range trading

Discussion in 'Technical Analysis' started by ymillion, Nov 10, 2007.

  1. ymillion


    i ve recently been trading the bonds market and have found it very difficult during ranging periods. Can anyone provide any advice or system ideas for trading these situations ????

  2. Buy the bottom of the range, sell the top.
  3. Suppose you sat in front of a fireplace, gazed into the fire and found it pretty. Perhaps you wish to hold the pretty fire in your hand. So you put your hand in the fire and get burned. Thinking it was just a one time event you might put your hand in the fire again. And get burned again. You may put your hand in the fire as many times as you wish until you learn what fire is about.

    How many times do you put your hand in the fire?
  4. bighog

    bighog Guest

    Sure.........................watch the bonds or TY (10 year notes), they trade on 32's. watch how often the 8 tick moves ......+or minus 8 ticks, do the same with 16 ticks, 1/2 a handle, 24 ticks 3/4 handle and a whole handle...................use these points as support/resist and look back at many charts........i am talking daytrading here............see if you can pick up useful trading objectives/STOPS at those levels and the game will be easier.

    PS, in general i found the bonds, notes are not good technical vehicles to trade compared to the ES etc. Seems traders in interest rates are a nervous bunch.

    Bottom line: look at a spot as an objective and exit..........risk management is even more important when trading these animals. good luck...............remember 8, 16, 24, 32..........keep looking at a 5 minute chart and see how often those points seem to be targets.
  5. One of the things I look for in a range bound market is areas where the stops are, which is slightly above/below recent highs/lows. When that supply or demand has been removed the market can move in the opposite direction more freely - i.e. if sellers have stopped out they no long exist to sell into the move to take profits. There is much less supply to slow the move down.

    The probability of a double bottom (lower lows) is higher than a single bottom because stops get hit. The probability of a triple bottom (lower lows) is higher than a double bottom because even more stops have been hit. Man....if you see a quad try not to wet yourself :D

    When traders get their stops hit they are unlikely to get right back in because they've been stung. That hurts so it's hard to shrug off that pain and go right back at it. That's one of the things that seperates successful traders from not -- the ability to toss the feeling from that loss and go right back to battle!
  6. You didn't mention anything about how you've been approaching your trading of the bonds.


    Personally, I don't like to scalp nor day trade them.

    In contrast, they are an excellent swing trade (overnight to several trading days) or position trade (several weeks to a few months) trading instrument.

    Recently there has been much to do with them.

    Long signal back in July and another Long signal or add signal to the prior Long around mid October.

    Thus, about 2 trade signals in the past serveral months.

    Therefore, I'm also saying its one of those trading instruments that if your complaining about range days...

    It's time to switch trading styles even if it means you won't get that many trade signals.

    (a.k.a. NihabaAshi) Martial Arts and Japanese Candlestick term
  7. bigswede


    I just came across this board and bighog's "HOLY GRAIL" post from 10-6-05.

    That post re-affirmed my dual moving average crossover approach to trading the Q's.

    In my case since I am new to trading and have no clue about trading e-mini's, I was curious what the pros/cons of trading the mini futures would be versus trading the QQQQ, QID, QLD.

    Right now I use QQQQ to set up my crossover triggers and pivot points, I then trade QID for the short, or I short the QID to create an ultralong (if its available to short) otherwise I trade the QLD for the long side.