techniques for choppy conditions

K

Kris

What techniques do you guys use when the market is choppy? Several ideas I've noticed in other threads include using constant volume charts, using a longer time frame, watching price action for lower lows and higher highs, watching the A/D issues at the start of the day to look for a general trend before trading...

Maybe some of the more experienced traders can comment and we can generate a few more ideas for noticing choppy conditions and getting out properly...
 
First, pick a fixed stop and limit offset, that you will use for both long and short trades. Then go long, and do not touch your stop and limit orders no matter what happens. Once the trade exits, either way, go short with the same stop and limit offsets. Rinse and repeat.
 
Quote from Kris:

What techniques do you guys use when the market is choppy? Several ideas I've noticed in other threads include using constant volume charts, using a longer time frame, watching price action for lower lows and higher highs, watching the A/D issues at the start of the day to look for a general trend before trading...

Maybe some of the more experienced traders can comment and we can generate a few more ideas for noticing choppy conditions and getting out properly...
More...

When the ratio of volume of shares trading up to volume trading down is weaving around 1 for long periods in the day, and the volume is down, and you find yourself nodding off, the game usually being played is "push the market this way", then "push it the other way taking out stops", then push it back the other way, etc. This little game may be brought to an end by a consolidation period when the market looks for all the world like it is getting ready to continue rising into resistance or dropping into support, but refuses to budge. It is then that quite often the market will break exactly opposite to what it looks like it would. (look for clues in the volume) Once you understand this game, you can trade it if you like. It is also a good time to prune your roses or play a round of golf.
 
So Andrew when the market gets choppy essential you're making quick scalps back and forth with tight stops?

Piezoe, you use ratio of volume as opposed to advancing/declining issues? Any advantage there?
 
Quote from piezoe:

When the ratio of volume of shares trading up to volume trading down is weaving around 1 for long periods in the day, and the volume is down, and you find yourself nodding off, the game usually being played is "push the market this way", then "push it the other way taking out stops", then push it back the other way, etc. This little game may be brought to an end by a consolidation period when the market looks for all the world like it is getting ready to continue rising into resistance or dropping into support, but refuses to budge. It is then that quite often the market will break exactly opposite to what it looks like it would. (look for clues in the volume) Once you understand this game, you can trade it if you like. It is also a good time to prune your roses or play a round of golf.
More...

What's the symbol to which you refer? The advancing volume minus the declining volume? ($VOLD in esignal)

I'm a big fan of the advancing/declining/unchanged issues ratio ($ISSU). I just wasn't aware that NYSE had a ratio for volume. What is it?
 
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