I have been looking for some good intraday chart patterns that indicate good entry points. I am not looking to scalp but rather find patterns that indicate breakouts, reversals, etc. Can anyone help me out.
There are some candlestick patterns that seem to be relatively successful at indicating reversals for periods of 20, 30, or 60 minute bars (smaller periods give too many false signals): Three Inside Up Three Inside Down Three Outside Up Three Outside Down Evening Star Morning Star Make sure they are formed completely for best results. Good luck.
Not to sound like a complete moron but could you explain a couple of those in a little more detail. I would really appreciate it.
Sorry, but I don't have time. Go to google and search on any of them. You will find complete explanations in many different places.
Most profitable pattern I know is trading around previous day hi or low. Watch the action of the stock around these levels. If a stock break a prev day hi or prev day lo, wait for confirmation DO NOT ENTER ON THE BREAK! Confirmation is a pause in the action. So after a break of previous day hi, watch a 2 min chart. Once the stock stops making new highs for a bar or two, enter long as soon as a new hi is made. You do not want a strong pull back, just a basing pattern. Put your stop just below the low of the reaction. Take half of the table at 1 R. Trail the rest, as long as the general market moves in your favour give it some room If the market reverses put the stop a little tighter. Watch the most volatile stocks with good volume Trade only inside opens Watch daily patterns too. (do not go long with resistance close, etc.) This is nothing sophisticated, but it will make you money Trade very small size with a cheap broker, IB is best imo. Best breakouts are those with nice daily patterns. Do not trade more than 3 a day This strategy has made me money most of the time. Key is patience, and do not jump the gun! You need a good program to set alerts around previous days hi and low. Master this simple strategy and you will make money consistently. I have done three trades today, all of them winners. Not big winners, but you do not have big winners on inside days like this. If you want any more info, just pm me.
Chartpatterns.com is an excellent site as Breakout said, for classic Edwards and Magee stuff. Also litwick.com for candles, go to Indicator Glossary on the left hand side of the page.
Great info - thanks for sharing. Quick questions: 1.) Do you follow a "basket" of stocks that meet your volatility/volume pattern? And, what is the lowest volume you have in that basket? 2.) Do you find any certain time of the day more reliable than others for your system? 3.) Do you find that you have a lot of trades happen at once, or do you choose different stocks/industries to make sure that does not happen? Thanks again.
1 Just volatility, price (>10) and avg vol > 500.000 shares 2. Yes, morning, before 11.00 and afternoons after 14.00 hrs Best is to be in before 11.00. If you are profitable, then you might try after 14.00 hrs. Also patterns are different. In the afternoon you want the stock to move gradually to the breakpoint, the move is usually smaller, but the stop can be too. 3 Yes, it can be quite hectic, just stay calm and watch for strongest and weakest patterns. Most of the time you get lots of signals. If you do get that you really can't go wrong (almost) Most of the time you can get at least half at 1 R, so if you b/e on the rest, you get half R at least. I tend to keep away from stocks that gap open significantly, because most of the time the real move is over Also I watch for the morning range. It should to be to large. Probability is also that the move is over. I realize these are all subjective ideas, but try to watch these levels, for a while. You will see that it works good enough to be tradeable.