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You're welcome for the thread and thank you for the great question. I often notice when I do my P/L that all my trades, and even more often, all my winnings were from one side. I think it helps to try and determine the right side especially on a trend day.
I attach the full cycle chart. I circled the pro activity on the highest timeframe. That pretty much told me to look for short only during this move. Unfortunately I missed the first two trade opportunities to get short (first two circles on my trade market chart).
Then we were approaching the end of the cycle on the big timeframe and I started looking for longs. I saw professionals buying on the middle & small timeframes. To be completely honest I was early on these. Once the highest timeframe got a new cyclical support level, that's when my trade worked. However in the past I've waited for it and it came late, so if I see we're at the end of a cycle (what I believe is the end, I can't know it's the end until the cycle is over obviously) and I see bullish divergences then I'm looking for longs.
For order flow, I'm not really looking at my market delta charts until I determine a good trade location on the cycle charts. You can see the red dots on better momentum - this is showing less momentum to the downside. Once I get ready to enter I look at the market delta charts especially the footprint. I also make sure we're not near a major market profile area, etc.
In a strong downtrend the order flow will always show bullish divergences so that's why I don't want to trade off that alone. I tried that and it's ok for scalping but I really want to focus on the big setups.
I hope that answers your question, if not let me know. Thanks.
Thanks. I find it very interesting how you combine your methods. Combining multiple methods that individually have an edge is a smart way to go about your analysis.
Do you find that your cycle levels/professional activity indicators coincide with major support and resistance market profile areas?
The cycle method by itself is great, the problem is what to use for a stop and when to enter? Price can always retest one more time, so either one uses a wide stop or one gets stopped out a few times. Both of those caused me a lot of grief. So what I'm hoping to do is get an extra confirmation and then look for a setup that has low risk (6 ticks is my hard stop) and a good probability of going at least 3-4 ticks in my direction. That way I can take 1 contract off to cover commissions and put stop at BE -2 for a no lose trade or BE for a small win (usually around 50 euros for the dax). This way I can get stopped out a few times without losing money and that gives me the confidence to keep trying which increases my chances of being in the big move.
The downside to this is that if there is not a good high probability low risk setup on the ladder, I don't take the trade. and that's how I "missed" the first two trade opportunities. However I feel like if I start taking low probability high risk trades, even though it would have worked great today, it probably won't work tomorrow.
In November I was trading CL with a 30 tick stop. In december I moved it to 20. I hated it. Now with 6 ticks max and usually less, there is less stress.
I always read that one should have tight stops and 3:1 reward:risk ratio. I could never make that work and thought with a high win rate I could get by with 1:1. But the reason I couldn't make it work is because I didn't have a big enough edge (no no edge actually).
Scaling out is also very important. I rejected this for a long time as it's mathematically suboptimal. But when using discretion, which is where the ultimate edge is, we're not dealing with normalized data and the mathematics get infinitely complicated. I started scaling out in my swing trading in September and it has worked well for me. That's when I started consistently winning.
In all that I forgot your question! For the MP levels coinciding with the cycles, I will pay more attention to that and let you know. The MP levels update dynamically throughout the day so I can't just look at my charts to see. Have to observe it in real time.
Today I got a long setup at Yesterday's POC. Good for 50 ticks.
So I guess the answer is yes the cycles do turn at the MP levels, I just haven't been paying that much attention. I mean I try to lean on the MP levels but I haven't really kept track of how many times they line up with the cycle turns.
here's the cycle chart so you can see the cycles at those levels. I have MP levels on market delta and the cycles on tradestation.
I'm seriously considering reprogramming everything on market delta the only problem is I can't get the better sinewave for market delta which is the dealbreaker.
