Definition of a trending day - futures io
futures io futures trading



Definition of a trending day


Discussion in Traders Hideout

Updated by Ming80
      Top Posters
    1. looks_one Fat Tails with 13 posts (21 thanks)
    2. looks_two Big Mike with 7 posts (3 thanks)
    3. looks_3 trendisyourfriend with 7 posts (3 thanks)
    4. looks_4 ThatManFromTexas with 4 posts (7 thanks)
      Best Posters
    1. looks_one ThatManFromTexas with 1.8 thanks per post
    2. looks_two philippe07024 with 1.7 thanks per post
    3. looks_3 Fat Tails with 1.6 thanks per post
    4. looks_4 tigertrader with 1.5 thanks per post
    1. trending_up 26,597 views
    2. thumb_up 56 thanks given
    3. group 23 followers
    1. forum 69 replies
    2. attach_file 15 attachments




Welcome to futures io: the largest futures trading community on the planet, with well over 100,000 members
  • Genuine reviews from real traders, not fake reviews from stealth vendors
  • Quality education from leading professional traders
  • We are a friendly, helpful, and positive community
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts
  • We are here to help, just let us know what you need
You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

(If you already have an account, login at the top of the page)

 
Search this Thread
 

Definition of a trending day

(login for full post details)
  #1 (permalink)
Site Administrator
Manta, Ecuador
 
Experience: Advanced
Platform: My own custom solution
Trading: Emini Futures
 
Big Mike's Avatar
 
Posts: 48,890 since Jun 2009
Thanks: 31,574 given, 94,504 received

For the purpose of statistics gathering, I am wondering if everyone agrees on the same definition for a trending day? And inversely, is a non-trending day automatically the same as a range bound day?

Proposed definition of long trending day:
A day in which the market opens, then moves higher throughout the day, without ever revisiting the opening price. The market eventually closes above the open.


Mike

We're here to help -- just ask

For the best trading education, watch our webinars
Searching for trading reviews? Review this list

Follow us on Twitter, YouTube, and Facebook

Support our community as an Elite Member:
https://futures.io/elite/
Follow me on Twitter Visit my Facebook Visit my futures io Trade Journal Reply With Quote
The following user says Thank You to Big Mike for this post:

Can you help answer these questions
from other members on futures io?
TOS script
ThinkOrSwim
How to show tick count in or next to the current candlestick?
NinjaTrader
Execute NT8-Optimizer by script
NinjaTrader
FYI plot bug & workaround: changing color or width is delayed 1 bar
EasyLanguage Programming
Volume Chart Trend Lines
TradeStation
 
 
(login for full post details)
  #3 (permalink)
Near Dallas, Texas, US
 
Experience: Advanced
Platform: NinjaTrader
Broker: ZenFire
Trading: CL
 
Gary's Avatar
 
Posts: 1,070 since Jun 2009
Thanks: 502 given, 2,233 received


Just for argument sake, I am not sure I agree.

Let's say I trade very short term on CL. The market opens, and moves up pretty smoothly 100 ticks from the open. During lunch it trades sideways, and then into the close it moves down 150 ticks. It closes 50 ticks below the open. By your definition, this was not a trending day. In my view, it was. I had a nice long trend opportunity, and a nice short trend opportunity. They are what may be considered short term trends, but none the less, the market was trending in my opinion.

No?

As consistently profitable traders.. "We get paid to wait, and we wait to get paid."
Visit my futures io Trade Journal Reply With Quote
 
(login for full post details)
  #4 (permalink)
Site Administrator
Manta, Ecuador
 
Experience: Advanced
Platform: My own custom solution
Trading: Emini Futures
 
Big Mike's Avatar
 
Posts: 48,890 since Jun 2009
Thanks: 31,574 given, 94,504 received

I know, I ran into the same argument which is why I started the thread

I want to create some trading statistics, for example item 1 is to calculate my own data to answer the question "How often does the market trend vs range?". I want to control the test myself so I know the conditions precisely.

I then thought about the definition of a trending day, and I realized a lot of people might take issue with it.

But if you open it up to include any day where the Close is higher than the Open (long) then really that is not a trending day at all, it could be a range day.

I also considered calculating the Average Daily Range and comparing today to the prior 10 days for example, and then we could say if the market closed in the upper half of the range it was a trend day?

But I have a feeling this is not how others are doing it.

Mike

We're here to help -- just ask

For the best trading education, watch our webinars
Searching for trading reviews? Review this list

Follow us on Twitter, YouTube, and Facebook

Support our community as an Elite Member:
https://futures.io/elite/
Follow me on Twitter Visit my Facebook Visit my futures io Trade Journal Reply With Quote
 
(login for full post details)
  #5 (permalink)
Near Dallas, Texas, US
 
Experience: Advanced
Platform: NinjaTrader
Broker: ZenFire
Trading: CL
 
Gary's Avatar
 
Posts: 1,070 since Jun 2009
Thanks: 502 given, 2,233 received

Well, we have some very smart people viewing the thread. I am sure we will hear from them soon.

Just to add, here is one definition of a trending day:

A trending market is a market where the price is moving in a single direction, either up or down, but not sideways. There may be several small price reversals, but nothing large enough to prevent the price movement from continuing in its original direction. A day trading trend may last for a few minutes or a few hours, and longer term trends may last for several weeks or months.

Gary

As consistently profitable traders.. "We get paid to wait, and we wait to get paid."
Visit my futures io Trade Journal Reply With Quote
 
(login for full post details)
  #6 (permalink)
Quebec
 
Experience: Intermediate
Platform: NinjaTrader wt Rancho Dinero's profiling tools
Broker: AMP/CQG
Trading: ES, NQ, YM
 
trendisyourfriend's Avatar
 
Posts: 3,878 since Oct 2009
Thanks: 3,506 given, 4,952 received

On the ES i would consider as a trend day one whose rotational factor on market profile would reach and stay above 6 and where we had an open drive and where after lunch 1pm EST price was still making higher highs/lower lows and finally would close higher or lower than the previous day.

Simple definition: a trend day is one where all counter trend traders would lose money big time fading the trend.

Reply With Quote
 
(login for full post details)
  #7 (permalink)
Site Administrator
Manta, Ecuador
 
Experience: Advanced
Platform: My own custom solution
Trading: Emini Futures
 
Big Mike's Avatar
 
Posts: 48,890 since Jun 2009
Thanks: 31,574 given, 94,504 received


Gary View Post
A trending market is a market where the price is moving in a single direction, either up or down, but not sideways. There may be several small price reversals, but nothing large enough to prevent the price movement from continuing in its original direction. A day trading trend may last for a few minutes or a few hours, and longer term trends may last for several weeks or months.

Gary

And how would you define that in Excel? It is too ambiguous a description.

Mike

We're here to help -- just ask

For the best trading education, watch our webinars
Searching for trading reviews? Review this list

Follow us on Twitter, YouTube, and Facebook

Support our community as an Elite Member:
https://futures.io/elite/
Follow me on Twitter Visit my Facebook Visit my futures io Trade Journal Reply With Quote
 
(login for full post details)
  #8 (permalink)
Market Wizard
Berlin, Europe
 
Experience: Advanced
Platform: NinjaTrader, MultiCharts
Broker: Interactive Brokers
Trading: Keyboard
 
Fat Tails's Avatar
 
Posts: 9,828 since Mar 2010
Thanks: 4,237 given, 26,548 received

This is my definition of an uptrending day:

- The market opens near or at the low of the day.
- The market closes near or at the high of the day.
- The daily range is above average.
- Throughout the day there is absence of sellers.

The third condition needs to be explained. Profit taking may cause prices to retrace after a strong upmove, but if there are no sellers the move down cannot be sustained, but will be seen as an opportunity to buy. Buying usually takes place at the VWAP or above the VWAP. Therefore I would translate the third condition into

-> prices not being able to exceed the lower noise level after open
-> prices staying above the VWAP all day long after the initial balance

On a strong uptrending day, prices will mostly remain between the first and second upper standard deviation bands of the VWAP.

Vice-versa for downtrending days.

Example: March 13 for ES 06-12



Example: March 20 for CL 05-12


Reply With Quote
The following 6 users say Thank You to Fat Tails for this post:
 
(login for full post details)
  #9 (permalink)
Market Wizard
Berlin, Europe
 
Experience: Advanced
Platform: NinjaTrader, MultiCharts
Broker: Interactive Brokers
Trading: Keyboard
 
Fat Tails's Avatar
 
Posts: 9,828 since Mar 2010
Thanks: 4,237 given, 26,548 received

Found on Traders Feed by Dr. Brett Steenbarger:

"Recognizing a trend day while it is in progress can lead to a number of home run trades, not least of
which is simply selling the market and staying short through the day. Here are a few ways of
recognizing a downside trend day in the making, drawing upon today's excellent example:

1) Cumulative NYSE TICK and Cumulative Market Delta start negative and go into a downtrend early
in the session;

2) Advance-Decline statistics are skewed from the open, with declining stocks swamping advancers by
2000 or more issues within the first hour of trading;

3) The market opens below its pivot level (average price from the previous trading session), never
trades above it, and hits S1 early into the trading session;

4) The market's leading weak sectors going into the day's trade (financial/banking stocks, in this case)
continue their weakness and lead the market downward;

5) Multi-bar bounces in the ES (and NYSE TICK) occur at successively lower price highs;

6) Significant buying (NYSE TICK, cumulative Delta, Dow TICK, advance-decline improvement) does
not enter the market after taking out S1 and S2.
"

Source: TraderFeed: Six Ways to Identify a Trend Day in the Stock Market

Reply With Quote
The following 4 users say Thank You to Fat Tails for this post:
 
(login for full post details)
  #10 (permalink)
Site Administrator
Manta, Ecuador
 
Experience: Advanced
Platform: My own custom solution
Trading: Emini Futures
 
Big Mike's Avatar
 
Posts: 48,890 since Jun 2009
Thanks: 31,574 given, 94,504 received


I want to clarify...

I want to identify a trend day using hindsight, not in real time. This is for statistics gathering.

What is the simplest definition of a trend day, so it can be programmed into Excel?

It seems we cannot really agree so far on what a trend day is (without ambiguity).

Mike

We're here to help -- just ask

For the best trading education, watch our webinars
Searching for trading reviews? Review this list

Follow us on Twitter, YouTube, and Facebook

Support our community as an Elite Member:
https://futures.io/elite/
Follow me on Twitter Visit my Facebook Visit my futures io Trade Journal Reply With Quote


futures io Trading Community Traders Hideout > Definition of a trending day


August 15, 2014


Upcoming Webinars and Events
 

Free BloodHound Licenses for everyone!

June
 

Every journal equals ten meals for the hungry

June
     



Copyright © 2020 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432, info@futures.io
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts