To setup and identify a trend you HAVE TO HAVE a 2min, 5min, 15min, and Daily Charts. On these charts you need a simple (not exponential) moving average of time frame= 5,20,40,222. This is a MUST. Set up these charts in the manner I have mentioned and go and look at your favorite instrument that makes you money these days. I should hope for you to see them come to life. We are only going over the BASIC strategies of identifying a trend. We will get much further into detail. For now I want you to see things the way that you should, NOT the way that you have. If you are already used to the setup that I have mentioned, that is fine. I just want to be on the same page as everyone else.
We are discussing how to deal with a trend WHILE WE ARE IN IT, we haven't disccussed how to identify a trend as it is developing. Breakdown of charts: 2min- used for entry/exits 5min- intermediary chart (we will get to this one a bit later) 15min- this is the chart you use for PIVOTS. Daily- Chart used for IMMEDIATE TREND I don't use 10min charts cause they are worthless, the 15min does a much better job of nailing pivots/reversals.
Instead of trying to justify why I am here or who I am or who I was, try to absorb my "nonsense". I will tell you the truth. The reason that I am posting to this board is so that I will smoke less cigarettes. That is the truth. Now I hope that everyone is comfortable with my being here. I have NOT posted to ET before, but I have been reading the posts/threads for sometime now, and I have to tell you most of it is garbage and self promo. I don't trade from a prop-shop I am solo with a few traders that help me out from my house. SE
Here is a website that I think will help motivate all the traders on this board. Try to see that there is a way to make money and enjoy the finer things in life, rather than to trade nickel and dime fifty times/day. http://www.kimble.org SE
Remember, don't make this harder than it should be. I just want you to become familiar with these moving averages. These are the only moving averages that work, based on stats. The 222 I will be showing you how to OFFSET to predict trend reversals. SE
Kim Schmitz. He was a computer hacker that was busted in his teenage years. He started a data security corp. which he sold for near 300million dollars US. He now does what you and I do. Trades. SE
back to trends: what your job is going to be is setting up charts/averages described before and : In Uptrends--Buying ALL pullbacks into(and BELOW) these moving averages. In Downtrends--Shorting ALL rallies into (and ABOVE) these Moving averages. There is your entries. Exits will come later and exactly which moving average is the KING will come later also. Now, since I can't show you pictures of charts, I will refer to the QQQ's and you can view them on your own computers. Just make sure you have the moving averages setup on your charts.
Here is what your screens should show, at the LEAST: 2min, 5min, 15min, Daily chart (of whatever instrument you trade) 5min chart of Nasdaq Composite 5min chart of QQQ's (you are going to be looking for divergences between the QQQ's and Nasdaq Composite intraday) 5min chart of the Dow 5min Tick/TRIN 2min SP Premium chart (this is the difference between SP cash index and SP futures) 5min SP futures chart 15min SP futures chart