I don't have any stats, just an observation. It seems that many mornings on the ES things take off at 9:30, only to flush out the short-sighted and then they reverse and go hard the other way. Anyone notice this or is just me?
You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an alternative browser.
You should upgrade or use an alternative browser.
Trading Methods
- Thread starter VisionTrader
- Start date
Quote from visiontrader:
You comment was interesting. I have never approached trading based on taking a position whichever way things go. I always make a decision based on very short term and if things don't go the way I thought, I just stay out. Your style makes sense.
The thing I like about it is that you don't have to choose direction...the market picks it for you. What I didn't show in the chart was that there is also a buy stop placed above the chop. My take on this trade setup is that everyone is watching the same charts and when they see a long period of sideways chop, when the market finally tips its hand one way or the other, everybody and their grandmother piles onto the bandwagon and pushes the market either strongly up or strongly down. It has proven to be a very good setup for me, but it does not happen every day...maybe once or twice a week. But when it does, it's a good one.
PEG LEG JOE
Quote from VisionTrader:
I don't have any stats, just an observation. It seems that many mornings on the ES things take off at 9:30, only to flush out the short-sighted and then they reverse and go hard the other way. Anyone notice this or is just me?
You're not alone. I am much more reversal-oriented in the mornings. I win a lot more often than I lose using this philosophy in the mornings, but occasionally I get burned a bit...that's why it's important to keep stops.
JOE
Although I am constantly working on my plan, here it is:
I use volume, ADX, 20ema and price bars.....
1min,5,15 for trading ES
5/15/60 for trading QQQ
My method is to wait during periods of low volitility and then when an impulse in price occurs, I trade the pullbacks, entering on stop orders in the direction of the impulse. I watch for this impulse on the shortest of my 3 time frames.........
If the ADX is rising the 3rd pullback on this time frame should be a pullback to the 20ema on the next higher time frame. This means for ES1min, the pullback after the 3rd impulse "should" be the first pullback on the 5min to the 20 ema.
I continue to watch for these set ups and progression up each time frame.........they play out well AS LONG AS VOLUME IS SUFFICIENT
If volume is lite as it is now in the summer, I will switch to higher time frames to allow trades to play out.
Change of trend criteria: I use what I call a first cross pullback. If in a down trend, I wait for price to change from a downtrend to cross above the 20ema and pull back to the 20 ema and hold. Waiting for an impulse up to trade the pullback.
There was a time when I used stochastics but I found that I would lose too much money trading divergences (felt like I was picking tops).
Stop loss is recent swing point. Profit is taken in direction of a climax..
I also like to trade "V" tops and bottoms.
I use volume, ADX, 20ema and price bars.....
1min,5,15 for trading ES
5/15/60 for trading QQQ
My method is to wait during periods of low volitility and then when an impulse in price occurs, I trade the pullbacks, entering on stop orders in the direction of the impulse. I watch for this impulse on the shortest of my 3 time frames.........
If the ADX is rising the 3rd pullback on this time frame should be a pullback to the 20ema on the next higher time frame. This means for ES1min, the pullback after the 3rd impulse "should" be the first pullback on the 5min to the 20 ema.
I continue to watch for these set ups and progression up each time frame.........they play out well AS LONG AS VOLUME IS SUFFICIENT
If volume is lite as it is now in the summer, I will switch to higher time frames to allow trades to play out.
Change of trend criteria: I use what I call a first cross pullback. If in a down trend, I wait for price to change from a downtrend to cross above the 20ema and pull back to the 20 ema and hold. Waiting for an impulse up to trade the pullback.
There was a time when I used stochastics but I found that I would lose too much money trading divergences (felt like I was picking tops).
Stop loss is recent swing point. Profit is taken in direction of a climax..
I also like to trade "V" tops and bottoms.
Quote from daytraderpete:
If the ADX is rising the 3rd pullback on this time frame should be a pullback to the 20ema on the next higher time frame. This means for ES1min, the pullback after the 3rd impulse "should" be the first pullback on the 5min to the 20 ema.
So your first two pullbacks are pullbacks to the 20 ema in the 1 min time frame and only the 3rd one is the pullback to the 20 ema in the 5 min time frame, right?
There was a time when I used stochastics but I found that I would lose too much money trading divergences (felt like I was picking tops).
If poss, can you elaborate on this comment more. I rely on stochastics heavily in my method. Can you explain where the stochatics failed you. Was it at the peaks? I find these pretty reliable for short term moves,
I used to watch for the pullback to the 50 EMA, then trade the bounce on the 10 minute charts when I traded FOREX. I assume you find this method more profitable than using Stochastics???
If poss, can you elaborate on this comment more. I rely on stochastics heavily in my method. Can you explain where the stochatics failed you. Was it at the peaks? I find these pretty reliable for short term moves,
I used to watch for the pullback to the 50 EMA, then trade the bounce on the 10 minute charts when I traded FOREX. I assume you find this method more profitable than using Stochastics???
Quote from electron:
So your first two pullbacks are pullbacks to the 20 ema in the 1 min time frame and only the 3rd one is the pullback to the 20 ema in the 5 min time frame, right?
Yes, check out the ES from about 10:45am - 11:30. The "first cross pullback" wasn't perfect, but you can see the impulse up. Then after 3 pushes, they price pulls back to the 20ema on the 5min for the next leg up. As more time frames line up, you can use more leverage.
Quote from VisionTrader:
There was a time when I used stochastics but I found that I would lose too much money trading divergences (felt like I was picking tops).
If poss, can you elaborate on this comment more. I rely on stochastics heavily in my method. Can you explain where the stochatics failed you. Was it at the peaks? I find these pretty reliable for short term moves,
I used to watch for the pullback to the 50 EMA, then trade the bounce on the 10 minute charts when I traded FOREX. I assume you find this method more profitable than using Stochastics???
Hey Vision,
thanks for the question. I found when volume in the direction of the trend was good, overbought would become more overbought. I was selling divergences and would get run over. Because of this I have found it a much more high probability trade to wait for an impulse in the other direction before trading in the direction. I'm not knocking stochastics, I just felt after analyzing MY losing or marginal trades, they were the result of getting into trades that had not yet shown reason to get involved.
Quote from peg_leg_joe:
One of my favorite setups occurs when the market breaks out of a mid-day tight consolidation pattern, as happened last Thursday. I place a buy stop above the market and a sell stop below the market at levels that I feel represent a genuine breakout from the chop.
PEG LEG JOE
Yes... See my post from Thursday:
07-24-03 09:56 AM
Is the market open this morning??
Spoos doing the red candle-green candle shuffle. This is the type of tight range AM day that could work well as a break-out play (if you have the patience.
Bring me your spam and toe cheese!!
Pete,
thanks for your answer. What I am doing is similar except that instead of ADX as the trend indicator I use Keltner channels. Once they are hit by the price at least twice and a pullback to the 13 ema average occurs I buy on a stop in the new trend direction.
I focus on 3 min charts.
This is my friend's method. I am just a happy user here.
Best,
electron
thanks for your answer. What I am doing is similar except that instead of ADX as the trend indicator I use Keltner channels. Once they are hit by the price at least twice and a pullback to the 13 ema average occurs I buy on a stop in the new trend direction.
I focus on 3 min charts.
This is my friend's method. I am just a happy user here.
Best,
electron