10 replies to this topic

[Douglas]

I've struggled with this question for many years.  For daily charts I currently let the three techniques shown below vote.  Majority rules.  Do you have a better trend indicator  or methodology suggestion that could improve my lot?   I've noted what I see as the strengths and weaknesses of each.  

 

1) Break a trend line and make higher lows and higher highs (lower lows and lower highs).  Very subjective, pain in the tush to do:

 

2) Fast and medium speed moving average cross over, for example,  3 EMA and 10 SMA.  Faster response but more whipsaws and a bit fiddly to select the "best" moving averages:

 

 

3) Chandelier stop crossing.  Very sensitive to settings, too loose and late, too tight and lots of whipsaws:

   

 

Currently they are all saying the daily trend is down, but on an hourly scale this morning in the futures market the trend appears to have turned back up.  Your suggestions and comments as to how to better quickly define the trend are definitely welcome.

 

Regards,

Douglas

 

 

 

 

[Chilidawgz]

What time frame are you trading? Daily. weekly or 4 hour charts ?

[traderx]

for trading daily what would you use?

[Douglas]

Chilidawgz, I'm just trying to identify trends that will last from a few weeks to a few month on a daily index price chart.  The risk windows that I blather on and on about predict when a trend change is most likely.  The trading system that I use is set up to pull the trigger when that change in trend is confirmed and indicators point in the direction of that trend direction.  The faster I can secure those confirmations, the more of the  trend that I can capture. 

 

If you're late to the party, half the time you're just left cleaning up the mess or dealing with the cops on a disturbing the peace callout.  If you're too early, you'll get stuck making the beer run, setting up the kegs and hanging all the decorations.  I just want to arrive when a good, long party is just starting and leave before I'm so drunk that even the ugly stocks are starting to look good.

 

Regards,

Douglas       

Edited by Douglas, 06 December 2021 - 10:25 AM.

[Chilidawgz]

I used to trade daily charts. I swing trade basically, a few days to a week or more. I have found two hour charting works for me. I use a tax deferred account so taxes are not relevant. I will use the QQQ  as an example but these charts can applied to anything. (not the AD of course) MACD/moving averages are your friends  I bought the QQQ this am, should have bought IJR. Oh well, the Q's are my fav trading index. I sometimes leverage or long or short but not today.

 

Edited by Chilidawgz, 06 December 2021 - 12:43 PM.

[da_cheif]

simple     use fib and dows 12hour rsi

[12SPX]

nice charts reminds me of david larews charts!!

[Douglas]

Well, speaking of trend change, according to my three indicator method shown above, the DJIA changed trend direction to up this Monday.  The green chandelier line was broken and the down trend was broken and a higher high and higher low were made.  The 3/10 moving average crossing did not happen until Tuesday, but 2 out of 3 on Monday was enough to turn the tide.  Today (Wednesday the 8th) is a risk window, so I'm expecting a reversal south of some degree, maybe not the same degree as the reversal north on Monday, but something of the Dixie variety. 

 

 

Regards,

Douglas  

[fib_1618]

 I'm just trying to identify trends that will last from a few weeks to a few months on a daily index price chart.

 

Based on this specific criteria, you might want to consider playing with the Parabolic SAR with the default value, and then use the ADX indicator, with a complimentary time value, to fine tune your entry and exit points.

 

Internally, that would be a different story.

 

Fib

[andr99]

to make money in the stock market you need just two things : experience and intuition. Experience because your brain must have already categorized patterns over the years and recognized in what direction they will end up when you face them. Intuition because no one rings a bell and you need yourself a ring sounding at the right time based on experience. As for indicators they tell the story, but only after. I use just one and it's enough.   

Obviously the most important thing is the time frame you choose. I' m comfortable with those medium term time frame that forgive you if you enter a bit early.....

Edited by andr99, 10 December 2021 - 11:58 AM.