Trading Hammers (revisited)

[wrbtrader]

Quote from gaj:

thanks for the reply; i'll post in feedback and PM him to see if it can be brought back.

appreciate the posts in here, i plan on going through them soon.

Also, I didn't start that older thread...it was Petradollar or Traderkay. I can't remember which.

Mark

 

[gaj]

thanks mark - yes, it was petra. baron said no, they can't bring it back.

ah well.

 

[wrbtrader]

Quote from gaj:

thanks mark - yes, it was petra. baron said no, they can't bring it back.

ah well.

By the way, I have a complete copy of this thread just in case it goes into moth ball prior to being deleted for old age.

Mark

 

[gaj]

a couple questions for you:

i know you only trade these with futures; any reason you don't trade them with stocks?

do you have different parameters based on time of day?


i primarily trade stocks, and one of the reasons this thread piqued my interest is because i'm sometimes in a trade before, and when i see a hammer that you'll like as a trigger bar (for future potential entry), i'm looking to get OUT of my trade.

a better way to explain - let's say i have a short position. it goes down a lot. when i see a sign of what you will eventually see as a WRB (the tail part of it forming, with the rest starting), i'm looking to cover my short.

if i can't get out, but is starting to form what you are calling a WRB, i'm still looking to get out on a drop back to the lows. and i think "my" covering (not me specifically, but other people like me) might be providing the impetus for your trade to start turning positive.


my other question - on times of day - is because i'll let a trade run more in the early morning / late afternoon than during the lunchtime lulls.


thanks for your thoughts and a standout thread.

 

[wrbtrader]

Hi gaj,

i know you only trade these with futures; any reason you don't trade them with stocks?

The issue is not that I don't apply these hammer patterns to stocks. The issue is that I don't trade stocks. Simply, I don't apply any kind'uv of methods to stocks because I don't trade stocks.

do you have different parameters based on time of day?...
my other question - on times of day - is because i'll let a trade run more in the early morning / late afternoon than during the lunchtime lulls.

Not for the entry method but I do have different trade management after entry based upon the time of day, day of a special week or some market tendency that occurs a few times per year.

Also, as you noted...hammer patterns can be used as exit signals or other trade management signals after entry.

Mark

 

[BlackDiamondss]

hi NA,

question, Does white WRB (c1) have to occur immediately after dark bullish hammer is formed, ---- that is by engulfing (c3) closing of (c1) > open of (c3)?

If so, what happen if there're inside bars shortly after the hammer is formed, and then after a few candles a white WRB (c1) occur? Does this pattern still valid?

Thanks,

D.

 

[wrbtrader]

Quote from BlackDiamondss:

hi NA,

question, Does white WRB (c1) have to occur immediately after dark bullish hammer is formed, ---- that is by engulfing (c3) closing of (c1) > open of (c3)?

If so, what happen if there're inside bars shortly after the hammer is formed, and then after a few candles a white WRB (c1) occur? Does this pattern still valid?

Thanks,

D.

Yes, that white WRB (c1) must occur immediately (as the first interval) after the dark hammer line.

Note: Notice how I didn't say dark bullish hammer...I said dark hammer line because the dark hammer line is not a bullish pattern all by itself.

I think you're asking what happens if there's other intervals after the white WRB (c1) considering it's reestablished that the c2 interval is the dark hammer line. Simply, intervals are not in between the c1 and c2 intervals.

However, others have discussed their own hammer patterns in this thread and if your talking about something different...please requote the source or show a chart example.

Mark

 

[BlackDiamondss]

Quote from wrbtrader:

Yes, that white WRB (c1) must occur immediately (as the first interval) after the dark hammer line.

Note: Notice how I didn't say dark bullish hammer...I said dark hammer line because the dark hammer line is not a bullish pattern all by itself.

I think you're asking what happens if there's other intervals after the white WRB (c1) considering it's reestablished that the c2 interval is the dark hammer line. Simply, intervals are not in between the c1 and c2 intervals.

However, others have discussed their own hammer patterns in this thread and if your talking about something different...please requote the source or show a chart example.

Mark

hi Mark,

Thanks for the reply. Sorry, yes I meant bullish dark hammer pattern.

I don't have a specific chart that shows this example. I am trying to illustrate this in words. So bare with me.

So after (c2) is formed then a dark hammer line is formed.

Then several inside bars that never close above high and low of the hammer line is formed.

Then (c1) is formed which closes above (c2).

Is this dark hammer pattern valid?



Note. --- it's slightly off topic ----

I am not sure if you know or heard about "2B pattern". For me it's a very powerful top/bottom reversal pattern. It involves price is trying to penetrate the previous low, then pullback for a healthy retracement and then re-test this low but fail to carry through and immediately pop above the previous low, in a downtrend. I found that whenever a hammer pattern (not certainly according to your rules) occur after the re-test gives a very powerful signal.

I try to see if I can find one example for this 2B pattern that follows your bullish hammer pattern.

Thanks,

D.

 

[BlackDiamondss]

hi Mark,

This is what I was talking about, the 2B pattern. Though if you see the bullish dark hammer pattern violates your rule as close of (c1) < (c3).

 

[BlackDiamondss]

Hi Mark,

I have attached the picture in the scenario I was talking about before. The dark hammer I was talking is marked by the red arrow. If you see, there's an inside bar occur following after the hammer line then followed by a WRB (c1).

Do you still take this trade?