THREE SET UPS - futures io
futures io



THREE SET UPS


Discussion in Trading Journals

Updated
      Top Posters
    1. looks_one Jeff Castille with 215 posts (429 thanks)
    2. looks_two cunparis with 146 posts (154 thanks)
    3. looks_3 shodson with 125 posts (211 thanks)
    4. looks_4 Fat Tails with 73 posts (189 thanks)
      Best Posters
    1. looks_one Fat Tails with 2.6 thanks per post
    2. looks_two Jeff Castille with 2 thanks per post
    3. looks_3 shodson with 1.7 thanks per post
    4. looks_4 cunparis with 1.1 thanks per post
    1. trending_up 221,847 views
    2. thumb_up 1,368 thanks given
    3. group 125 followers
    1. forum 1,073 posts
    2. attach_file 239 attachments




Welcome to futures io: the largest futures trading community on the planet, with well over 150,000 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
 

THREE SET UPS

(login for full post details)
  #511 (permalink)
 cunparis 
Paris, France
 
Experience: Advanced
Platform: Market Delta & Ninjatrader
Trading: ES
 
cunparis's Avatar
 
Posts: 2,565 since Jun 2009
Thanks: 1,162 given, 2,088 received


Dragon View Post
Maybe off-topic, maybe not. As I continue to learn about trading in general, one thing is puzzling to me. I keep hearing traders say to follow your rules. But, how can a discretionary trader succeed over time without breaking his rules? Put another way, if I establish a set of rules that is profitable for me, shouldn't I be able to hire a programmer to automate them? It seems that a profitable ATS is hard to come by, thus, I am led to believe that profitable discretionary traders are always breaking their rules.

It depends if there are set rules or just flexible criteria. I don't have set rules where if this is above this I don't trade etc. I look at a variety of data (many would argue way too much) and then I decide if it's a high probability setup and if so I take it.

For example I use sine waves. I like to see two setups where two timeframes make cyclical turns together or the smaller timeframe breaks out in the direction of the higher timeframe. But I will trade against the higher timeframe if my other data is pointing to a high probability of a move in the other direction. I'm not breaking a rule. It's all just guidelines.

I personally don't believe it's possible to code up what I do with discretion. Even if it were, it'd be so complicated that testing it and fixing bugs and training it would take so long that market conditions would change and then it'd no longer be profitable. That's the key here: a discretionary trader can use discretion and adapt to changing market conditions. An ATS won't adapt. It'll just enter a drawdown and by the time the trader figures out that it's not coming out of the drawdown and pulls the plug it'll probably have loss money. That was my experience any way.

I've shown how I can achieve profit factors > 10 using discretion. I don't think an ATS can do that.

however all that isn't an argument against automation. For a simple setup if it's automatable then automate it. I traded a mechanical (but not automated) stock system for a long time. It was not optimal but since it required only a few seconds effort each day I traded it. I stopped btw when my discretionary trading started performing better than the stock system, it didn't make sense to continue it.

for the inside bar, I could automate it but I prefer not to. one reason is it's a lot of work programming, testing, fixing bugs, etc. I've done it before and it takes a long time. By the time someone succeeds in doing that it may not be profitable any more. For inside bar I feel it's not worth it. I get an audio alert, put in a bracket order and I'm done. I also like to trail my stop a bit and that requires discretion.

Follow me on Twitter Reply With Quote
The following 2 users say Thank You to cunparis for this post:

Can you help answer these questions
from other members on futures io?
Multidata
EasyLanguage Programming
value chart indicator by sim22
NinjaTrader
Tips for directional bias during Asian Session?
Traders Hideout
Tick Data Group Buy
Emini and Emicro Index
mahDualCandlePattern
NinjaTrader
 
Best Threads (Most Thanked)
in the last 7 days on futures io
Spoo-nalysis ES e-mini futures S&P 500
100 thanks
How many day traders are profitable?
58 thanks
how many hours per day do you watch the market?
15 thanks
Why you should move from futures to forex
15 thanks
Attached Orders
13 thanks
 
(login for full post details)
  #512 (permalink)
 YulinYao 
Washington Crossing, PA
 
Experience: Beginner
Platform: None
Trading: ES
 
YulinYao's Avatar
 
Posts: 6 since Jun 2010
Thanks: 0 given, 2 received

There are three dojis at the beginning of your chart - they suggest a trend change more often thant trend continue. Please tell if this is true?

Reply With Quote
The following user says Thank You to YulinYao for this post:
 
(login for full post details)
  #513 (permalink)
 gabga100 
New York
 
Experience: Advanced
Platform: NT
 
gabga100's Avatar
 
Posts: 147 since Nov 2009
Thanks: 44 given, 72 received


The Automated systems traded in the street are very different from everything I could ever read on this site ......

Usually they require co-location at the exchange as speed is success factor Number 1

The World of High Frequency Trading ~ T3Live Blog: Daily Stock Market Trading Commentary

You know what you know but you do not know what you do not know.
You do not see things how they are, you see things how you are.
In life you do what you want but you do not want what you want.
Reply With Quote
The following user says Thank You to gabga100 for this post:
 
(login for full post details)
  #514 (permalink)
 aviat72 
San Francisco Bay Area
 
Experience: Intermediate
Platform: NT,TOS,IB
Trading: ES,CL,TF
 
Posts: 280 since Jun 2010
Thanks: 156 given, 273 received


gabga100 View Post
The Automated systems traded in the street are very different from everything I could ever read on this site ......

Usually they require co-location at the exchange as speed is success factor Number 1

The World of High Frequency Trading ~ T3Live Blog: Daily Stock Market Trading Commentary

Do recognize that there is a big difference between HFT and automated systems. HFT systems need co-location as much they need their computers need power supply; they are essentially latency arbitrage systems working across different exchanges. The time-frame they trade in is very small.

Automated systems will typically trade in a much larger time-frame to HFT. It may stretch from a few seconds to minutes or even hours. You do not need co-location as much as an HFT. That being said, many automated system shops also co-locate since traders want to eliminate anything which can potentially take away their edge. Further co-location is not that expensive compared to the other costs associated with trading; it is taken as a cost of doing business, and hence becomes a big money spinner to the service providers.

Visit my futures io Trade Journal Reply With Quote
 
(login for full post details)
  #515 (permalink)
 emini_Holy_Grail 
Dallas,TX
 
Experience: Intermediate
Platform: NinjaTrader, OpenQuant
Broker: Zaner/Zen Fire
Trading: ES,6E,6B,GC,CL
 
Posts: 599 since Nov 2009
Thanks: 176 given, 126 received

""I am also interested in seeing whether Shodson's strat, when fully developed, becomes profitable. I think that the most important part of this Three Setups approach is to make sure to only take trades in the morning U.S. time and avoid the news (as Jeff says "Know when to trade"). If that part is successfully automated, then I wouldn't be surprised if that strat could be applied to a plain old zero-line cross on an Eco, SMI, CCI, or a MA crossover to achieve similar results that Jeff experienced""

Dragon - do you mean, the three setup results could be similar to either of these zero-line cross on an Eco, SMI, CCI, or a MA crossover or you meant combine both setups?

Reply With Quote
 
(login for full post details)
  #516 (permalink)
 shodson 
OC, California, USA
 
Experience: Advanced
Platform: IB/TWS, NinjaTrader, ToS
Broker: IB, ToS, Kinetick
Trading: stocks, options, futures, VIX
 
shodson's Avatar
 
Posts: 1,969 since Jun 2009
Thanks: 533 given, 3,683 received


Eric j View Post
I commented early in this thread about the similarities between this approach and the DIBS method . Im familiar with this bunch thats trading DIBS and they mirror the results here in that they all have different results in the same markets at the same times but the disciplined traders have the best results overall . Disciplined traders.

Define "discipline"

If discipline = "the ability to strictly follow [your] rules" then a computer is the most disciplined trader there is.

If discipline = "following your rules but reacting according to the 10,000+ hours of screen time you've put in and how you feel about the way the market is moving" then a computer will fail because it doesn't feel markets.

I have tremendous respect for successful discretionary traders that can read a tape and a market, but I don't think they have hard and fast rules they stick to 100% of the time, they are mostly guidelines but they give themselves discretion to artfully go around them to ameliorate their psychological makeup and, hopefully, improve their success.

Follow me on Twitter Visit my futures io Trade Journal Reply With Quote
The following 5 users say Thank You to shodson for this post:
 
(login for full post details)
  #517 (permalink)
 Dragon 
Bellingham, WA
 
Experience: Intermediate
Platform: Ninja
Broker: Zen-Fire
Trading: 6E, CL
 
Dragon's Avatar
 
Posts: 494 since Aug 2009
Thanks: 747 given, 259 received

Emini,
I was just pointing out that maybe the money management, time of day, avoiding news, were probably more important aspects to these setups than IB or OB. From the looks of it, I am probably completely wrong about this.

Visit my futures io Trade Journal Reply With Quote
The following user says Thank You to Dragon for this post:
 
(login for full post details)
  #518 (permalink)
 Fat Tails 
Market Wizard
Berlin, Europe
 
Experience: Advanced
Platform: NinjaTrader, MultiCharts
Broker: Interactive Brokers
Trading: Keyboard
 
Fat Tails's Avatar
 
Posts: 9,870 since Mar 2010
Thanks: 4,238 given, 26,873 received

Three consecutive dojis indicate a trading range. Al Brooks refers to them as (iii) setups. I would not say that a trading range indicates a trend change. You need to look at other criteria to find out what it stands for.

Let us assume that the (iii) setup occurs outside a Keltner Channel or Bollinger Band, that it follows an expansion bar with high volume (climax bar, stopping volume) and that one of the dojis is a churn bar. Then I would think that the odds favor a reversal. But even in this setup, you often will first have a false breakout (final flag of bull/bear trap), before price reverses.

If the (iii) setup occurs near the moving average, I would not see any reason that a trading range, which is nothing than a type of congestion, should resolve in a reversal. In the contrary, I would assume that trend continuation is more likely, if the market shows a clear trend in a higher timeframe.

In any case, you would want to wait for a breakout of that trading range, before entering a trade.


YulinYao View Post
There are three dojis at the beginning of your chart - they suggest a trend change more often thant trend continue. Please tell if this is true?


Reply With Quote
The following user says Thank You to Fat Tails for this post:
 
(login for full post details)
  #519 (permalink)
 shodson 
OC, California, USA
 
Experience: Advanced
Platform: IB/TWS, NinjaTrader, ToS
Broker: IB, ToS, Kinetick
Trading: stocks, options, futures, VIX
 
shodson's Avatar
 
Posts: 1,969 since Jun 2009
Thanks: 533 given, 3,683 received

...so I thought I'd do some more "don't trade during lunch" backtesting, this time with CL-07. You can draw your own conclusions. I have what looks to be my favorite 24-tick target scenario highlighted in blue.

Attached Thumbnails
Click image for larger version

Name:	cl-07-allday-with-lunch.png
Views:	194
Size:	31.5 KB
ID:	16813   Click image for larger version

Name:	cl-07-allday-avoiding-lunch.png
Views:	175
Size:	35.7 KB
ID:	16814   Click image for larger version

Name:	cl-07-before-lunch.png
Views:	180
Size:	31.1 KB
ID:	16815   Click image for larger version

Name:	cl-07-during-lunch.png
Views:	158
Size:	30.8 KB
ID:	16816   Click image for larger version

Name:	cl-07-after-lunch.png
Views:	193
Size:	30.4 KB
ID:	16819  
Follow me on Twitter Visit my futures io Trade Journal Reply With Quote
The following 5 users say Thank You to shodson for this post:
 
(login for full post details)
  #520 (permalink)
 emini_Holy_Grail 
Dallas,TX
 
Experience: Intermediate
Platform: NinjaTrader, OpenQuant
Broker: Zaner/Zen Fire
Trading: ES,6E,6B,GC,CL
 
Posts: 599 since Nov 2009
Thanks: 176 given, 126 received


shodson
is the target and SL both 24? and we had 50 trades during lunch. is that for whole week?

Reply With Quote


futures io Trading Community Trading Journals > THREE SET UPS


Last Updated on May 15, 2014


Upcoming Webinars and Events
 

NinjaTrader Indicator Challenge!

Ongoing
     



Copyright © 2022 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, Ph: +507 833-9432 (Panama and Intl), +1 888-312-3001 (USA and Canada), 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