smart guys that really know their stuff .....futures speaking.....know their positional long term stuff but when they start talking intraday trading emini's they are as lost as a goose...a blind goose at that...they use the same strategies and their long term ideas and try to apply them to the daytrading.........like "indicators don't work well".....my indicators continue to work so well that i had to stop posting the accuracy rate as i got tired of the verbal assaults on these forums.........i use 4 lines that tell me everything i need to know.....the market can run but it can't hide from these 4 lines.....do they lag? ever so slightly do they lag........how is that? years of hard labor.......the "guys" are still very very smart.........smarter than i will ever be...but their stuff is geared for other trading environments.......not the daytrading stuff.......i have seen no one on any of these forums who know much at all about daytrading strategies on the emini's that work well for long........when they say 20 point stops, what is the news for today, bar noise, such as that i immediately recognize they don't know what they ar edoing intraday emini's..........sorry for the harsh comments, just tired of nowhere posts giving wrong information for intraday emini trading.....porgie

 

[porgie]

4re,

By no means was previous post by me directed at you......i only truly encourage you and hope you are enormously successful.......but for emini intraday trading be careful about planning next day trade ..anticipation is not good...that is mind bias....then we want to prove ourselves correct...even if we are not ....the ego hurt me for a long time we don't even know what next 10 minutes will bring ......but through backtesting and experience realtime stuff we can create entries that are very high probability and "should" give us what we need.........we don't know which support resistance will hold........the macd will lock up overbougt and oversold the same with big run or strong trend day...stoch, bb the same as all oscillators will do.......too much stuff to look at for daytading is harmful ....the less information given to the mind the better as long as the information is all we need to keep the high probability in place ........the mind is the challenge, not the market........sincerely best wishes to you and your brother....porgie