Trend Dodging

[AmCan1 10]

Sure thing Cuttshot. I believe the idea is a good one and if it leads to profitable trading, that's all that matters. I didn't know JCarter had it working with TOS though. That's news to me.

[TraderWill 11]

AmCan, it's just an indicator, not a system. As Cutshot says John Carter has been using a version of it for a while. He has a book out, I forget the name, that has a chapter devoted to trading with it. Carter's basic strategy if I recall was to take a breakeout when exiting the squeeze, using the histogram to indicate direction. Not sure what exit rules he was using.

[AmCan1 10]

Great Traderwill. Thanks for the info. I think I'll keep my eyes open for his book. I'm always looking to read and learn about different trade methods and I can see the merits of this one. The principals make sense to me.

[cuttshot 11]

amcan,

 

the book is worth the read. it has some interesting ideas in it. he basically outlines his approaches throughout the book so you get a feel for his trading style.

[AmCan1 10]

Here is an informal look at some mid session squeeze trades on the TF 233 tick chart. I've indicated with arrows what I would think to be good setup bars, without really studying or thinking through a formal strategy. Looks like it could have been 2 winners and 1 loss and a very positive end result; or at least some sort of variation to that, depending on trade rules. Seems to give some good signals though.

[cuttshot 11]

it would be interesting to experiment with different ways of calculating the setups. I would think going for some kind of a fixed target initially also with a fixed risk would provide a better framework than just going with reversals. Obviously it's going to take some work to dive in and test. I don't know about you but there just aren't enough hours in the day to get to things like this.

[AmCan1 10]

Ain't that the truth! Despite popular belief, I gotta get at least 4 to 5 hours of sleep a night whether I need it or not. I think there's enough tools on that chart to come up with a decent exit strategy. I got a momentum indicator overlayed on top of the channels, the yellow dashed line, and a slower one, the cyan line. The channel itself can be used to trail and the histogram could signal when to tighten or perhaps move to a 3 bar stop type of idea. Lots of ways to figure this one out. Or, we could just read the book. Lol..

[markl67 10]

Carter has mentioned exiting a squeeze trade on 2 TTM bars in the opposite color of your direction. I receive his free daily videos and not to dis the man, but it seems like every other week he's showing a chart with a different time frame using a different indicator - now it's the TTM wave.

 

Back to the original post, I didn't see anyone mention using tick levels to determine trend or strength of the trend...

[AmCan1 10]

I know there are a lot of techniques on how to use the Tick to gauge strength or perhaps more importantly, weakness in a trend. I used to watch it along with a few other internal indicators but I never fully got a feel for it. I ended up with a dynamic, price action based method that kind of had everything I needed baked into the strategy so I stopped watching the Tick. I'd be interested to hear other's take on it or way of using it though. I know that it is a very useful indicator/tool when applied appropriately.

[bathrobe 10]

  Dinerotrader said:

I am primarily a reversal trader. My main concern of course is to make sure I am not taking a reversal trade in the middle of a strong trend. I am wondering what methods others use to gauge trend strength, breadth, etc.

 

Does anyone use a reasonably reliable indicator that gives them an idea if they should stand clear of reversals for the moment because of a trend?

 

Just curious what others out there have used when trying to identify a move strong enough to end up an intraday trend.

 

I use an average of the $TICK which gauges the overall sentiment pretty well, I would never place a trade based on this but it does a good job of showing strength. I also only trade reversals, if I remember I will post a picture tomorrow.

[bathrobe 10]

  AmCan1 said:

I know there are a lot of techniques on how to use the Tick to gauge strength or perhaps more importantly, weakness in a trend. I used to watch it along with a few other internal indicators but I never fully got a feel for it. I ended up with a dynamic, price action based method that kind of had everything I needed baked into the strategy so I stopped watching the Tick. I'd be interested to hear other's take on it or way of using it though. I know that it is a very useful indicator/tool when applied appropriately.

 

I do not put to much stock in it but if the market is rising and the $tick dropping I will look for shorts if other factors come into play, but the $tick alone, no short.

[waveslider 10]

Indicators to determine trending nature of a market:

 

ADX - directional index, whether bars are overlapping

Autocorrelation - whether the next bar tends to follow through or reverse

Fractal indices - not totally clear on how these work, but higher readings demonstrate trending.