All you need to trade is a horizontal line - TheRumpledOne

[TheBramble]

So, breakouts on dailies are not BS, but on hourlies are tougher to trade. Even more so, when spreads have to be considered.

Breakouts work as often as they don't Trendie. The particularly useful bit of news about this which otherwise superficially would consign it to the 'no edge' bucket, is that if you consider the dyamics of the breakout and what the range channels actually represent, they offer a superb and low-risk opportunity to trade profitably by fading every breakout of which around 50% will come very good (back into the channel). Those that don't, cost little to find out they're not. At which point you simply reverse and get on-board the now established breakout move.

panic edit: One proviso for those less experienced in trading - you fade only when the initial (or only you hope) breakout momentum has quietened. Using whatever methods you normally employ to establish this. It could be MACD, shorter ranges, LII T&S or simple tick pressure. On an up break, you'd wait for the momentum to quiet, place your short with a stop just above the the high of the breakout move which shouldn't be too far above you at this point. Reverse for a downside breakout.

 

[jayjay121]

Breakouts work as often as they don't Trendie. The particularly useful bit of news about this which otherwise superficially would consign it to the 'no edge' bucket, is that if you consider the dyamics of the breakout and what the range channels actually represent, they offer a superb and low-risk opportunity to trade profitably by fading every breakout of which around 50% will come very good (back into the channel). Those that don't, cost little to find out they're not. At which point you simply reverse and get on-board the now established breakout move.

panic edit: One proviso for those less experienced in trading - you fade only when the initial (or only you hope) breakout momentum has quietened. Using whatever methods you normally employ to establish this. It could be MACD, shorter ranges, LII T&S or simple tick pressure. On an up break, you'd wait for the momentum to quiet, place your short with a stop just above the the high of the breakout move which shouldn't be too far above you at this point. Reverse for a downside breakout.

so the breakouts that don't work are these fake out trades included?, or just those moves that have exhausted?

 

[TheBramble]

so the breakouts that don't work are these fake out trades included?, or just those moves that have exhausted?

There is no "work" or "don't work". And ‘fake out’ is just a term to identify when the price didn’t go the way we thought it would.

And don’t get hung up on the psychology of ‘exhaustion’, ‘continuation’ etc. they’re just more phrases that pretend or assume there is a definite causal link between psychology of ‘the crowd’ and prices.

All these lines and channels we 'see' are imaginary. Luckily, lots of other people ‘see’ them too and place limits and stops there. Goody goody.

You trade what you think other bods are most likely to do – they are your customer.

Lots of bods jump on any old breakout and the pros and money men know this. They’re selling into the top of the weakening breakout (assume an upside breakout).

Sometimes, it just carries on and you get on board that direction.

In the shorter TFs it’s pretty random. Which is fine. Like a coin toss with good money management. I used to suggest that (as I thought back then) with a certain degree of ‘worst case’ in mind. I increasingly feel that’s not too far from the truth.

 

[bansir]

Breakouts

Hi,
Breakouts! I purposly ignored this opporunity thinking "Better wait for the retrace, must not chase the price".
I missed some really good pips, see chart, breakout at B1 .
On reflection, I think the price action leading up to this breakout may have offered some clues as to wether it was likely to pop.

I think maybe the frustration at having missed out screwed up my next trades.

Best Regards,
Neil

 

[black bear]

Common sense

There is no "work" or "don't work". And ‘fake out’ is just a term to identify when the price didn’t go the way we thought it would.

And don’t get hung up on the psychology of ‘exhaustion’, ‘continuation’ etc. they’re just more phrases that pretend or assume there is a definite causal link between psychology of ‘the crowd’ and prices.

All these lines and channels we 'see' are imaginary. Luckily, lots of other people ‘see’ them too and place limits and stops there. Goody goody.

You trade what you think other bods are most likely to do – they are your customer.

Lots of bods jump on any old breakout and the pros and money men know this. They’re selling into the top of the weakening breakout (assume an upside breakout).

Sometimes, it just carries on and you get on board that direction.

In the shorter TFs it’s pretty random. Which is fine. Like a coin toss with good money management. I used to suggest that (as I thought back then) with a certain degree of ‘worst case’ in mind. I increasingly feel that’s not too far from the truth.

Hi

another Good post

must be on one of my posting days, going for double figs :cheesy:

All these lines and channels we 'see' are imaginary. Luckily, lots of other people ‘see’ them too and place limits and stops there. Goody goody.

The above is very important, really

Think about what you think you know :?: really think, take a few days off and treat yourself

sorry what did you say................


You have x ray specs and your special and only you see it or have thought about it that way, ITS NEW

get out of here man

Latter:clover:

 

[black bear]

We do the above because we are human and like to think we are in control of everything

 

[black bear]

Breakouts

Its real if you can"t get in at a good price, real ones move real Quick

 

[TheRumpledOne]

Range Breakouts DO INDEED work. However, only when used correctly.
(the famous Turtles themselves a 20-day and 55-day range breakout. Although I think it was the High or Low rather than "opening price".)

Your BZ used on the hourlies is a variation on the Daily breakout. You have simply assumed it would work on a different time-frame.

There is a recent post by TheBramble asking members to see if Fibs work on 18-hr charts, or whether pivots work on 105-minute charts (that may be my example, but thats the gist of his post) and see if there are any patterns.
The principle is what "other traders are looking at".

Most market-movers probably do take notice of previous days/weeks ranges, and note the breakouts, but unlikely to be doing so on hourlies, hence why the BZ on hourlies is at best noise, esp when you dont factor in candlestick patterns, nor indeed action relative to previous several bars.

So, breakouts on dailies are not BS, but on hourlies are tougher to trade. Even more so, when spreads have to be considered.

But, I think you should at least acknowledge bansirs strength of mind in following the BZ for a really long time.
And also acknowledge BZ doesnt work for everyone.
And applaud him for finding something that he does feel comfortable with, and seems to be making pips with, and wish him well for his future successes.

There is no one single one-size-fits-all method of trading, and some of us prefer squigglies. :cheesy:

The Original Buy Zone was used on the market opens (London, NY and Sydney).

The Hourly is for scalpers wishing to take advantage of the average hourly range.

Bansirs successes/failures were due to choices made.

 

[Splitlink]

There is no "work" or "don't work". And ‘fake out’ is just a term to identify when the price didn’t go the way we thought it would.

And don’t get hung up on the psychology of ‘exhaustion’, ‘continuation’ etc. they’re just more phrases that pretend or assume there is a definite causal link between psychology of ‘the crowd’ and prices.

All these lines and channels we 'see' are imaginary. Luckily, lots of other people ‘see’ them too and place limits and stops there. Goody goody.

You trade what you think other bods are most likely to do – they are your customer.

Lots of bods jump on any old breakout and the pros and money men know this. They’re selling into the top of the weakening breakout (assume an upside breakout).

Sometimes, it just carries on and you get on board that direction.

In the shorter TFs it’s pretty random. Which is fine. Like a coin toss with good money management. I used to suggest that (as I thought back then) with a certain degree of ‘worst case’ in mind. I increasingly feel that’s not too far from the truth.

Short term trades should be taken as triggers for a longer term view, IMO. Taken by themselves, they are random, as you say.

Split

 

[TheRumpledOne]

Trade at the YELLOW LINES in the direction of the candle color.

Simple, yet profitable.

 

[StratOpt]

Why an indicator and not a strategy ?

Any indicator that can be coded has a defined set of rules. Any set of rules that can be followed can be coded. Any indicator that plots lines on a chart can be changed to buys and sells by following those rules. Then the resulting strategy can then be tested both backwards and forwards. Indicators do have their uses, but if a person says that they follow a set of rules based on an indicator, but do not provide the testable strategy or a repeatable means to do the testing then a person has to asks why is that ? There may be a legit reason, but I would like to hear it.

So somebody just provide a written strategy with all the rules in it and people can apply that and test that, and if somebody would want to provide their written strategy based upon the rules as outlined by this method, then I would be more than happy to run it through my walk forward tester and then provide the results to the forum. It is as simple as that. If you know all the rules to this, but don't have the programming ability to put into testable code, then submit the rules and I will personally code it. Strategize not hypothesize.

 

[BrainStorm]

Trade at the YELLOW LINES in the direction of the candle color.

Simple, yet profitable.

Its also kind of deceptive if you look at how the candles formed there are some tricky situations. 3rd bar went down first so would have failed. 4th bar the same. 5th bar crosses up first then goes down another fail before a win. 6th bar crosses down a couple of pips fails then crosses up a couple of pips and fails. Now with clever money management you could probably have scratched a few pips out. I am certainly not saying trading of a horizontal does not 'work'. Just saying that looing at a static chart rather than live bars can induce perceptional bias if you are not careful.

Having said that I am guessing those lines arent random but I think random lines would work just as well. Or round numbers or 50% retradcement lines or or or. EDIT: I notice they are round numbers <doh>

Personally I like to trade off lines generated by previous price action.

 

[TheRumpledOne]

Price doesn't seem to like to hang around a round number.

Look at the chart... the first trade was a long. You could have stuck around for a .25 gain.

 

[TheRumpledOne]

Looks like this thread spawned some others.... you know what they say about imitation...lol

 

[TheRumpledOne]

Has anyone given this a try?

 

[TheRumpledOne]

It should be OBVIOUS to the reader.

 

[TheRumpledOne]

Latest weapon in my arsenal is the ABOVE/BELOW indicator.

Now I have real time stats on how many bars closed above/below the current price.

This helps you know SUPPORT / RESISTANCE.

 

[TheRumpledOne]

More statistics to be used to take money from the banks.

 

[Hilly_trader]

i want to ask that what system is encourage in the forum? secondly please some1 shd tell me how to trade news

 

[nedal26]

TheRumpledOne... keep the good work