iCharts Discussions

[SwingTrader]

The following method is based on "Multiple timeframe momentum" ideas by Robert Miner. This particular trading method is a variation of his idea.

The attached chart shows a 15 mins NF chart on the left and a 5 mins NF chart on the right. The idea is to trade in the direction of higher timeframe momentum. The higher timeframe chart has one indicator - STS (5,3,3). The lower timeframe chart has one indicator - CCI(3).

LONG SETUP: in higher timeframe STS must be trending up (the blue line must be above the red line). Once this condition is satisfied, switch to lower timeframe chart and wait for CCI to touch -100. After this once CCI turns up and goes above 0 go LONG. Don't worry about the CCI level after this. IMPORTANT CONDITION : Go long only if price is trading above the low of bar on 15 mins chart where STS gave bullish crossover. If price is below the low, ignore the trade.

SHORT SETUP : in higher timeframe STS must be trending down (the blue line must be below the red line). Once this condition is satisfied, switch to lower timeframe chart and wait for CCI to touch +100. After this once CCI turns down and goes below 0 go SHORT. Don't worry about the CCI level after this. IMPORTANT CONDITION : Go short only if price is trading below the high of bar on 15 mins chart where STS gave bearish crossover. If price is above the high, ignore the trade.

ADVANCED SIGNALS : Plot additional indicator on 15 mins chart - STS (13,5,3) - this is to watch for short-term & long-term price cycles turning at the same time which would indicate probable reversals. Let me explain it more....STS (5,3,3) tracks the short-term price cycle and STS (13,5,3) tracks the slightly longer price cycle. When both these indicators go overbought (>= 70 or very close to it) or oversold (<= 30 or very close to it) then it probably is time for a reversal. One can, at this point, switch to 5 mins chart and wait for CCI to reverse above/below zero and go long/short as per the signal. Example: If both STS are oversold then wait for CCI to turn up from -100 levels and go above zero, at this point go long in anticipation of a reversal....and vice versa. The reversal signal is stronger if price is turning from an iCharts level (especially the key bands - bull-r1 / bear-s1).

NOTE: The above advanced signal idea will, of course, not work everytime. The idea is to just catch as many good signals as possible.

The advanced signals are for experienced users only and should be avoided by beginners. Just taking standard long & short signals given above is enough. It just has to be done consistently following the rules given. Even though reversals are not caught, high probability trades are taken using the standard signals. For reversals (advanced signals) anticipation is necessary which requires some experience.

INITIAL STOP LOSS : For longs, on 15 mins chart, 2 pts below the low of the bar where STS crossed over to bullish. For shorts, on 15 mins chart, 2 pts above the high of the bar where STS crossed over the bearish.

TRAILING STOP LOSS : Best way is to use "Live Charts" and plot EMA of LOW (8 period) for trailing SL for longs. EMA of HIGH (8 period) for trailing SL for shorts.

*** STS was changed from 8,3,3 to 5,3,3 to keep a significant difference between the two STS. If you plot both 8,3,3 & 5,3,3 on 15 mins chart and see - the difference is not much. It does not matter which one you use for trend identification on higher timeframe. Stick to 5,3,3 as per above rules. ***

I will be posting examples of these shortly....

[varun_alld]

this setup looks good .....
but you have mentioned a chart over there which you have forgot to attach.....

please attach that 15 minute NF chart for a better picture !!!!!!!!!!

Cheerszzzzz ! ![/b]

[smartcancerian]

ST sir, wat TF is to be used for live charts..???( for TSL purpose- i assume it to be 5tf)

[SwingTrader]

[SwingTrader]

[smartcancerian]

ST sir, one more query .in advanced option..in parameter-2, fill 3 & in parameter-3 box, fill 5..am i rite..??

[SwingTrader]

[SwingTrader]

Kindly hold on....running a backtest....I might have to change the parameter of CCI as it is too fast. The problem is if I increase CCI parameter a bit we miss some good trades in fast trends but if we keep it this low (cur parameter is 3) then we get too many entries. That is why running the backtest to get a good balance between these two.

Will post an update shortly with what I decide, will also post the chart examples.

[SwingTrader]

Today's example....a tough morning for this system due to the 30 pts morning range until it broke to the upside above LOC.

I hope you understand the chart too many markings. Please go through the rules once more as I edited a bit a while ago. Have moved initial stop to 15 mins chart, 5 mins SL was too close most of the time. I have not changed the CCI parameter as there is no advantage in doing so.

Fire your questions

[SwingTrader]

Probable advanced signal as per the system:

As of 12:50, NF on 15 mins chart has both STS overbought. NF probably reversing down from here. I would have been more comfortable to take a counter-trend signal if price had hit BULL level before reversing.

[smartcancerian]

ST sir, in the chart attached, when buy condition met in 15tf, the next candle was trading above the low of trigger candle, in 5 tf cci must be above 0, so we will manage to avoid that trade..

[SwingTrader]

[SwingTrader]

Another buy triggered. STS gave a bullish crossover on 15 mins chart on 14:15 PM bar, the low of this bar was 5165.25. Longs are valid on 5 mins chart above this level.

On 5 mins chart CCI dropped below -100 on 14:20 bar, on the next bar CCI crossed above 0 triggering the long trade. The close of the 14:25 trigger bar was 5172.75 which is above 5165.25 so this signal is valid. The SL will be 2 pts below 5165.25. LOC is 5161 so one can opt to keep the SL below it for more safety.

[vinay28]

Dear ST

In your chart attched by you earlier in the day, you had identified 5137 as SL for long while in the later post you have said Sl as 5165 or so. Is it because of different strategies or the SL changed over the day?

Thanks, Vinay

[SwingTrader]