Thanks yoohoo thats good information. I watch the ES YM NQ and ER2 and also the $sox, and look for divergences to give an indication of some setups. I get my direction and timing from the ES and then wait for the moment on the ER2 which always has that last volatile, shake out swing before any major move. I think I will use the bars to set a more rigid stop discipline as I'm giving back to much on my few bad trades.
What are the issues aspiring traders want help with?
- Thread starter yoohoo
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Thanks yoohoo thats good information. I watch the ES YM NQ and ER2 and also the $sox, and look for divergences to give an indication of some setups. I get my direction and timing from the ES and then wait for the moment on the ER2 which always has that last volatile, shake out swing before any major move. I think I will use the bars to set a more rigid stop discipline as I'm giving back to much on my few bad trades.
BoyBrutus, I recommend you try using range bars on the ER as it takes the time jellywobbles out of your indicator setups.
Have you tried cci for divergences? cci tends to be a lead indicator and you'll find lots on Woodies site. I use Woodies settings for cci and there's lots of free info on his site. Also Ensign have a free ready made template with all Woodies settings and you can read about it in Ensign's latest newsletter which is downloaded from their site.
cci with stochastics can help make for good entry/exit setups.
If you are waiting for volitile shake outs I'd suggest you try reducing your timeframe so you can trade them and roll them into a bigger timeframe for a longer hold.
Also make sure you use 3 different timeframes for ER and 2 for the cash.
Range bars make using the prior bar easy for judging a stop. Also you will see the price action is much more fluid (runs of one colour) than using time or tick charts.
Have you tried cci for divergences? cci tends to be a lead indicator and you'll find lots on Woodies site. I use Woodies settings for cci and there's lots of free info on his site. Also Ensign have a free ready made template with all Woodies settings and you can read about it in Ensign's latest newsletter which is downloaded from their site.
cci with stochastics can help make for good entry/exit setups.
If you are waiting for volitile shake outs I'd suggest you try reducing your timeframe so you can trade them and roll them into a bigger timeframe for a longer hold.
Also make sure you use 3 different timeframes for ER and 2 for the cash.
Range bars make using the prior bar easy for judging a stop. Also you will see the price action is much more fluid (runs of one colour) than using time or tick charts.
Thanks Yoohoo
I had to look up range bars and saw your reply that Esignal dont do them but ensign do.
For those who dont know heres a link explaining them.
http://www.fibonaccitrader.com/HELP40/Range Bar/default.htm
Esignal do have volume tick charts and in a way follow the logic of what you say as most moves have heavy volume advancing and low volume on pullbacks, more clear longer bars advancing less bars, small range on pullbacks, but range bars are pure price. I will have to spend some time on the weekend looking into this.
Thanks again, much appreciated.
Sorry to jump ahead of tyler19's question. I have been doing some reading on S/R and currently trade on a daily chart with swing trades of 2-4 days. What would be the best way to establish S/R for this type of time frame?
Also, what kind of profit target do u set for a stock when u buy on a breakout ABOVE resistance (not bouncing off it). For example, the stock is in consolidation along resistance and then breaks above the line on heavy volume along with all your indicators lining up. Where should I look to as a profit target? I know I can set my own target but is there any specifics based on S/R for setting a target when u buy on a breakout above the line. Thanks
tyler, part of the discovery process for you will be finding a timeframe that suits your risk profile and this affects the finer points in S&R. I will assume you have grasped basic S&R concepts like horizontals from hi/lo's and trendlines.
I would suggest you work out what suits you on something like the ER YM NQ or ES where there's lots of activity. Go for a 1, 3 and 10 minute timeframe. You can add 5 min into the mix if you like it better.
Begin to search out how price action has extremes and a mid point that it likes to return to. Try a 180/2 Bollinger Band and see how this works a multi timeframe basis.
The 180 mid is effective on each timeframe. Add 10+13 moving averages and a 40+120 weighted and observe the action.
Also line up a 5 min charts of the ER YM NQ and ES with nothing added but horizontals for yesterday's Hi/Lo/Open/Close and same for yesterday. It's a lot easier if you can draw this automatically like in Ensign. This will give you super intraday S&R's. Observe that strong turning points are often common to all markets.
See attached charts
I would suggest you work out what suits you on something like the ER YM NQ or ES where there's lots of activity. Go for a 1, 3 and 10 minute timeframe. You can add 5 min into the mix if you like it better.
Begin to search out how price action has extremes and a mid point that it likes to return to. Try a 180/2 Bollinger Band and see how this works a multi timeframe basis.
The 180 mid is effective on each timeframe. Add 10+13 moving averages and a 40+120 weighted and observe the action.
Also line up a 5 min charts of the ER YM NQ and ES with nothing added but horizontals for yesterday's Hi/Lo/Open/Close and same for yesterday. It's a lot easier if you can draw this automatically like in Ensign. This will give you super intraday S&R's. Observe that strong turning points are often common to all markets.
See attached charts
TimDog, the 2 - 4 day timeframe is tricky for S&R because price daily price action doesn't show reversal points in that timeframe. I have good examples of what I look at but first lets deal with targets.
I seldom use targets because it can keep me in too long or make me pull out too early, so what I do is use price action eg candle signals and combine it with something dynamic like Bollinger Bands.
I'm assuming you will add horizontals and trend lines. I would use two 60 min charts along with the daily. On one 60 min I copy the daily chart and the other uses a 60 min line chart for S&R. (I believe this line chart is what Kingfisher calls the Fatboy - he will charge you $7K for this!)
The daily chart I use has 4 Bollinger Bands all set at 90 period with the multipliers set at 0.6, 1.2, 1.8, 2.4.
Add a 2 day Trailing Stop and 50+200 simple moving averages (red and pink balls)
If an average hits a Bollinger Band it adds to the strength. Also it's a good idea to view the futures to the cash daily if you are trading the index.
see attached charts
I seldom use targets because it can keep me in too long or make me pull out too early, so what I do is use price action eg candle signals and combine it with something dynamic like Bollinger Bands.
I'm assuming you will add horizontals and trend lines. I would use two 60 min charts along with the daily. On one 60 min I copy the daily chart and the other uses a 60 min line chart for S&R. (I believe this line chart is what Kingfisher calls the Fatboy - he will charge you $7K for this!)
The daily chart I use has 4 Bollinger Bands all set at 90 period with the multipliers set at 0.6, 1.2, 1.8, 2.4.
Add a 2 day Trailing Stop and 50+200 simple moving averages (red and pink balls)
If an average hits a Bollinger Band it adds to the strength. Also it's a good idea to view the futures to the cash daily if you are trading the index.
see attached charts