Wednesday, 25 April 2012

More Granularity

As the volatility changes and the volume drops, I change my bar size to see the order flow better. NOTHING else changes. I'm monitoring the trend of the one chart and trading the pullbacks. I use the CCIs and the EMAs to track these events.


Today's DAX open created an uptrend. The overnight ES showed that this would occur. The reaction of AAPL to its earnings report was mostly responsible as the market could have gone either way after yesterday's trade. I dropped my Renko to 3 with the wick so I could see the pullbacks better. I had targets from my Fav Fibs. The results are in the chart below. 


The divergence indicated by the Orange lines was a pause in the move. Trend remained intact but alerted me to look for a solid re-entry which came later.

5 comments:

  1. The link for the indicators ["Click this link here for the indicators"] returns the following message:


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    Error (404)
    We can't find the page you're looking for. Check out our Help Center and forums for help, or head back to home.

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    1. Anon, 08:31, I'll fix it on the week-end.

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  2. I would like to get your thoughts on this idea I have regarding bar sizing. I have been looking at both tick charts and range charts. I like the tick charts because some of the indicators I use require volume data but I wanted to have the tick and range chart plot in a similar way day after day -- this means they should both pull back to a 99 or 33 EMA in as identical a manner as possible. I have found that by building two different indicators I can keep them synchronized and in turn adjust them to the overall market volatility. For the range chart I take a reading of the ATR for the past 10 days then divide that by 10 to get an average daily ATR. I then take that number and divide it by 15 so my range bars reflect 1/15th of the daily ATR. Currently for the ES it puts me at a 1.25 range bar. This seems to give me a more consistent view of the 33 and 99 EMAs among other things.

    The tick indicator takes the total number of ticks for the last 10 days and divides that by 10 to get an average tick day. That number is divided by 150. This gives me a nicely synchronized tick chart to range chart.

    I'm wondering if you have any thoughts on this -- if you think it may be misleading in some way not apparent to me yet or if you think this may complicate stops and money management?

    Thanks!

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    Replies
    1. Anon 02:23, If it works for you and you have back tested it, GREAT! I see the idea and it may have benefits. A bit too complex for me although I have used Volume bars.

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  3. what is the point of showing all these entries, when its where the exit is where you make or lose money.

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