Here is a good set up for beginning and maintaining a stop log for doing C&R's for trailing stops during trends of any pace.
I'm going to do it in a step by step way using today as an example starting where you suggested above.
1. Make a log of the sequence of potential stops as they appear as significant points in formations.
2. Go to the one minute chart for this because the tape that is running is on the five minute trading fractal.
3. Set the scale to two point intervals, i. e., 878.0, 876.0, 874.0, etc...
4. Enter first the peak, 878.1, and use this as point 1 for the channel that is setting up.
5. Enter subsequent points as they occur: 877.0, 877.2, 875.2, 876.2, 877.0.
6. What I do is actually leave spaces so that I can put the entries in order following the trend. What you get is: 878.1, 877.2, 877.0, 877.0, 876.2, 875.2. Naturally if you have 877.0, you only put it in once. Sometimes, a retrace occurs and I just erase the points that no longer apply. Notice that all the entries are in four significant figures where the least significant is to the right of the decimal point and the numbers 0,1,2,3, just stand for the 1/4 trading values as the number of quarters.
7. Circle the entry that is a current potential stop that you will use when the time comes.
8. Determine how many peaks are occuring every 15 minutes. There are two or three. Use two peaks as your C&R time periodicity (ten minutes for today). Carry this value forward as long as the market is the same.
9. Circle four entries back from your last entry at all times. If the pace quickens, then circle three back. If the pace slows, circle five back. In this way you calibrate the offset of potential stops in current time and pace of market.
10. As the trend ends you will see that you no longer can add values to the stop log. You continue, however, to C&R this is like a pincer movement where the market trend is moving towards you and your stop C&R's are moving to the market. When you notice that you can no longer add values it is time to exit prior to the time that the pincer would close. You make more money this way. When you get to an intermediate or advanced state, you will consider reversing at this time in order to be on the right tack when the price BOs of the existing channel. You will also notice that the last entry you make ususally becomes point 1 of the next channel. This is how a lot of stuff turns into KISS.
As you can see, this all worked out fine.
The trend slowed and a slow trend commenced where the tape is on the 15 minute fractal. You can see that an exit on the fifteen minute was about 866.0. The subsequent congestion, convergence and centering occured up to a point where several VDUs occured.
This set you up for a bracket entry where the centering value is the same as your exit (866.0). It doesn't matter which way the market continues, you use the sequence of break out volume, MACD BO off neutral and the STOC BO off 50%. You can tell when the centering begins because the periodicity ends and only volitility setments (small and large) sequence along.
Today, the BO for your bracket was short. You set up 866.3, 863.5 and 864.3 as respective points 123. Your new point 3 becomes 865.1 and you are on your way with your stop log.
thank Liz for typing the notes.
