SPM discussions

Once the 2 minute MACD crosses up and price moves above the sma 3,1 I'm in that trade. That is the initial cross.

The second trade is when the MACD cross holds, but price retraces below the SMA 3,1, and then pops back above it.

That is the retracement trade.

I have a lot of success with the initial cross trades, retracement trades require an extended move of price action to be successful, and are most effective when the Zero Line supports the trade.

Reverse the setups for Short trades.

 

Mandel thank you! That makes it crystal clear.

Now please explain this one:

"" retracement trades require an extended move of price action to be successful, and are most effective when the Zero Line supports the trade.""

 

The retracement trades are the second or third trades of the trend.

The trend has to continue going in the same direction for them to be successful.
***
The Zero Line is a momentum indicator and shows who currently "has the ball".

If the MACD is above the Zero Line, the Bulls have the ball, so there is a greater probability of a retracement below the sma 3,1 being bought and moving price back up.

If the MACD is below the Zero Line, the Bears have the ball, so there is a greater probablity of a retracement above the sma 3,1 being hit with more selling and moving price back down.

Take a look at today's chart and you will see how this technique played out perfectly. In fact the most recent Buy Signal was a retracement below the SMA 3,1 which had the support of the MACD Cross and the support of the MACD Zero Line, so price found support and poped right back up!

 

Thank you so very much! I'm still learning.

 

How about details on this one? Easy for you but those of us trying to learn this method would appreciate details of your entry.

* Time, price...?
* Did you wait for MACD cross or use the 3 SMA?
* Initial stop?

Thanks

 

Still dropping knowledge, huh T?

 

I might suggest that you first determine your setup . . . perhaps using M’s description of what he’s looking for. When that criteria is met, figure out how you will enter. There are many ways to enter . . . to buy, maybe you set a limit order two ticks above the sma line for a retracement buy, maybe you wait for price bars to stop making new lows and enter with a buy stop above that bar, maybe you wait for a bar to close ABOVE the prior bar and finesse a limit order when you see this. There are some great price action threads that cover a lot of entry techniques . . . it’s all about price action, not the MACD . . . it just gives you a fairly rigid setup to know when price action should be paid attention to.

Why do I mention this? Because figuring out what entry technique “suits your style” is key and is why you always hear this like a broken record. You may find that you like waiting for a significant retracement as long as the MACD is still crossed to the upside, you may find that you like being pulled into a trade using a buy stop order, you may find that reading the tape when you see your setup allows you to get a feel for price action in real time and control your entry via a limit order.

Which way works best? . . . none of them and all of them. Exit strategy is probably more important. Again – to sell you can wait for the price to go below or close below the 9sma, you can wait for a MACD cross in the opposite direction, you can wait for a bar to close below a prior bar, you can use a three-bar trailing stop, you can set targets based on key support. Pick something that makes sense to you based on your observations and go with it. None of these are any worse than others (imo). The market is a moving target, so go at it with a fixed frame of reference and don't change your approach every two seconds – ie, “it’s hard to hit a moving object if you’re on a rollercoaster yourself.”

Or heck, just listen to M’Set.

Good trading.

 

A new system .. work in progress...

mB and mS are buy and sell entries; blue dots are pivot points

Basic system, haven't done any exit as yet.

In this system I am using the 5/34 oscillator also.

see attached.

<img src=http://elitetrader.com/vb/attachment.php?s=&postid=2153988 width=800>

 

Results from day two. I slid my total PnL over into the window to be visible and hid my account number.

I've been a position trader so adapting to day trading has been painful. I made two idiotic trade execution errors today that cost me $200, yet I still ended up green for the day.

Lesson learned - I now have a strategy loaded into OEC to auto execute my profit target and stop OCO. (Yes, I know I need to adjust my profit target based on what I'm seeing on the tape.) I also "get" that on chart trader I have to RIGHT click when I want to sell! Sheesh.

 

Sample signals from today.

Try to notice the anticipation and why.

TV

"...the only action" lol


<img src=http://elitetrader.com/vb/attachment.php?s=&postid=2154015 width=800>