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Psychology and Money Management


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Millionaire in 10 weeks & Conversation with broker

  #15 (permalink)

Montreal
 
 
Posts: 128 since Jan 2013


researcher247 View Post
So your stops are 0.5 pts (or 5ticks) on the Russell? That is 'noise' - how do you qualify an entry without getting caught up in the 'noise' of up 10ticks/down 10ticks/up 7ticks/down 7ticks w/your Renko bars even when price dips into your favorable cloud(s) area(s)?

Yeah I know that 5 ticks is nothing to the Russell however, if you look closely, you will find something interesting.

Look at last Friday's chart. You can see in the green rectangle that the bulk of the price was hovering above not only the darkest cloud but also above the lightest one too.

What I deducted from watching my indicator is that you carefully watch where the price IS and where it's NOT. In Friday's case, it's NOT within the 1st cloud so you ONLY enter when you see a dip at that level.

Look at the number of times the priced dipped into the 1st cloud, only 7-8 times. That's NOT being bombarded with dips where the second you get into one, it reverses on you and makes another one and another one and another. I don't know about you but I can handle 7-8 events per trading day.

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On Thursday however, the bulk of the price was hovering within the 1st and light blue cloud so unless you want to get whipsawed, YOU DON'T GET IN at every reversal you see within the 1st cloud, instead, you wait that it makes a reversal at the 2nd and darker cloud where reversals occur a handful of times.

In this screenshot, the market only hits the dark cloud once so you would get in at that level. Earlier that morning and later on that day, the price hovered within the 2nd and darkest cloud so you would get in at the peaks OVER that 2nd cloud. here again reversals at that level don't occur too often.

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Oh yeah, one more thing.

I found out lately that on Renko charts these bars just loooooooooooooovvvves to make double bottoms or double tops, they're freakin EVERYWHERE!!!

So if you get in at a peak and it reverses on you, you can get out and place your limit order right at that double bottom or double top point and get in at the best entry point on the chart.

You will be surprised as to how often it will work.

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In fact when I made my $25 yesterday, it was on my very 1st trade and I caught it after entering at a triple bottom!!!

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Btw, I have not invented sliced bread here. I just did my homework for many years to find the best trading system I could find and even then, it's not perfect. That's in fact the main reason why I am posting it here so that maybe you guys will help me improve it.

On almost all my books, CDs, DVDs and even Cassette Tapes I bought throughout the years on trading, they all say the same thing...

"... Find the TREND and then BUY THE DIPS".

Well... these 2 clouds are giving me BOTH. The color of the clouds tell me the trend direction and the price actions regarding those 2 clouds are giving me the deepest of dips while indicators like Stochastic will show up reversals at the 20/80 line on ALL those reversals and THAT is how you get whipsawed.

However if everyone is like you telling me that it will fail then I might as well do like I did at TradeStation and pack my things and go elsewhere.


Last edited by MerlinWorld; July 28th, 2019 at 12:31 AM.