The "Flip" Trade (support and resistance changing roles)

[walterw 10]

Blu ray : I am forcing myself not to have contact with easylanguage, I came to the conclusion that I was adicted to it...

 

now I am trying to proove myself that its not the software and the sofisticated algorithms that can give you an edge, but a good simple trading idea... and consistency in it...

 

Glad to hear you are enjoying the flip... cheers Walter.

[Blu-Ray 10]

Blu ray : I am forcing myself not to have contact with easylanguage, I came to the conclusion that I was adicted to it...

 

now I am trying to proove myself that its not the software and the sofisticated algorithms that can give you an edge, but a good simple trading idea... and consistency in it...

 

Glad to hear you are enjoying the flip... cheers Walter.

 

 

Walter, nice one..... I know what you mean about being addicted, I've wrote more indicators in the last week, than I have done for the past year.

 

Keep up the good work and I'll try and chip in if I can.

 

Blu-Ray

[walterw 10]

Here we have todays first 50 minutes Flips... in timing cci 0 line cross has performed the best... As you can notice I am posting the entries, in terms of exit I will soon share some ideas... cheers Walter.

 

 

PD :both charts are 55Tick

[walterw 10]

Now on very diferent climate, we had a coil break type flip outside the coil, the first one was a stop and the second one worked nice...

[walterw 10]

More flips today... cheers Walter.

[walterw 10]

Ok, at this point of this beta process I clearly made my mind about how I would handle timing for the flip trade... thought there are a lot of alternatives, I came to the conclussioin that the cci 0 line cross is the most reliable and clear signal... cheers Walter.

[walterw 10]

Hello fellow traders ¡¡ today is may 11-07 , on the first part today we had a coiled cyclycal market indeed...

 

One way to see that is the fact that we couldnt break the keltner outerbands..

 

In terms of flips, a day like this one, its recomendable to take coil breaks type flips and dont try to trade the flips that happen inside the coil...

 

Now, after a coil break we normally expect some trending conditions... in a very fu#*¡¡ed coiled day the coil break goes from coil to coil... thus creating some frustration to the trader...

 

Here some psicological discipline may come handy and a clear understanding that a day like this would be more suited to walk your dog on the park...

 

 

Now let me share some of todays flips and see some interesting nuances that could lead to more succesfull flip trades... on the first chart you can see coil breaks flips that dont go anywhere, they just create a new coil...

 

On the second chart things got a little more trendy... and flips did perform a little better after breaking the coil...

 

Now One trick here : if the break takes on the Keltner Outerbands , then there are more chances to expect some momentum (trending) ahead....

 

So the energy of the break could give some hint on how much energy the flip will have...

 

Remeber that any setup has to take into consideration in wich market climate its situated... keltner bands are good tools to measure cyclycal or momentum conditions...

 

PD: I am using a 100 exponetial 5 atr keltner bands on a 55T russell chart.

 

cheers Walter.

[walterw 10]

Here are the flips to the end of the trading day... cheers Walter.

[walterw 10]

Ok, at this point of this beta process I clearly made my mind about how I would handle timing for the flip trade... thought there are a lot of alternatives, I came to the conclussioin that the cci 0 line cross is the most reliable and clear signal... cheers Walter.

 

 

I want to add here the discretionary alternative that will give a more early entry signal but could have more potencial noise... I would consider using it in very slow market conditions like happened today at first hour...

 

Instead of taking the 0 line cross, you can enter the trade with the +-50 line cross on the desired direction: -50 from below for longs, +50 from above for shorts...

 

In terms of timing I think we got two clear decent alternatives to take flip trades.... cci 0 line cross or cci +-50 lines cross...

 

This can be monitored on the cci 14 at a 55T chart or a cci 35 on a 22T chart.... any of them will give you the same signals...

 

On the below example the two trades where not super trades, the market was dull, now for a scalper it worked 5 ticks each trade... wich its very good... in that case the +-50 entries would had been very competitive...

[walterw 10]

Hello fellow traders ¡¡ todays flips are a nice example of context considerations in terms of momentum and non-momentum conditions, we could say that flips taken on a non-mometum area have less chance of success vs flips been taken on momentum areas where the market has more chance to take some nice temperature...

 

today so far we had 2 clear flips, the first one happened on the mid band area wich is certainly a non-momentum area and got finally stopped....

 

the second one happened in the inmediations of the outerband where we can expect momentum to build up wich actually happened making a nice decent trade...

 

with this observation in mind it would be very recomendable to take "momentum flips" wich would happen at the outerbands area... so we keep adding this nuances to the flip aproach... feel free to interact.. cheers Walter.

[walterw 10]

Here I want to share a daytrader`s perspective on flips using a 1 min chart...

 

For today, flips where very clear.. cheers Walter.

[walterw 10]

for daytraders here is the last 1 min flips today... cheers Walter.

[walterw 10]

Today is tuesday may 15, I atach charts of most clear flip trades today...

 

On the first hour we almost did not get flips because they would break levels but dont come back to retest them, momentum was there...

 

Today I timed entries with cci 0 line cross.... My first stop idea its when we cross 0 against us... that would be a stop... cheers Walter.

 

 

 

PD : attached charts are russell 55 Tick with keltner exp 100, 5 atr and cci 14

[walterw 10]

Ok , so here we go now... let me start deliberating on exit alternatives for our flip trade... not easy, but not imposible... once we get some where with this topic and make our minds about how to exit we would probably have a nice complete decent system to trade... with a clear entry stop and exit

 

Alternatives ? lots...

_we can use a mathematical RRR aproach as early debated on this thread...

 

_we can use technicals on the price pane, maybe average cross ? why not a WRB candle ?

 

_we can use cci readings..

 

_for the more prepared they can exit with tape...

 

lots lots lots.... obviously each trader here may want to use their exit that fits their personality...

 

I clearly think that "flip" its an entry aproach itself and that the exits to apply should be individually choosen by each trader as it fits their personality...

 

So from here on what I am going to present will respond to MY personality and its not necesarily the best alternative...

 

I would expect to hear diferent alternatives to mine to see what traders are being able to come up in terms of exits for flips...

 

 

Here I will present MY exit alternative that fits my style : I like to follow CCI for my exits... they make my life a little more easy... dont forget I am left brained...

 

So in terms of CCI we have a series of alternatives...

 

let start with this point: I dont pretend to take the entire move, it doesnt hurt me to leave money on the table... what I understand that will hurt me is if I have a bad RRR ... ok ?

 

now most of this flip trades, just about all off them on this 55T russell chart with my stop criteria stated on the above post have given me an average stop of -5 or -6 ticks.... so going for a 5 to 8 ticks profit will put my RRR on a 1/1 to 1/1.5 RRR and here comes the fact that just about ALL succesfull flips had made it above 5 ticks moves... aha ¡¡¡

 

On the other side ( and I know some traders dont share this with me ) but I am a man that likes to make his 100 bucks per contract per day and enjoy life after that...

 

So.... you see how exit strategies are tailored acording to traders personality ?

 

ok, let me come back to cci... and let me make clear I am not a CCI er... was... not any more... BUT cci can do some nice decent jobs for stupid people... When CCI reaches a level you may want to say, I am done... its good enough for me and when that level happens to fit your $ expectations for the day together with a good RRR relationship with my stops... well good ¡¡ I am out... could had made a 100 bucks more ? who cares ? it met my expectations.... I am happy and ever after...

 

so CCI hook from extreme HFE can be one... +-100 recross other... and for the machos recross of 0 line...

 

again I say : thats what makes ME happy...

 

On the example from today, you can see two trades that delivered +6 ticks each... and then the market moved 30 ticks more... insane ¡¡¡ why did you get out ¡¡... well let me tell you, I, me, Walter did not know that super move was ahead... it could perfectly not happened... but I, me, Walter made my 100 bucks... so again... no frustration.... It worked swift, made my day I am not trying to catch fantastic moves that may never come...

 

so my exit strategy really really fits my personallity... would love to hear yours ¡¡ cheers Walter.

[walterw 10]

So here I post todays flips... they had left a decent performance today and must confess since flip I am following the entire session.... mmmm

 

Would love to hear some feedback if some one is still following this simple aproach, could you share your experience some charts... etc .. also how are you dealing with exits.... cheers Walter.

[walterw 10]

As the flip aproach is evolving on my analysis, observation an "yet" virtual trading... I am find a great amount of nuances to this trade...

 

I know that when we start to add nuances "maybe" its a great oportunity to complicate things and start transforming a great idea into a great inferno...

 

I proposed myself not to do so with flip trades, all of the contrary, the idea is to keep "flip" trades as simple as posible...

 

I know most normal traders would share a complete finished idea of a particular trade... as I am not that normal, I took an idea and started developing it in front of the public... so you will see that "flip" may experiment some slight changes to get to the final product I would like to see here... and obviously that product should be adapted to each individual personality as they feel confortable with it...

 

 

Now let me share this "nuance" that for me probably will be transformed to a "rule".... as you know the "flip" trade is formed by two clear pivots, 1rst pivot creates the level where we will have a break and later a 2nd oposite pivot forming the "flip" itself....

 

My nuance/rule is : "1rst Outerband Pivot , 2nd Mid Band Pivot " From now on the "Level Rule"...

What I mean is that the 1rst pivot should be formed at the keltner outerband area.... then the break of the level would make us travel at some above/below level of that outerband sugesting momentum and here come the incredible mathematic and maybe geometric fenomena that when we get to the flip level to create the 2nd pivot we are right at the Mid Band... ¡¡¡

 

It happens over and over again... I will post you all the examples possible ahead.... but its just that way, you form the first pivot at the outerbands, then travel all the way to the mid band to make the "flip"...

 

Whats the edge of this rule ? well maybe its the fact that on this levels we are touching momentum areas... and the flip is charged with a more dynamic market condition compared to the fact that if the outerband pivot never got broken to make a flip then the market never got any momentum at all and would be convenient not to trade on that congestion condition....

 

So I attach some examples from today.... cheers Walter.

[walterw 10]

Here are some other examples from previous posts... that take the level rule into consideration... cheers Walter.

[walterw 10]

Here I add another graphic explaining the overall area concept for "flip" trades... good trading today, cheers Walter.

[walterw 10]

Today`s first 75 minutes of session delivered this flips, the first two dont have the level rule, the third did have it but got stopped...

 

I am experimenting also some diferent posible way of timing entries on the price pane with two Linear Reg averages 6 and 25... their crossover could give some nice decent entries... cheers Walter.

[walterw 10]

This evening is delivering some nice momentum.... a nice momentum flip has been clearly formed... in terms of exit as we have a momentum climate I would keep a runner above the white keltner band.... cheers Walter.

[walterw 10]

As this week starts, I feel "Flip" more part of me, so since today I am trading this live...

 

So far I think I got a clear argument with clear entry rules, stop rules and exit rules....

 

The "momentum level" nuance so far has given the best trades to select from so many oportunities...

 

So far today we had one nice momentum flip... first we got an outerband pivot, then a small break and FLIP... got in on a ZLR fashion... scaled out a scalper exit with HFE 2/3 position and closed entire rest at the 0 line cross...

 

Personally on live I am done for today... but will paper trade the rest off the session.. cheers Walter.

[walterw 10]

And here is todays second one (paper).... chart looks so similar to the first one... I like that "Momentum levels" it gives me good ods to enter on strength climate... my runner is something to add here on my exit strategy...

 

I will use that runner only on momentum levels flips.... so far so good... cheers Walter.

[walterw 10]

Late on the day we had a series of flips .... this ones are exactly with the level nuance... forming pivot at outerbands, flips at mid band...

 

So far I find the most reliable setup with forming pivots at the outerbands...

 

 

I am also experimenting diferent timing posibilities at the price pane... so far a very nice combination is the least square ma 6 (yellow) with a simple ma 7 (light grey)... their crossover can be used for timing....

 

cheers Walter.

[neustaju 10]

To Flip Trader: Great job on noticing this price pattern. Reminds me of Elliott Wave when wave 4 finds support/resistance at wave 1. Unless you get no commission/fees put away tick charts and pull out a 15 or 30 min chart. Look at past price history for several days and see if your same trading strategy can be applied. Make fewer trades and only enter based on long term analyisis because it limits your exposure to risk.

[walterw 10]

neastaju : yes ¡¡ this aproach can be adapted to any time frame and type of trading.... medium/ long term... I presented the idea as a scalper I am but can perfectly be adjusted to the more long term trader.... feel free to add charts with the strategy applied to longer terms, would love to see how other people can use the overall concept in diferent time frames...

 

cheers Walter.