I live in Sydney Australia and
for almost two months now I have been paper trading with live data on the ninja trader platform looking at scalp trades using a specific entry system called Boomerang scalp trader.
It is, its creator claims designed specifically for the ES. however can be used on other indices/eminis . not only does he use this system but he also recommends looking at the " tape bias" such as the Trin and Tran, s&p and few other indicators on the opening bell and through out the day to indicate a bullish or bearish day on the ES
Living in Aus presents a problem for me to trade the ES even on the Globex as the price doesn't see much short term volitiliity suitable for scalping when the US market is closed(imo) at the moment it opens at 11.30pm Aus time
Howver I read where one trader is using the system successfully on eminis such as the
6E. So ihave been getting used to using Ninja Trader and this system mainly on the Euro and Aussie dollars with only limited success and failure
I have a few questions at the moment ...
1. what factors influence currencies such as the aus and Euro $$ on an intraday basis that I am able to easily research each morning ,and during the day,such as Trins or Trans (or whatever) I am looking for specific suggestions here that will suggest to me that we may be having a bullish or bearish "currency day"?
2. watching these two currrencies (6A & 6E)on a 4 range chart over the past two months suggests to me that the one currency pretty much trends (short term) in the same direction as the other, why is this and how can i use this or other indicators to my advantage?
3. people on this and other forums talk about short trem trading in the first couple and last couple of hours of the market as there can be more " noise" (read: less trending) in the in the middle the of the trading session. But with the Globex eletronic exchange virtually open 24hrs a day, this can be quite a confusing statement as the " normal trading day" for the aus $$ is different to the Euro which is different to the Yen etc
So if I want to sit at home in Sydney Australia (GMT+10 hrs) and trade the Euro or any other currency for that matter , at what point in the 24hour clock does the intraday data
that indicates a bullish or bearish time ahead no longer become valid.
ie: when trading the ES it is suggested to look at the tape bias before the USstock market opens for the day ...to get a possible indication of the coming days direction how can I apply this to other indicies such as the 6A and 6E and at what time of day do they no longer be valid
4. I beleive (correct me if wrong) that the currencies tend to gravitate around their opening price. It may trend up or down in the course of the day, but on a neutralish day will probably close pretty close to the open. So it can be a good idea (i beleive) to have a horizontal line that at the open of the day, that remains a reference point throughout the day to remind you if you may be looking at a currency that is near the extreme of its trading range and is likely to return back towards the equilibrium? ie Open price
So whta is the refernce hour for both the 6A and 6E?
Our local stock exchange opens at 10am , however the 6A seems to be active from about 8AM )local time). So at what time specifically do I start looking at the appropriate
influencing factors for the upcoming day
What are the appropriate hours for the 6E?
Or does it all just revolve around what wall street does during its "OPEN" hours?
5. I use a 4tick range bar and am having some problems getting stopped out of otherwise correctly bisaed trades. ie: I'll go short only be to stopped out on a small reversal which then continues on what other wise would be a winning trade.
I believe ATRs are commonly used to calculate a stop that allows room for your trade to breathe.
Can this be set on a " range bar chart" Or does being a "range" chart negate this concept?
If it can be used, what is an appropriate " range" to set my stop?
If not could I possibly use say a 5min or other time frame to calculate the ATR before setting the stops in my trades.
6. What is a tick chart?
Think this is plenty for my post
Thanks for your help
The following 3 users say Thank You to grego for this post:
I think you should be able to use it on 6E pretty well.
The "tape" he recommends is for the US Stock indexs only. It will not work for any other instruments. That's why he trades the ES. They do work very well for the ES, YM and NQ. Don't use them for the currencies though.
I think if you want the best time to trade 6E or 6A, you should try for the London open or the New York open. The London open seems to be the best. The US session can be slow sometimes and the US afternoon session is often better spent watching paint dry.
I would think about using a 6 range bar on 6E but the boomerang system is designed to work on a 4 range bar so you should leave it at that if you use that system. I would refrain from adding any further indicators to that system as it is designed to be a stand alone system. To many other indicators will simply complicate matters and make you hesitate while you analyze one more indicator.
The ATR for 6E is normally about 6. If you use a 4 range bar, and you get your entries right, a 6 tick stop could work. However, if I remember correctly, the boomerang system says to use a 2 point stop on the ES, that works out to 8 ticks on 6E. If you are going to follow the system, then you should use the 8 tick stop. Otherwise, its just a crap shoot. Stop placement is so very subjective depending on what type of system you trade. Try the 8 tick one for now, it sounds to me like that will work for you at least to see if the boomerang system actually works.
As for what other stuff to watch on currencies, pay attention to the daily chart for longer term support and resistance, but in general, the boomerang should not need a bunch of other stuff.
I took a look at the system and liked the premise of it but did not buy it.
Let us know how it goes. Start a journal and post some charts of your progress. I am sure the entire futures.io (formerly BMT) community would like to see how you do with this.
Simplicity is the ultimate sophistication, Leonardo da Vinci
Most people chose unhappiness over uncertainty, Tim Ferris
The following 4 users say Thank You to PandaWarrior for this post:
I wasn't considering using the particular tape that is referred to for the ES NQ etc, it was just an example to suggest to others that I am looking for some
indicators i could use, which may indicate which way I could expect the currency to trend during the day.
instead of inadvertently trading against the trend
The "daily" chart I assume this is based on local european/London time ?
Yes, the Globex is a 24hmarket , but you will see the majority of the volume during S&P pit hours. A factor 5 to 1 or 6 to 1 is not unusual, due to Big Money (aka paper) participants trading the cash contract (big) and hedging/reversing on the eminis. That kind of volume can drive the market in a certain direction very fast.
I trade 6E, ES, DAX on GMT+1, basically the opposite of your time window, and start out when Eurex opens (8 am GMT+1). Then see volume coming in at London open which can result in another move, after which it usually dries out until US Bonds open.
So, a good gauge on when 24h markets are actually active is to look at the volume over a 24h cycle.
With that said, I personally like to trade the ES outside US pit hours as it's more predictable and I know that the participants can afford the overnight margin, i.e. mainly pro's are involved.
The following user says Thank You to jerry828 for this post:
On the Boomerang system the target is 12 ticks and stop is 9 ticks. but scaling at 3,7,10 ticks and moving your stop closer once you hit the first target seems to work well. I got this system in may when it was very volatile 9 tick stop was way too small would get shaken out in seconds. A good way to get in is to look took at a small tick of 233 or 400 ticks with some EMAs and look for the small pull backs. for the entry. 6E haven't really tested a method for that but might require bigger targets and a higher range chart.
I've been sim trading using Ninja Trader with Mirus ZenFire for 8 days using Boomerang, Trade Bias, ForceIndex, Risk Manager and Ultimate Trailing Stop indicators. Still adjusting but the Ultimate Trailing Stop which can use a variety of indicators, i.e. Bollinger, ATR is default set to 3 ATR. That's what I've been using but noticing, as you have that this might not be a wide enough stop. I'm new to futures (10 days) and still feeling my way around. I trade the following markets: 6E, CL, CG, NQ, TF. I use the trailing stop to follow the up trend when I'm in the trade. I found keeping my sell limit stop one trailing stop back from the recommended trailing stop when the instrument is running is a good idea. Of course you have to watch it as it's moving.
I'm still fighting getting up at 2:45AM US EST to trade the London Opening. If you're using NT, I'd suggest you do the Market Replay after hours to practice and refine your boomerang trading skills. I've also looked at the Emini Watch indicator videos but for now I'm going to "dance with the girl I brung to the dance" and concentrate on Boomerang. One variant that Matt Bowen uses (he developed the risk manager and works for Indicator Warehouse) is using the GMMA in lieu of the trade bias lines in the boomerang. He doesn't scalp as close as Mohan (the developer) does apparently. For what it's worth.
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