switching gears to Price Action via SLA

[dbphoenix]

I can see how you could view it that way. For me, I wanted to view the bar with the green dot on it as a retracement for an up move. It didn't make a LH, but it did make a LL. Then price failed to meet that low, make a HH or another LL. It felt like a hinge might be forming so I wanted to be above the highest high thus far or below the lowest low. The high entry hit first.

But it's nice to see that others are actually looking at what I'm posting. I really appreciate the feedback.

Did you draw these lines in real time/replay?

 

[Gabe2004]

The dashed lines point to similar bar cluster points.
Would you have defined the area with the ? as a RET?

Gabe

 

[gears]

Did you draw these lines in real time/replay?

All of the lines aside from the bigger hinge (after the black exit dot) with the diamond were drawn during replay.

 

[gears]

The dashed lines point to similar bar cluster points.
Would you have defined the area with the ? as a RET?

Gabe

I don't quite understand all of the lines that you drew, but the area marked with a '?' I did see as a RET. BUT - with the 2nd bar in that area making an equal high, but lower low and then price just kind of hanging out/moving sideways, I didn't want to get sucked into a trade just to want to exit immediately. So for me, the safer (yet later entry) would be higher or lower than the prices already on the scene.

 

[dbphoenix]

All of the lines aside from the bigger hinge (after the black exit dot) with the diamond were drawn during replay.

You're making decisions based on lines that can't be drawn until after the decision has to be made. Either you're looking ahead, or you're afraid of following the rules if they require you to make a trade that might not be a profitable one.

This approach is not about all profits and no losses. It's about cutting your losses short --scratching -- and letting your profits run. You can't know in advance which will be which. If you have to know, you're going to have to get over it.

 

[dbphoenix]

In the interests of saving time:

A relatively mechanical approach, depending on how one defines "ret". One can use the bar itself, one can use the right-tick, or one can define it as a "pause". If this is milky, drop to a lower bar interval, e.g., 30s, and these overlong bars will disappear. They will become even more overlong if one goes to a higher interval, e.g., 2m or 3m, but there will be fewer trades, possibly more losers, possibly no trades at all.

 

[boru]

In the interests of saving time:

A relatively mechanical approach, depending on how one defines "ret". One can use the bar itself, one can use the right-tick, or one can define it as a "pause". If this is milky, drop to a lower bar interval, e.g., 30s, and these overlong bars will disappear. They will become even more overlong if one goes to a higher interval, e.g., 2m or 3m, but there will be fewer trades, possibly more losers, possibly no trades at all.

I have struggled with this. I found dropping to a lower bar interval encouraged micro trading. the depth of a RET did (does) influence my feelings as a shallow RET doesn't retrace enough and a deep RET may be price turning. It seems to me there is a line in the sand where you take the trade and as Db says be prepared to scratch. You probably won't know for sure until you thoroughly backtest RETs. I am only starting down this journey myself so feel free to disregard. good luck

 

[dbphoenix]

I have struggled with this. I found dropping to a lower bar interval encouraged micro trading. the depth of a RET did (does) influence my feelings as a shallow RET doesn't retrace enough and a deep RET may be price turning. It seems to me there is a line in the sand where you take the trade and as Db says be prepared to scratch. You probably won't know for sure until you thoroughly backtest RETs. I am only starting down this journey myself so feel free to disregard. good luck

Key words here being "may be". "May be" is not part of the consideration. If there's a ret, take it. If it doesn't go and turns into a rev, either SAR or scratch. Guessing what's going to happen next defeats the purpose of this approach. Trade what's in front of you, not what you think is going to be in front of you.

 

[gears]

You're making decisions based on lines that can't be drawn until after the decision has to be made. Either you're looking ahead, or you're afraid of following the rules if they require you to make a trade that might not be a profitable one.

My understanding of how to draw a DL and SL is as follows: Price moves in a particular direction. Price retraces some. Trader enters stop for a price one point away from the high or low of the RET depending on direction. Subsequent price movement either triggers the trade or not. If trade were triggered, DL or SL is drawn to highlight whether or not price continues to "go with the flow." With that in mind, I can definitely see how you'd think that I was drawing lines after the fact - and I am - after a trade is triggered.

This approach is not about all profits and no losses. It's about cutting your losses short --scratching -- and letting your profits run. You can't know in advance which will be which. If you have to know, you're going to have to get over it.

I do have a lot to get over and this is one thing, but I do realize that not every trade will go my way --- there will be scratches AND losses --- understandably.

One can use the bar itself, one can use the right-tick, or one can definite it as a "pause."

When you say, right-tick, do you mean the appropriate tick time for the trader or something happening on the right side of a bar or something else?

 

[dbphoenix]

My understanding of how to draw a DL and SL is as follows: Price moves in a particular direction. Price retraces some. Trader enters stop for a price one point away from the high or low of the RET depending on direction. Subsequent price movement either triggers the trade or not. If trade were triggered, DL or SL is drawn to highlight whether or not price continues to "go with the flow." With that in mind, I can definitely see how you'd think that I was drawing lines after the fact - and I am - after a trade is triggered.

The DLs and SLs are not drawn based on one's entry off a ret. Price can travel quite some distance without having a ret at all. But that doesn't mean that a line can't be drawn under it or over it to track the balance between demand and supply, which is after all the whole point of the lines. When price breaks your 0940 SL, you look for a ret for a long. That's all you look for. But you didn't get one before your 0946 SL was broken. That break means that you look for a short. The short is taken off the first ret, which is at 0951. Whatever line might be drawn after that stopentry is made has nothing to do with whether or not to enter the order. All that matters at that point is whether or not the stopentry is triggered and, if so, whether or not it goes or gets scratched.

When you say, right-tick, do you mean the appropriate tick time for the trader or something happening on the right side of a bar or something else?

The left tick of a OHLC bar is the open for that bar. The right tick is the close for that bar. If one doesn't want to open up a separate chart for a smaller interval, he can use the right tick to determine his rets, which are in fact there on a smaller interval. When markets are moving fast and a given price has been rejected hard, there may not be a ret in that interval for five or ten points, if not more. This is where it becomes more important to read price than to read lines.

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