My 6E trading strategy | Currency Futures


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My 6E trading strategy

  #780 (permalink)

Chicago IL
 
Trading Experience: Intermediate
Platform: Ninja, MT4,TOS, SC, Matlab
Broker/Data: CQG, AMP, MB, DTN
Favorite Futures: E/U, G/U
 
forrestang's Avatar
 
Posts: 1,039 since Jun 2010
Thanks: 227 given, 697 received


Lmess View Post
Now I'm up to date with the videos as well. Here are a couple new things I learned:

1. You look for divergences to take place when looking for an entry. If everything sets up properly in the 1508 and 377 tick chart, but there is no divergence in the 377 tick chart, you do not take the trade. If the stochastics indicator is moving the same as price, you don't take the trade.


trendisyourfriend View Post
I got the same interpretation too. That is not mentionned in the PDF. In fact, it contradicts what is in the PDF since for a trade to take place you need a HH or LL in both charts (1508,377). Obviously, if this is what happens then the stochastic will also mimic price. SO is this a trade setup or do we need also some kind of divergence all of the time ? This is not clear to me and i suppose it is not for others too. The more we see what Charles is doing, the more we find rules and exceptions.


Lmess View Post

At the beginning, I was a little obnoxious because I kept questioning Charles about the rules. Eventually, I've come to the conclusion that those rules serve as general guidelines, but there are some exceptions to the rules that have appeared as the thread has grown.

As for the divergence when looking for an entry, it seems as though in the videos, the divergence requirement kept him out of what would have been some losing trades. I guess the divergence setting up before the entry gives price that extra momentum needed to move in the direction of the trade once a trade has been taken, which like I said before, is what I like about this system. So if the divergence is going to give it that extra momentum, then I will include it as a requirement for a proper setup when implementing this strategy. I will keep studying the strategy until I feel comfortable enough to use it in my live trading.

You guys raise some great points. I had similiar ideas too.

As for me, I DO NOT TAKE a trade unless i can find a divergence with a DT/DB. Thing is... they're usually on every trade worth taking in one shape or another! I have become much more flexible in locating those DT/DB formations as well. But finding a divergence along with that seems to provide really nice trading opportunities.

I think we'll see a lot of different opportunities given that this is a discretionary methodology, so eventually I'm sure we'll each hammer out what makes sense individually.

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