Hi Db, I was wondering if you could share some more information about what it is that you are doing with the NQ. Would it be possible for you to explain: Where it is that you enter. Why you enter there. Where you place an initial stop. How you move your stop as a trade goes in your favor. If you decide to exit without being stopped out, how and why. I know this is asking a lot, but I am curious. Maybe you could walk through the trades from yesterday as an example. Or perhaps just share general rules or thoughts on what you do, without relating to specific trades. If I'm asking too much of you, I will understand if you do not share the specifics of your strategy. Thanks in advance, Banker
actually I was wondering the same thing...I arrived at this thread a couple of days ago and I'm having trouble finding the actual strategy as it is being traded now. Thanks!
Not at all (it's a bit difficult to understand why anyone would post on a trading board without being willing to discuss his strategy). Some of this has already been posted, but quite a few posts have been deleted. Currently I'm using SnoSur4's idea (posted on the first page of this thread) of entering breakouts with a 2pt trigger, both for initial entries and for reversals. For the NQ: The first entry op is after the first five minutes, if there has been a gap of at least 1% (if the gap is 3% or more, I will likely not trade that day). Otherwise, price is left alone for 15 or 20 minutes until the opening high and low are found. Entry is then made when one of these is broken by 2pts. If price remains within this range, there's no trade. If there's a report due out at 1000 and price has done nothing by 0950, I'll just wait for the report since everybody else seems to be doing so. The initial stop is 5pts. When I'm 5pts ahead, I move the stop to BE. If and when price breaks the trendline, I move the stop to 1pt above/below the last reaction high/low. If price reaches the 10d average range limit and the last reaction high/low is uncomfortably far away, I may switch to a smaller timeframe to find a closer LRH/LRL, or even use an end-of-bar stop, particularly if there's been a ramp (it's often possible to squeeze out a few extra points by continuing to manage the trade, but this can take hours, so it depends on what your time is worth, though if you're trading two contracts, you can use an EOB stop with one and an LRH/LRL stop with the other, then just leave). As for the chart display, I use 1m, 3m, and 5m charts of the ES and NQ. No moving averages, no Bollinger Bands, no stochastics, no Keltner channels, no RSI, no Williams' %R, no ADX, no MACD, no CCI. Just price candles and trendlines. I also maintain 30m and 60m charts (minimized) just so I don't forget about important support and resistance. I never use pre-emptive exits. If it doesn't hit my stop, why should I sell? Though I will exit just before the close if my stop hasn't been hit by then. However, this is unusual. As for yesterday, the first trade was in at 1111 and out at BE twenty minutes later. The second trade was in at 1103.5 and out seventeen minutes later for -5. The third trade was a reversal, in at 1110.5 and out nearly an hour later at BE. The fourth trade was also a reversal, in at 1107 and out 90m later for +13.5. I use the ES and NQ jointly to decide whether to take a trade or not. If, for example, the NQ is close to triggering an entry but the ES isn't anywhere near that point, I will generally pass on the entry as it nearly always fails. --Db
No post has been deleted that had any of your strategy in it dbphoenix. I copy and save all of the posts that I delete. After a time I delete those from my files too. Your most recent post on this thread is the first that you have shared your strategy. Were it not, the two members who have recently asked for some insight into your strategy, one of whom has been following this thread from the beginning, would not have recently asked. I would like to have PM'd this to you, but as yet you have not read the PM I sent you November 21, 2002 at 5:49 pm EST. As such you find it here. If you have me on ignore, the other members will still see the truth even if you don't.
Ok, I did print out snosur4's post for myself. This is what I understand so far: This strategy ignores whatever trading has occurred in the futures market before the cash market index opens. When the cash market opens, the roughly first 30 minutes of trading in the derivatives are not traded by Snosur4, but not necessarily by you. This opening time of varying lengths is observed from the sidelines to find an "opening trading range" to base initial trend following trades for the day off of. Once this opening trading range is clear, entry stops (mental or physical?) are placed around the range. The trigger for the trade is not break out of the range itself, it is delayed by a point or two, depending on what contract is being traded (ES or NQ). The direction of the trade is determined by which way prices move out of the "opening trading range" first. I'll use NQ as an example. If NQ moves 2 points higher than the "opening trading range" a long trade is made. The initial exit stop is set (mental or physical?). Snosur4 places the exit stop 4 points away from the entry price, you place the exit stop 5 points away from your entry point. So essentially the trade is considered broken if prices move back into the "opening trading range" by 2-3 points. This would basically prove via this strategy that the breakout was false, and the trend is not going in the direction of the trade as planned. If the trade was stopped out, a new entry stop would be placed 2 points away from the prior "false breakout of range" high or low, in case the previous breakout direction was correct after all. If the "false breakout" was indeed a true reversal, and the trend was indeed determined to be the other direction from the failed trade, the stop on the other side of the "opening trading range" from the morning would trigger, and the trade would now go in that direction instead. Now let's say the original trade was not a false breakout, and prices did end up trending from the "opening trading range" in the original direction without stopping you out for a loss. So you made your trading range in the morning, placed entry stops around it, one of them triggered, and the trade seems to be a success. Now, let's say the trade is a short sale trade. When the trade has progressed so that prices have fallen 5 points from your entry price, you move the stop down to break even. This much I feel I understand. Now Snosur4 will take half of his initial position off the table when prices have moved 3 points in his direction. The other half is "leaving my original stop on the rest." and/or? "If the trend continues I will trail the stop usually manually by observing market structure. Sometimes I will scale out if I feel that it is running out of steam." Whatever that means to him. You on the other hand said: "If and when price breaks the trendline, I move the stop to 1pt above/below the last reaction high/low." Which trendline break? The trend from the "opening trading range" area that you are currently trying to capture? If so, you do not close the position if the trendline is broken? Instead you would move the stop (if short) one point above the last reaction high? Right? What if the breaking of the trendline involved also breaking of the last reaction high? Do you move the stop to the next reaction high up? I guess this is where I start to lose understanding. How is the 10d average range limit calculated? What's a ramp? What's an EOB stop? Which chart (1m,3m,5m) are trades based off of? Which chart period are stops set on? Which chart period are reaction highs and lows determined on? I can understand using the ES to confirm a NQ setup. I like that idea, and will try it myself. Also, I know these are quite a few questions, but how are future trades determined? Since the "opening trading range" is probably historical as the day goes on, what triggers a new trade, say in the afternoon? Is it a whole new trading range, or something else? If it's a whole new trading range, how is that determined. Thanks for helping, Banker
Here is a simple trading style, known as the "Chimpanzee Method." http://www.enthios.com/trading/the_cross.htm
I'll be happy to answer your questions, but I prefer to do it on the Futures board. I've begun a thread there called "Keeping It Simple". --Db
As I have previously mentioned, I am a terrible record keeper, so not entering my trades into a spread sheet (I don't even know how to use one) I can't readily assess data about trades. But I had an idea about something and sort of just perused my trade sheets and realized something. For my own psychological reasons, I always sell half of my position when I have attained 3 points NQ or 2 points ES. Now from what I have noticed....these trades have a higher rate of success than do the completed breakouts. So my thought is this: Maybe this would make a good sort of scalping system all by itself. If someone has backtesting capabilities you could test for a breakout after the first 30 min with a 4 point target/stop on the NQ and a 3 point target/stop on the ES. I think that allowing for only 1 trade in either direction in one day would be best ie. only 2 trades total both in opposite directions. Or maybe some variation on the above theme. I would run this on esignal but I don't have a clue how. This could be a good system for someone who can't or doesn't want to watch the markets all day. Enjoy the holiday. Mike