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steven21
Registered: Aug 2004
Posts: 74 |
06-19-09 01:08 PM
She just did a webinar at thinkorswim. Go to tos website and find under Support->Software Support, thinkDesktop section. Or search for her name.
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DonKee
Registered: Mar 2006
Posts: 588 |
06-23-09 06:03 PM
I hope everyone who has followed along has been having a good month.
I have had a few pm's that were similar in themes. They had to do with getting chopped up on narrow range days.
First off, when the ES is trading in a 4-5 point range for a few hours, you will be scratching out of your trades or taking small losses. It's just the reality of trading. You're not doing anything wrong, we can only take what the market gives. Best to recognize these periods and adjust.
If you keep track of your trades by time of day, you'll see that the best trends are the first hour and the last 90 minutes. If you notice that 11a-2:30pm est is not profitable to trade, then don't trade (lol). Oh yea, it's also June (same goes for July and Aug).
You can make money on narrow range days, just lower your expectations on your targets. You will find narrow range days tend to follow wide range days. My expectations going into today were for a narrow range day.
Here's a chart of my 3 trades through 12:30pm. The total range has been 10 points. I'm plus 3.75. I'll take it.
P.S. 3rd trade was a sell divergence at the .618% retracement of the previous down leg. I picked up +1.50 on that, I put +2.00 on the chart to show the drop. When the range is narrow, lower your expectations of the move, especially in the middle of the day.
 3-10-16 trades 06232009.jpg
This has been downloaded 437 time(s).
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brownsfan019
Registered: Jun 2005
Posts: 2872 |
06-24-09 04:09 PM
Don - what do you think about using this on the ES during pre-market hours? I'm mainly thinking of the 8am-930am EST since we can get some nice moves on econ news days.
Thanks
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DonKee
Registered: Mar 2006
Posts: 588 |
06-24-09 04:17 PM
Quote from brownsfan019:
Don - what do you think about using this on the ES during pre-market hours? I'm mainly thinking of the 8am-930am EST since we can get some nice moves on econ news days.
Thanks
When you get into a position a few minutes before an important number, 8:30am est or 10am est, you are gambling a bit on the reaction to that number. I find the volume from 8:45-9:15 est to be too light for me. Sometimes it will take 10 minutes just to fill up a 1000 tick bar.
I would encourage you to watch that time frame to see if it might be profitable for you.
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Beezer-1
Registered: Jun 2008
Posts: 10 |
06-25-09 09:17 PM
I want to thank DonKee and the thread contributors for a very helpful and motivational thread. I first noticed this thread about a week ago, and have been trying it out by backtesting it over the past couple of months of data. For sure, my backtesting is not entirely accurate (scratches, etc), but I've got a good feel for how this strategy can be profitable over time.
DonKee, your information on the setup itself is very helpful. But moreso are the insights that you have dropped since the start of this thread, on how you use your system. Over the past week, I have been learning a lot more than just a way to use the MACD - and it is doing me a lot of good. Thank you.
Question: as people have pointed out already, this is a trend following strategy and as such does not work so well in non-trending markets. However from my limited experience sofar, I'd go as far as saying this is a *weak trend* following strategy. I have noticed that when the market starts moving strongly up or down, and tiny pullbacks or no pullbacks at all occur, we never get an entry signal.
I understand that the entry is designed to enter on the first pullback of a swing trend - but what do you do in the cases when price is just rocketing skyward and no pullback is offered?
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DonKee
Registered: Mar 2006
Posts: 588 |
06-25-09 11:38 PM
Quote from Beezer-1:
Question: as people have pointed out already, this is a trend following strategy and as such does not work so well in non-trending markets. However from my limited experience sofar, I'd go as far as saying this is a *weak trend* following strategy. I have noticed that when the market starts moving strongly up or down, and tiny pullbacks or no pullbacks at all occur, we never get an entry signal.
I understand that the entry is designed to enter on the first pullback of a swing trend - but what do you do in the cases when price is just rocketing skyward and no pullback is offered?
Your observation about a strong trending market is "right on".
As you watch that 3/10 histogram, you'll see a lot of instances where you can take a position aftert the first pull-back in the histogram. That first pull-back won't make it to the other side of the zero line. You'll need to take an entry when that 3/10 oscillator starts to move back away from the zero line.
There are two resons why you will generally see this occur:
1) The trend is so strong that we don't get much of a pull back
2) Volume is so light that using a 1000 tick bar is not describing the pull backs well enough for us day traders to scalp a few points.
Remember, we want that 3/10 histogram to describe what the chart is doing and tell us when pull-backs have completed. Put todays chart into a 500 tick chart. Take a look. As I mentioned a few days ago. Volume is going to be light until the end of August. If the 500 tick chart starts defining the action better for me, I will put that up, too. Adjust your targets and stops if you go down in ticks as the swings will be shorter and faster.
No doubt about it. It is completely frustrating to miss a big move or take a bunch of signals that don't follow through. It's just part of trading. Sometimes you'll lose a little on a big trend day. Sometimes you'll do very well on a narrow range day. It happens. The more you watch that 3/10 histogram, the better you will get at your entries and exits.
I always tell myself, "there will be another bus coming tommorrow".
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