Chart Patterns

[MRC & Co]

And here is where I disagree, entries are a masterpiece of trading.

Patterns represent the big players in THAT particular market, each market has it's own big players and therefor it's own patterns.

They are the ones defending positions, pushing through levels, deciding how far a breakout will run, deciding when a pullback can take place, it is those you should understand, and why each market, has it's own, unique behaviours. All in my opinion of course.

 

[skyQuake]

Lets take the SPI for example
Resistance right near the JAN Highs
Why?

Because people who bought in january are happy to exit at break even and get out.

There are maybe 5 people who have done that with the SPI as you have described. Maybe a total of 30 contracts.

Funds may have done similar but based their decisions on a lot more/different factors.

 

[MS+Tradesim]

And here is where I disagree, entries are a masterpiece of trading. ........ All in my opinion of course.

I'm with you. Entries are an undervalued art. Took me awhile to figure that out.

 

[tech/a]

And here is where I disagree, entries are a masterpiece of trading.

And where is the disagreement?

In the chart I have supplied where is the best entry with least risk?

IT when you find it,isnt as much of a masterpiece as you would think---is it?

Low risk maximum R/R.

 

[MichaelD]

And here is where I disagree, entries are a masterpiece of trading.

Patterns represent the big players in THAT particular market, each market has it's own big players and therefor it's own patterns.

The funny thing is - I agree entirely with this statement.

Figuring out who's moving the market and then positioning myself to try and take advantage of this is key to my two income producing systems.

That, however, will not be found by looking at any conventional patterns, at least not in conventional ways.

 

[MRC & Co]

The funny thing is - I agree entirely with this statement.

Figuring out who's moving the market and then positioning myself to try and take advantage of this is key to my two income producing systems.

That, however, will not be found by looking at any conventional patterns, at least not in conventional ways.

Yep, agreed.

Also, same with me Tradeism.

Tech, the best entry depends on what you are trying to do and how much you are prepared to risk to do that............

For me, on your chart, that would be at the bottom of box 2.

 

[Bobby]

That, however, will not be found by looking at any conventional patterns, at least not in conventional ways.

Wow !
About time this was stated , well said MichaelD .

 

[tech/a]

Dont disagree.
Well not entirely.

While you may well see it stick out like a tree on a hill by itself in your DOM reading.
I too see it in my chart.

at least not in conventional ways

And its not!

 

[MRC & Co]

Wow !
About time this was stated , well said MichaelD .

Well actually certain chart patterns can be effective, if they appear in your market regularly.

But entry has to be perfected for yourself, depending on what you are trying to achieve and this also comes down to the relative position of the pattern and the behaviour of the market. Both are far more important than the actual pattern.

Again, in my opinion again.

 

[Bobby]

Well actually certain chart patterns can be effective, if they appear in your market regularly.

But entry has to be perfected for yourself, depending on what you are trying to achieve and this also comes down to the relative position of the pattern and the behaviour of the market. Both are far more important than the actual pattern.

Again, in my opinion again.

Hi MRC,
Like to hear more of your perception , especially during those periods you alluded too ..

 

[ceasar73]

Ive said it once...I'll say it again, this is a great forum!

ceasar73

 

[Cartman]

And here is where I disagree, entries are a masterpiece of trading.

I'm with you. Entries are an undervalued art. Took me awhile to figure that out.

A bludy-men to both those statements ----------Good MM is a waste if your entries are crap --- unless you have very deep pockets !! --

Good MM is rewarded with Good entries !!

The funny thing is - I agree entirely with this statement.

Figuring out who's moving the market and then positioning myself to try and take advantage of this is key to my two income producing systems.

That, however, will not be found by looking at any conventional patterns, at least not in conventional ways.

G'day Mike (and not trying to pick a blue here), but I though the crux of your entry system was picking a higher high of the last X amount of days in an uptrend (or vica verca) ---- I'm pretty sure that is poles apart from Mirc's idea of a low risk entry

have you changed your style/main entry criteria due to the current economic situation? ---

as i say, genuine question, and not trying to inflame here

 

[tech/a]

Both are far more important than the actual pattern.

If both are far more important then you'd be trading whatever the "both" is.(Overall trend,time passed since last consolidation--(pattern),speed of price moves--etc).

You would have no need for a Pattern.

EVERY trend starts with a pattern---even if that pattern is a prolonged flat period.

Every profit comes from a trend--even a single tick is a trend.

A bludy-men to both those statements ----------Good MM is a waste if your entries are crap --- unless you have very deep pockets !! --

Good MM is rewarded with Good entries !!

You really dont get it!

 

[MichaelD]

I too see it in my chart.

Hate to disillusion you, Tech, but there is NO statistical significance in the patterns you are showing.

I'd suggest that you are putting the case that the tails are suggesting that lower prices are being "rejected" - i.e. that buyers are willing to soak up all that the sellers have to offer and then some, but if you actually code up these patterns and test them - there is no statistical significance to be found there.

50% go up, 50% go down and there's no particular correlation with fat tail outsized returns.

Been there, tested that.

Of course, by no means does the above preclude trading such patterns profitably, but it ain't the pattern that makes the profit.

 

[MichaelD]

G'day Mike (and not trying to pick a blue here), but I though the crux of your entry system was picking a higher high of the last X amount of days in an uptrend (or vica verca) ---- I'm pretty sure that is poles apart from Mirc's idea of a low risk entry

My long term trend following does this, but that is a long time frame capital building system. The other systems I trade are for income generation and work in totally different time frames and exploit different edges.

One thing consistent across all systems is to get out as quickly and as painlessly as possible if the market disagrees with me.

 

[MS+Tradesim]

there is no statistical significance to be found there.

Out of curiosity, what do you define as statistically significant?

 

[tech/a]

Hate to disillusion you, Tech, but there is NO statistical significance in the patterns you are showing.

I'd suggest that you are putting the case that the tails are suggesting that lower prices are being "rejected" - i.e. that buyers are willing to soak up all that the sellers have to offer and then some, but if you actually code up these patterns and test them - there is no statistical significance to be found there.

50% go up, 50% go down and there's no particular correlation with fat tail outsized returns.

Been there, tested that.

Of course, by no means does the above preclude trading such patterns profitably, but it ain't the pattern that makes the profit.

Michael.

Sorry to dis illusion you with the illusion that its the tails I'm interested in.
I stated its not conventional and its not.

The pattern tells a story,which is a player in the setup NOT the entry. The entry is triggered by "The Unconventional"
Which is way off beam with conventional thinking.

Thats as far as I go with this as its MINE MINE!!!
Guess away.

 

[MRC & Co]

If both are far more important then you'd be trading whatever the "both" is.(Overall trend,time passed since last consolidation--(pattern),speed of price moves--etc).

You would have no need for a Pattern.

EVERY trend starts with a pattern---even if that pattern is a prolonged flat period.

Every profit comes from a trend--even a single tick is a trend.



You really dont get it!

It's the entire lot together, patterns, levels, trend structure (which I guess you could class as a pattern in itself, I am talking of 'traditional patterns such as H&S, triangles etc).

Your buying low volume pullbacks in an uptrend. I wouldn't take your first box entries without viewing the prior action. I would be more selective and only take the second box pullbacks which touch the previous swing high (buying off a level, based on trend structure).

 

[Cartman]

You really dont get it!

i think i get a lot more stuff than you might realise Tech !!


ps i assume Tech that Mirc and MS also dont get it as well ??

My long term trend following does this, but that is a long time frame capital building system. The other systems I trade are for income generation and work in totally different time frames and exploit different edges.

One thing consistent across all systems is to get out as quickly and as painlessly as possible if the market disagrees with me.

Fair enuff --- just curious about that, cause taking a breakout high is obviously a lot different to backing yourself on a failing retrace .... Cheers.

 

[tech/a]

Would you prefer

Warmer warmer---colder colder---type replies until you get it.

Its UNCONVENTIONAL what makes you think you can see it in THAT chart?