Fibs, used correctly, can tell if price trend is continuing to expand or not - if you understand what that means.
I think I follow, but my problem isn't so much entry as what I do after entry. So when you say go short for example, how much are you looking for or do you trail with a stop? How do you decide it isn't working?
Ok, first of all: Everything written in this forum by me is my personal opinion and is for information only, should not be construed as financial, investment, legal, tax, or any other advice, and I disclaim all liability in respect to actions taken based on any or all of my opinions. It works with ES and lots of the major equity names. I chose the NQ's because there are only 100 underlying so I can take a look at, say, the top 25's chart rather quickly to get a more detailed "under the hood" look. The 50sma (yes, just the mean of the last 50 hrly closing price) its self guides me to be long or short. The slope of the 50sma on the 60min when the futes crosses gives me extra confidence in the direction. I would estimate 90% of my trades are based off the 5min charts (others 1min or 3min). Once I'm in a position, there are 12 bars per hr that dictate my actions. I would love to NOT have to make so many trades, the commissions are currently running ~3% of portfolio but I leanred quickly that, my account is too small to just do mini NQs in this volatility. I DO NOT enter a trade based on what I think I will make or a tgt other that it should trend in the direction I am expecting. Take a close look at the picture I posted of my 2 screens. You can see that I can't really see the PL window (circled red) of the positions. I used to have it and it would just distract me. I DO enter a trade knowing exactly where my stop should be (explain later) and a definitive Hard stop which originally was 12 pts when I first started, now at 25pts. I normally use the 5 min exclusively for my closing positions (extremely volatile sessions dictate the 1 or 3min as written previously). the 19sma on the 5 min gives a lot of clues. If you don't have enough experience to start recognizing 5 minute data than Patience is your your #1 hedge! Just WAIT and make your trades around the 50sma. Generally, being short when the futs cross/stay under and being long when it crosses/stays above should be a viable strategy. From here, one can optimized with closing hrly price action and underlying price action using 5 and 15 min. I have to end this post here for now (have to attend a banquet where both my daughters may place in a science/engineering fair in their own individual project.. yes, I'm proud of them.. but I rarely let them know that ... I'm including the 60min and 5 min chart from Feb7 for reference. See how the 60min crossed over/under the 50ma. Thats some heart breaking whips don't have smaller time frames to trigger the trades. Study the 5 min charts of those 4 hrs, burn those images into your brain. Look at how the candles were at: 9:30 (my time is PT zone), 10 11:25 11:40 12 12:50 From 10:30 to 10:50- those 5 candle pattern happens a lot for major reversals, that's almost the "2nd mouse cheese thing". ok gotta go, remind me later about trailing stops (yes I use them when appropriate), closing tgts and the excel projection spreadsheet.
Great film scene your icon's from. 10 Ways Traders Take Profits https://elitetrader.com/et/threads/the-myth-of-letting-your-winners-run.345542/page-28#post-5376530 8 targets in trading https://elitetrader.com/et/threads/...t-right-here-baby.335635/page-20#post-5358043
Stops, trailing stops. When I got a chance to glance at the charts this morning, the 60min NQs had crossed over/under the 50ma 5x already. Gave me a hint to what the day may be like, especially after gapping last nigh and the day after 3x witching which means usually is a rebalance day. If I had no clue about the day, as during days when I first started... I prob would have taken a lot of stop losses on the nqs. But seeing how it gapped last night and the strength of ES today, there is no reason NQ should be below the 50. Anyway, this made me go slow today. I ended up eaking out a profit on Nqs, but was able to open and close an NDX spread to help make 3%. The way I establish my stops goes something like this. When the setup is right, and NQ is about to cross over or under, I start to establish positions with 1-2 micros these typically are +- ~5 points from the cross. These initial positions have an initial stop of the previous bars low or high. Once the cross is made, I scale in a bit more.... these new positions have stops of +- 10pts of the actual 50ma depending on if you are long or short. I only use trailing stop if I have to leave the desk and believe the mkt will still provide more prfoit, but my stop on these are around 7pts max. Today's action has the 50ma sloping up all day. The inital break down at midnight, afterwards took 3 bars to retake. every closing break after took 1 bar so far. This is pretty bullish. I'm bullish for the day but since I have to tend to personal things calling it quits. Oh, on days like this, it's easy to do a bull put spread and make decent money. I'm guessing we'll close ~ 12677ish Edit: Oh, the odd fill is due to me closing the spread at individual timing trying to maximize profit. I close the short P first and as mkt track back down closed out the long P.
Like I said previously, just curious is all. MA's I decided we're not my thing loooong ago. No need for disclaimers on my accord. Still don't get why slope of MA for so many trades - unless you use other things to trigger a trade, besides 19SMA on 5min? But that's ok. Carry on.
Oh,the disclaimer wasn't meant specifically for you but as general statement just to protect me in case some yoyo gets any ideas... For the slope, it's 50 closing prices (60min = hrly). The rate of change (ROC) as Dest alluded to in one of his earlier post sometimes makes a difference. I havent gotten meaningful correlation yet. Steep slope, mild slope and flat.. at what angle the indices cross often times give you a clue as to how far it penetrates and for how long and it's not what most would think. Do your research and you will see. I've given much more info than I had initially intended and I think the info is meaningful enough to add and tweak one's trading. Anyhow, before I took my daughters to school today I made sure to get up at 3am to see if I can make some trades knowing the NQs crossed above the 50 at the close yesterday. I was flat till about 3:45am when I put on 2 micros using 5min chart as roadmap. I missed adding a mini at around 4:10 so had to wait til next consolidation, which wasn't til 5:15. Put on a mini and almost got stopped out @5:45, but the 1 min chart gave clear pattern to stay long ( actually to add, but I was already near my max position limit which is 1.5 mini contracts = 1 mini + 5 micros). If account gets to 100k, I'll start trading max of 2.5minis. Anyway the rest was history until the action at ~6:55am gave me conviction to go short. I wrote about the "5 bar reversals" usually reversing the current ST trend... but, if it doesn't, trend gets magnified. Anyway times stamps of the actual trades to show and account balance after closing futes so I can take my kids to school.