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The Learning Journal of RedK Trading Options...

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  #21 (permalink)
Dubai, UAE
 
Experience: Intermediate
Platform: TOS, TradeStation
Broker: OX, TradeStation
Trading: Stocks & Basic Options
 
RedK's Avatar
 
Posts: 171 since May 2012
Thanks: 44 given, 143 received

these new indicators are doing well so far.. helping me stay in a trade when i should, or get a better exit if it's exit time .. it's amazing how much more insight you gain once you use indicators that you know how they work from the inside, that can make you better understand what the price is "telling you"...

inspired by friends i made here on the forum (thank you, you kow who you are ), i made a new study today based on MA crossing.. it was quick to put together and i stole the idea from part of my K_Trender code. put added better visulaization and simplicity.. color for the trend, signal up & down for the position.. and it's a trend catcher.. posted herehttps://futures.io/download/vip_elite_circle/1267-download.html?view

will call it the TraderRibbon.. not only i like the effectiveness, but honestly, it also looks attractive on a black background. i thought plotting something like this was only possible in NT and not for ToS..

TraderRibbon will not only show trends up & down and signals, but also helps identify chops. when the candle start penetrating the ribbon to the other side (from where it used to be during a trend) or from both sides, that's a chop.. stay out, and wait until you see a signal (reversal in most cases) and the candle's whole body is only on one side of the ribbon..

for anyone using Trender, the fast_Momentum signal in Trender is *not by crossing the main line*, but it's in changing color. once Fast_Mom sitches colors, that means the fast momentum is taking a different direction that the long term.. and the best trades are when they're both in agreement (Cyan + Greed) or (Orange + Red) .. the main line has an additional "Yellow" state which is "no Trend" like a detection of a chop, or "no gain", or slow down of momentum in the direction of the current move. it doesn't mean a reversal.. that can be a bit confusing when you see indicator pointing down and the price still goes up .. but think of a car moving forward, slightly touch the breaks, it slows down but still moves forward.. it will only get in reverse with a major force pushing it backwards ... that's when the line crosses zero and price heads for a fresh down move.

good trades yesterday .. and i even used weeklies.. confidence building.. i know after 6 months i will still be saying the same.. it's a journy and a lot to learn..

RedK

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  #22 (permalink)
Dubai, UAE
 
Experience: Intermediate
Platform: TOS, TradeStation
Broker: OX, TradeStation
Trading: Stocks & Basic Options
 
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Posts: 171 since May 2012
Thanks: 44 given, 143 received

Been suffering for a long time from having different timeframe charts (each with it's set of studies & settings) telling me contradicting signals - i'm looking for entry or exit on same stock in both charts.. the 15min says "go", and the 1Hr says "don't" ..

i did some reading, some research on how others trade & here's what i figured out.. the charts can "speak" to me better now.. this is like suffering from weak eyesight, and then you go to the doctor and you get new pair of glasses.. and WOW.. ! i can truly see the details
the same concept is also found in Edler's books. for me, major leanring ...


i shared this with a fellow trader and got the impression this may be valuable to share in the journal..

- i usually use 2 timeframes, a longer one, say 1 hour, for strategic analysis (trend direction, volume action...) and a shorter one, say 15mins for tactical execution (see best point of entry and exits..). apply the same for any other pair (1min vs 5min, 5min vs 15min, day vs week..etc) and i save these pairs as a grid in ToS so i can quickly switch between pairs.

- the issue i had before, i had no alignment of "scale" of studies between the 2 charts, or relating that scale to study settings.. i use a trend study on top, volume and momentum as main indicators on lower studies for both charts.. each on it's own settings (maybe the famous ones) .. wrong!! this is where i have to get conflicting messages .. it's all confused..

Putting things in order:
1. Decide the timeframe you want to look at for the strategic analysis (right chart).. say I choose 12 hours.. that’s like 1.5 days of trading. good for short-term option positions. for stocks I may use a daily chart with 10 period setting (2 weeks) so the trend signal is meaningful. let’s use hourly and 12 for the example..
2. calculate the factor between the time aggregation of the 2 charts ---- 1 hour to 15mins is 1 to 4 .. I’ll call this 4 my “zoom factor”
3. for the trend study (I use Trader_Ribbon), set the right chart on a settings that you like to identify & “catch” a trend (I’ll use from above, 12) – but if I use another trend study that also includes a fast length, I would use 3.. so my trend study settings are 12 & 3
5. Volume on the right (if you look at an EMA volume) use the same 12
6. Momentum on the right, use the same settings (12 for main length and 3 for fast)..

now comes the left chart .. every 4 bars on left = 1 bar on the right. I want the trend study to reflect the same trend from right chart (not a different, confusing, smaller moves).. because the right chart is the one deciding that there’s a trend for me, choosing entries and exit is from left chart .. I need to be looking at the *same* trend wave (but zoomed) and not other wavelets inside it.

1. multiply trend study settings on left by the zoom factor.. they become 48 & 12 .. see in the screenclip how the trend signal is at the exact location between the 2 charts, but magnified on the left
2. volume: I want to see very short term moves .. every bar of volume is 4 bars on the right.. if I take half the settings that’s 8 times magnification.. I will set volume EMA length to 6
3. tactical momentum settings: this is a preference.. you won’t benefit from multiplying by zoom factor as we did with the upper trend study. I would rather do like volume and see a magnifies view, to help me choose the entries and exit.. 4x or 8x settings vs the right chart.. so either keep it as 12, 3 (that’s a 4x) or half that for 8x..


i'll apply the same rule for other studies i add on both charts.. I wouldn’t now put a study on any of them unless I question it “what are your settings and why? what are you showing me? how do you relate to your other sister?”



I marked some areas on the screenshot so you can see how this “zoom factor” plays .. the trend (Trader_Ribbon) study between the 2 charts is exactly the same, signals fire up at the exact same time.. but you can see the momentum moves from different zoom lenses, see how a small momentum move on the right side looks in 4x magnified view on the left ..

love my new glasses ... hope you do!
Cheers,
K

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  #23 (permalink)
Dubai, UAE
 
Experience: Intermediate
Platform: TOS, TradeStation
Broker: OX, TradeStation
Trading: Stocks & Basic Options
 
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Posts: 171 since May 2012
Thanks: 44 given, 143 received


forgot the trading piece.. yes i was in that down move on INTC with some long PUTS .. and exited when it went flat on me ....

RedK

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  #24 (permalink)
New York City New York USA
 
Experience: Intermediate
Platform: Think or Swim, Infinity Futures
Broker: Thinkor Swim for Charts an Infinity Futures for Trading Dom
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Posts: 52 since Jul 2012
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RedK,

I want to tell you nicely done and very well explained. I like your highlighting it makes it really easy to see what you are explaining. Keep it up I am using yor stuff and it really works.

Thanks

Hguru

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  #25 (permalink)
Dubai, UAE
 
Experience: Intermediate
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Posts: 171 since May 2012
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have an issue with my TDAm account and can't trade for a while.. paperwork needs to be done to re-activate the account.. so i sold the stocks i held and all in cash .. my studies show they may move down which they started doing later in the week. no regrets.. good time to study my statement and go thru my past quarter trades and scrutinize them to find some learning.

also working further on simplifying my setup .. I decided I will focus my setup only on Trend + Momentum + studies to show me common Price Levels .. volume as well but as a supportive indicator. I need nothing else. this is not simple, when you start thinking about the insight these (Trend & Momentum) can deliver when you combine different timeframes (not talking about 2 charts, but talking about watching a single plot of 2 stochastic – like in K_Trender, or 3 MA’s, or 2 RSI of different lookbacks... they tell a lot). that filters out many other concepts that at the end are dependent on these areas ..

speaking of momentum & price levels, I just posted K_Trender_TopChart_v2 ...
https://futures.io/download/vip_elite_circle/1272-download.html?view



this is like a price chart companion/alternative to K_Trender (actually a simplified version still based on 2 stochastic momentums of different lengths), and it also plots a price channel of different choices (Keltner, BB, Elder’s, and my favorite ... Highest/Lowest .. and more) .. we include a dual signal system, the channel color for the main length momentum and an up/down arrow for the fast length momentum. thanks to my friend HGuru for helping me complete this work.. you can read a better description in above link.

the code for coloring that channel was so tricky for my scripting skills, but happy I got thru it.. this study is a main part of my setup so hope fellow traders may find value in it..

hope to get back to trading soon,
best,
RedK

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  #26 (permalink)
Dubai, UAE
 
Experience: Intermediate
Platform: TOS, TradeStation
Broker: OX, TradeStation
Trading: Stocks & Basic Options
 
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Posts: 171 since May 2012
Thanks: 44 given, 143 received

but happy i sold QCOM last week .. it started the move down as my studies told me.. no regrets.

also good time to "close my quarter" - it's end of Spetember, so i will do the quarterly P/L & trade analysis and capture learning for the next quarters. trying to stay consistent with this.

i know i'm around 3 to 4% up vs last q - my ambitious target is a 10% - and i'm also curious to see what type of trades were more profitable than others, and where i went completely wrong and impulsive and need better control.

stay profitable all,
RedK

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  #27 (permalink)
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On Wednesday, October 10th @ 4:30 PM Eastern US, Carley Garner will be presenting a webinar on futures.io (formerly BMT) which covers Options Trading (specifically Futures, but it will be a broad overview). I've asked Carley to put together a multi-part webinar, so this is Part 1 and will just be "Basics - 101".

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  #28 (permalink)
Dubai, UAE
 
Experience: Intermediate
Platform: TOS, TradeStation
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Posts: 171 since May 2012
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it's official that i'm now no longer with TDAm, and can't use my ToS anymore.. (sad! feels like losing a close friend). this is due to the new business rule to disconnect clients in certain locations.

i'm also sad and extremely upset, no, i'm furious, about how TDAm handled the situation. they first confirmed that i can update my profile since i'm only in this location on temporary (job post) basis, to my "permanent" country of residence and then they can re-review and enable the account, did that, they came back and said need certain documents, did that, they came back and said more documents, did that, then finally they receive everything and say no .. and that was a painful/rude/strange...etc conversation .. to me it was more funny that upsetting, since i've been in customer service-related jobs for all my entire career. just can't beleive it.. there's no small joint that treats clients, even ex-clients, this way - let alone large corporates..
let's spare the details..and move on.

my account is now disconnected. no notice, no chance to back up my studies, statements, activities, watchlists, scans, ..etc .. if i didn't have recent backups, i would have been completely locked out of 18 months of day & night work .. even with the backup, i still have to do a lot of work to recover that state i was at, well - life is full of surprises, some good, some disappointing ...

set back, no issues. moved my account to my other broker and will take a break form trading to sort things out. find the next setup of broker/tool to get myself back in "technical" trading (my other broker doesn't provide that), and continue the learning journey. this won't stop here.

be back soon, green lines to all..
RedK

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  #29 (permalink)
New York City New York USA
 
Experience: Intermediate
Platform: Think or Swim, Infinity Futures
Broker: Thinkor Swim for Charts an Infinity Futures for Trading Dom
Trading: Oil
 
Posts: 52 since Jul 2012
Thanks: 448 given, 46 received

RedK,

That is terrible news and no one should be treated like that ever. I ran a business for 25 years and I can tell you if we treated people like that we would have been out of business. I guess they have forgotten what it is like to be a customer. There should have been a better way for TD to handle the situation.

If there is anything I can do to help you with the studies either to complete them or anything please let me know. I will do the best I can to help you.

Hguru

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  #30 (permalink)
desert CA
 
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Dang, that stinks RedK. I used to think TOS was worldwide. I guess this is one major flaw of the TDA merger when so much had improved with the TOS platform since. I wonder if this action was motivated by some policy to keep U.S. retail trading contained within the borders like they did with the 1:50 leverage limitations for forex. Sorry you were cut off like that with no warning beforehand, I agree is awful customer service.

Hope you get all your fine thinkscripts back. Thinking about Ninja?

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April 26, 2013


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