Combining Candlesticks, Indicators, and Pivots

[jacobnbr1 10]

Ok i have some books and a few audio books on the way also.

 

Until the can somone help me with setting up a chart?

I normally use BigCharts: Stock Charts, Screeners, Interactive Charting and Research Tools and i want to try and explore a chart with some dma's, or ema's with a few indicators to get familiar with. I have read in many books that dma works well.

 

I was thinking if i wanted to place trades with an idea of holding for a week or so i should plot them on a 10 day charts with a breif look at the 6 month chart to confirm a trend is preasent? would this be accurate?

 

chris

[Soultrader 12]

Hi Chris,

 

What kind of help do you need? Do you have access to a trading data vendor like Tradestation? These software come with alot more tools of the trade.

 

Also it is a good idea to use multiple timeframes. Look at the bigger picture first then narrow it down to time your entries or exits. You should use a weekly, daily, 60 minute, 15 minutes, and perhaps a 5 minute chart to time your entries.

[jacobnbr1 10]

I do not have a data vendor like tradestation. I am not sure how tradestation works, I am sure there is a fee for the data correct? Do you have to have a trading account to veiw their data?

 

How about telechart service? i have been looking at that. sounds kinda cool.

 

thanks. chris

[Soultrader 12]

I have an account with Tradestation and I make over 10 roundtrips a month so my software fee is waived. However, you can still use Tradestation for I believe $99 a month plus data fees.

 

If I remember correctly, Telechart is Worden? They do have a great charting sofware but I prefer Tradestation over any data vendor. The only fault is that they do not have market profile charts.

[jacobnbr1 10]

And market profile charts are what? Are these charts needed to swing trade?

 

thanks

[Soultrader 12]

Market profile charts can be useful for any type of trading. However, they need to be learned first in order to understand them. They are plotted like a bell curve with the concept of time x price = opportunity.

 

If you would like to study this concept I highly recommend picking up Mind Over Markets. You can also check out some videos from this thread.

 

http://www.traderslaboratory.com/forums/market-profile/376-market-profile-education-resources.html

[jacobnbr1 10]

All do respect of your comments and advice, do you think it would be wise to purchase this software when one could familuarize himself 1st with a free type charting program such as StockCharts.com - Simply the Web's Best Stock Charts or BigCharts: Stock Charts, Screeners, Interactive Charting and Research Tools

 

telecharts is 99.95 per month and tradestation is 249.95 per month- unless you are trading 5000 shares per month and i can't really say i would trade that much while learning to swing trade..

 

I figured i could start with the basics and when the need to go more technical comes then i could expand to newer and better things.

 

thanks.

chris

[Soultrader 12]

You are working with delayed quotes at this moment? I think for the time being you can practice with delayed charts but you should consider paying for real-time data feed. Have you looked into e-signal? I used to use their market profile chart and their fees may be cheaper than Tradestation.

 

The reason why real-time data is necessary it because you need to understand the flow of the markets as the action progresses. You will also need to work on timing your entry points based. This can only be done with real-time data. I have also used Telechart in the past and I think its a great inexpensive software. But I prefer to use the charting tools that Tradestation has to offer. I am sure Telechart will do just fine for you for the time being.

 

I actually have got an offer to try out a software free of charge. Its not the best software package but if you are interested let me know. They offered for me to use it free of charge including data fees if I used it for the website. I can maybe let you give it a test run for the time being?

[jacobnbr1 10]

Sounds pretty good. I have a prophet type service with scottrade and most of my studdies are there and bigcharts.

 

I know you had said i need to look at the charts in a monthly, weekly, hourly,15 min and 5 min scale.I can set differant time frames in there, what am i looking for? do i want a yearly chart or 6 month or maybe even a 3 month chart?

 

My charting programs work as follows-

prophet min time frame is 1 month and max is 10 years.

big charts 5 min to 10 years- big charts being a little more defined.

 

Hope these are not too dumb of questions

[Soultrader 12]

No question is ever dumb You should look at a bigger timeframe such as the daily or weekly to see the bigger trend. Then you should narrow down to a 30min or 15 min chart to identify support and resistance price levels. Then you should narrow it down to a 3-5minute chart to time your entries.

 

You are working with delayed quotes?

[jacobnbr1 10]

I am not sure what you mean by working with delayed qotes?

As of my prophet charts it says it is a java real time qote.

 

Can you please explain.

 

chris

[Soultrader 12]

Delayed quotes are data that is not real-time. Most free charting packages do not provide real-time tick by tick data since this costs exchange fees. Instead they are usually delayed by 15 minutes or more.

 

If you can not see the tick by tick price movement, you are most likely working with delayed quotes. Can you pop out a time and sales?

[jacobnbr1 10]

No i can't pop out time and sales...

 

So let me get this right here, I need real streaming qotes as in e-signal- worden or tradestation.

 

Plot a chart to identify the term of trend is up for bullish trades and down for bearish-shorts..

 

Most of the charts i plot are in the middle of some type of cycle where they look momentumless. infact most of the ones i hold now as insider buys look as if the trend is straight line accross. Is there somthing i can do to find candidates for a trend up?

 

When i do find one that does have a good upward trend i will then be plotting support and resistance for an enty point by focusing closer on the charts as in 30-15 minute charts and then the entry point by 3-5 minute charts upon support touch.

 

correct?

 

thanks.

 

chris

[Soultrader 12]

It all sounds so easy doesnt it? But trading is one hard profession. You need to identify a trending market from a consolidating market and switch strategies. Its easy to jump on board in a trending market; buy pullbacks or short rallies. However, this only happens 30% of the time. You need to be able to adapt depending on market conditions.

 

If you are looking for stocks on the fly, take a look at stocks stuck in a range. Scan for stocks trading in a bracket and then plan on buying breakouts out of the range. This is more of a momentum strategy which I do not use.

 

Are you aware of the support and resistance levels of the stock you are trading? If not, study the chart. Study volume and look for possible reversal price levels. These are the levels you want to be looking for to time your entry and exits. Of course its not that simple. You need to scan for the overall health of the market.

 

Keep studying the markets and read alot of good trading books. I do not want to see you making typical newbie mistakes that can be costly. There are so many different strategies one can apply in trading. Learning how to identify support and resistance is also a skill. Learning the art of entry or exit is another skill.

 

If you are not an insider, there is no exact method to understand what the insiders are doing. Study the charts. The charts give off tremendous clues about a stock.

[jacobnbr1 10]

I would say if i had not already tinkered in the markets- Yes it does seem easy..

 

Unfortunatly it is not and i already know it.. That is my purpose for further knowledge of t/a.

 

It almost seems to me that if you chart one out at support and you do everthing according to some text-books they breakdown and fail. I guess this would be a normal trendless market action? However you will find one that actually does do what you thought it would do and further over confident yourself as beleiving you have figured out the nitch for trading and thus overtrading the same set-up to lose at the same play causing confusion of why it didn't work...I personally do not think there is anything wrong with the set-up but bad market conditions for this style...

 

Perhaps my issue may be from never interacting in a good forum of discusion of why things are the way they are...

[jacobnbr1 10]

Ok i have been looking at some charts and seems as if when i scroll from chart 6 month to chart 3 month and then zoom in closser to the days i just get mixed signals of what is going on. Any advice on this?

 

Perhaps i need to draw the support and resistance lines 1st along with any divergence lines?

 

thanks

[Bfbusa 10]

Question concerning Pivot and retracements.

 

As the strategy dictates, you want to wait for a retracement to the pivot before entry. Whould a candlestick pattern Tweezer Tip formation , as seen on the YM chart today 9/25/2006 at 10:47am be considerd a pivot test and then retracement on the next bar. In this particular instance, the YM never looked back, it just kept going.

[Soultrader 12]

Hi Bfusa,

 

Not sure what a Tweezer Tip formation is. Can you post a chart up so I can take a look?

 

I had a long bias for the YM today because of the daily charts. If you take a look the trend was still valid and the YM has just finished its pullback. It was all about timing today to try to get in for the nice trend.

[Stockaddict 10]

jacobnbr1,

 

What methods do you use to detmerine insider buying? Of course they need to report this to the SEC but the public will find out well after inside buying has been done. Do you look for clues in volume?

[Bfbusa 10]

Hi Bfusa,

 

Not sure what a Tweezer Tip formation is. Can you post a chart up so I can take a look?

 

I had a long bias for the YM today because of the daily charts. If you take a look the trend was still valid and the YM has just finished its pullback. It was all about timing today to try to get in for the nice trend.

 

Hi Soul,

 

If you look at the TM chart from todat at 10:47 am you see two candle bars with equal size tails at the value low pivot befoe the day long revesal. I post the chart if I knew how. You also see another tweezer earlier at 10:06am. They are usually significant after a bit of a run in price and could signal a change of trend. Especially when they occur in conjunction with other signals. Hence, the pivot points.

 

Bill

[Soultrader 12]

Hi Bill,

 

You can post charts using the attachment button that looks like this: This function is only available when you post a reply and not the quick reply.

 

I use a 233 TICK chart so the candlestick patterns may be slightly different from the one you see. However, when the YM tested the value low pivot, it does look like we saw a doji followed by a candlestick with the equal size wicks.

 

The value low pivot is usually a good pivot to use as support. Once broken, it acts as key resistance. Today, it became the dead low which is quite interesting. I was careful today at the initial test of the value low pivot due to weak market internals. But after it held the second test, this was a good information that the markets had found support and good for a long setup.

[Soultrader 12]

Ok i have been looking at some charts and seems as if when i scroll from chart 6 month to chart 3 month and then zoom in closser to the days i just get mixed signals of what is going on. Any advice on this?

 

Perhaps i need to draw the support and resistance lines 1st along with any divergence lines?

 

thanks

 

Try looking at the larger timeframe to see the bigger trend. You might see a downtrend in a 30 minute chart but an uptrend in a daily chart. Always look out for the bigger trend.

 

Since you plan to trader on a longer time frame, the understanding the bigger picture is vital. Woud you be able to post some charts up so I can take a look? Perhaps I can explain this better. Thanks