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My 6E trading strategy

  #864 (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

Reversal Research

I've had some thoughts on the REVERSAL TRADES over the past as it seems like some I take, and some I don't. It seems like my right brain is trying to draw a correlation between the ones that tend to work out and the ones that fail.

My observation is basically that the swing points that make up the reversal on the 1508, must both "fit" to something. For example, say you had a downtrend, and you observe a reversal setting up on the 1508 below a red cloud. Price then pierces the inside of the cloud. What you would want is to see the swing high stop at some point of resistance, either the 50EMA, the top of the cloud, or possibly a round number.

Next that swing low that prints, you either want it to stop at either the 13ma, the bottom of the cloud, or a round number. If it 'fits' into that Support or Resistance, and you get an entry for the long, it seems like it might be a way to distinguish a good reversal from a bad one.

Hopefully the pics explain what I am getting at. Has anyone else had any similar observations? Just bouncing some ideas around. There also is the possibility of looking at the wicks or bodies of candles for a fit, simliar to DT/DB formations, but just for now this is the idea.

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My 6E trading strategy-prime2011-07-11_123702.jpg   My 6E trading strategy-prime2011-07-11_123724.jpg   My 6E trading strategy-prime2011-07-11_123805.jpg   My 6E trading strategy-prime2011-07-11_123827.jpg   My 6E trading strategy-prime2011-07-11_123912.jpg   My 6E trading strategy-prime2011-07-11_123934.jpg  
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