Learning to read Price Action with P&F Charting

Discussion in 'Strategy Building' started by HolyGrail, Mar 22, 2008.

  1. Don't mean to go off topic here...

    Been following on and off since the start.

    Question is, I'm using DTN ProphetX but the P&F is not reliable/accurate. I tried InvestorRT, but the interface and usability is very difficult and time consuming (downright awful)...I trade a variety of products and often need to pull up a chart of something quickly.

    Any other suggestions on software packages?
     
    #1031     Jul 13, 2008
  2. I am enthralled by this post.. I've been reading it for the last 2 hours and still have a ways to go. Glad to see another Houstonian on this board.

    HG, what are your TOP 3 performing long signals??
     
    #1032     Jul 13, 2008
  3. Hi HG/Howard,

    thanks for the great thread. I just finished dorsey's book and read through the first 1/3 of this thread and want to summarize for my own benefit and also to confirm my understanding and some questions.

    If any of the below is wrong, please make the correction.

    Patterns
    I know many patterns are discussed, but i just want to focus on the basic ones as to keep it simple.

    Best probability

    False Double/Triple bottoms & tops
    1) False double bottom (triple is same except add 2 more columns (xo pair) before the fakeout).
    <table border=1><tr><td>o</td><td></td><td></td><td>x</td><td><--LONG SIGNAL</td><td></td><td></td></tr><tr><td>o</td><td>x</td><td></td><td>x</td><td></td><td></td><td></td></tr><tr><td>o</td><td>x</td><td>o</td><td>x</td><td></td><td></td><td></td></tr><tr><td>o</td><td>x</td><td>o</td><td>x</td><td></td><td></td><td></td></tr><tr><td>o</td><td></td><td>o</td><td>x</td><td></td><td></td><td></td></tr><tr><td></td><td></td><td>o</td><td></td><td></td><td></td><td></td></tr><tr><td></td><td></td><td></td><td></td><td><--STOPLOSS</td><td></td><td></td></tr></table>

    2)False double top
    <table border=1><tbody><tr><td></td><td></td><td></td><td></td><td><--STOP LOSS</td><td></td><td></td></tr><tr><td></td><td></td><td>x</td><td></td><td></td><td></td><td></td></tr><tr><td>x</td><td></td><td>x</td><td>o</td><td></td><td></td><td></td></tr><tr><td>x</td><td>o</td><td>x</td><td>o</td><td></td><td></td><td></td></tr><tr><td>x</td><td>o</td><td>x</td><td>o</td><td></td><td></td><td></td></tr><tr><td>x</td><td>o</td><td></td><td>o</td><td></td><td></td><td></td></tr><tr><td></td><td></td><td></td><td>o</td><td><--SHORT SIGNAL</td><td></td><td></td></tr></tbody></table>

    Good probability

    Triple tops/bottoms
    1) Triple bottoms
    <table border=1><tbody><tr><td></td><td></td><td></td><td></td><td></td><td><--STOP LOSS</td><td></td></tr><tr><td></td><td></td><td></td><td>x</td><td></td><td></td><td></td></tr><tr><td>o</td><td>x</td><td></td><td>x</td><td>o</td><td></td><td></td></tr><tr><td>o</td><td>x</td><td>o</td><td>x</td><td>o</td><td></td><td></td></tr><tr><td>o</td><td>x</td><td>o</td><td>x</td><td>o</td><td></td><td></td></tr><tr><td>o</td><td></td><td>o</td><td></td><td>o</td><td></td><td></td></tr><tr><td></td><td></td><td></td><td></td><td>o</td><td><--SHORT SIGNAL</td><td></td></tr></tbody></table>

    2) Triple tops
    <table border=1><tbody><tr><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td></td><td></td><td></td><td></td><td>x</td><td><--LONG SIGNAL</td><td></td></tr><tr><td>x</td><td></td><td>x</td><td></td><td>x</td><td></td><td></td></tr><tr><td>x</td><td>o</td><td>x</td><td>o</td><td>x</td><td></td><td></td></tr><tr><td>x</td><td>o</td><td>x</td><td>o</td><td>x</td><td></td><td></td></tr><tr><td>x</td><td>o</td><td></td><td>o</td><td></td><td></td><td></td></tr><tr><td></td><td></td><td></td><td></td><td></td><td><--STOP LOSS</td><td></td></tr></tbody></table>


    Money Management (ES intraday)
    I find howard's management to make a lot of sense and very close to how i am trading the es, even though i am using time series charts with ma and price levels right now.

    1) Trade 3x contracts
    2) Take 33% profit at 1pt, another 33% profit at 2pt, and change the stop loss for the last 33% to trailing
    3) Do not take trade if the initial stop loss(below/above the last o/x) is too wide >3 pt
    4) Do not take trade if the risk/reward ratio is >1

    Questions
    1) How you finding investor RT now after 2 months for DAYTRADING ES, is it reliable? what datafeed are you using? If IB, did you sign up for DTN Market Access Historical Data for extra 15bucks a month?

    2)
    If your entry is 26, and stop loss is 21. Are you expecting a 5pt gain to satisfy the 1:1 ratio? Looking at the chart, it has first resistence at 29. I am just curious what is your risk/reward plan and logic for this entry

    3) I know this was discussed, but for intraday ES trading are you using CLOSE or HIGH/LOW? I did some testing and they produce vastly different charts depends on the price action. Just curious.

    4) Why are the below 2 chart different, 1 is from your attachment, the other is from stockcharts.com For the life of me i cannot figure out why. (It's not high/low vs close, i tried both, box size etc are also the same).

    LEH: I put the difference in the red box
    Your chart: http://spoki.com/showphoto.php?photo_id=29
    Stockcharts.com: http://spoki.com/showphoto.php?photo_id=30

    thank you once again!
     
    #1033     Jul 13, 2008
  4. I'm still in vacation mode, but I am back. I still haven't even looked at a chart yet, although I do see that the spy broke it's 5 year trend to the downside. Hope everyone made money while I was gone. I've been busy making dvd's of the trip as I took over 1300 pictures(trimmed down to 640), and about 4 hours of movies.
     
    #1034     Jul 14, 2008
  5. its gonna take you a while to recover from the pasta and chianti.hope you had a good time.did you travel around.?
    we are flying to venice on saturday,going for a cruise round the med finishing in barcelona
     
    #1035     Jul 14, 2008
  6. We had a great time. We went to Venice,Pisa(yuck), Florence, Assisi, Rome, Pompeii, Sorrento, and Capri.

    We met some really great people, and we all planned on meeting again in Sicily for a couple of weeks in 2010.
     
    #1036     Jul 14, 2008
  7. ElCubano

    ElCubano

    welcome back home slice....
     
    #1037     Jul 14, 2008
  8. zanjani1

    zanjani1

    I was in Capri back in 1978. Our hotel room cost only $5 a night and we had to share the bathroom (we were students) but the scenary was beautiful and I still dream of the pizzas.
     
    #1038     Jul 14, 2008
  9. holygrail.. maestro
    tell us about the chianti,the montepulciano
    spaghetti alla vongole,fetuccini alfredo
    opera in sienna
    fantastico.maestro
    bravo
    takes my mind of x and o columns
     
    #1039     Jul 14, 2008
  10. nooooo, lets talk about the x and o!!! it's all about the x and o!! :D
     
    #1040     Jul 14, 2008