Charts for the Day

[timepass]

Are u using ADX in isolation?
If so what is the strategy w r t ADX.

But my query is in general reg design parameters, whether meant only for Higher TF & why frequent failure in Lower Tf esp for s

Not traded it as yet, just watching it and trying to work out a strategy. Combine ADX with 8/21ema crossover and trade in the direction of the trend, trail SL to 8ema. The problem is that it is not necessarily intraday.

 

[anil_s_trivedi]

anil Trivedi,

Many a times i have seen Strategies using Indicators like MACD, Stochastics, ADX give Good results atleast on 80% of the trades when applied on EOD.

However, the same when applied for Intraday, on lower T Frames say 15/30 min give Poor results.

Is it because they were created with setting values for Longer TF.

If so, how do we change the parameters, by Trial & Error, Stock specific?

What is yr suggestion.

Ofcourse, i am aware you r Not a Day Trader by & large.

Dear Rangarajan,

I had read almost good experts on ADX, Be it original Welles wilder, Charles lebeau, Linda Rashcke, Charles schaap...One thing i noted is they are not trying to incorporate ADX as a system implementation ( Charles schaap believes on systems from ADX) but they see it as a indicator only to gauge strength/weakness. Like charles lebeau want to see ADX rising from below 20, then after getting ADX into strong zone of above 30, he switched to other trend following indicators like MA. Similar approach is being used by Paul Rabbit.

But traders i see try to use it as a system like go long when ADX rises above 25, and price is above breakout zone...Its not like that, what i understood, many a times ADX rises above 25 and then fall backs below it...

Regarding settings of indicators, original indicators were designed mostly on daily EOD data. They try to see 14 day cycle...many use RSI(14)...But daily ATR readings are quite different from intraday ATR readings, traders failed to understand this simple things, so expectations on intraday need to be scaled down accordingly...

I am against changing settings stocks wise/ index wise...Its not indicator but our brains need to see price...Changing indicators value is deadly example of curve fitting i suppose...

Use what suits you best, If you are not happy with ADX14 signals, try to use ADX9...or any ADX'n' settings...but you should understand changing settings you are alterating ATR values too...so it is a reasonable thing you need to answer this...

Lastly, Indicator implementation is easiest if one understands how it basically constructed in first place...

 

[amitrandive]

Dear Rangarajan,

I had read almost good experts on ADX, Be it original Welles wilder, Charles lebeau, Linda Rashcke, Charles schaap...One thing i noted is they are not trying to incorporate ADX as a system implementation ( Charles schaap believes on systems from ADX) but they see it as a indicator only to gauge strength/weakness. Like charles lebeau want to see ADX rising from below 20, then after getting ADX into strong zone of above 30, he switched to other trend following indicators like MA. Similar approach is being used by Paul Rabbit.

But traders i see try to use it as a system like go long when ADX rises above 25, and price is above breakout zone...Its not like that, what i understood, many a times ADX rises above 25 and then fall backs below it...

Regarding settings of indicators, original indicators were designed mostly on daily EOD data. They try to see 14 day cycle...many use RSI(14)...But daily ATR readings are quite different from intraday ATR readings, traders failed to understand this simple things, so expectations on intraday need to be scaled down accordingly...

I am against changing settings stocks wise/ index wise...Its not indicator but our brains need to see price...Changing indicators value is deadly example of curve fitting i suppose...

Use what suits you best, If you are not happy with ADX14 signals, try to use ADX9...or any ADX'n' settings...but you should understand changing settings you are alterating ATR values too...so it is a reasonable thing you need to answer this...

Lastly, Indicator implementation is easiest if one understands how it basically constructed in first place...

Anil Sir

I hope you don't mind , I am sharing your posts in my thread for learning purposes.

 

[rangarajan]

anil Trivedi,

While going thro yr threads, many a times you had used the word " Structural change of Price '

What exactly you want to convey thro this phrase?Why not just change of price.
Is it a Jargon of yr favourite.

While we discussed Just Dial, price climax at 536, you had mentioned it merely as News based.

Out of curiosity, i applied yr strategy HH/LL 60.
The previous HH/LL60 was 740 on 9/11/15 & when it was breached on 28/1/16, stock fell by Rs48

But when 536, again the new 60 was breached on 3/2, just ONE ruppee till now to 535.

But my point is when analysed, you had not mentioned about this LL60.
Any compelling reason.

In the post quoted by amitrandive, mindgames recommends
a Filter to avoid false trade.( ma75)
Even by that, it is weak.
ADX is very strong for D/Trend.
So, in my opinion only Distribution going
& more Pain to follow

But it is always my Pleasure to hear yr views & look forward to yr reply.
And what parameters u will look for Reversal.

 

[anil_s_trivedi]

anil Trivedi,

While going thro yr threads, many a times you had used the word " Structural change of Price '

What exactly you want to convey thro this phrase?Why not just change of price.
Is it a Jargon of yr favourite.

While we discussed Just Dial, price climax at 536, you had mentioned it merely as News based.

Out of curiosity, i applied yr strategy HH/LL 60.
The previous HH/LL60 was 740 on 9/11/15 & when it was breached on 28/1/16, stock fell by Rs48

But when 536, again the new 60 was breached on 3/2, just ONE ruppee till now to 535.

But my point is when analysed, you had not mentioned about this LL60.
Any compelling reason.

In the post quoted by amitrandive, mindgames recommends
a Filter to avoid false trade.( ma75)
Even by that, it is weak.
ADX is very strong for D/Trend.
So, in my opinion only Distribution going
& more Pain to follow

But it is always my Pleasure to hear yr views & look forward to yr reply.
And what parameters u will look for Reversal.

Dear Rangarajan,

While going thro yr threads, many a times you had used the word " Structural change of Price '
What exactly you want to convey thro this phrase?Why not just change of price.Is it a Jargon of yr favourite.

The point i want to make is, when price itself showing deteriorating structure, means weakness...It can be in form of LH-LL or H&S Breakdown spanning atleast 9-12 weeks or more...

When price structure is weakening, we as a traders dont see whole picture but get obsessed with our indicators and analysis, rather than focussing on larger pattern unfolding...

Tell me how many traders see before entering trade what is price going on right now, are we in HH-HL, or we are trading sideways on one timeframe above our trading timeframe...Very few...then we enter, and indicators failed...we blame on indicators. but where is strength on higher timeframe...

Here, if you see in this thread, latest is SBI, we know its a weak case way above, but still traders try to jump in a every lag down...Let it first show some sign of holding, let it show some constructive pattern, be it double bottom low volume testing, or falling wedge...etc...

Important point is when larger pattern is unfolding, its necessary to sit tight...


While we discussed Just Dial, price climax at 536, you had mentioned it merely as News based.
Out of curiosity, i applied yr strategy HH/LL 60.
The previous HH/LL60 was 740 on 9/11/15 & when it was breached on 28/1/16, stock fell by Rs48
But when 536, again the new 60 was breached on 3/2, just ONE ruppee till now to 535.
But my point is when analysed, you had not mentioned about this LL60.
Any compelling reason.

I avoid catching bottoms, on that day i had not seen LL60 template...was focussing on climax selling being going on that day... Generally it happens retesting of supply zone gets tested to check fresh supply...

HH/LL60 itself telling stock is lingering on its lows...making newer 60 days lows...

In the post quoted by amitrandive, mindgames recommends a Filter to avoid false trade.( ma75)
Even by that, it is weak.
ADX is very strong for D/Trend.
So, in my opinion only Distribution going
& more Pain to follow
But it is always my Pleasure to hear yr views & look forward to yr reply.
And what parameters u will look for Reversal.

I am not getting that post from mindgames...plz post reference link...

In case of just dial, right now we are trading in a bar range of 1st feb, so its a case of continuation going on. Means no sign of strength...just a 'pause' on non stop selling...

Generally i want a good base buildup to say a reversal in intermediate term on price chart....I am not talking about 1-reversal kind of things...Base should have subsidized low volume, and when price starts to leave the base, i want volume expansion...Now during low volume consolidation you will see many low spread bars...As soon price leaves base territory good bulls bars closing near highs come up, these should be on above avg volumes...

And if want one bar reversal, then focus on lower lows, then suddenly one bar opens up below previous days low, move up into previous days range and closes above previous days close...This is classic reversal bar in action.

 

[rangarajan]

anil Trivedi

Tell me how many traders see before entering trade what is price going on right now, are we in HH-HL, or we are trading sideways on one timeframe above our trading timeframe...Very few...then we enter, and indicators failed...we blame on indicators. but where is strength on higher timeframe...


I can see the pain & Anger in you with the indifferent traders losing their hard earned money.

What you say is absolutely correct.

Even i was like what you said before i came to Traderji.

Learnt a lot from here from many Stalwarts including you.

Trivedi, you can only take the Horse to the Water, but can you make it drink?..


I am not getting that post from mindgames...plz post reference link...

http://www.traderji.com/technical-a...gh-probability-breakouts-271.html#post1119782.

And if want one bar reversal, then focus on lower lows, then suddenly one bar opens up below previous days low, move up into previous days range and closes above previous days close...This is classic reversal bar in action.

I follow this generally.
But is it essential that it should close above the previous day close or Body is sufficient.

Thanks for yr time.

 

[anil_s_trivedi]

[/B]

I follow this generally.
But is it essential that it should close above the previous day close or Body is sufficient.

Thanks for yr time.

These are variations of Reversal bar. I am following basic pattern 1.
Now think which suits you best, pattern 2 and then pattern 3 is more bearish.

Generally, aggressive intraday traders go short few ticks below low of reversal bar.

Now question arises, if we are focussing in pattern 1, then is it advisable to go on every reversal bar appearing on a price chart....No...strictly no...

Reversal bar means reversing the current trend...thats it...so focus on reversal bars which are appearing after 'n' days highs or lows...so you will be saved in congestion market...

Hope it helps...

 

[rangarajan]

You need to see it in context of ongoing trend. Many a times high volume zones never get tested, bcoz what we see a climax selling, is being smartly being picked up by institutions who dont want to have further damage.

While analysing bottomsm its always beneficial to study is selling pressure still there. And for every selling going on (Effort), is the result is getting or not. Else its not selling but smart accumulation going on.

If selling is above avg and price fall is not there, sense something is changing, either someone wants to get rid here only, or it is supporting price here...

But for moving out of base/consolidation, i always love to see above average volumes...

I had given one technique of likely support/resistance in this thread with respect to volumes...just search it...it says, just open any stock chart, watch high volume bars for past 2-3 years, place horizontal lines on those price bars registering high volumes, you will see, future correction always find support/reaction points on these high volumes zones...its a great tool...
Such high volume is not created by us, its institutions who get in with those capacity, and there holding period i significant, so they came up during those times...

anil Trivedi

Just Dial, today's Low 536.5
But Vol till now is lesser than climax vol.

To recap yr various analysis w r t this share, stock had no follow up in opposite direction & testing the O/S zone once again but on lower vol.

Quote :
For better bottoms i want at least volume below average on retesting the bottom. As it indicates lack of sellers enthusiasm to sell there. And lack of selling result in price refusing to fall further.

Unquote :
So, will price go below 535 tomorrow or NOT
Both Daily & weekly Stochastic in O/S for more than 5bars & still o/S.
Even w/o the share coming out of O/S zone, it is getting hammered.
Climax Vol was the Highest in the last one & half yrs.
So, will the price take Sup there once again?

Whatever theory, trade what you see.

anil, i want to say one thing.
many large asset based cos whose replacement cost is phenominal like Tatas, Birlas, Sail, Ambanis, etc while trading around rs 500-600 levels, how a recent entrant like Just Dial can sustain & justify this high Price ( was quoting around Rs1800 one to one & half yr back )
it is common sense not to invest in these bubbles.

pl post what you have to say on vol & price in present scenario

 

[anil_s_trivedi]

anil Trivedi

Just Dial, today's Low 536.5
But Vol till now is lesser than climax vol.

To recap yr various analysis w r t this share, stock had no follow up in opposite direction & testing the O/S zone once again but on lower vol.

Quote :
For better bottoms i want at least volume below average on retesting the bottom. As it indicates lack of sellers enthusiasm to sell there. And lack of selling result in price refusing to fall further.

Unquote :
So, will price go below 535 tomorrow or NOT
Both Daily & weekly Stochastic in O/S for more than 5bars & still o/S.
Even w/o the share coming out of O/S zone, it is getting hammered.
Climax Vol was the Highest in the last one & half yrs.
So, will the price take Sup there once again?

Whatever theory, trade what you see.

anil, i want to say one thing.
many large asset based cos whose replacement cost is phenominal like Tatas, Birlas, Sail, Ambanis, etc while trading around rs 500-600 levels, how a recent entrant like Just Dial can sustain & justify this high Price ( was quoting around Rs1800 one to one & half yr back )
it is common sense not to invest in these bubbles.

pl post what you have to say on vol & price in present scenario

Dear Rangarajan,

Prices in sideways mode but going down with volumes. all bars witnessing pretty above avg volumes...Ideally tomorrow low will be broken...Todays was a also a down bar with above avg volume. so efforts getting result(price moving down).

Looking closely today was lowest close...

Usually avoid guessing scenario, but it should break low of 536 and then can go till 510-520 zone...Then a bounce thereoff, above 536 zone...Nature of this bounce will tell whats in store...It should have few clean bull bars with above avg volume...

So these testing times below 536 will need lower volumes, to indicate supply shrinking...

Lastly regarding price bubbles, Its always better to stay away if one dont understand business...And in bull markets everyone is analyst of his own, only during turbulent times, men of steel gets tested...

 

[rangarajan]

Dear Rangarajan,

.And in bull markets everyone is analyst of his own,..

This is called Punch Dialogue.

I wonder where i Fit in.