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[fivesboy] 15/8/2008 15:22

Hi Henry and all on here. It's been quiet!

As usual, just watching today though there was a good FTSE trend for around 11 a.m.

I wanted to ask how you play CCI and price divergence. It seems very often in a trend the price and CCI will go in the same direction then at some point the CCI starts diverging whilst the price continues in it's original direction. At some point the price snaps back into line with the CCI trend again so that they're both going in the same direction. Is there anything in particular you look out for to indicate when this happens?

I would also love to see your charts of the day you focused exclusively on Price Action and yoru simple rules. I've tried it and failed so there must more to it.

Cheers. TGIF!

[henryatkin] 13/8/2008 07:57

Btw ... those listed in 309 above do not apply before 09.00 - until then just trading the bars without indicators.

edit: some obvious flaws to be made re inclusion of CCI setting.

[henryatkin] 13/8/2008 07:39

A lot of these indicators are propietry and only available, sometimes at extra subscription on sites like Tradestation and E-signal.

[minky] 13/8/2008 07:00

Morning all.

Fives, I have also been trying to find the Laguerre indicator without success.
Jurik indicators are also interesting but I believe they are proprietry and not available in easy language.

[henryatkin] 12/8/2008 21:07

Fives ... Funny business, I find it easier to pull the trigger on CCI trades than I do with price action. I have spent today only using price action. I have made 51 points from 19 trades(4 loosing) by putting in some filters - confirmation. The day has done me a lot of good. I feel I could trade all day long even switching from ftse to forex. I kept to the one min chart and had a few simple rules written down in front of me:

Example as per long trade.

1) Enter when the bar close is higher than the previous two bars.

2) The SMI must be over +40

3) The CCI must be over +100 (130 is a bit too high for this)

4) In a ranging market or consolidation wait for a breakout. After the breakout wait for the next bar to confirm the trade with a higher high (1,2 & 3 must also still apply).

Exit - close the trade on a bar with a close lower than the previous two bars. Wait for a confirmation bar befor opening a short but remember that now CCI will have to be below -100 and SMI below-40.

The bars are the stop unless you choose otherwise


The two previous bar business is just something I tried that works after listening to a couple of day traders on a vido link somewhere - can't remember exactly where. I think it was probably the Tradeology websit free email trading course - very worthwhile if you can find time for it.

[fivesboy] 12/8/2008 13:51

Hi Henry,

Thanks for your recent posts and the clarification of CCI exits etc. Very informative as usual. I still struggle for confidence when it comes to using CCI for entry into a long. I try and make sure it is near the 20 x 20+8 cross and there is some confirmation price action rather than just straight up or down candles and obviously SMI being in the right territory.

I looked at that strategy you used on the SnP but was wondering what you used on it as the key indicator used, Laguerre, is not on CMC / IG? It seems interesting and when I have a bit more time will try and use it on Meta Trader.

I switched to Ev$ today as was not having much joy with FTSE and it paid off though I missed the pick up that occurred around 9:45.

Interesting you're using candle reversals more than 2 bar breaks. Is that patterns from Bulkowski?

[henryatkin] 11/8/2008 12:42

There is another example of that CCI zero cross reversl today on forwx E v $ at 12.04/5. If I am in a trade when this happens I now wait for the next candle to confirm or reject the direction of my trade.

[henryatkin] 11/8/2008 12:09

I traded ftse at the open with a decent profit up until the consolidation then switched over to Forex E v $ very good trends this morning. Price action from both trend lines and candle patterns all worked like textbook. Seems to work better with close at break of previous three bars though. That would have saved me closing and re-entering a couple of times.

A couple of points I did notice today which I have seen a lot previously is the size of the bars when the CCI crosses the zero line and reverses . It shows up on Fridays and todays one min chart. Imo these bars are on low volume which is why they so often almost instantly reverse. I put it down to a lot of traders who follow Woodies CCI trades both manually and by program trading. The zero line reverse pattern for a few points is one of their biggest plays. A lot of trades all doing the same thing at the same time but in comparrison to the big picture they are a small volume. There was a down bar of this type at 08.15 on the ftse uptrend. Fortunately I noticed it crossing the zero line so ignore the two previous bar close rule and held the trade for good profits.

I have been paying far more attention to candle bull/bear reversing patterns. It has saved a few points today on both ftse and forex - giving it priority over the previous two ba break close.

Pukeko - I agree re long term but it seems a lifetime when watching a one minute chart :-)

[pukeko] 11/8/2008 09:16

Good Morning Henry. Thanks for your comprehensive reply. It was your initial stop on a long term trade that I was looking for, but great to see your exit strategy for all eventualities summarised again, together with your reasoning.

I'm afraid it still seems a little strange to me, to talk about a long term trade that I know will be closed by the end of the day and probably within the hour. ;-)

Thank you.

[henryatkin] 10/8/2008 16:28

THE BEST FREE "PRICE ACTION" INFO YOU WILL EVER COME ACROSS imo:



The reason I am looking into forex strategies is that there is no published volume on the forex markets due to not being under one central exchange. All forex traders trade without a volume indicator so they are on a level playing field as spreadbetters.

[minky] 09/8/2008 11:53

Thanks everyone for the good posts and especially Henry for re-iterating the rules. It is good to be reminded occasionally. Helps keep me out of trouble.
I tried the forex factory link bu it would not download properly. It said the download was corrupted. Anyone else had a problem?

[henryatkin] 09/8/2008 08:41

Found another decent strategy for short term trades:




I tried it last night on SnP500 for a profit of 6.8 SnP points with two winning trades and two loosing.

[henryatkin] 09/8/2008 08:31

Pukeko. I use different stop strategies depending upon the trade strategy:

1. For short term trades following a low moving averave or Tema or Dema I would use the previous two bar rule. For long trades the stop starts at the trade entry and follows the price. You exit if the price closes below the low of the previous two bars. For short trades exit if the price closes above the previous two bars.

2. For long term trades my initial stop would be the price cutting the 20MA. After the trade is established and running at a profit I let it run to exit strategy which is one of three:

A. MA 20 crossover with 20+8
B. CCI zero line crossover
C. The long term trend line break - not always obvious until you get used to spotting a coincidence of trend lines on the price chart and the CCI chart. As a guide if the trend line break is showing at a good distance above or below the 20MA it is not likey to be the long term trend and will probably have further to run. Long term trend line breaks tend to be fairly close to the 20MA and show on both the CCI chart and the price chart.

For long term trades I enter with three positions and exit each of them with a different one of the above three. It means that you average your exits and on occasions that one exit strategy gets you out too early the other two will likely keep you in the trade.

[pukeko] 08/8/2008 21:56

Hi all. Its great to have a thread in the TNT mould. (ie sensible discussion about the subject, and its on the free board too!) Congratulations Henry.

I'm afraid I am still very much at the novice stage here, as I can't devote enough 'quality' time to the live prices, however some of the ideas are coming together in my head a little better now :-)

I am interested to know what stop loss / exit strategy you all use if your trades do not move straight into profit. Do you use any indicators or just have fixed number of points when you tell yourself you got the entry point wrong and quit the trade?

Sorry if you have covered this earlier. Let me know if you have and I'll read back through. (at least there won't be 45000 posts to look through - lol)

[henryatkin] 08/8/2008 16:35

Ady, I only enter trades above and below the 130 line on the 60 period. Exit at 3 different price stategies. So enter on long trade when the CCI is +130 and exit one postion at 20 and 20+8 ma crossover, exit another position at a crossover of the trend line and a third position at the CCI zero line crossover. If you get thrown out as per today then the long term (all morning) trend is not worth trading, so pack up - plenty more days when it will work.

Another way to see if it is worth trading is switching from 1 minute timeframe to 5 minute. I don't enter a trade if the candles are being chopped by the 3+1, 3+3 and 20 MA's. Its not always obvious from the 1 min chart but if you switch to 5 mins on todays you will see that there was nothing worth trading between 09.00 and mid day.

[mr stealth] 08/8/2008 13:16

hi guys

been a tad slow for me too, realise my performance is based on how strong the market is trending ( very obvious by looking at a few MA's on daily ftse chart)
however i do believe that there must be a few good tactics for most
times so been busy testing etc

cant get my mind around how the CCI is used ?
looking at today for instance its zig zagged up & down through the centre line
which would have caused some nasty losses
assuming entries short when it fall below & entries long as it rises above ???

[fivesboy] 08/8/2008 12:42

My post was put in the vague hope that everytime I put up a post about the market being slow, it picks up. I think the market is on to me :)

I was thinking of you all this morning wondering what fun you were having whilst I was sitting at a screen trying to get in at any vaguely positive sign and failing (thankfully small and in no way a danger to the weeks positive territory) Still I've been doing admin as well as keeping an eye on things so has not been a total waste of time.

As you know I really like the TEMA up and down signal. I can't see there is a tremendous amount of difference between 21 and 32 to be honest. I am following your lead and only using TEMA. I had been using simply a two bar confirmation of change of colour but has not worked today (but did work really well on Monday/Tuesday when I stayed in short term trend rather than exit early. I think you have to adapt and for non-trending days the earlier exit would keep you in positive territory much more easily. I will monitor how this goes but this TEMA in general is my favourite as it's so visual and clear.

[fivesboy] 08/8/2008 11:52

Tedium ad infinitum.

[minky] 07/8/2008 13:40

Fives,
Me to.

[fivesboy] 07/8/2008 12:22

Everytime I say things are tedious it picks up. It's just like London bus syndrome. I had a terrible start to the day. I too was off yesterday and coming back today I was breaking all the rules as I wasn't really in tune and focused. Then I started concentrating better and got back in and have ended up in reasonable profit so am delighted to have turned it around. I am finding focusing on the previous two bar prices really helps you focus on what you are doing ans assessing where things are going. Your number one tip for me recently. Thanks again.

Like the early trading thoughts. Would certainly keep you out of trouble although quite often some good action from the starting bell. I guess safety first is the order of the day.

Response from CMC re spikes: "The cause of the big dips today and yesterday in the UK100 were due to a bad price feed from our providers. If any of your positions are closed out due to such spikes from bad prices then CMC will reinstate your positions. If you have any further questions please do not hesitate to contact me. Thank you for trading with CMC Markets." -- Yup and that won't screw your trading strategy up!

Would appreciate in your e-mail a review of your rules of CCI as apart from watching it's general trend and seeing where a long term trend is broken, I don't use it that much. Sounds like it would obviously benefit me to do so. I am finding the long term strategy not quite as reliable as short term or price action now though when it works it works well. I think I need to be clearer on my confirmation signals for the long term strategy.

[henryatkin] 07/8/2008 11:00

Fives ... yes will get round to the email later today. I was also just watching & waiting for an early trade which didn't come. I am trying to stick with just Tema in the first hour and putting together some filters to keep me safe. So far I find the 32 period seems quite good. Don't trade the first 4 minutes. SMI must be outside +/-40 and CCI outside +/-130. Wait for the first Tema reversl before entering a trade. Reverse the trade after closing on the second bar colour change (I use blue for down periods and green for up periods). Try to confirm the trend reversal with a reversal on the SMI and/or a line break on the CCI chart. It does miss some decent trades now and then but if you can ignor that the results seem very positive so far. Having said that in the very early trades 08.00-08.30 ignor the CCI filter. Still early days for this one but I have to find something to keep me out of early losses and in for early winners.

The after 09.00 period Tema works just as good and the CCI long term trades are all working fine and making far more money than tema or price action. I didn't trade yesterday but have done well again this morning so far.

I also am going to reactivate an IG account. I will leave £1K in CMC to cover any trades in the event of IG going down. I recall MTGlass saying that he likes to keep two accounts open whilst trading. Seems a good idea.

[fivesboy] 07/8/2008 08:43

Pretty tedious this morning. Sitting waiting now for some decent action. Look forward to email mentioned a few posts back Henry.

[fivesboy] 06/8/2008 22:57

Hi Henry, Yes, I noticed the early bars missing a few weeks ago. I thought it might be because of some system issue. I got you to e-mail me your chart so I could check the bars, remember? I forgot to tell you but I contacted CMC about it and they fobbed me off with something about not being able to store the all the price information during high volatility and so only stored the closing price. I countered that this was only 3 extra bits of information per price bar and it seemed to work ok for the the rest of the day without a problem. They insisted this was the reason.

I suspect you're right. I am going to resurrect my IG account and see how they do. CMC also cheeses me off when it requotes and gives you 3 seconds to respond, giving you little time to check the new price and where it relates to what you thought was your entry price. I understand IG also offer off the chart trading which might be interesting.

The CMC price spikes is a worrying recent development.

[henryatkin] 06/8/2008 16:16

Smarm confirmed that these spikes did not show up on IG charts. I have also noticed how CMC hide the price bars on the opening few minutes if you try to back check charts for previous days. Looks like they don't want us to trade the opening volatility.