iCharts Discussions

SwingTrader · Posted: Mon Aug 22, 2011 8:38 am Post subject: MTT example for 19.08.2011

I have attached NF charts for 19.08.2011 with relevant indications. Do note that one will be taking all the shorts indicated there. Only the earliest one will be taken and then the trade would be managed by moving the trailing stop loss. The other short signals can be used if the first one is missed but it is suggested that the earliest 1st or 2nd signals are low risk, after that for subsequent signals the risk increases.

Also note that there is one more short signal on the 14:40 PM bar that I have not indicated. I did not indicate it because on 15 mins chart STS had indicated the oversold setup so short is not permitted there.

Will continue to post examples...watch out for the charts for the worst case scenarios because those are the days when one has to manage the trades well. If losses can be contained on those days then the better days will more than take care of the profits. Worst case days are my favorite days...I concentrate on those days the most for testing strategies.

SwingTrader · Posted: Mon Aug 22, 2011 8:44 am Post subject:

IMPORTANT CHANGE:

Please check the system rules again, I have fixed a mistake. The EMAs in the system are actual WMAs. I have fixed it in the system rules post below.

SwingTrader · Posted: Mon Aug 22, 2011 11:08 am Post subject:

Today is a good example of a difficult day for the system...at least until now.

1. STS was overbought at mkt open but as I mentioned on the chart, reversal trades are best avoided at mkt open.

2. Since STS was overbought the long trade triggered at 9:35 would have to be ignored (if it would have been taken we would have had to reverse it for a loss when the reversal to short was triggered at 10:30)

3. Now as of 11:05 STS on 15 mins is oversold and we are looking at a bullish reversal (further shorts would be ignore at this point as STS is oversold).

SwingTrader · Posted: Mon Aug 22, 2011 1:09 pm Post subject:

Today is the 3rd day in August 2011 which is difficult to trade using the MTT system. The other days were 3rd & 10th Aug. Today the day's range is okay but SLs are wide so one is having to keep wide stops or skip taking the trade. I guess most short-term trend following methods would be facing this issue (unless, of course, the trader is willing to drop down to lower timeframes like 10 min + 3 min combo...of course these combos will have other issues to deal with).

I will later post charts for 3rd & 10th and will also post charts for few good days to give an idea of what is possible with this system.

girishhu1 · White Belt Joined: 17 Aug 2009 Posts: 316

hellow st sir,
what should be the timeframe setting- i mean 3 days, 5 days etcetc.? i have noted that the setting influence the moving averages.
regards,
girish

SwingTrader · Posted: Mon Aug 22, 2011 8:49 pm Post subject:

SwingTrader · Posted: Mon Aug 22, 2011 9:38 pm Post subject: MTT - NF - 22.08.2011

Today's MTT chart for NF

A/B/C etc below refer to markings on the chart.

OB - Overbought
OS - Oversold
HTF - Higher Timeframe
LTF - Lower Timeframe
ISL - Initial Stop Loss
TSL - Trailing Stop Loss

A. This is a high risk long entry as STS is OB on HTF. ISL is around 4830 just below the recent swing low. This trade got stopped out when trade B got triggered.

B. STS OB on HTF. Reversal short triggered on LTF when WMA crossed down below SMA. ISL was 4858 just above the short-term swing high above the moving averages. This trade got stopped out when trade C was triggered.

C. STS OS on HTF. Reversal long triggred when WMA crossed above SMA. ISL was around 4830 just below the recent short-term swing low. ISL moved up (TSL 1) when the swing high at 11:15 was broken at 11:40. This trade got stopped out when TSL was hit at point D.

D. TSL hit for trade C.

E. STS OS on HTF. Long reversal triggered when WMA crossed above SMA on LTF. This long reversal entry came in late due to the powerful reversal. SL was also quite far...so I am not sure how many would have taken this trade. But this trade was good (looking at it with hindsight). ISL was around 4815 below the swing low.

F. Looking at this point it is clear that it is a possible reversal to downside as STS is OB on HTF. The important point to note is that when in a profitable trade do not take the standard reversal signal, take the reversal only on break of a swing low (in case of long & swing high in case of shorts). If the trade is not profitable just go ahead and take the standard reversal signal when WMA crosses SMA. The reason for this is clear - price will have to prove itself. If it is a profitable trade, let it run because the probability is for the trend to go on. Let the price do a bit more and prove itself for us to take a reversal. If the trade is not profitable then price has already proven itself indicating that we are wrong so go ahead and take the reversal as price is indicating that it is already going in the other direction.

Three whipsaws and one good trade....I have seen worse days than this for this system....check 3rd & 10th Aug as examples. Most other days have been very decent. Most months have 3-4 such days for this system, the important thing is to handle the trade well on these days.

manass · White Belt Joined: 21 Sep 2009 Posts: 172

Thanks SwingTrader for a beautiful explanation
Regards

SwingTrader · Posted: Tue Aug 23, 2011 7:16 pm Post subject:

NF MTT chart for 23.08.2011

A. NF was in short-term downtrend after open on HTF, a standard short was triggered by CCI at 10:05 (marked on 10:10 bar on the chart as that is when the entry would have been made). This was a high risk trade as STS on HTF was OS. ISL for the trade was around 4898 (2 pts above recent swing high). This trade was stopped out (before ISL was hit) when reversal long was triggered at point B.

B. When trade A was active STS on HTF went OS which suggested possible reversal long soon. But since a short was active, as I said yesterday, price would have to prove itself for us to reverse the position by closing above a swing high that was above both moving averages (on LTF). This happened on the 11:10 bar (the position was reversed on the next bar - short closed, long initiated). ISL was around 4879 (just below recent swing low). TSLs for the trade are marked on the chart (just below higher swing lows).

C. When trade B was active STS on HTF went OB which suggested possible reversal short soon. But since a long was active price would have to close below a swing low that was below the moving averages on LTF. Before that TSL for the long was hit. A short could have been initiated after that itself by reversing the position or optionally after a swing low was broken (as indicated on the chart). This trade would have had to be closed just before market close.

vinay28 · Black Belt Joined: 24 Dec 2010 Posts: 11748

Lovely ST, thanks. Did enter my head a bit. Would it possible for you to post such commentries intraday for immediate understanding please, like you do under a different thread; "analysing NF using icharts...."?
Vinay

jjm · White Belt Joined: 17 Mar 2010 Posts: 411

SwingTrader · Posted: Tue Aug 23, 2011 8:50 pm Post subject:

SwingTrader · Posted: Tue Aug 23, 2011 8:55 pm Post subject:

jjm · White Belt Joined: 17 Mar 2010 Posts: 411

Dear stji,

Today in LTf we have got + cross over of moving averages but candle is yet to close above recent swing high...

In this case the recent swing high is 4970 ..Trust my understanding is correct..

FOr regular trade
The conditions to be fulfilled

HTF wma above sma:which is in currently candle, however candle yet to close..

LTF : 2nd condition pls clarify swing high is 4970 or 4952

STS is in neutral zone

Regards,

JJM