Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.

thalestrader

Reading Charts in Real Time

Recommended Posts

Lately I've been getting my butt handed to me in the market. It's no fun. But I have been noticing something about my trades that I think can be improved. However, it involves an amount of discretion I'm not used to exercising.

 

For example, here's a short sequence.

 

attachment.php?attachmentid=20380&stc=1&d=1269806699

 

As has been gone over in this thread, I would enter when price makes a lower low, with my stop above the lower high. However I have been noticing that when I take a full stop, it's usually because even though price made a lower low (or higher-high in the case of a long) it only did so enough to get me filled before quickly rebounding and stopping me out.

 

In other words, in the case of a long, we can think the higher high as price breaking a resistance level. But sometime the level only bends enough for me to get fill via a stop-limit order, before falling back down. Here's an example of a long on ES that took out a full stop on Friday. Oh and I know you can't tell here, but I did wait for the blue line to get taken out before I got in long.

 

attachment.php?attachmentid=20381&stc=1&d=1269806699

 

Here's a 5 second view. Notice the vol spike just as a I get fill. Price then retreats and retreats before stopping me out.

 

attachment.php?attachmentid=20382&stc=1&d=1269806699

 

My question is this: is there a way, in these kinds of circumstances, I can look at the chart and see the vol spike, see the rejection and get out early? I know for sure that if getting out early is an option than reentering has to also be an to be an option, and that's fine.

 

The obvious answer is seems to be yes, but that's easy to say here. We have to keep in mind that this is a decision that has to be judged and decided while I'm in a trade. As of now I've avoided making price based decisions while in a trade because that's when our judgment is most skewed. But I'm starting to realize that dynamicness (dynamicism?) would have it's benefits.

 

What exactly can we look for in price that may tell us to jump out early? I think a volume spike can be meaningful. For whatever reason, they seem to happen just as price changes direction (just like here). The other thing to look for is of course whether price is moving against you. But then if you look at the long above, price could easily have went against me for a time, then made a HL and continued upwards. How are we to know the difference? Could time be factor? For example, the rate at which price is moving against us?

 

And if we do jump out early, do we re-renter with the stop in it's original place? If so that means additional risk which could outweigh the benefits of getting out early to begin with.

shortseq.png.79d3be2aecb8eefe59d4de87f4f199bb.png

hutyr.png.3d4482942071d3ee3a6fc87a464c95e1.png

5aa70ff1886d4_5sec.png.abb12b3761b2114b77e3a209b7a511ec.png

Share this post


Link to post
Share on other sites

Hi Jon

 

I also trade the ES. My default bracket right now is one point stop and 2.5 points target. What I am looking for is my trade to go green right away. If it doesn't, I am looking for the door. Once I am in the red, if the trade goes green and then comes back, I am looking to exit at BE. I got a string of BE trades the past couple of weeks but I'm not complaining because those are all trades where a) my entry wasn't great and B) all I paid for the shot was commissions. If a trade goes green by five or six ticks, then I can decided about moving the stop.

 

 

As far as reentries goes, if I have a level I am really sold on and I take a stop--whether it's BE or a couple of ticks-- and the setup hangs around and still looks good, I will hear myself saying "I still like this." Then I'll take the same price if I can get it. Maybe I get stopped again but when a setup looks good, that's what it's all about. You have to get your money down then, right?

 

 

I see pro traders and mentors saying "Forget about losses, move on." I don't find that easy. I usually end up reflecting awhile and sometimes that means I miss a nice move that I knew about but lost my concentration. That's maybe time to go work in the garden for awhile.

 

My two cents. Best of luck regrouping.

Share this post


Link to post
Share on other sites

Jon - been in the same boat looking at the same info and trying to avoid those exact losses.

 

All I can say is this:

 

1. The ES sucks monkey balls compared to practically every other futures market available. Due to the constant arbitrage between teh big and small contract backfill is the name of the game much more so than with any other market.

2. I found that range bar charts really cleared up a lot of the mess and "standardized" my trades and risk as it was the same measure of price movement to measure off of most all the time for pars and targets.

3. I would look into using some type of bar count filter or moving average filter to see if the LH/HL is already overextended or if its still got momentum left to play with.

4. I have been using the Value Chart indicator to see if the push upwards into the LH/HL is overextended on the Value Chart. If it is, I kind of see it as having already made the push and not having much left in the gas tank.

 

There is no right answer I suppose... I just also found those losses very annoying and I don't think there is any big right answer. Maybe these suggestions might give you places to look for answers.

Share this post


Link to post
Share on other sites

I don't know if you guys will like this. I sleep while the ES is active (yes!!!) so I have no experience trading it.

 

My view is based on zones, boxes, or value areas (call them what you want). What you show above is the formation of a value area, progression down to form a new one (a down trend) a move to the upper edge of the value area and then a very minor test of the value area above. This is then rejected for a loss.

 

If you think about these moving rotations/boxes/zones/value areas and remember that an edge test is very likely to fail either at the edge as above or half way into the value area then you might well choose not to trade a 123break that is at the edge of the value area. ??

 

20384d1269824826-reading-charts-real-time-hutyr.png

hutyr.png.0f41f458232a1357b746e06c437ff56e.png

Share this post


Link to post
Share on other sites
Lately I've been getting my butt handed to me in the market. It's no fun. But I have been noticing something about my trades that I think can be improved. However, it involves an amount of discretion I'm not used to exercising.

 

 

While this might sound incredibly arbitrary, I have been trying to employ a 10 minute rule in trading the NQ/YM. Basically when the trade breaks, I do nothing with my stops for 10 minutes. If the trade isn't going my way by then, I try to reduce my risk by half or by the closest swing. This still calls for some discretion, but stream lines the process a little bit. Trading break outs is tough, thats why I have been trying to find a way to reduce my risk as much as possible. So far this simple rule has led me to some decent SIM profits. But this is also with a relatively small sample size, but i'd figure I would throw the idea out there.

 

EDIT: If a trade immediately jumps to 1R profit, I reduce my risk before the 10 minutes is up, otherwise I do nothing.

Share this post


Link to post
Share on other sites
Lately I've been getting my butt handed to me in the market. It's no fun.... I have been noticing that when I take a full stop, it's usually because even though price made a lower low (or higher-high in the case of a long) it only did so enough to get me filled before quickly rebounding and stopping me out.... My question is this: is there a way, in these kinds of circumstances, I can look at the chart and see the vol spike, see the rejection and get out early?

 

I do not use volume on intraday charts, so I will not comment on your proposed use of volume in this case.

 

I am reminded of a post I made a little over a month ago:

 

...I've been going back over the Linda Raschke seminar material again over the last few weeks, and one line that must have resonated with me at the time is this: "The trade must move in your favor right away. Sideways is not an acceptable response."

 

Well, if I'm long, and if sideways is not acceptable, then down is an absolute no-no!

 

If I am not up a few ticks real soon, I am likely out. If I am stopped in based on a BO that can't even hold for a handful of seconds, I am out. As for re-entry, I enter at a new BO high (for longs) or new BO low (for shorts).

 

One thing to keep in mind is hat this thread has really spoken of two different "1-2-3" entries, and the one one you are using in this case is a simple sequence typically associated with Joe Ross and his Ross Hooks.

 

Another, more rigorous 123 is that associated with Trader Vice, and those require the break of a correctly drawn trend line. The Trader Vic 123 will weed out many, though not all, of those instances where you get ticked into a trade that immediately reverses. The trade off will be that by the time you gte both the trend line break (Trader Vic's 1), a retest of the high (Trader Vic's 2) and then a break of the significant low (Trader Vic's 3) a large portion of the move may already be over.

 

The Joe Ross type 123 will get you in for much of those moves, but you often will also be buying or selling the "C" of a simple ABC correction, which reverse against your new trade and quickly head for a break of the B pivot. This is why I do not stick around long in these trades. These either work, or they do not work (usually). True, sometimes I cut the trade loose only to see price do what I had positioned myself for it to do. In those cases, I re-enter as described above. Remember, risk is a function, not a simple measure - risk is a function of spread (entry-stop loss), position size, and probability., So though the re-entry level is not as favorable as the initial entry, by adjusting position size, along with the increased probability that the trade will work if the BO direction resumes, the risk really has not changed (at least not much).

 

I would also recommend a couple of posts from early in this thread, one by Blowfish, where he reminds us that where there is a potential long trade no doubt lurks a potential short trade as well; which leads to the second post I recommend in which Kiwi advises us to always consider the other side. If we are preparing to get long, ask what would make us change our minds and decide to go short instead?

 

In my view, my stop loss protects me against suffering an inordinately large loss. It also marks a point where I am wrong. But, it is not the point at which I am wrong - it is the outer boundary of the bad lands. If price is heading in the direction of my stop, I am already wrong.

 

I would also recommend that anyone working along with this thread read (or re-read) chapter 7 of Trader Vic I - Methods of a Wall Street Master. Pay special attention to the 2B criterion, as many of these trades based on Joe Ross 123's that get immediately stopped out are suitable for a stop and reverse on the basis of the 2B criterion.

 

Best Wishes,

 

Thales

Share this post


Link to post
Share on other sites

Thales,

 

I have spent the last week reading pages 1-300 and the last 50 pages of this thread. I must say this is a great thread and it ranks right up there w/ AHG on ET (if anyone knows what that is).

 

I want to try to force myself to participate and see if I can learn something in the process. I am one of those that reads a lot but rarely posts.

 

I am on sim right now (I watch 6E and NQ) and I replay the day when I get home from work. I eventually want to trade the Asian futures.

 

I tried out Oanda last night and I think that is going to be too painful for me. I really wanted to try to trade the same markets as everyone else here but I couldn't get the data to match and order entry was harder than it should have been so I am just going to stick with what I am doing.

 

I do things a little bit differently than some here so maybe some can help me fix my glaring errors and in return I can .... well I don't know what I can give in return. Maybe some bad advice. :)

Share this post


Link to post
Share on other sites

Jashano - welcome - re matching charts and data, many people trade slightly different contracts, or the spot as opposed to futures. Plus with the FX different bar starting times may result in slightly different data sets - hence trying to match exactly will be hard unless you have the exact specifications of someone else's chart.

Have no fear in posting ideas, mine constantly seem to loose! - its all about ideas, education and helping yourself and others....so I am sure everyone is happy to see other ideas and other contracts.

Share this post


Link to post
Share on other sites
...I am on sim right now (I watch 6E and NQ) and I replay the day when I get home from work. I eventually want to trade the Asian futures.

 

I tried out Oanda last night and I think that is going to be too painful for me. I really wanted to try to trade the same markets as everyone else here but I couldn't get the data to match and order entry was harder than it should have been so I am just going to stick with what I am doing.

 

I do things a little bit differently than some here so maybe some can help me fix my glaring errors and in return I can .... well I don't know what I can give in return. Maybe some bad advice. :)

 

Hi jashanno,

 

Nothing wrong with Sim - while it will do little to help you with the emotions of trading, it is the proper way to learn the mechanics and to help train your eye - as we are nearing opening day, I'll shift to baseball for my analogies: Sim is the batting cage - it will help you learn to see the ball and practice taking your swings, but it will not take the place of standing in against a 90+ mph curve ball in front of 50K screaming fans. But even the pros take swings in the batting cage regularly.

 

Do not worry about trading what everyone else is trading here. I trade the 6E, and I think both the 6E and NQ are wonderful instruments to trade, especially for someone learning to read price based on S/R and various repeating patterns.

 

As far as doing things differently, this is not a "my way or the highway" thread. Each of us who have participated here have our own grip on the bat and our own individualized stance at the plate particular to his or her "body" type. I would wager that those who have improved the most here tend to be those who do it his or her own way.

 

Welcome to TL and welcome to this thread. I look forward to your participation.

 

Best Wishes,

 

Thales

Share this post


Link to post
Share on other sites

Current look at the 15 minute EUR/JPY...

 

It's probably just my inexperience, but I don't know anything to do but wait when price looks like this. I'm just waiting for it to start "swinging" and/or reach one of my blue lines.

 

attachment.php?attachmentid=20402&d=1269950935

EJ15M.jpg.cbd84a0e5270c0a4fdcfdee7daaaf46b.jpg

Share this post


Link to post
Share on other sites

Thanks for the insights guys. This is one of those tough questions that there really is no perfect answer to. I'm in the midst of a drawdown right now so I'm not going change anything, but I'm going to keep working and thinking about this until I figure something out.

Share this post


Link to post
Share on other sites

The ADP Employment Report had some effect on the EUR/JPY..this news was NOT "market moving" or "high importance" on Econoday or DailyFX, yet it still caused the Oanda spreads to widen to 10 ticks! I have a feeling I'm going to end up getting taken out on one of those news spikes one of these days... :)

 

attachment.php?attachmentid=20430&d=1270037984

Untitled.jpg.b5ef880f1c507b41320e3e99eee84fbb.jpg

Share this post


Link to post
Share on other sites

Here's a trade I like. Just an observation and not even sim.

 

Edit: How do you post your charts? Mine just come up as an attachment. Do you have to have a web link?

euro.bmp

Edited by jashanno
edit

Share this post


Link to post
Share on other sites
The ADP Employment Report had some effect on the EUR/JPY..this news was NOT "market moving" or "high importance" on Econoday or DailyFX, yet it still caused the Oanda spreads to widen to 10 ticks! I have a feeling I'm going to end up getting taken out on one of those news spikes one of these days... :)

 

Hiya Cory,

 

Use the forex factory calendar as the reports there are coloured by how they generally affect currencies. You'll see that the report is marked RED :)

 

Forex Calendar @ Forex Factory

 

With kind regards,

MK

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Topics

  • Posts

    • HLF Herbalife stock, watch for a bull flag breakout above 9.02 at https://stockconsultant.com/?HLF
    • Date: 1st April 2025.   Will Gold’s Rally Hold Strong as New Trade Tariffs Take Effect Tomorrow?   Gold continues to increase in value for a sixth consecutive day and is trading more than 17% higher in 2025. Amid fear of higher inflation, a recession and the tariffs war escalating investors continue to invest into Gold pushing demand higher. The trade policy from April 2nd onwards continues to be a key factor for the whole market. Can Gold maintain its upward trend? Trade Policy From Tomorrow Onwards Starting as soon as tomorrow, a 25% tariff will be imposed on all passenger cars imported into the United States. While this White House policy is anticipated to negatively affect European industrial performance, it will also lead to higher transportation and maintenance costs for everyday American taxpayers. The negative impact expected on both the EU and US is one of the reasons investors continue to buy Gold. Additionally, last month, President Donald Trump announced reciprocal sanctions against any trade partners that impose import restrictions on US goods. Furthermore, tariffs on products from Canada and the EU could increase even more if they attempt to coordinate a response. Overall, investors continue to worry that new trade barriers will prompt retaliatory measures, particularly from China, the Eurozone, and Japan. Any retaliation is likely to escalate the trade conflict and prompt another reaction from the US. Experts at Goldman Sachs and other investment banks warn that this will lead to rising inflation and unemployment. They also caution that it could effectively halt economic growth in the US.   XAUUSD 1-Hour Chart   The Weakness In The US Dollar Another factor which is allowing the price of XAUUSD to increase in value is the US Dollar which has been unable to maintain any bullish momentum. Despite last week’s Core PCE Price Index rising to its highest level since February 2024, the US Dollar has been unable to see any significant rise in value. Due to the US Dollar and Gold's inverse correlation, the price of Gold is benefiting from the Dollar weakness. Investors worry that new trade barriers will prompt retaliatory measures from China, the Eurozone, and Japan, potentially escalating the conflict. Experts at The Goldman Sachs Group Inc. believe that such actions by the US administration will drive rising inflation and unemployment while effectively halting economic growth in the country. Can Gold Maintain Momentum? When it comes to technical analysis, the price of Gold is not trading at a price where oscillators are indicating the instrument is overbought. The Relative Strength Index currently trades at 68.88, outside of the overbought area, since Gold’s price fell 0.65% during this morning’s session. However, even with this decline, the price still remains 0.40% higher than the day’s open price. In terms of fundamental analysis, there continues to be plenty of factors indicating the price could continue to rise. However, the price movement of the week will also partially depend on the employment data from the US. The US is due to release the JOLTS Job Vacancies for February this afternoon, the ADP Non-Farm Employment Change tomorrow, and the NFP Change and Unemployment Rate on Friday. If all data reads higher than expectations, investors may look to sell to lock in profits at the high price. Key Takeaway Points: Gold’s Rally Continues – Up 17% in 2025 as investors seek safety from inflation, recession fears, and trade tensions. Trade War Impact – New US tariffs and potential retaliation from China, the EU, and Japan drive uncertainty, boosting Gold demand. Weak US Dollar – The Dollar’s struggle supports Gold’s rise due to their inverse correlation. Gold’s Outlook – Uptrend may continue, but US jobs data could trigger profit-taking. Always trade with strict risk management. Your capital is the single most important aspect of your trading business.   Please note that times displayed based on local time zone and are from time of writing this report.   Click HERE to access the full HFM Economic calendar.   Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!   Click HERE to READ more Market news.   Michalis Efthymiou HFMarkets   Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
    • Date: 31st March 2025.   Trump Confirms Tariffs on All Countries, Sending Stocks Lower.   The NASDAQ continues to trade lower due to the US confirming the latest tariffs will be on all countries. In addition to this, bearish volatility also is largely due to the higher inflation data from Friday. The NASDAQ declines to its lowest price since September 11th 2024. Core PCE Price Index - Inflation Increases Again! The PCE Price Index read 2.5% aligning with expert forecasts not triggering any alarm bells. However, the Core PCE Price Index rose from 0.3% to 0.4% MoM and from 2.7% to 2.8% YoY, signalling growing inflationary pressure. This increases the likelihood that the Federal Reserve will maintain elevated interest rates for an extended period. The NASDAQ fell 2.60% due to the higher inflation reading which is known to pressure the stock market due to pressure on consumer demand and a more hawkish Federal Reserve. Boston Fed President Susan Collins recently commented that tariffs could drive up inflation, though the long-term impact remains uncertain. She told journalists that a short-term spike is the most probable outcome but believes the current pause in monetary policy adjustments is appropriate given the prevailing uncertainties. Although, certain investment banks such as JP Morgan actually believe the Federal Reserve will be forced into cutting rates. This is due to expectations that the economy will struggle under the new trade policy. For example, JP Morgan expects the Federal Reserve to delay rate cuts but will quickly cut towards the end of 2025. Market Risk Appetite Takes a Hit! A big factor for the day is the drop in the risk appetite of investors. This can be seen from the VIX which is up almost 6%, Gold which is trading 1.30% higher and the Japanese Yen which is the day’s best performing currency. Most safe haven assets, bar the US Dollar, increase in value. It is also worth noting that all indices are decreasing in value during this morning's Asian session with the Nikkei225 and NASDAQ witnessing the strongest decline. Previously the stock market rose in value as investors heard rumours that tariffs would only be on certain countries. This bullish swing occurred between March 14th and 25th. Over the weekend, President Donald Trump indicated that the upcoming tariffs would apply to all countries, not just those with the largest trade imbalances with the US. NASDAQ - Technical Analysis In terms of technical analysis, the NASDAQ continues to obtain indications that sellers control the price action. The price opens on a bearish price gap measuring 0.30% and trades below all Moving Averages on all timeframes. The NASDAQ also trades below the VWAP and almost 100% of the most influential components (stocks) are declining in value.     The next significant support level is at $18,313, and the resistance level stands at $20,367.95. Key Takeaway Points: NASDAQ falls to its lowest since September 2024 as the US confirms tariffs on all countries, adding to inflation concerns. Core PCE inflation rises to 0.4% MoM and 2.8% YoY, increasing the likelihood of prolonged high interest rates. Investor risk appetite drops as VIX jumps 6%, gold gains 1.3%, and safe-haven assets outperform. NASDAQ shows strong bearish momentum, trading below key technical levels with support at $18,313 and resistance at $20,367.95. Always trade with strict risk management. Your capital is the single most important aspect of your trading business.   Please note that times displayed based on local time zone and are from time of writing this report.   Click HERE to access the full HFM Economic calendar.   Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!   Click HERE to READ more Market news.   Michalis Efthymiou HFMarkets   Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
    • PM Philip Morris stock, top of range breakout at https://stockconsultant.com/?PM
    • EXC Exelon stock, nice range breakout at https://stockconsultant.com/?EXC
×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.