My 6E trading strategy

June 15th, 2011, 01:17 PM

cjbooth

On the ABCD it is not the lenght of the ZigZag lines themselves - it is the price values

Calculate this way

1. take the low price of point A
2. take the high price of point B
3. subtract the 2 to get the price difference in the move from A to B
4. Point C cannot make a lower low
5. take the difference between point A and point B and divide it by 2
6. Add the result to the high of point B
7. No candle can close above that level, it can stop no more than 2 ticks from it but cant close above it

Charles

Ah, I see. The pics I posted did have the price values, i.e. the vertical distance traveled in price.

But your post provided clarification in that price must not CLOSE above that price distance added to point B.

forrestang

Is this the exception for the 377 chart, that HHs are ok on the 377 for ABCD patterns? I would think YES, since price is making a small HH on the 1508, that it will inevitably make HHs on the 377 as well?

Is this correct above?

June 15th, 2011, 02:07 PM

forrestang

Ah, I see. The pics I posted did have the price values, i.e. the vertical distance traveled in price.

But your post provided clarification in that price must not CLOSE above that price distance added to point B.

Is this correct above?

Yes thats correct the ABCD is a 2nd trading strategy by itself. With the 377 chart being 4 times faster than the 1508 it will be showing HH's most likely when the trade signals.

To trade the ABCD you need to clearly understand the pattern and see it developing

I strongly recommend that you dont trade the ABCD until you are 1st profitable trading the standard pullbacks

Charles

June 15th, 2011, 03:10 PM

Since this thread didn't populate itself with a "Quick Summary," this document might help as new people filter in and read this thread. Also it might be a way for current users to quickly point people in the right direction.

My plan is to add to this document a checklist, of things I need to remember while watching the charts. But as is now, I think 90% of the topics covered are hyperlinked in here.

If someone appends to it, or finds a better way to organize the info, just update the version number and repost. I think the only topic not in here, is the explanation of the reversal trades, which I remember reading, but couldn't find it while creating this.

Enjoy!

----EDIT----
Found the other two items I was looking for. Added the info on the Asia Session move, along with the Trend Reversal trade. This latest is v1.1

June 15th, 2011, 04:02 PM

forrestang

Since this thread didn't populate itself with a "Quick Summary," this document might help as new people filter in and read this thread. Also it might be a way for current users to quickly point people in the right direction.

My plan is to add to this document a checklist, of things I need to remember while watching the charts. But as is now, I think 90% of the topics covered are hyperlinked in here.

If someone appends to it, or finds a better way to organize the info, just update the version number and repost. I think the only topic not in here, is the explanation of the reversal trades, which I remember reading, but couldn't find it while creating this.

Enjoy!

thanks for your work,

Charles has contributed, one of the most influential and practical threads, that I have read on futures.io (formerly BMT).

yes, there are other threads, even some that I have started and participated on, however, this one, pound for euro,

has produced more practical, viable trades with the least amount of emotional capital expenditure.

thanks Chas.

June 15th, 2011, 06:19 PM

traders,

I have discovered a glitch in the ZigZag indicator that is possibly causing the inconsistent plots on our charts being in line at the same time.

First make sure you have the indicator set to "calculate on bar close" to "false", you want this indicator plotting intrabar

Second with the indicator set at a span of 1 it should plot a swing anytime a candle wicks above or below the high/low of the previous bar.

this can cause you to have a very serious level of concentration on your 1508 chart but if you do you will see HH/LL's that the ZigZag is not plotting based on your tick counts.

See this 1508 chart I have posted, in the rectangle area this is where I had the ABCD setup earlier. You see now that have restarted my charts that the ABCD swing is not there. Notice the candle with the arrow pointing that wick is below the low of the previous bar - there was a ZigZag swing on my chart at the time but since I have restarted the charts and that bar closed as an up bar the swing is not there.

If you see this occur the high of the previous bar would be point B in an ABCD swing

Do not remove the ZigZag indicator as I mentioned in the past its not great but its better than nothing, but do watch for this on your charts. A wick above or below the prior bar should trigger a swing in the ZigZag with it set to look at every bar which a setting of 1 does

I hope this does not totally confuse everyone because it confused me to type this

Charles

June 15th, 2011, 07:48 PM

Hi Charles, would the first ABCD setup be valid ?

BTW, i have been testing the longer term chart (1508) with 9 RangeNoGap. The Swing formations seem to be more consistant with this bar type.

June 15th, 2011, 08:41 PM

cjbooth

See this 1508 chart I have posted, in the rectangle area this is where I had the ABCD setup earlier. You see now that have restarted my charts that the ABCD swing is not there. Notice the candle with the arrow pointing that wick is below the low of the previous bar - there was a ZigZag swing on my chart at the time but since I have restarted the charts and that bar closed as an up bar the swing is not there.

Looks like the indicator felt bad and cheated on the next one up.

June 15th, 2011, 10:02 PM

trendisyourfriend

Hi Charles, would the first ABCD setup be valid ?

BTW, i have been testing the longer term chart (1508) with 9 RangeNoGap. The Swing formations seem to be more consistant with this bar type.

Yes without being able to measure the price swing it looks valid

caution lets not start curve fitting charts, it may look good today but when I came up with this method I judged its effectivenss over 180 days of data. So I saw how well it worked during many market conditions and even through holiday periods.

charles

June 16th, 2011, 06:56 AM

cjbooth

Yes without being able to measure the price swing it looks valid
...

I have drawn a Fibonacci scale on the chart for this exact purpose, ie, to measure the price swing. The -50% line corresponds to the maximum distance price can move according to your numbered list.

cjbooth

...
caution lets not start curve fitting charts, it may look good today but when I came up with this method I judged its effectivenss over 180 days of data. So I saw how well it worked during many market conditions and even through holiday periods.

charles

But maybe your hisrorical tests were wrong since the ZigZag is unreliable. Why don't you use the other PriceSwing indicator. It has more options and has no bugs. It is a superior product.

June 16th, 2011, 07:04 AM

@trendisyourfriend

Do you mean the zz that creates swings based on vertical distance traveled? That thing always seemed kinda arbitrary, how do you know if you want to use the length of 12, or 16, or 20..... I'm just wondering which length you would pick? Or is there another zz indie that plots based on the bar formation?

On another note, did anyone trade today? I only see two possible trades, maybe a third. The third I wouldn't have taken, the 2nd probably not, the first trade though, seems to be ok? Big News coming out today.

My 6E trading strategy

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My 6E trading strategy