Stochastic Divergence

Hi Everybody,

I talked about using more “standard” technical analysis, like oscillator divergence a few days again,. So I would like to share another great example on the 3min YM form yesterday.

Here we can see how the YM made a reversal at DP resistance, but the important point is how this was also on very clear Stochastic divergence. This nailed the high for you, just before a nice fall.

With +3.4R Profit (ignoring slippage and commission) available at the opposing DP target, this was a nice trade, and shows how the MTP tools (DP) can be used in conjunction with more standard analysis techniques, like oscillator divergence.

Thanks, Steve,

Holy Grail trade on the 3min Dax Part 2

Hi Everybody,

On the Standard Blog, I took a look at what I call the “holy Grail” setup. This is where the abc correction (TS4 sell) come in as part of the “initial correction”, to the “initial move” off an “important high or low”. In Elliott Wave terms, this is a Wave (2) correction. So let’s take a look at this chart, using the Elliott Wave module in MTPredictor.

As you can see, the software found a Major Wave (2) high at the TS4 sell, which was followed by a string Wave (3) decline. This is a perfect example of this Holy Grail setup.

With a +14R Profit available as DP support came in, this was a brilliant trade and yet another example of why this is my favourite setup......

Thanks, Steve

Elliott Waves and DP tools

Hi Everybody,

Please remember that MTPredictor contains some great tools and modules in the software, for example the DP and Elliott Waves. Yesterday, on the 5min YM, there was a great example of how these combined together with a standard technical analysis techniques of oscillator divergence to nail the high of the day for you yesterday. The important points are how the reversal came after a “good looking” 5-wave rally, with the high unfolding at both DP and WPT resistance, and all on very clear Stochastic divergence. As you can see, this nailed the high of the day for you !

The YM then declined nicely into the close for a lovely +6R Profit (ignoring slippage and commission).

There are too many people who simply rely on the Automatic signals, without taking the time, and making the effort, to learn how to use these more Advanced techniques. When you do, you will be amazed at what additional trade opportunities you can uncover !

Thanks, Steve

Gap Open play on the NQ

Hi Everybody,

For those of you who have read the Trading Course and have followed this Blog for a while will already know that I like to look for a “Gap Open play”, where the markets makes a Gap open but then reverses immediately at DP support/resistance. Well, we had a brilliant example on the 3min NQ yesterday.

As you can see, this nailed the low, just before the sharp rally in the morning. As the STF was strong as the initial DP target was reached, Advanced Traders would have swapped to the ATRStop. This would have held the long into the highs of the day for a very nice +6R Profit (ignoring slippage and commission)

Thanks, Steve

Manual Analysis

Hi Everybody,

Today I would like to remind you all that both MTPredictor v6.5 and the NinjaTrader 7 RT add-ons have a number of additional “manual” tools that you can use to uncover additional trades. Here is a good example form just this morning on the 3min Dax.

Here we had support at both the DP and the minimum Wave C WPT. This signal a potential long trade The Dax then rallied nicely. The ATRStop was then used to lock in a very nice +3.1R Profit (ignoring slippage and commission).

But the point is that MTPredictor is not just the automatic setups, you do have the tools to be able to perform your own analysis and as such find additional trades.

Thanks, Steve

The Holy Grail

Hi Everybody,

Yes, the 5min NQ that I looked at in the Standard Blog had the backing of the STF, But I always like to see a nice “pattern” and the abc correction on the NQ was a littler “flat and choppy” for my liking. As you all know, my favourite trade (I call the holy grail), is when we get an “initial” correction off an “initial” move off an “important” high or low. So for this I like to see a nice “pattern”. For me the 5min YM had a batter looking “pattern” than the NQ so was the better play for the Typical Wave 3 target. In particular the way we had good support at the initial low (15min support, not shown), and the abc was more of a “correction” to the initial rally, rather than just a drift sideways as in the NQ.

As you can see, this indeed worked out with the 5min YM reaching the Typical; Wave 3 WPT perfectly for a lovely +8.7R Profit (ignoring slippage and commission).

What I also liked about this trade was the way the rally off the TS3 buy unfolded in 5-waves, giving yet more confirmation to hold the trade into the targets.

Again, all this gets easier with experience and knowing what to look for, but as I keep on showing this is why I call this trade the “Holy Grail” and is the one I look out for all the time.............

Thanks, Steve

When to take DP setups, Part 2

OK, here is the 15min Chart. As you can see the TF was at DP resistance on this 15min Chart at the time the 3min DP sell was coming on. Thinking about my train example again, this is like the rails coming up against a set of buffers that signal the end of the track. As the “larger degree” 15min Chart was at resistance then it was “OK” to go against the STF colour on the 3min Chart as a “larger degree” trend reversal was indicated.

The DP’s and WPT’s are very powerful and this is why I suggest that all traders should always be aware of DP support and resistance zones on their “larger degree” (15min) charts “before” the 3 or 5min Charts get there......... This is just part of the daily routine that all traders must do. Saying you are too lazy to do this “prep work” is no excuse. It does not take any time at all to have a “quick look” at your 15min charts at regular intervals during the day so you all “know” where these areas of “larger degree” support and resistance are.

Thanks, Steve

When to take DP setups

Hi Everybody,

This is a question I get asked a lot, and that is when to consider DP setups. The reason this is not as easy as the other setups is because the DP is a “trend termination” setup. So it is like standing in front of a train, in that you will get squashed if the current move is a strong trend. So when should these be avoided and when can you consider taking them ?

As always, the answer is in the “larger degree trend”. Yes we have the STF on the “current chart, but as well all know, all indicators are lagging (by their very nature), so we look to the larger degree chart for DP’s and WPT’s. Let’s take a look at an example on the 3min TF (Russell Index) from yesterday.

As you can see, this was a very good looking DP sell setup, that had a number of other techniques all pointing to a high as well. But the STF was blue. So normally I would suggest “Standard” traders avoid trades that are “against” the STF colour. BUT, lets now take a look at the 15min Chart.

Thanks, Steve

“day session” or 24hr charts

Hi Everybody,

As you have already seen, I have taken a look at the DP sell on the 3min YM chart. But as the STF was blue at the time, Advanced Traders needed “larger degree resistance” at this level to justify ingoing the STF colour.

Now, when we look at the normal “day session” 15min YM chart, there is no obvious resistance. When this happens, I also take a quick look at the 24hr session data just to see. And in this example, using the 24hr chart, not only was the YM at DP resistance at this high, but there was also an automatic DP sell set-up as well ! As such, this gave the Advanced Traders among you permission to consider this trade.

As we have already seen, this nailed the high of the day for you ! Then stopping and reversing at the TS4 buy (using the standard rules) nailed the low for you ! I don’t think the newer traders among you fully appreciate how amazing this is, to be able to nail both the high and low of the session is absolutely brilliant. All the tools you need are in MTPredictor, it is up to you whether you wish to take the time and make the effort to learn how to make full use of them....

Thanks, Steve

VSA and DP nail the low !

Hi Everybody,

Here is yet another great example that I was following yesterday on the 3min FTSE. Here we had a High volume (VSA) spike that unfolded right at DOP support. This nailed the low of the day !

The FTSE then rallied nicely to reach the initial DP target, but as the FTSE reached this target the STF (not shown) was strong, so this suggested that the rally would continue higher..... But then I noticed that the rally was unfolding as a very nice Elliott 5 wave sequence, so when the FTSE reached the minimum Wave 5 WPT and the open Profit was a nice +6R (ignoring slippage and commission) the “sensible” course of action would have been to protect this Profit.

As you can see, this not only nailed the low of the day for you, but also caught a very nice rally. You already have all the tools in MTPredictor to be able to uncover brilliant trades like this, whether you make the effort to learn how to do this is up to you.

Thanks, Steve

The Holy Grail

Hi Everybody,

The 3min FTSE yesterday gave us another brilliant example of my favourite trade, where I look to play the Wave (3) swing, following an “initial correction (Wave 2) after the “initial rally” (Wave 1) off an “important low”. You have all seen this many times before, so you should be familiar with this play by now....

The result was amazing, with a massive +7R Profit (ignoring slippage and commission) as the 3min FTSE reached the Typical Wave (3) WPT.......... brilliant !

Thanks, Steve

High volume (VSA) spike nails the high of the day !

Hi Everybody,

The 3min Russell Index yesterday made a classic high volume (VSA) spike reversal at double DP resistance top nail the very high of the day yesterday ! The Russell then decline into the opposing DP, where another high volume (VSA) spike unfolded, but this time the bar’s high was not exceeded, so your stop would have been trailed as the Russell continued lower.

The short trade would have eventually been stopped out for a massive +9R Profit (ignoring slippage and commission)

An amazing trade and a brilliant example of how the high volume (VSA) spike and DP combination can nail brilliant trades for you – in this example, short from the high of the day ?

Thanks, Steve