and he has backtested the 7 set-ups? Or are they just dime in a dozen set-ups that you can find everywhere on the web that nobody knows whether they work?
I find it hard to trust the 20EMA on the 5min chart because it's so constantly changing. Sometimes its trending and it bends it hard, other times its trending and it bends it because it was to consolidate, other times it just wants to reverse the trend. So unreliable Im not sure how you traders can use it profitably.
For most traders who have studied Al Brooks and are acquainted with his primary setups (i.e. "Best Trades") there probably isn't a whole lot to learn from the book. Volman discusses 7 setups and each have their own chapter. I've gotten through the three chapters on trends and 2 of the 3 setups are H1/L1 (referred to as First Break (FB)) and H2/L2 (Second Break (SB)). The one thing that Volman has convinced me to do is experiment with tick charts instead of 5-minute charts. On the ES, going below lets say 500 ticks is a recipe for disaster, but on less liquid instruments like 6E, 6B and CL you could easily pull off the 70 tick or 133 tick. Whether or not I'll continue to play in the smaller timeframes remains to be seen, but I am going to give it a shot. For those of us who have learned a lot from Al, Volman's book will be a relatively quick read and you might get a nugget or two.
The 20EMA on the 5-min chart is the weakest of the S/R levels I use in my trade decisions. A 20-period EMA on the 1-min chart is far more useful in conjunction with the bigger picture of the 5-min chart. In the 5-min time frame, the strongest level for me to pay attention to is the trend line, the next strongest level for me is the previous S/R level in play, and finally the parallel channel line. The 20EMA in no way serves as a trade entry level. If the 20EMA coincides with the trend line, I'm all over it; if not then it carries little weight for me until it's tested twice and holds, in which case I use a smaller time frame (1-min) for trade entry.
I will study what you mention. Your commitment to helping newbies never ceases to amaze me. I take my hat off ND. FoN
NoDoji, Could you please explain give some example as to how is it that you use the 1min chart with the 20ema? Thank you
I posted an example some time ago on Metal's excellent thread: http://www.elitetrader.com/vb/showthread.php?s=&threadid=220303&perpage=10&pagenumber=2 Volman's book is all about the 20 EMA on a scalping time frame (70 ticks for his FX trading, 1-min for my CL trading). ADD: Notice how on the chart in that thread I waited for the 5-min 20 EMA to be tested twice and the LH was my confirmation of high probability continuation of the previous downtrend. The 1-min chart offered me the sell stop entry ensuring that price itself (not my opinion) triggered my trade entry.