This article is very interesting and thks for sharing. Entering on CCI at -1oo will be a very good pull back entry with 20 EMA in uptrend, but it also has chances of reversing and go below -100 of CCI to change 20EMA to downtrend. any comments?
The following 2 users say Thank You to emini_Holy_Grail for this post:
In my opinion, using a fixed value as proposed by the author of this thread has just as much chance to reverse if not more chance. On the other hand, if you take the time to identify where zones of supply/demand are then you increase your chance. I am not a big fan of these fixed signal values like -45 or +45. In hindsight these systems are seducing but in practice i am a bit skeptical.
I read someone who called it the TLB100, where the TLB stands for Trend Line Break, he recommended that you wait for the CCI to cross the 100 line and then also for it to break the trend line on the CCI as confirmation. Attached is today's chart for CL before the close. I think the safest trades would be to add a mid period moving average (e.g. 50 sma), wait for the short period to cross the mid period or about to cross, then only take the first signals you get, minding all your other s&r on the chart itself. After that they will become risker.
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As far as the 1 Pt, you should have no trouble making 5+ Pts a week.
I have used a second CCI on my CCI indicator of 50 which does help, just as you suggested. I will show it below for your perusal. I removed it from all posts when some complained about to much on the charts. I was shown it on a webinar by a Pro. I used it on the same plane as shown. You may choose to use it in the same format as my histogram. The CCI 50, -100, 100 indicator does not affect my trading to any major degree; therefore, there was no need to display it. Some traders might like to see how this indicator works on their market. It may help in timing your exit. I also show it on a seperate plane here in the histogram.
Its a priviledge to be apart of and contributing to the futures.io (formerly BMT).
If CCI > 0 and < 200 and the CCI is moving lower and reverses forming a "V" , go long,
If CCI < 0 and >-200 and the CCI is moving higher and reverses forming an inverted "V" , go short,
If the CCI is > -100 and < 100, Exit when the CCI makes 2 consecutive moves against your position.
If you are long exit if the CCI crosses below 100.
If you are short exit if the CCI crosses above - 100.
Attached is an excel spreadsheet from June 2010 manually tracking this system ,trading 1 contract of TF. But I must tell you, June was a banging month. The results were skewed by the raging market. The rest of the summer the system traded profitably , just not the stellar performance of June. Which proves you should never confuse genius with a bull market.
I'm just a simple man trading a simple plan.
My daddy always said, "Every day above ground is a good day!"
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Zscore is the CCI calculated with Standard deviation instead of the mean. I should have given the example with CCI instead of Zscore and saved everyone the confusion. You can download the CCI with back color changing etc here...