Big Mike's Trading Blog

Day trading futures, discussing money management and trade management techniques, and more

And we're off to the races...

Tuesday's price action was pretty exciting.  For about an hour.  After that first huge run up the market gave up and went home, everyone took an early afternoon.

Maybe they all went home and had a nice juicy steak like Stewie from The Impatient Trader!  Man I sure wish I did!


You know you've got a powerful move when the 4 range barely even taps a very tight stop reversal marker, as shown here on this 4 range chart.  The reversal marker is part of TrendBars, my adaptation of Roonius' SuperTrend:



The 6 range chart showed one fake out at about 9:30am my time (10:30am EST) but we didn't fall for it because we didn't get a clear short signal.  Then that short failed, and immediately we were long again:


The 3 minute chart shows the huge run up and then a very slow grind up the rest of the day.  I stopped even paying attention around noon, there was just no need, it was obvious it was all just going to be chop and grind from here, the opportunity was at the early hours of the cash open, and if you missed it then just pack up and wait for another day.


Remember, the #1 goal is not to lose money.  Making money is down the list somewhere.  So if you see a day with a huge move and then chop/grind, don't force it.  Just wait it out.  If it doesn't break out of its chop and grind, then don't trade until the next day.  There is always another day, and the trick is to be around with cash in your pockets for the right opportunity once it presents itself.

Mike

12 comments:

Anonymous said...

Thanks for the great Blog Mike.
Somewhat off the trading subject but I believe you are using Win7 which I am considering changing to.
Any comments & which email program do you use with it?
Regards John

Big Mike said...

John,

I use Outlook as part of Office 2003 and have my own Exchange server in-house, and then my gmail/yahoo mail from IMAP or POP3.

Mike

Anonymous said...

Thanks Mike
John

Anonymous said...

Mike, why you do not eliminate mike trend and macd from chart and trade only your double ma. take a higher timeframe like 30 min as filter. jump in and out in your trading session. the result is the same.
i had backtest my double ma (EMA/ADXVMA with SL) 10000 bars of 6 range of my trading time and currency for settings.
SL is optional for choppy markets.

best regards wh

Anonymous said...

Thanks for the blog and for the indicators. I believe more to come with new version of NT (multitimefreame etc.)

Do you see any advantage of using range charts?
STYR

Graeme said...

Hi STYR

I like the 6 range chart for the ES because it allows me to reliably place a SL order 1 tick above/below the signal entry candle as it is forming. Usually price fills my order but occasionally price reverses and I avoid a bad entry. I'm a great fan of Mike's ChannelThis (my settings 1, 1.5, 9, VMA, 21, ADXVMA) and take longs when green candles close above a blue ChannelThis and shorts when red candles close below a red ChannelThis (ie do not take trades inside the channel). The ECO2New2 is great as a confirmatory indicator (my settings 7,34,45) to smooth it, and I use the red dot Fading in this indicator to avoid some bad or early entries. In addition I also use the RSqueeze(BBSqueeze) indicator with the red dots changed to yellow (easier to see) to avoid poor entries when the yellow dots are showing (very reliable).

Graeme

Trading said...

Hi Graeme,

Can u please post a link for your chart?
where u took entry
Thanks

Anonymous said...

Hi Graeme, Could you please post you chart the method you use to take entry

Big Mike said...

Hi wf,

I'm still trading a core set of rules but changing up indicators all the time right now, it's kind of a re-evaluation time for me now that I have decided to stop investing all my time in auto strategies.

Mike

Graeme said...

Here is a pic of the ES from 29 May using the indicators I use. Note that the time is for Brisbane, Australia (14 hours behind current US eastern time - cash market opens @ 11.30 pm here). I don't enter long until the ECO2New2 is above zero and vice versa for shorts, and an ECO2New2 cross-over imminent or recent should be seen. In the pic 4 trades can be seen (I manually added the arrows), and my entry is 1 tick above/below candle close.

http://tinypic.com/r/2d8if83/5

Graeme

Trading said...

Thanks Graeme

Graeme said...

For the record I recently changed from VMAZones to ChannelThis, but have now switched back to VMAZones as the entries are much earlier and more reliable. Same rules apply as mentioned above for ChannelThis. If you like the colors for ChannelThis a setting of 1, 0.5, 14, VMA, 14, VMA will give a similar result to the default VMAZones. Friday 29 May was a shocker for the ES, but the VMAZones/ECO2New2 showed 15 signals and 14 were profitable.

I prefer to trade 2 contracts - take 1st profit @ 1 point and the second @ 2 points; trailing stop uses a BE+1 when price hits 1 point profit. I may try a strategy to let the 2nd contract run to 5 points with a trailing stop (starting with 6t @ 2 point profit then changing to 4 tick @ 4 point profit), as 10 of the 15 trades last Friday delivered quite a bit more than 2 points profit, but I do like the conservative approach, and 3 points profit per 2 contract trade is OK with me.

Graeme

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