YM, ES and DJIA Analysis

[firewalker]

	Quote:	MC
	HRMMMM Could it be???? A longer period intraday chart with a test sans the 1 minute noise and micromanagement we all thrive on??? Yep...now back to my 5 minute noisy chart.

I think tests occur on each timeframe, from one second to one day

[MC]

	Quote:	firewalker
	I think tests occur on each timeframe, from one second to one day

Well of course...but there are auctions going on within other auctions. And of course the timeframe you use should jive with your style of trading.
Do you not weigh the different timeframes in as a factor though? A test on 1 minute charts means much less to me than a 15 minute chart for example.
A weekly to me is MUCH more important and less noisy than a daily. I'm not training to be a scalper though...so a scalper might use tick or volume based charts.

It's all in the eye of the beholder and hopefully they are using the proper timeframe to match their trade.

[OAC]

Yesterday I was suspecting an expanding triangle being formed, and here it is today on the ES 15 min chart:

[firewalker]

	Quote:	OAC
	Yesterday I was suspecting an expanding triangle being formed, and here it is today on the ES 15 min chart:

These kind of formations tend to make life difficult when trading from the outer edges... all the false breaks along the road.

If you don't mind me asking, does the presence of such a formation have any effect on your trading? I mean, do you wait and stand aside?

[OAC]

	Quote:	firewalker
	These kind of formations tend to make life difficult when trading from the outer edges... all the false breaks along the road. If you don't mind me asking, does the presence of such a formation have any effect on your trading? I mean, do you wait and stand aside?

The simple answer is this is a very difficult pattern for the swing traders. But it is good for the scalpers because the volatility is usually good. Just be careful to go with the trend once we break out of this formation. I guess looking at your daily and intraday MP helps.

[firewalker]

	Quote:	MC
	Well of course...but there are auctions going on within other auctions. And of course the timeframe you use should jive with your style of trading. Do you not weigh the different timeframes in as a factor though? A test on 1 minute charts means much less to me than a 15 minute chart for example. A weekly to me is MUCH more important and less noisy than a daily. I'm not training to be a scalper though...so a scalper might use tick or volume based charts. It's all in the eye of the beholder and hopefully they are using the proper timeframe to match their trade.

Although it might be more likely that scalpers use smaller timeframes, I would be incorrect to assume that you are a scalper because you trade off a smaller timeframe...

In the same way much of the patterns in a hourly chart disappear in a weekly one, much of the patterns in a 15-second chart probably disappear in an 30 minute one. But that doesn't mean they aren't there anymore. They are just 'hidden' from the eye imo...

I'm not sure what you mean by "weighing in the different time factors"... support on a daily timeframe is still support on a 1 second, minute, hour timeframe.

[MC]

	Quote:	firewalker
	Although it might be more likely that scalpers use smaller timeframes, I would be incorrect to assume that you are a scalper because you trade off a smaller timeframe... In the same way much of the patterns in a hourly chart disappear in a weekly one, much of the patterns in a 15-second chart probably disappear in an 30 minute one. But that doesn't mean they aren't there anymore. They are just 'hidden' from the eye imo... I'm not sure what you mean by "weighing in the different time factors"... support on a daily timeframe is still support on a 1 second, minute, hour timeframe.

I'm talking about tool selection, not saying everyone that looks at a tick chart is a scalper.

Multi timeframe based confluence of levels for one. You can and will see additional/different levels on a more granular timeframe will you not? So on a tick chart much of which is noise to a swing trader, is not noise to a scalper. Would you try to tighten a screw with a butter knife? It may work but it's not the best tool for the job.

If you look at a monthly chart that's in a bull trend and move in on tighter timeframes...each step in you see more and more detail. What's important to a scalper means very little to a long term investor and vice versa. If a long term investor is using a tick chart I don't think that's a logical fit and even as a rookie I would say that may be the wrong tool. Of course if you profit consistently who cares if the tool selection isn't what most deem proper. We all need to do what works for us, but often what works for the majority is the most applicable option no?

[james_gsx]

	Quote:	firewalker
	No need to feel defensive... I wasn't attacking your view, but I am nonetheless curious how such a countertrend trade can offer a decent risk:reward trade, given you are basically rowing against a very strong current.

I never actually setup a real trade, it was all hypothetical to explain what OAC saw in his chart as potentially bullish. You were confused because I threw in the ES chart to show the various moving averages as possible exit points, even though the ES wasn't the catalyst for the trade it was instead OAC's chart, the ES was just used as a simple example.

The counter trend trade was simple, a tweezer bottom is a very short term bullish pattern (think of it as a double bottom). The trade would be simple, buy at the close and sell depending on your risk management strategies. I don't know the exact amount of points, and I'm not going to go through and calculate it for you as I gave a simple enough example (below the low). I offered the 8ema, 21ema, 1300, etc as various exit points for this type of extreme short term trade. Obviously, one could adjust his risk depending on the possible reward, or you could wait for confirmation before entering the trade. All I simply wanted to show was how the chart OAC posted could actually be considered bullish, but then you tore it apart and it pissed me off. Now I think we can get back to discussing candlesticks, have a nice day.

Oh and btw, if you look at yesterdays SPY close at $126.18, we opened at $127.11. Not a huge gain, but it does go to show how that pattern could be a nice counter trend setup if used properly.

[james_gsx]

Well since eSignal decided to screw up my account, I have to use the SPY charts Nonetheless, it tells a similar story. Just to clarify, if my memory serves correctly the ES has a spinning top at support, and the SPY has a "hammer" at support.

My long term view is still bearish, but I wouldn't be surprised to see a small rally around this area. I wouldn't short, or necessarily go long here (except to hedge). I think the better strategy would be to wait for confirmation of this hammer, or wait for a close below 1,250 (ES) then a move back to that level to act as resistance. We've had 5 straight weeks closing in the red on the SPY, that doesn't setup any type of trades for me but it is something to take note of.

[james_gsx]

eSignal finally fixed my account. I told them if it wasn't fixed within a certain time frame, I would be taking my business elsewhere. Of course, it was fixed faster than any other problem I've had with them in the past. Go figure.

So the 8 EMA continues to show resistance. We had a few small body dojis, followed by a rather big range yesterday, then today a rally that closed near it's highs. Volatility is creeping in, and if the ES can move above the 8 EMA tomorrow I think it would be highly plausible to see a move to the 21 EMA, which happens to 1300 right now. Todays close is at recent support back in March, so time will tell if that holds.