"Trading Day by Day" by Chick Goslin

[The General]

Jonny T,

IMHO both a) and b) are used - if the 50dma is currently moderately up and the next couple of days to come off are higher than current price but big down days then there is a fair chance that the sma will turn down. As opposed to a strong uptrending 50dma when the prices to come off are higher than current price and are large down days then the sma might go fairly neutral...

Well that's my take on it in any case....

 

[nine]

Johnny,

Try a 3 10 16 Macd and make sure you use the simple moving average type (2). Its identical to your sms

PS. My book arrived today ... ordered it on 27th while in Hong Kong and its just arrived in Australia (direct from Chick's site). I will probably build a dll that shows the 49th (or 50th) day back with a colour change on the sma and perhaps a dot below/above todays price. Also I will do the same on the ma of the simple macd if thats relevant. Guess I dont know until I read the book.

PPS. First impression. Finally someone who knows about trading who can write (vs Mark Douglas) ... the buddha of trading ? be skeptical of all I say ? I plan to be critical if I can find reasons to be so given the incredibly positive comments in this thread so far.

 

[nine]

Here is a dll (save in c:\sierrachart\) and two study collections (save in c:\sierrachart\data\ the first just uses sierra standard indicators and the second uses the dll to give extra functions).

I have coloured the ML to show above or below zero and added a marker against the SL for the 16th bar back ... but I havent read much of the book yet so I dont know if this is useful or not

 

[s-a]

Kiwi,

I did something similar for Tradestation having a market showing the SL 16 bars ago. Good work. I personally place more significance on the ML going up or down and therefore I colour code that accordingly. Read the book, you might well change what you have

 

[Bigbusiness]

In this chart, I have turned the ML in to a histogram and have added a shorter period ML line to help predict when it will turn positive and negative. Seems to work quite well.

 

[pb]

Well I've just ordered the book after reading so many glowing reviews, particularly from certain members whom I respect.

 

[nine]

OK. Heres an updated one.

It now colours the M Line based on slope rather than position

It also has a zero line that goes yellow (choose your own favourite colour) whenever the TL and ML are concurrent.

Dont forget to briefly exit Sierrachart before saving the new DLL as I lock the DLLs to Sierra while it is running.

*** realised that you couldnt change the TL length in the "concurrent indicator test" so fixed that in the "updated" version ***

 

[roberk]

Has anyone subscribed to Chicks daily calls? I started 12 days ago and so far he seems to have lost on about 70% of his picks. Is that how it looks to others? He is a vague on stops and entries so it is hard to be certain.

 

[JonnyT]

I am swiftly coming to the conclusion that the method doesn't work....

Anyone able to persuade me otherwise?

JonnyT

 

[s-a]

You guys make your minds up on your own. Reading a book on something and then applying it for a couple weeks in a very tough market over the holidays is unfair IMHO. Takes time to learn this approach, it isn't an out of the box system. TGM has been using this for 10 years, myself for about 6 months exclusively. The method works fine for me and I know for a fact it works fine for TGM and MartinD as well. But you guys make up your own minds.

If it was easy, everyone would have a porsche or two.

HG

 

[neil]

fair Play

Some bits from Elite trader....did not see angry customers banging at his door. Perhaps a more informed and rational analysis of the system could be made after twelve months usage.


http://www.elitetrader.com/vb/showthread.php?s=&postid=12583&highlight=chick+goslin#post12583

http://www.elitetrader.com/vb/showthread.php?s=&postid=638910&highlight=chick+goslin#post638910
( By TGM 6 posts down)

http://www.elitetrader.com/vb/searc...d=644695&sortby=lastpost&sortorder=descending

 

[Bigbusiness]

I haven't started trading with this method or read the book properly yet but from the charts I have made, the last few weeks look quite good. I am mainly looking at the Dow, Euro/USD on daily and 1 hour charts. I have adjusted the ma's slightly for each market and time frame, as I don't think using the same settings for all of them is a good idea.

There are times when the markets are choppy when this method wont work but I have yet too see a system that keeps you out in the choppy markets and catches the big trends.

Does anyone else see a likeness to ChartMan's Dow trading method? I seem to remember JonnyT couldn't get that to work either. Perhaps there are too many subjective elements for someone who is so good with system trading methods?

 

[TGM]

Chick's market letter is based on a STRICT interpretation of the lines. You cannot use it as a 'blind' buy and sell letter to make bundles of money. It is a TEACHING newsletter to make sure you understand status....and a few tricks. Any questions about the letter call and ask him.

Since I have been receiving his letter for a long time (years). I would say it is as good a letter as you will get for 50 dollars a month. My opinion is based on the fact that I was on trading desks that subscribed to everything out there --elliot wave, PqWall...yadda, yadda... etc....( over 10k a month in subscriptions). Chick Goslin's market letter is the only one I still get. However, I manage risk basis the three lines. A few days does not make a market letter. Remember it is a teaching market letter. It does take a little bit to get used to the letter and his tendencies (just like any other). The good news you can call and query him.

Oh and he put out anticipation shorts on Monday in the stock market. His calls on the stock Market and the Currencies are very good. I read those every night. If I think he is on to something hot. I call him directly. What more can you ask for.

 

[TGM]

I haven't started trading with this method or read the book properly yet but from the charts I have made, the last few weeks look quite good. I am mainly looking at the Dow, Euro/USD on daily and 1 hour charts. I have adjusted the ma's slightly for each market and time frame, as I don't think using the same settings for all of them is a good idea.

There are times when the markets are choppy when this method wont work but I have yet too see a system that keeps you out in the choppy markets and catches the big trends.

Does anyone else see a likeness to ChartMan's Dow trading method? I seem to remember JonnyT couldn't get that to work either. Perhaps there are too many subjective elements for someone who is so good with system trading methods?

Good observations Big Business. Avoiding chop takes a little experience. The easiest way to do it is diversification. As far as settings for the indicators, use what you are comfortable with. As long as you have a SL, ML, LL ---you will be fine. I have used the same indicators for about 11 years now. So I am very comfortable with them.

If JonnyT is a pure systematic trading with no discretion. This method will be difficult for him. Because he will not take the necessary time to build experience with it. You can develop mechanical models with it (I have). But you have to put in the time.

 

[Bill G]

I've tried utilising the MACD facility on Sharescope for the ML and SL, difficult.
I think a better way to show this is to use a stochastic "7%K and 10%D" as chick quotes on P27 that Linda Rashcke says it gets close to the SMR. I think the fast stochastic is better to indicate divergence , and the slow for a less whipsaw effect..
Bill

 

[Roberto]

To me, it seems slightly disappointing (but inevitable, I suppose) that so much of the discussion should be taken up by "the system" presented in the book, rather than all the other more important things the author stresses about the general nature of trading. I'm not for a moment suggesting that anyone who buys the book planning to get hold of "a simple, duplicable system of making trading profits" is going to end up disappointed, but really the book is so much more than that, that these discussions (entirely natural and reasonable though they are!) don't even begin to do it justice. The precise details of Chick's method, as he keeps on and on stressing, are not really the point at all.

 

[DESKPRO]

I am swiftly coming to the conclusion that the method doesn't work....

Anyone able to persuade me otherwise?

JonnyT

Having read the book I have concluded that his method is not for me at the moment ... simply because I believe I do not have enough capital to trade this system because it would work with very wide stops which I cannot afford... its great if you happen to catch a trend at the begiining but trying to use it when in the middle or possibly the end of a trend (EUR/$?????) will result in unacceptable (to me) drawdowns... as Paul Tudor Jones said in Market Wizards " If you are a trend follower trying to catch the profits in the middle of a move , you have to use very wide stops. I m not confortable doing that."

 

[roberk]

Having read the book I have concluded that his method is not for me at the moment ... simply because I believe I do not have enough capital to trade this system because it would work with very wide stops which I cannot afford... its great if you happen to catch a trend at the begiining but trying to use it when in the middle or possibly the end of a trend (EUR/$?????) will result in unacceptable (to me) drawdowns... as Paul Tudor Jones said in Market Wizards " If you are a trend follower trying to catch the profits in the middle of a move , you have to use very wide stops. I m not confortable doing that."

Deskpro,
This is why trendfollowing - and indeed trading- is so hard. It not only goes against out natural inclinations -as Chick points out in his book- but also takes deep pockets or a readiness to take a high proportion of losses. So far, considering Chick's daily report he seems to be on the high number of losses side: I had expected him to be staying with trades much longer.
I think very few people will be able to overcome their inclinations and become trend traders - but the tiny number that can may be the ones who succeed in this game.

 

[s-a]

To me, it seems slightly disappointing (but inevitable, I suppose) that so much of the discussion should be taken up by "the system" presented in the book, rather than all the other more important things the author stresses about the general nature of trading. I'm not for a moment suggesting that anyone who buys the book planning to get hold of "a simple, duplicable system of making trading profits" is going to end up disappointed, but really the book is so much more than that, that these discussions (entirely natural and reasonable though they are!) don't even begin to do it justice. The precise details of Chick's method, as he keeps on and on stressing, are not really the point at all.

Amen.

HG

 

[nine]

OK. I will bite

To me, it seems slightly disappointing (but inevitable, I suppose) that so much of the discussion should be taken up by "the system" presented in the book, rather than all the other more important things the author stresses about the general nature of trading. I'm not for a moment suggesting that anyone who buys the book planning to get hold of "a simple, duplicable system of making trading profits" is going to end up disappointed, but really the book is so much more than that, that these discussions (entirely natural and reasonable though they are!) don't even begin to do it justice. The precise details of Chick's method, as he keeps on and on stressing, are not really the point at all.

Good observations Big Business. Avoiding chop takes a little experience. The easiest way to do it is diversification. As far as settings for the indicators, use what you are comfortable with. As long as you have a SL, ML, LL ---you will be fine.

I will bite Roberto.

I am enjoying the book but will probably not change the indicators I am using to match Chick's. I am thinking a little more about what I do in his terms though. So here is a "take" on SL ML LL.

I use a pair of MAs to give me a LL ... basic direction ... and I physically cause myself pain if I ever trade against them. NO counter-trend trades.

I use two different indicators for my ML (one is particular price behaviour). For me the ML is telling me when to delay trading in the direction of the LL until I get extra conviction that the retracement is over and price is likely to continue on.

I use simple price patterns for my SL.

So I ask for the trade to be in the direction of the LL and take it with simple SL if the ML doesn't say No. If the ML says No I wait for the ML to say yes of for more complex price patterns (SL). Exiting is another story.

What do you think Roberto?

Edit: Deskpro ... Chick's method (or my version) can be used on very short timeframes (I trade euro on 5 minute and go down to 1 minute in very steep moves) so you can achieve acceptable stops based on price patterns.