YM - ES - ER Strategy

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dfmccarty
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Postby dfmccarty » Wed Oct 10, 2007 8:45 pm

Ed,
First, I'm sorry I've taken so long to reply.
Second, I appreciate the strong advice.
Now on to more questions . . .

1) Now that I understand using the Trade Zones & Dynamic_SR better (not completely but better, LOL); how would you have entered at 10:15 as you suggested? On the close of the bar that set the resistance or during the next bar? I guess I'm asking how to use the Dynamic_SR3 for entries?

2) Any suggestions on how to use the Dyanmic Long/Short (Cyan/Magenta ) bars of the Dynamic_SR3?

3) Any thoughts/advice on how to read the indicator when Dynamic Resistance and Dynamic Long are at the same point (same question for Support/Short)?

4) Any suggestions on exits and/or trailing stops?

Well, that's enouogh for now!

Thanks in advance for the help,
Dennis

PS
If there are any posts I should read just let me know.
I'm trying to wade thru all of them BUT it is like picking gold dust out of dirt!
Dennis
Thanks

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eudamonia
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Postby eudamonia » Wed Oct 10, 2007 9:30 pm

Dennis,

No problem. Trading and understanding trading is not a sprint. It is a marathon. Pace yourself. Enjoy the learning process. Make it fun. This will help you get through the difficulties.

To answer your first question, my conviction in the continuation of the downward trend would have been confirmed after the 2 doji candles on weak volume immediately after the candle that set resistance. To me it shows that the buyers are uninterested at supporting this price. Also yesterday's market profile shows that prices did not find value for long at this price.

I don't use the Cyan/Magenta lines. You might want to direct that question to Avery.

For your third question let volume and volume profile tell you the whole story. Support and resistance is half the battle. The other half is seeing how price reacts at those levels. Does it rush through S/R with ferocity or does it approach these areas lazily on low vol. at low speed?

Exits and trailing stops are always a good question. Again I use volume profile (especially if we are trading in yesterday or recent value areas) and S/R. How does your trade react to new support levels (assuming a downward trend) or vice versa? When volume doesn't continue to collaborate your story it's time to look for a partial or complete exit. Personally I don't trail my stops or pyramid out. If I'm convinced the market is doing something I get in with my full lots (I may scale in to achieve better price but not because of any other reason). If I'm out I'm completely out. That's just me. It's not necessarily the only way to do it.

There are many posts with great advice on this forum. Too many to recommend. Just keep reading through the forum. Again there is no rush. Experience will make the advice more useful.

If you want to follow one idea that is more useful than any other it is this - Practice trading everyday (the more realistic your simulations the better). At least for 1-2 hours. Like going to the gym. It builds trading muscles. When you get good, take away your indicators and trade price and volume alone - if you've learned enough about your indicators you will be able to "see" where they would tell you to trade. When you get even better pull up markets you've never traded and try to "see" your indicators. Pull up something on a long time frame and on a short time frame. Pretty soon you can trade with nothing but price and volume (either by bar or time and sales). To facilitate this simulated trading I recommend doing it in real time or with a tick by tick replay (as in NinjaTrader, NeoTicker, eSignal and others).

If you do this you can trade any market and any time frame be it weekly Pork Bellies or 55 tick Yen. You will have the confidence of trading the markets and not the indicators. You can always trust the market to move as it should.

Edward

P.S. Do not expect immediate results. I've been doing this for several years and I am still learning everyday. Avery has been trading for much longer and I'm sure he is still learning. Enjoy the process.

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Patch
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Postby Patch » Fri Oct 12, 2007 12:02 am

Edward

Great post and great to hear from you and see your recent picture. You look really good in Oregon.

Dennis

The only thing I would add to Edward's post is to read Trading in the Zone by Mark Douglas. It is a fine read and full of insights and helps for new and old time traders. Your first job is to severely limit your risk and preserve your capital and stay in the game. If you can't make paper profits paper trading, you can't make real cash trading live consistently. Leverage takes away as fast as it gives. FX brokers make more money as you trade more often. It is all very simple.

Jeff
In VA
aka Patch the Pirate
ENOUGH being a Yalie for me Back to the Sea. "What i can lose, i can win" "YES YOU CAN" - dragon33 -"Pick one method and one pair and stick with them until you master it. "The choice is yours - success or failure." TRO

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eudamonia
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Postby eudamonia » Fri Oct 12, 2007 12:52 am

Jeff,

Thanks. The picture is actually of me on Catalina Island in CA. I haven't had a chance to take any good pictures up in Oregon yet. I'm going to the coast next week though, so I may take some good ones then (and post one).

Edward
Eudaimonia (pron.: you-die-moan-e-a) (Greek: εὐδαιμονία) is a classical Greek word commonly translated as 'happiness'. The less subjective "human flourishing" is often preferred as a translation.

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