Intraday profit system

[anayash]

Vinst, I see that! It just seemed to make sense to me, especially when one of the lines has dropped under the 20, and after the golden cross.
I am starting to get hooked on this indicator. Similar to the stochastics, I was noticing times of divergence that is also very effective.
The only problem is, like all oscillators, its lags. But, still, it's worth the continued test.

Hi Paul,

which divergences are you looking at? the one in the ADX line or the one in the +DI/-DI lines?

 

[4xpipcounter]

image upload

Anayash, I was wrong in assuming that.
In the case of an uptrend, it made a lower low and the +DI made a higher high. I was also looking at the -DI. The same way except of course looking for a higher high.
The problem with my thinking on that was that the whole object is to get above the 20 line. Regardless of what may be seen in terms of a divergence, once price is above the 20 line then that is your signal. Also in the case of this chart, the -DI has no interest of going anywhere, as it is swimming below the 20 line

Before I get too hasty with this observation, there is one other thing I've noticed, and maybe someone can confirm or repudiate it. I'm noticing when one of the lines is close to 40 or above it, and the other is close to 0, both could be considered extreme readings for the indicator. I noticed once they curl towards each other, then the respective move happens. Such is the example at the beginning of the TL I drew on the indicator. The DX was also way up there, so it indicated there was still going to be a strong move, and it happened. I also noticed the +D1 (in this case) never made it above the20 line, and the DX also gave out. I would thing in that case once the DX gave out and the +D1 is still sub-20, it's time to jump out.

All of that is in hindsight, so I'm waiting to here some input concerning it. If the latter observation is correct, then it added flexibility to the indicator.

Hi Paul,

which divergences are you looking at? the one in the ADX line or the one in the +DI/-DI lines?

 

[jagdeep]

First of all I like to thanks my friend Srinivasan Lakshminarayanan(sln1941) for encouraging me for this post. I was hesitating to post my system here. Because I was not sure whether it will be good to post system here or not, because I am new in trading. I am following Indian stock market for last 2-3 years, before I jumped up in market with real market. Market always gave me thrill to be part of it. I made wining trades as well as loosing trades. But Most of time I lost money because I have followed others advice for success. Once I decided to leave market. Then Again I started searching and find out that TIPS destroy my money. It is better to make mistake by my own decision than losing money with others advice.
So after many searches in many websites and most importantly Traderji.com , I made my system. But as I am new to this system, I am again asking all the members to find out if this system really works or not. Because I saw 98% winning in this strategy. Even if you lose money, your winning trades will cover up.
I use Sharekhan Trade Tiger, no any other trading software. So I made back testing on this strategy manualy with last 1 months with many scripts. This strategy is not script specific.
Now enough chit-chat I made. Here is my strategy

What we need: 3 EMA, 13 EMA, 39 SMA, Stochastic(8,3,4). If anybody wants then can use MACD also, for extra confirmation.
Time Frame: 5 min time frame. If you want duaal confirmation, then use 10 min chart and 5 min. But my preliminary time frame is 5 min.
Our trigger is just like many system when 3 EMA crosses 13 EMA. I use 39 SMA as my base/trend/stop loss trigger.
Long Call:
39 SMA should be flat or incrementing. Incrementing 39 SMA is better than other flat. Now once 3 EMA cross 13 EMA from bellow, we are ready to take trade. After cross we will take position on a green body candle after the cross. Now we need to take care of strong momentum or we can catch some whipsaw. So I recommend that take position if stochastic shows reading more than 16. It is better to have value above 20 for extra confirmation. I avoid position if it decrements an coming bellow 20. Then wait for a turn.
Stop loss= Our stop loss will be above 39 SMA, and you can adjust it with your risk appetite. I use ADX for volatility calculation. But make sure that your stop loss is above 39 SMA.
Once our trade is favour of us we will increment our stop loss gradually. Only because I dont want to make my wining trade a losing trade.
Exit Policy= I dont want to exit by myself. I prefer to be in trade till that dont hit my stop loss. But is better to square off some of our trade once 3 EMA cross 39 SMA. I saw that many times 3 EMA cross make final turn of the trade and sometimes it makes short term correction of the price for better rally.

Short call:
It is just reverse of long call. Everything will remain same only this time 39 SMA will be at top and 3 EMA and 13 EMA will cross it. Stochastic must be above 16 and incrementing.

May this system looks like very similar to the system you use, I dont want to take any credit for that. I just have collected many system information and made this simple set up. I saw that this system is easy to use and it has many adjustment. Like Base trend follower 39 SMA, basic stop loss level calculation, sort term momentum recognition (3 and 39 cross).
I made back testing but I still looking for feedback from other members.

thanks for the system and it will be nice if you can inform on what scripts you have practically used and what was your result , individually on each scrip or on gross basis since you have started using it.say if you had a capital of 1 lac , it multiplied to how much in that duration.

thanks again

 

[vikrit]

...........

Before I get too hasty with this observation, there is one other thing I've noticed, and maybe someone can confirm or repudiate it. I'm noticing when one of the lines is close to 40 or above it, and the other is close to 0, both could be considered extreme readings for the indicator. I noticed once they curl towards each other, then the respective move happens. ...

.........

two observations i use with adx-

-when upper DI is above 40 & lower DI <10, then start bending to meet, and adx is aslo bend, then high probability of reversal or a correction.

-whenever ADX line below 25 & cut lower DI line from below then high probability of a good move in the direction of upper DI (if upper DI=-DI, then down move, if upper DI=+DI, then up move)


also try different setting rather than 14


.

 

[prst]

two observations i use with adx-

-when upper DI is above 40 & lower DI <10, then start bending to meet, and adx is aslo bend, then high probability of reversal or a correction.

-whenever ADX line below 25 & cut lower DI line from below then high probability of a good move in the direction of upper DI (if upper DI=-DI, then down move, if upper DI=+DI, then up move)


also try different setting rather than 14


.

just want to add a point with adx.
ideally, you should consider a trade only when adx moves above 25.
one should not trade barely on the dmi crossover. this willl lead to a large number of whipsaws.
for adx, and its multiple ways of using, u can refer a book on adx by george schaap.

 

[4xpipcounter]

PRST, what is your opinion of what I think is called the golden cross, where the + crosses the DX and the - (or viceversa) simultaneously?
I'm observing it live on Nifty. The 4-hour shows the cross under 25. This would mean at least a strong intraday move north (+ crossed over -) if it hold any validity.

just want to add a point with adx.
ideally, you should consider a trade only when adx moves above 25.
one should not trade barely on the dmi crossover. this willl lead to a large number of whipsaws.
for adx, and its multiple ways of using, u can refer a book on adx by george schaap.

 

[prst]

PRST, what is your opinion of what I think is called the golden cross, where the + crosses the DX and the - (or viceversa) simultaneously?
I'm observing it live on Nifty. The 4-hour shows the cross under 25. This would mean at least a strong intraday move north (+ crossed over -) if it hold any validity.

i've started looking into the adx recently..
what i've read about the golden cross, on most forums, is that it does indicate beginning of a trend.
but unfortunately most of the crosses end up as whipsaws(as seen from the chart).
one can use other filters like rising adx AND a stochs as well.. to make out genuine trend beginnings from fake whipsaws.

 

[NewbieT]

Another good move.

Hi Debargya,

I was going through your posts. In this chart the candle was in red. Why did you make the entry here then?

May be I am missing something. Please clarify.

Thanks,
Manoj

 

[Debarghya Mukherjee]

Yes, my signal is in this bar. Because it matches all my set up rules.
ADX above 20, crossing from below. Also ema cross over.

If you follow my friend vikrit then see his point
"-whenever ADX line below 25 & cut lower DI line from below then high probability of a good move in the direction of upper DI (if upper DI=-DI, then down move, if upper DI=+DI, then up move)"

results are in front of you.

Hi Debargya,

I was going through your posts. In this chart the candle was in red. Why did you make the entry here then?

May be I am missing something. Please clarify.

Thanks,
Manoj

 

[vikrit]

just want to add a point with adx.
ideally, you should consider a trade only when adx moves above 25.
one should not trade barely on the dmi crossover. this willl lead to a large number of whipsaws.
for adx, and its multiple ways of using, u can refer a book on adx by george schaap.

which book you are talking. what's the title?