The Stochastic Indicator

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bundlemaker,

From your entry, I think you're still trading ES03M.
You should be trading ES03U since last Thursday was rollover.

I've seen it work with different levels of stops, anywhere from
2 to 4 points initial stop and move up to breakeven. You just
have to be consistent and follow every signal you get and
know that overall, you should have more points gained.

You can practice by going over previous days of this year.
Also go over the days the vorzo and dawg have posted for
and see if you get similar trades.

Good Luck!
 
Quote from bundlemaker:

first trade today:

long ES at 11:05:07, 1010.75
xxx at 11:14:59 1009

then it took off, how much room do I need to give these trades?
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Bundle,

For rockets, I will generally exit a trade when there is a flaw in the normal sequence of things.

Example of normal sequence:
rocket signal -> traverse to away side of channel on rising volume -> traverse to right side on fading volume -> traverse to away side etc

If a flaw occurs (failure to traverse, MACD x, stoch leaves zone, channel is broken) I will get into exit mode.

Sometimes a trend will start strong and then correct to a slower trend by forming a 2nd pt 3 (Jack's aircraft takeoff analogy). Something like rocket failure -> channel BO -> MACD x.
This is the case with your trade.

Mind you, I didn't trade that day so these are after-the-battle comments, so they're not worth much.

The trend started as an iceberg, then at 11:00 rocket signal -> entry.
Entry was at the away side of channel, I'd wait until the channel is broken to the upside and then enter. If it's not, I'll wait for the traverse to the right side.
11:05 traverse to right side -> 11:10 channel broken, rocket failed and MACD about to x -> exit

To figure out whether to stay in when this occurs I look for clues on the 1m chart, 5m NQ/YM, 3m TICK/TRIN. If the channel is broken on rising volume on the 1m chart, I'd probably exit quickly. If I'm in doubt, I check the others. The idea is to get a feel for the prevailing market direction at that time.

Since the trade went south right after entry, I probably would've done the same thing. It's hard enough to wait for the 2nd point 3 when you're in the money.

I am cautious when a MACD cross occurs before the other flaws, it usually signals a reversal and I get out quickly.

Hope this helps.
 

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Quote from JohnnyK:


I have a small request: Could you post, along with your daily and weekly stats, a running log of total number of points gained over total number of trades?

I have a large request: I will soon be in a position to trade at least one contract. Would you be interested in instant messaging your trades as you make them for a percentage of any profits? If so, what % would make it worth while for you?
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JK,

I've been real busy at work lately and too tired to get up in the morning to trade - this week I didn't trade at all. I will trade tomorrow and post at the end of the day, including the running total.

As to your other request, I think you should know that the trades I've posted so far are simulated, so they do not reflect my live trading. In fact, I expect to make about half of the simulated results when I go live. I was about to switch a few weeks back but then I was busy at work so I put it off until I have more time - this should happen in a few weeks. It sucks but I think it'd be foolish to go live now when I'm in the market only a few hours a week.
I know Dawg was trading live and had success with the method but he didn't trade lately either.

I could send you my trades in real time if you think that would help. Of course I would do it for free - I have learned this method courtesy of Jack who generously shared it with us. Wouldn't that be something -

But I think that what's more important for you is to learn the method and learn how to deal with the stress. Simulate it for a month or two until you get consistent and comfortable, then go live. Post your trades - that helps to stay focused and disciplined.

If you take the time to understand the method you will get a better understanding of how the market works, when to trade and when to stay out.
The concept of washing is priceless too. It's the opposite of what most systems and books preach - instead of waiting for a fixed stop to be triggered, you get out as soon as there is a flaw (the reason for your entry is no longer there).

vorzo
 
Fri Jun 20

#1 long rocket (hist<0.4)
11:12 long 1001.00
11:34 sell 999.00 rocket failure -> no new pt 3 -> up vol picking up -> reverse iceberg
-2.00

Entry was late and hist <0.4; volume dropped on prior bar. Guess I was itching to take a trade.

#2 reversal iceberg
11:34 short 999.000
11:59 wash 999.00 up vol picked up
0.00

#3 short rocket
13:03 short 997.50
13:58 cover 993.25
channel BO -> stoch and MACD entwined -> new pt 3 -> failure to trav/dbl bottom on 1m
+4.25

Week +2.25 / 1 day / 3 trades
37 days/93 trades/+118.00
 

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We arrived home in the early hours of the morning.

As you may know I went to cash (equities) on 06JUN03. As an OT update, the trip was terrific.

I have read the thread as way to get uptodate and, below, is a rough out of what i have planned for the near term.

Half of year's profits come after Labor day. So I will ease back into the market accordingly and journal it for the benefit of those who need to see the detail of getting into a rotation with several money streams. My younger Brother is managing my deceased brother's accounts consevatively and I will use examples from that which you may find helpful. It is running at 40% YTD. My MAY was about the same including up to the 6Th (40% for that month plus interval only.)

On the ES front. The comments from the 6th to the present are very good and important; my thanks to all who commented. I don't think of this thread as "mine"; someone started it to get my comments out of an important thread that I intruded upon.

I have started getting the entire thread into a form that will be extremely informative. I am copying what I did not copy before and will flesh out a lot of stuff. All ASAP.

Some very significant and important observations have been made. some oneclearly tated that to get really sharp you must go through the experience of getting there. I am focussed on the transference of skills. It is getting clearer that skills may be acquired and the route involves "knowing" what is going on. fortunately, very fortunately there are people who post who allow us and me, in particular, to "see" into their environment. I needed all of this to make my points. Now it is here.

Now, without dispariaging anyone and in the prirt of progressing in excellence, we can all profit from the foundation found here.

The "pop" comments and the let's have a contrarian (fade) challenge to the stuff here are really the grist we need to play out in great depth the way the game is played.

When you are all millionaires in a couple of years, you will see that we actually do both the trend and the fade simultaneously; it has just not become part of the consciousness as yet. the clue presented to you is the "continuation" and "cahnge" mode stuff. we use two strategies that are triggered by conditions. as some have determined (not guessed), it is true we will use overlaps of these seemingly indepentant aspects. Those who stated here recently that they see the failure to traverse the channel as the key "flaw" to behold for optimizing profits are, in fact, demonstrating that they perceive that profits may be acquired continually as a foundation principle in making money.

What makes me feel great s reading that people using well build approaches can gain from what we all contribute here.

This all leads us out of debates that are not pertinent to making money. All indicators can be adjusted as leading indicators by using maths. We leave prediction way behind at some point as unecessary. To be minimalists and operate in a KISS mode and continually make money is the result we will all have soon. We seek a way to connect to the market that is bona fide and that has overcome all the myths that have been created historically.

Our vacation was a delight; I notice that it cost 1 1/4 points of one transaction (equities) I made to go to cash on the 6th. lol.. We operate in a mode where what we do cannot be upgraded by those we connect with.

as we achieve our goals here, we can all have a blast too.
 
Welcome back Jack,

I am glad you had a great trip. I am looking so forward to what lies ahead. Right now, learning from the hard way, i have also realized that reversing on failed rockets(divergence with no entwining) is a great way to take more money out of the market. I have only conciouslly been able to make 2 types of successful trades. Rockets and thier corresponding reversel when failure to traverse the channel, and the failed rocket reverse. the failed rocket occurs is when their is divergence and no entwining. the failed rocket reverse exit that i see can be one of three things; rocket resuming wash( I hate this becasue i have then taken 2 trades, rocket and reversal rocket without a profit), rocket to the other side, or rocket failure on the other side.
lately, i have been really taking it in the arse with BO trades. I can never get the timing quite right and usually can not get out of a falied BO with a wash. usually a loss.

In terms of failed rocket reverse. i sometimes use a BO trade of 1 min consolidation or sometimes i wait for a vdu and BO trade out of that. Sometimes their is a failed rocket reverse without a vdu. jsut some thoughts. i cant wait until we get to patterns. i feels as if this is the next plateau.


j
 
vorzo,

In your example of a normal sequence above, I'm assuming it's a long scenario. If so, then the "away" side of a channel would be the top of the channel and the "right" side would be the bottom of the channel. Am I getting this right.

From your analysis of my trade ("entry was at the away side of channel") can I take it that if a rocket triggers but then pulls back to the low part of the existing channel, then that's a valid re-entry, or perhaps an ice berg entry. I'm not clear on how specifically to use Jack's channels, and I can't find the page on this thread where he describes what to do.

Finally, I've fought indicators so much for so long, I have to admit, I don't really know what a macd cross over is: is it the 2 moving average lines crossing, is it the 2 lines moving across the neutral (or 50%) line, or is it the histogram going from positive to negative.

btw- for those interested in such things: starting tomorrow I'm going to take every beginner setup that occurs with real money. I trade full time, but will be out a couple of mornings this week. I'll post all my trades. I only wish I would have seen this thread much earlier on.
 
Quote from bundlemaker:

vorzo,

In your example of a normal sequence above, I'm assuming it's a long scenario. If so, then the "away" side of a channel would be the top of the channel and the "right" side would be the bottom of the channel. Am I getting this right.

From your analysis of my trade ("entry was at the away side of channel") can I take it that if a rocket triggers but then pulls back to the low part of the existing channel, then that's a valid re-entry, or perhaps an ice berg entry. I'm not clear on how specifically to use Jack's channels, and I can't find the page on this thread where he describes what to do.

Finally, I've fought indicators so much for so long, I have to admit, I don't really know what a macd cross over is: is it the 2 moving average lines crossing, is it the 2 lines moving across the neutral (or 50%) line, or is it the histogram going from positive to negative.

btw- for those interested in such things: starting tomorrow I'm going to take every beginner setup that occurs with real money. I trade full time, but will be out a couple of mornings this week. I'll post all my trades. I only wish I would have seen this thread much earlier on.
More...

I know these questions were geared towards vorzo, but i thought i could maybe help. You take the rocket signal and enter your trade, it can either turn into a wash or rocket. if it is a rocket, the stoch will entwine inside the 80 , 20 tape. if the fast stoch touches the 80 or 20 line on the 5 min, perk up and pay attention to the price action. the trend can either come to an end and diverge out of the 80, 20 or resume back into the trend. if it resumes back into the trend, you have your point 3. I assume this is what you are talking about when you say valid re-entry point. I do sometimes add to my position after i have a valid point 3 which creates the right side of a long channel.

Now, you should have your channel based on points 1,2 and 3. If the price then fails to make it to the other side of the channel that you have just drawn, get out becasue it is the end of the trend. Eventually, you will want to reverse at this point.

MACD xover means when the macd histogram goes from pos to neg or neg to pos.

j
 
It seems that Magna is betting against me :p

You make a valid point though, my results may be disastruos (much like my previous attempts with NQ) when I go live. Which will happen as soon as I have more time.
Until then, paper only folks. I'm here to learn, not to build credibility.
 
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