The ACD Method

Perhaps you can clear something up for me before I decide to spend a great deal of time studying the ACD methodology. Namely: What is the opening range when using end of day data?

I currently swing trade using end of day data with a breakout here or a pullback there. My work is in the evenings and weekends. I have read and enjoyed the first chapter of the Logical Trader (a few times) and even though the charts are not present I have no problem visualizing what is being described.

All the examples in chapter 1 deal with intraday trades and the OR is in minutes. How does one establish the OR with EOD data? A 2 or 3 day high and low? Weekly high and low?

Thank you.

 

I don't want to go into the particulars as I've spent the last 4 years of my life perfecting this and I don't just want to throw out there all the various combination's of levels that work really well. If you read the book and have a solid understanding of what exactly the essence of ACD is, you will figure it out pretty easily.

Having said that, I'm not trying to imply there is a magical set of numbers that work. As I've said before, you need to have a very thorough understanding of volatility and price action to comprehend this. Me giving you opening range parameters or levels won't help you much.

Please understand that ACD is not a technical indicator in that it produces absolute price levels like a moving average or a support or resistance level. If you are not a good price action trader, it will be difficult to grasp what ACD is telling you. But everything you need to know about ACD is in Fisher's book.

 

I thought that this post along with Mav's advice on using multiple OR's and thinking more in terms of "how" the instrument ought to behave have been invaluable. I got a little stuck at first on using the system as an indicator with stringent rules (like a MACD or RSI etc..) but once I started experimenting and using it in the reference of price action, it started coming together.

For what its worth (and believe me I don't claim to be any sort of expert) just play around and see what works. I don't know if everyone will agree but once I switched focus, I've had far better results.

Thanks guys, your advice is helping

 

Didn’t realize the EOD OR info is of a proprietary nature. I wrongly assumed some general EOD OR parameters would be covered in a later chapter or in the appendix. That’s apparently not the case.

Thanks for your input. I appreciate it.

 

Maverick do you use ACD to daytrade commodities?

 

I don't. What I do though is use intra-day signals for entering into weekly trades. Jsmooth went over similar type of trades. Such as using a failed A down on an intra-day to enter a weekly or monthly signal.

 

Let me explain so my response doesn't come off as rude. Here is the thing about trading. When you use standard stuff that everyone is using or watching, it creates traffic. It means obvious entries in the market are going to generate lots of stops in that area which means the market is likely to test that area and stop you out. This is the problem of making obvious trades. The idea is to find a part of the highway where there is little to no traffic. This means there will be a minimal amount of stops there and more likely you will be able to stay in the position. Telling everyone where my OR's are is like putting a sign out on where I'm entering the highway thereby creating more traffic or noise. So it would be better if you found your own quiet spot to enter trades. Hope that explains it better.

 

Thanks Maverick, I just started the book and that was what I was looking at it for.

 

A new interview with the Logical Trader - http://www.futuresmag.com/Issues/20...ark-Fisher-A-trader-returns-to-his-roots.aspx

 

Great article MS. Thnx for posting.