Good thread JJ. I've always liked pivots, the fact that they 'work' regardless of the timeframe they are generated from suggests they are more than just self fulfilling. At different points through the thread you mention Current trend, Market Trend & Pivot trend. Are the first two one and the same (DMA direction and price above below)? What about the pivot trend, is that simply whether you are above below the daily PP? Just wanted to be clear on your terminology. Cheers, Nick.
Hey Blowfish, welcome to scene. Market Trend & Pivot Trend are esentially one-and-the-same, both literally and technically, as I am describing them here. They are based an analysis of the Median Pivot (commonly called "Pivot Point") in relation to its 3 Day Average and 5 Day (1 Week) Average. I use this formula because it's easier to calculate X-Y and X-Z where: X = Median Pivot, Y = 3 Day Average of Median Pivot, and Z = 5 Day (1 Week) Average of Median Pivot; than it is draw lines across a screen connecting Highs and Lows (though Steve46 did a muy excellente job of it!). The Current Trend is losely defined as the relationship of the 18 SMA and 40 SMA (18 on top = uptrend, 18 on bottom = downtrend). The DMA wasn't really working for purposes of the thread, so I dumped it. There's a complete set of instruction and a Basic Pivot Point Calculator on pg 22 of the thread, so help yourself. The process and methodology works with anything that creates an OHLC, so you don't just have to trade the stoodgy ES (in fact, I perfer the NQ, the YM ain't really work'in for me, though). Stock scalpers can also put this info to good use. Best Regards, Jimmy Jam
For Wednesday, 8/23/06. Market Status Pivot Trend: Neutral 1st Resistance: 1306 Median Pivot: 1302 1st Support: 1298 Current Trend: Up *** Well, we had an impromptu class with Steve, made some money saw some of that back-and-forth action that I was looking for, so all-in-all, I'd say it was a good day. System made 2 pts, (could have gone for 3+, but that's OK). Current trend is Neutral, so it's possible we could see some action from either side of the fence. *** As an excercise, you might want to go back and review the S1, P and R1 Levels for the past 5 days or so, along with the Pivot Trend and chart action. If you do, I bet it'll start making a lot more sense. See ya at the Open. Best Regards, Jimmy Jam
Alrighty then. A buy was generated right out the gate. Long @ 1303.25 *** Look for the setup and try to "call it" on your end. This will get you used to seeing them and reacting quickly when they happen. Best Regards, JJ edit: 1st resistance is at 1306, and since the trend is changing (or at least appears to be as of right now) I will most likely take profits there).
If CCI Histogram crosses the zero line, we're going back up to test resistance. edit: That didn't happen, stop was hit at 1299.25. Waiting for next setup.
Looks like we're stuck between the Monthly R1=1304.25 Weekly Pivot=1295.00 The good news is that we have had 2 very narrow range days in a row, so a wide range day is getting closer
Yeah, I know. The chop requires patience, otherwise your account might get chopped up while you try to trade it. *** I'm making another modification to my basic setup. I'm trying the CCI Histogram set to 50 instead of the standard 21. The rule is that you can only hold Longs while the CCI Histogram is above the Zero Line, and you can only hold Shorts while it is below the Zero Line. This should keep us out of the bad trades, and help us to cut the trade a little quicker (though not by much, I admit) when a trade goes against us. Lets see how it works. JJ
Be careful to not to try and tailor your system to the current day or past couple days. You will always feel like your behind the eight ball. I only speak from experience
Quite right. But if your system does not lose too much or is flat to a small profit during these sessions it will be a pretty good system. There's always an upside.
JJ, I like your set-ups as they are ( I use CCI 14). One thing that helps me is to know about any numbers that may move the market . http://www.marketwatch.com/news/economy/economic_calendar.asp?siteid=mktw&dist=& I knew housing was coming out at 10:00am, thus no trades until after the number. Yea, I might have missed a big move, but so what? There will always be another trade. The market has failed at the monthly pivot for three days now. Do I really want to get long at that point or wait until it breaks out and buy the pull-back? Keeping market context and news events in mind is something you can't program into a system, but you can use it to either give you a reason to trade or not trade during a specific period of time.