Johnny Rock's comeback

What settings did you use for the upper blue line and the lower red line? The ones that indicate the channel.

 

This is not set in stone yet, but here are some ideas on how I may try to use this!:

• If I believe the stock/commodity is in a downtrend, fade ALL seven week breaks that fail on the upper limit (reverse for up trends).
• If the stock/commodity is attempting to find a top/bottom, play all seven week failures to both sides
• work on a solid exit strategy
• The initial stop would be the swing high/low.

I loaned out my copy of Stan Weinstein's book and never got it back. I need to purchase that book again; specifically because of the four stages of market cycles he goes into (not so much the moving averages he uses - I think it was 10-34, not sure). Anyway, the four stages of the market cycle would be a good indicator of which types of trades I should be stalking.

Btw, I cherry picked the entry points here and left out a few that made a new high/low by a few ticks and quickly reversed. However, the stops were so tight it would only have resulted in minimal losses. Optimizing the exit strategy would be key in two of the stages (bottoms/tops) and cake on the most profitable stages (a prolonged trend). In both of the latter cases, I like the idea of entering the trade after a wash out/rinse job.

 

Chiefs to win (lay the points, -5)
Patriots to win (lay the points, -4)

Last week was great for all of us underdogs, but the real VALUE this week is with the favs.

Coaching will be the key! Don't sleep on Andy Reid.

 

Playoff bets:

• Patriots to cover (+3)
• Once again this game will come down to coaching; that and the weather.
• Patriots have a losing record on the road this year and their history suggests they are vulnerable on the road in the playoffs. That is why there is VALUE here.
• The weather seems like it will be in the low 20s instead of single digits, but Mahomes 4 worst games (quarterback rating) are when the temperature is < 30 degrees.
• The colder it is the better off it is for a quarterback who played his whole career in the cold.
• If you are feeling frisky, take the under (55.5) for the same reasons.

 

Code:

1. Upward (longs, reverse for shorts) sloping MA bands (10/34/50 on weekly)
2. PC breaks if criteria 1 is met
3. 10 MA stop

Purpose:

• Catch large trends
• Provide logical re-entry points
• If MA bands are congruent, and not flat, multiple entries will have a minimal cost as traders are shaken out

Each vertical line denotes multiple entries/exits (small gains/losses) taken before the larger move sticks.

 

Alternate Tests:

• 34/50 MAs sloping in direction of the trade
• 10 MA used for momentum stop only
• Standard Deviations between MAs

 

The premise of Dummy Trading was simple:

• Find stocks that were moving (gaps on high volume).
• Wait for an orderly pullback or inside bar.
• Trade in the direction of the trend when the trend resumes.
• I believe you can still find the series on the way back machine. If not, search for Trader X (albeit the exits are based on Fibonacci numbers), but the entries are similar.

For years I have been attempting to day trade futures on that system because that was the only prolonged period I maintained trading stocks. The system works.

My mind stumbled upon something recently. My goal remains the same - a profitable futures system (taxes, leverage, liquidity).

However, instead of getting smaller (time frame), what if I went bigger?! Check out the monthly charts.

Chart keys:

• Vertical lines denite an entry/exit on a losing trade.
• Horizontal lines denote entry/exit on profitable trades.
• To keep it simple, all entries are taken on fitures that are moving (10 SMA and 34 SMA are separating, coupled with breaks or expansion bars).
• Stops are simple too. I am using 2 bar stops (high/low).after the trade moves in my favor on a rolling basis. The initial stop would be the high/low of the entry bar.
• These are discretionary trades with wide initial stops, so having a decent account will be a priority. Trading the micro contracts on gold, wheat and corn are an option (possibly even the QM instead of CL as the account grows). It's worth a try!

Edit: on the CL chart there is a losing trade (based on an inside bar) that I just saw and is not marked. And on the SPY chart, there is a double line because I was in a hurry, so that is one exit, not another entry.

 

I believe that is a 33.5 period donchian channel/price channel depending on the software.

 

I use something very similar, however am using a 20 bar Donchian channel. One calendar month contains about 20 days, which is why I chose that value.