I know tick charts are great for intraday trading, but I'm wondering if anybody uses large tick-size charts for swing-trading instead of using the daily charts? Any thoughts or experience would be of interest.
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I have tried it with mixed results....I think the key iwould be using a sufficiently large enough number (at least 2000)and really KNOW how to read it. In a nutshell I would have to advise against it for multi-day type swings. Backtest something and let us know what happens.
If you do be aware of the FACT that there is no universal tick #. Some tick counts work well on one instrument and when applied on another will suck. You'll have to spend some time and come up with a good "all around" number for whatever it is you wish to trade but as with everything else it won't be 100%
Yes, as you grow up with granularity, multiply your indicators too (3 days EMA would be 18 bars in 1h charts), so you can get good intraday signals for positions from 2 until 10 days, specially for trend-following strategies. I saw that it works well here in Brazil, because it is still a not madure market, but following swing trades in market with more noise (HFT traders) is more difficult.
Tick charts are primarily used for intraday trading, they give a better picture of whats going on during a given time frame. A lot of people will still use 4hr and daily to see the big picture and use tick charts to fine tune entrys and exits. At some point if you used a high enough tick count you could aproximate a daily bar but at that point you kind of defeat the purpose.
Depends on what your instrument your trading...I use different numbers on each one because they behave differently. Aside from that seems like there is no concensus on what number to use everyone seems to have something different. you have to experiment with tick counts until you get something you can "read". Let me know what your trading and I can tell you what I use