I usually don't mention index spreads on here but today was a good example of a market, that at first glance looked like it went no where, yet the IWM/DIA spread put in a fantastic day. This spread actually is market neutral vs the ETF spreads I post. Pretty smooth all day long.
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The ACD Method
- Thread starter sbrowne126
- Start date
Itâs almost the end of January and almost time to set new monthly A values for February. Iâve been at this for just a short time so Iâm still working though the details and use only SPY as I learn ACD methods. I currently use one day RTH for the monthly OR. While it would seem intuitive to use the first trading of the month for the OR, there are other options; the first Friday to coincide with the employment report, the third Friday to align with options expiration, etc. Iâd be interested in a dialog on the pros and cons of different optionsâ¦..
Is it OK to have a 20-min OR (4 x 5min candles) but yet trade off 5min charts time frame.
Also, what time frames do you guys use when testing day/week/month A levels?
To be more clear, if you trade off a 5min time frame then your A level should be confirmed after 2.5min.
On a weekly is it 2.5days??? That wouldn't make much sense would it?
and on a monthly and so on..
Obviously confused about that...
Thank you for anyone who could help me clear that up
Also, what time frames do you guys use when testing day/week/month A levels?
To be more clear, if you trade off a 5min time frame then your A level should be confirmed after 2.5min.
On a weekly is it 2.5days??? That wouldn't make much sense would it?
and on a monthly and so on..
Obviously confused about that...
Thank you for anyone who could help me clear that up
Quote from amsterdam:
Is it OK to have a 20-min OR (4 x 5min candles) but yet trade off 5min charts time frame.
Also, what time frames do you guys use when testing day/week/month A levels?
To be more clear, if you trade off a 5min time frame then your A level should be confirmed after 2.5min.
On a weekly is it 2.5days??? That wouldn't make much sense would it?
and on a monthly and so on..
Obviously confused about that...
Thank you for anyone who could help me clear that up
Great questions. Lets see if the resident expert chime in with exact means to calculate the time portion of your question.
I will try. I think the answer is to use the same 2.5 ( 5 minte bars) for A' up. since you are using/ trading with 5 minute bars even though it is the weekly A' you are looking to confirm/reject.
The weekly calculation with respect to the opening range I think is an average of the previous 5 day opening range levels...
Quote from amsterdam:
Is it OK to have a 20-min OR (4 x 5min candles) but yet trade off 5min charts time frame.
Also, what time frames do you guys use when testing day/week/month A levels?
To be more clear, if you trade off a 5min time frame then your A level should be confirmed after 2.5min.
On a weekly is it 2.5days??? That wouldn't make much sense would it?
and on a monthly and so on..
Obviously confused about that...
Thank you for anyone who could help me clear that up
amsterday, take this for what it's worth, I'm new to ACD. If your OR is 20 minutes, you need price to be above/below for half the OR (10 minutes in your case) to confirm the A. You can trade using 5 minute candles, but dont confuse the OR duration with your trade time frame.
On the weekly, I'm capturing data for both one hour and two hour OR at the start of RTH on Monday morning to set the weekly A levels. I dont know yet which I'll use.
Quote from amsterdam:
Is it OK to have a 20-min OR (4 x 5min candles) but yet trade off 5min charts time frame.
Also, what time frames do you guys use when testing day/week/month A levels?
To be more clear, if you trade off a 5min time frame then your A level should be confirmed after 2.5min.
On a weekly is it 2.5days??? That wouldn't make much sense would it?
and on a monthly and so on..
Obviously confused about that...
Thank you for anyone who could help me clear that up
Amerstam, we have gone over this stuff ad nausem on here but I'll be a good sport and say this again. All of our time frames are going to be different. I personally don't used fixed time frames like the first hour or two hours or whatever. It depends on the product and on the volatility of that product. For example, why would I use the first 2 hours for the grains on the weekly? They only trade for 3 hours and 45 minutes all day! Why would I use one hour or two hours for currencies when they trade 24 hours?
Some people like to use the Sunday night open through the Monday morning RTH open as their opening range. It's really a matter of preference. The important thing for you is that whatever time or volatility you use, that it helps you read the price action. Just be consistent. Generally speaking, the longer the product trades and the more volatile it is, the wider the OR time frame I use.
NFLX and AAPL super strong today. I hope the King has some AAPL tucked away.
AAPL single handedly holding up the entire global economy. Unbelievable.