newscalper wrote:Bredin said about price going to the opposite extreme then coming back across the open.
5 min chart, yellow line = weekly open. Look for daily rat then observe, the trade here is on the third day. The chart shows a nice win, lots of trades don't win but I don't want to post that chart.
I think you must to be prepared to place more than one trade a day but not overtrade, maybe limit to only one per hour when price is crossing the daily open.
I see many trades that don't work but also many that make a large profit, statistics on this are???
Trade management is key and your rules for exit. I don't agree with 'if you see 2 pips it's a win' etc (sorry TRO) because if you think like that you don't know when to hold and when to fold, or with trailing stop at 5 pips etc. you'll get crazy stopped out: isn't Zline about that? But I also see that by averaging out you can sometimes hold on all day or even for days with little risk , which is what I was talking to TRO about b4 Xtmas in 2%. i.e. if we know the probability of our trade going + pips before our stop we can take off part of our position and hold. It's the missing part of the puzzle.
what if you scaled in rather than out?? putting profit into more position during the big run.... only putting a small portion on the table in the first place so as to reduce whipsaw (if thats an issue for you)
OEF is about 80% true for all bars regardless of timeframe, most of the fails are non-momo, small bodied bars...
I just meant it to be used here as a 'waiting' mechanism, very few daily bars have the open as an extreme....
Just for kicks take a look at rat style entries for m5/15 setup bars that close across the daily open
edit: I love the rat for entries, btw... not meaning to hijack a thread with my acute cases of rat-abuse.