Trading CL with the QM Proxy in a Chimp Fashion

[walterw 10]

Hello dear fellow traders... I decided to do a little sharing for some while, its been sometime since I dont share some of my latest stuff, and I am inspired to do it at this time..

 

In this thread I will share a simple easy method to trade the Crude Oil ( CL ) futures contracts... but it has an interesting aproach because it uses the mini Lot QM data to come up with the trend definition... You see, CL its a very very volatile future, and its not that easy to establish correct trend definitions at times... so using the QM mini lot data, as a proxy for trend definition, I finded it very intersting to see it in work...

 

It is simple, because I do beleive in simple technical analisis, compared to all the new fancy stuff that unfortuantely it may look fancy and atractive but the botton line of live trading accts does not necesarily look that fancy as well...

 

This CL thread that I will be contributing for some time is just to prove that easy and simple things work very well...

 

The Chimp style and fashion its present... adxvma stuff combined with multitimeframe ( and in this case multidata ) analisis... Thats say is my edge in the context of simplicity...

 

I do not trade the CL myself, just to small amount of contracts for me... I am an ES trader myself and like to trade larger volumes... but the idea here is to bring some light into what a simple aproach can do to those traders that maybe at this time are quite confused and stressed by the complex fancy stuff that doesnt give them more than a good looking chart in paralel with a small trading acct ...

 

So lets get started on the next post... cheers, The Chimp

 

[walterw 10]

So this method for CL will be in the direction of the Trend... so it will show a way to do "Trend Trades" on CL...

 

Now the catch is that we will not define Trend on CL itself, but we will do it on its parent Future QM ( emini Crude Oil ) .. this QM trades less than CL, so it has less data than CL and that is usefull for us because it will clean a lot of noise to determine the Trend..

 

Also it will help us to stay inside the trade.. and this is a great issue on the trading comunity... STAYING inside a trade... you see, if you dont stay inside a trade, then you will never make clever money.... in the past decade I learned that you need to clear out the noise that shakes you out of trades without any need.. just to see after you where stoped out, how the market continue on the direction of the trade you "where in" ...

 

So the QM chart I will be showing here, does exactly that... it gives a good Trend Definition and it will also be a good "keep inside the trade" tutor... so you can relax and enjoy the show on a Chimp style Fashion...

 

 

Lets define Trend...

 

 

In a QM 20 Tick Chart we will have three averages, a white, Black and yellow lines..

 

They are this : Yellow ADXVMA 2 , Black ADXVMA 6 , White EMA 15 of an ADXVMA 6

 

So trend definition its very simple :

 

For Uptrend : Yellow above Black and Black above White

 

For Downtrend : Yellow below Black and Black below White

 

With this three line aligned in that fashion, we will say that we got a "PURE TREND" and that we are ready to start looking into the CL Chart to find precise entry spots...

 

 

I will add on a later post indicators and templates as well... cheers The Chimp

[walterw 10]

So now that you got a nice clean Trend definition, you need a place to get in...

 

Dont pretend to get on the best spot... thats where tarders have problems and loose just to much time studing, pretending to get the best spot and not get any heat while on a position...

 

The truth is, that you will at time get on the best spot, but on the most cases it will not be on the best spot... and the chimp says WHO CARES ??

 

You see, thats weakness and a subjective way of thinking, when you pretend to get on the best spot...

 

But WHY do traders are so anxious to get always on the best spot ? just to see over and over that it is an imposible task to be done... WHY ? because they dont have a way to STAY INSIDE the trade when obviusly a high amount of trades in a natural and profesional trading conditions it is absolute normality to take heat on trades...

 

So we dont care that much if our entry its not that best spot... we will care more to be able to manage the trade, being able to Stay inside rather to look for the imposible perfection of super fantastic unrealistic good entries...

 

Offcourse entries must have a certain degree of competitive criteria, but they must not have that pressure on them... you trade otherwise nervous, anxious... with guilt during heat... frustration on stops... suicide after years of burning accts

 

so on next post maybe tomorrow I will show a simple Entry rule already on the CL future chart itself and also post indicators and template... now I got hungry and zome muzzarella pizza its awaiting me... cheers The Chimp.

[walterw 10]

So lets continue... We defined trend on the QM 20 tick chart, and as I mentioned on the previous post now we need to get a specific Entry definition... but without the pressure of being "perfect" ....

 

So for that purposes we need a CL 65 tick chart where we will get our entry...

 

 

What we want is first a PULLBACK against the trend with the green line crossing the black line oposite to the trend... followed by the TIMING by the crossing of the green line to the black line in the direction of the trend... this are adxvma averages... chimp stuff... this are "clean" averages...

 

 

Very simple way of getting in...

 

Now on the next post I will show you the greatest edge on this method... wich is the way to STAY INSIDE the trade and go for good moves without taking unecesary stops...

 

Let me grab some cofee here...

[walterw 10]

So you can see on the pictures of the previous post, how I define trend with a QM 20 tick chart and define pullback / timing on the CL 65 tick chart... You are suposed to trade the CL

 

So How do I STAY INSIDE this trade ?... well simple, if the yellow line crosses the black line on the QM chart, then YES its a stop... if not, its NOT a stop :crap:

 

You will see a lot of noise... lot of moves on your favor and on heat against you happening on the CL ( your position future ) but you dont care about that... just focus on the yellow and black line on the QM chart...

 

That criteria will be used for stop and for ultimate exit... YES you may get out on a nice fixed target before, but that fixed target must be at least 1:1.5 RRR to the average stop size...

 

Here stops can be in USD quite important, and profits very nice as well... so CL trading its not for small accts.. This morning I fulled arround with 5 contracts and I would recomend to asign at least 5k per contract to be psicologicaly sound...

 

So here I post some exits examples :

 

 

 

In this examples you can see that I used the QM chart to close my trade on the CL Future... thats called a "Proxy" chart... the nice thing is that QM its not that crazy as the CL, but it goes on the same direction, calling for good trend definition, stops and ultimate exit...

 

On next post I will add indi and templates.... gradually I will be showing examples and maybe some videos ( course style ) to make it more clear... cheers The Chimp.

[walterw 10]

So here are the files... The ADXVMA average, wich is a characteristic tool used by the Chimp and the Ninjatrader Templates for QM and CL as well...

 

Tomorrow I continue to add examples... hope you enjoy it, cheers The Chimp.

adxvma.zip

Chimp Templates.rar

[walterw 10]

Hello, fellow traders... let me update some setups from today monday on the CL using our proxy system on the QM...

 

 

 

 

 

Nice moves... simple stuff and very clean... cheers, The Chimp

[walterw 10]

Hello fellow traders... I wanted to make a little update on the CL Proxy trade, using the QM for clean trend definition...

 

Its a nice clean trade and also using the ADXVMA it makes it a great clean timing...

 

Here are two nice trades today :

 

 

 

 

As I mentioned before, the QM gives the trader an edge for trend definition because it doesnt have that much noise as CL ... so you can have a clean trend definition on QM and use it for trading the CL... Also it can keep you inside the trade and clean up the noise that would normally trigger an exit...

 

Coments for people who have tried this are very welcome...

 

For those who contacted me via email about my "other stuff", YES its still available... it has being a true success story so far, it doesnt get aint better really...

 

just keep in touch. Nice having all this fans here at TL, someone asked me wich Thread I consider the best one from the good times when the chimp was active here, and I may say pretty much all of them adds to the learning curve of any trader... but the adxvma strategies are the best and they really changed my trading after that great discovery here... great times of interaction and development...

 

good trading, cheers The Trader Chimp

[turboscottomatic 10]

Nice to see you back Walter! I don't post much but I read a lot. I've learned more about KISS trading from your threads back in the day than just about anywhere else. Thanks for all the generous posting. You've helped a lot of people. I hope to see you back some more in the future!

 

Scott