Going With The 60min Flow!!!

[rkkarnani]

No RK,that long trade got nullified and we had to revert to short....so,the downtrend and multiple down bars on the 60 is there,the bullish candle at the open was there.....What wasn't there was the big BAR 2 and BAR 3,etc.....3 bars sideways,this rule does not hold.We are back to our usual rules......Stops at 2 bar back which is way back as we wait for a pivot to form.

Saint

Saint, Would it be correct to presume that had the 11 AM bar breached the high of 10 AM high+filter we would have gone long yesterday(20thNov).
Thanks.

 

[rkgoyal_98]

Dear Saint,


Kindly explain once again plz why we should not reverse to longs today. 1st 5 min bar hi is 2547.1 and then next bar high is 2549.05. next bar high is 2544.3 while this bar has broke lod that was 2519 and 2505 for 1st 2 bars. So as per the rules this would have been our add also. Now the next bar is bullish with low of 2502 and high of 2559.9. Normally after adding the break of LOD our SAR should move to 2549.05+filter. Since a new bar high is 2559.05 do u mean to say that now we should consider this as congesstion and keep adjusting SAR and now SAR should be at 2560+filter. Next bar is 2568 with low of 2517.7 as per this our SAR with move again after this bar. Again next bar high is 2571.65 and then last bar is 2575. Hypothetically if new bars keep moving upwards with small amount withing our filter and bar low is also moving up by only a small amount shall we move SAR after completion of each bar. With this what i am thinking is that new bar should take out or SAR completely otherwise we will keep adjusting SAR and will stay in existing trade.
Kindly confirm if this is the method to be followed or kindly clear if i am understaning anything wrong.

In fact i have gone long in the last hour when my SAR was hit at 2575 (2559.9 +15)

Regards.

 

[hitesh]

To Tackle whipsaw by lot resizing:

I completely agree that there is no need to post SAR here on this thread. We shall use room / filter as per our comfort level now onwards. May be large number of pending stop loss at single price lying in the NSE System might have created whipsaw.

However, I have tried to tackle whipsaw by Lot resizing, which is as follows:-

1. For any fresh entry for Long or Short to start with one lot.
2. In case of whipsaw, to reverse the position and to add one lot in the position with every whipsaw, till 3rd whipsaw.
3. Maximum lot size be four.
4. Maximum Adds in the position to be two.
5. The lot size of Adds should be as per initial size of the position.

As for example:-

1. Suppose a Scrip A has lot size of 50 shares and presently in Short mode and I have no position so far.

2. When Buy / Long triggers, I will be Long with 50 shares. In case scrip goes in my direction, I will be happy with 50 shares and two adds (each of 50 shares).

3. But in case of whipsaw (1st), I will squared off 50 shares. I will short 100 shares. In case scrip goes in my direction, I will be happy with 100 shares and two adds (each of 100 shares).

4. In case of whipsaw (2nd), I will squared off 100 shares. I will Long 150 shares. In case scrip goes in my direction, I will be happy with 150 shares and two adds (each of 150 shares).

5. But in case of whipsaw (3rd), I will squared off 150 shares. I will short 200 shares. In case scrip goes in my direction, I will be happy with 200 shares and two adds (each of 200 shares).

6. My maximum lot size reaches in three whipsaws. In case of further whipsaws, I will stick with four lot size. My feeling is, if I have selected right scrip with perfect flow, it should start trending even before 3rd Whipsaw. But still, if for some reason whipsaw increased, I will continue with 4 lots.

Seniors are requested to comment / suggest / advise.

Regards
Hitesh

 

[Sec 5 (Pyr)]

Dear Saint,


Kindly explain once again plz why we should not reverse to longs today. 1st 5 min bar hi is 2547.1 and then next bar high is 2549.05. next bar high is 2544.3 while this bar has broke lod that was 2519 and 2505 for 1st 2 bars. So as per the rules this would have been our add also. Now the next bar is bullish with low of 2502 and high of 2559.9. Normally after adding the break of LOD our SAR should move to 2549.05+filter. Since a new bar high is 2559.05 do u mean to say that now we should consider this as congesstion and keep adjusting SAR and now SAR should be at 2560+filter. Next bar is 2568 with low of 2517.7 as per this our SAR with move again after this bar. Again next bar high is 2571.65 and then last bar is 2575. Hypothetically if new bars keep moving upwards with small amount withing our filter and bar low is also moving up by only a small amount shall we move SAR after completion of each bar. With this what i am thinking is that new bar should take out or SAR completely otherwise we will keep adjusting SAR and will stay in existing trade.
Kindly confirm if this is the method to be followed or kindly clear if i am understaning anything wrong.

In fact i have gone long in the last hour when my SAR was hit at 2575 (2559.9 +15)

Regards.

Why did you move the stop from 2549+ to 2559+ but not move it ahead for 2568+ and the rest?

Anyway, your guess is correct. I'm annoyed that I forgot this rule, but if a bar closes higher/lower and triggers our pivot BUT NOT THE PIVOT + FILTER then we assume that the new high/low is the new "pivot" and add the filter from there.

 

[KomaL2099]

Actually, since yesterday's move was just a fakeout, it still counts as a prolonged downtrend and therefore anyone following the positive gap rules should've gone long.

We've even had situations where it was a genuine breakout(a profitable one) but the breakout only lasts a day or so, meaning the overall trend when seen from a zoomed out chart is still a prolonged downtrend. I've seen it in the original examples posted for this method.

Also, there are a few other reasons to have gone long today, but since everyone's just trading independently now, there's no real "right" or "wrong" way anymore. The flow will unite us all soon enough anyway.

Completely agree.. very recently similar thing happen .. one of our reversal turned to be failed break out and then two days later we applied gap rule ...

 

[rkkarnani]

Do we go long above todays high + room....
is it a valid breakout of yesterdays sideways move...

 

[Prabhjeet]

To Tackle whipsaw by lot resizing:

I completely agree that there is no need to post SAR here on this thread. We shall use room / filter as per our comfort level now onwards. May be large number of pending stop loss at single price lying in the NSE System might have created whipsaw.

However, I have tried to tackle whipsaw by Lot resizing, which is as follows:-

1. For any fresh entry for Long or Short to start with one lot.
2. In case of whipsaw, to reverse the position and to add one lot in the position with every whipsaw, till 3rd whipsaw.
3. Maximum lot size be four.
4. Maximum Adds in the position to be two.
5. The lot size of Adds should be as per initial size of the position.

As for example:-

1. Suppose a Scrip A has lot size of 50 shares and presently in Short mode and I have no position so far.

2. When Buy / Long triggers, I will be Long with 50 shares. In case scrip goes in my direction, I will be happy with 50 shares and two adds (each of 50 shares).

3. But in case of whipsaw (1st), I will squared off 50 shares. I will short 100 shares. In case scrip goes in my direction, I will be happy with 100 shares and two adds (each of 100 shares).

4. In case of whipsaw (2nd), I will squared off 100 shares. I will Long 150 shares. In case scrip goes in my direction, I will be happy with 150 shares and two adds (each of 150 shares).

5. But in case of whipsaw (3rd), I will squared off 150 shares. I will short 200 shares. In case scrip goes in my direction, I will be happy with 200 shares and two adds (each of 200 shares).

6. My maximum lot size reaches in three whipsaws. In case of further whipsaws, I will stick with four lot size. My feeling is, if I have selected right scrip with perfect flow, it should start trending even before 3rd Whipsaw. But still, if for some reason whipsaw increased, I will continue with 4 lots.

Seniors are requested to comment / suggest / advise.

Regards
Hitesh

Hitesh it is a good strategy to tackle whipsaws and I agree that we tend to get big moves after 3-4 whipsaws, nice suggestion

But you should be careful about Money Management, risking too much of money can prove really harmful for financial health....

 

[hitesh]

Hitesh it is a good strategy to tackle whipsaws and I agree that we tend to get big moves after 3-4 whipsaws, nice suggestion

But you should be careful about Money Management, risking too much of money can prove really harmful for financial health....

Thanks prabhjeet.

For Money Management, I have restricted my Maximum Lot Size at four.

My assumption is, if my selection of scrip is with the smooth flow (after Thorough backtesting), than I think, I may end up with two/three lots only.

Thanks for the feedback.

Regards
Hitesh.

 

[dnjadeja]

lt long trigered....?

 

[Saint]

Do we go long above todays high + room....
is it a valid breakout of yesterdays sideways move...

RK,

How I dealt with was as follows.......we have a sideways congestion and a breakout above pivot.The MovFil prevented a reversal....Whether we revert or not doesn't mean that it is not in an uptrend.A very weak limp uptrend no doubt.

If price had gapped down or started even,all fine....a gap up was in keeping with the ongoing,albeit a weak trend and against our positions.......meaning I treat it like I would treat a gap up against our direction above the pivots.....to reverse over the first bar's high.

It is very rare that the filter keeps us out of a trade these days.....it did yesterday.Can sometimes be a great boon,but when it doesn't,we have to have counter measures to tackle it.

Saint