There are a number of ways of trading. One way is to trade anything that looks like a trade, another is to pick the high win rate pictures and be patient until they arrive. Its a matter of how "tight" you want to play, to use a poker expression.
You can trade, say, 30 times a day with large size looking for a small average profit per trade to make you green for the day. Or you can aim for surer trades and hit it with a bit of size and make an emerald green day. Both styles are valid but making a conscious decision which one to trade is important so you know how to create your TP. The pic below show some of my more patient trades today. Look at the pictures to see the elements that make them a high win rate picture.
The TradeStation chart below shows a sequence of those "surer" trades. The market broke at the first trade and allowed me to trade a whole series of pullbacks until the market became oversold - see the 135CCI, below -200. That was my signal that I had to wait for a new picture. Maybe there can be more trades after that oversold but they cease to be "sure" (high probability = high win rate) trades and my TP meant I had to pass on them. There are enough trades every day so I don't need to be impatient. When I translate that trading plan into an algo, I transfer those same rules and require the pullback entry to be filtered out if the market is oversold or overbought.
The TradeStation chart below shows a sequence of those "surer" trades. The market broke at the first trade and allowed me to trade a whole series of pullbacks until the market became oversold - see the 135CCI, below -200. That was my signal that I had to wait for a new picture. Maybe there can be more trades after that oversold but they cease to be "sure" (high probability = high win rate) trades and my TP meant I had to pass on them. There are enough trades every day so I don't need to be impatient. When I translate that trading plan into an algo, I transfer those same rules and require the pullback entry to be filtered out if the market is oversold or overbought.
I have to figure out how to put that indictor on the TOS platform. Thank you.
ReplyDeleteWas the adjustment to the CCI 45 before RTH? The volatility caught me off guard yesterday.
ReplyDeleteHersh, bigger CCI smooths out the bumps. I think volatility is here to stay. I look at the overnight market to see if it has been more volatile or not.
ReplyDeleteThank you. It took me until mid day to switch the 99EMA for trend.
ReplyDeleteDo I have until the last day to register for the Flobot Workshop?
ReplyDeleteTroy, we're filling up now but if you are sure you want to attend but want to pay at the last minute then email me your contact details and I'll hold a place for you. Only issue is that we sent you out 4 DVDs after you subscribe, that you should waych before the Workshop.
ReplyDeleteYou say that after a -200 reading on the CCI you wait for a new picture. Does that mean that you look to see what the buyers want to do and watch how much strength they have before considering to go short again or are you saying the new picture is a different price range on the chart from the one you traded?
ReplyDeleteAnon 15:47 If I was short and the big CCI went to -200 then my trade is over and I look for the next pixture. I also am mindful that an oversold market may bounce and I won't re-short until I see that sellers come in again.
ReplyDelete