Divergence Trade Thread

For those of you playing the home game, there was a nice 5M signal at the open and it is producing. I am sitting this one out. I usually get caught in the whips during this time and it is hard on this old man.

 

71?

 

Here's the chart for the YM. Just an example of the trigger to begin your decision process.

Notice a divergence in sto, macd and chaikin.

I went back to my black charts. The ADX line in on the chaikin and I have it color coded as follows.

gray=below 20
magenta = <30 and >20
green = >30

Igonore the other lines. They are day, open, high, low.

Again, not in this trade

 

My age progression is:

1,2,3,5,8,13....now at 89

 

Hopefully, everyone is watching the longer time frame charts. If the DB that is forming(formed) holds, there will be strong bullish divergence thru several time frames.

This could mean a move up is in order. I certainly hope it doesn't work out, but I can't fight it.

I think one thing we can say if it happens is that the 5M chart was a launching pad today. It gave us a signal prior to the open.

 

I am always learning and experimenting. In my world, it goes.....

If it ain't broke, fix it.

I have plotted the YM 233 tick and the ES 233 tick. I will watch it. Looks very interesting. Much different to me and may have some merit.

You have to read the "DaVinci Code" to understand.

Good trading.

 

One thing I do on a trend day is drop down to the 1M chart and look for signals that are supported by the 5M chart.

For me, a trend in price is defined as a move of 50 or more points in the DOW with at least 1 pullback and in the ES a move of 5 points or more with 1 pullback.

Today in the ES we have a move down of around 11 points with one pullback (more of a rest sideways). At this point I will look at the 1M chart to see if I can find a Double Top with the same divergence pattern for a sell occurring in conjunction with the first turn down of the sto on the 5M.

This is occurring right now. This helps find justified set ups on down days when there are no DT's or DB's on the 5M.

Just some thoughts. If It looks good, I will post it.

 

I always find it interesting how financial news is handled differently than my hometown paper.

Here in anytown, USA we take the slightest of bad things and make negative headline news out of it.

With financial news, it is always made to look good not bad. There is always good found in it by CNBC, etc.

I wish they would find good in the bad in my hometown.

 

Try to explain your thoughts on this at some point.

 

VT,
I don't know about him, but I saw a very clear DV on my (your) 1M chart using your old settings from your previous thread, oh low those many days ago I didn't take it though.
There wasn't anything to confirm it,
as far as I could tell anyway.

jd