I trade SPY and ES using the Don Miller system. I use a 3 minute chart for daytrades. What do you trade?
To save space, I won't go into all the reasons I'm interested in this, but I do have a question about this point (which I did not pick up the first time). Are you saying that since the first downside break failed, the downside is (was) "done" as far as you're concerned? If so, how many points -more or less - does a break have to be in order for a failure of it to be significant, in your experience? For example, if the downside break had been 5 pts instead of 10, would you have taken another attempt at a downside break? --Db
Another question What if you're stopped out during the advance but price does not return to your "neutral zone"? Under what conditions would you re-enter? Thanks for being available. --Db
I've just made a small modification to my system over the last few days. Talking about it here has helped me crystalise my thoughts better. I've extended the first half hour to be 40 mins, and now I'm looking at the breakout of the range from 9.30 - 10.10 EST. Doing some back checking through results, this modification would have prevented almost 50% of all loss making trades, so I'm going to run with that for a while and see if the improvement continues. Natalie
My hubby uses a similar system to you Natalie, and he holds his until it looks like a reversal..... How do you judge how long to hold it?
I agree about the value of putting one's thoughts out there. As to the first half-hour or 45m or hour, it's always seemed to me that it's best to let the market find it's own initial high and low. This takes at least a little time, and probably won't be done by 0945 if there's a report scheduled for that time. However, it may be done by 1000, and one could then play the break of either once the report is issued, if that's part of his strategy. If, however, no reports are being issued, the market may find its "natural" opening high and low at 0950 or 0955. In this case, there isn't necessarily a compelling reason to wait. Doing so, in fact, may mean entering the breakout - if there is one - too late, and either being stopped out or being forced into an uncomfortably wide stop. --Db
The 15 minute bars quite often fall into nice neat trends, and usually they just keep on confirming the direction for a while. once they start to fail, I get out. Another method I use is with a 5 min chart, using an SMA calculated on (O+H+L+C)/4 rather than just the close, and come out when a crossover occurs. Often the avarage supports and confirms the position nicely through a long trend. Then I have a stoploss, which once the position is well underway gets regularly adjusted just in case of a sudden reversal which catches me unawares. And I draw a few trendlines when needed just to help confirm everything. I hope that helps your husband, and nice to see another woman round here... Natalie
Yes Db, I agree, and I'm looking abck historically to try to ascertain a pattern in this so that I can modify and refine my method still further. My concern with using longer time frames is that it will erode profits while reducing losses. I generally stay out anyway immediately before big news, but Right now I'm looking through the various announcement times (or lack of ) and coreelating that with results... Natalie