Trading NR7 setup

[AW10]

Thanks Karnani for posting the chart.
Inangia - my interpretation will be

The first Nr7 i.e Bar A had a weak background (sorry for using vsa terms please bare with me) and then we got a No Demand Bar in the form of Nr7. However MP graph showed that an extension was inevitable so the short position was not initiated.

In laymans term (as non-VSA trader), I would read that weak background shown by tiny , narrow, sideway bars. So when NR7 bar came at point A, it was just showing extreme of contraction and next bar showed as the expansion. Due to prev weakness, this expansion did not last and gradually price came back to the range again.

The next Nr7 i.e at Bar b occurred with some strength in the background but the trend was down so once again the trade was not taken.

at point B, we had seen bearish strength developing from prev red, large, high volume bars.. (added to that was failed upside break of last NR7 bar), and next bar gave us expansion. I don't what happened after that ..but most likely trend we would have seen next bar also with lower low.

My question here is how would you guys take a position here solely based on NR7 ? ?

I have give sample trading rules in one of the initial post of this thread. Rules are simple, enter long or short with limit order above/below the NR7 bar..(one can also use filter of few points). Stop is at the other end of NR7 range.

As you have clearly indentified the background, this should help in defining the
exits. When background is weak, better to grab the profit or atleast come to breakeven and forget about trailing.
when background is strong, maybe scale-in and manage trade with trailing stops.

I have not given a real trading system with precise entry/exit rules and left that to individuals to tweak it to their personal taste and develop their own system around this setup.

Hope this helps. Thanks for brining in the concept of background.. here.

Happy Trading

 

[Placebo]

Thanks for putting up the chart rkkarnani. Cheers mate
AW10 I was just thinking about merging all the concepts that i understand and nr7 would fit in perfectly since most of VSA/Wyckoff methods are centered around wide range bars and narrow range bars.

In the previous post i showed places where i was unable to find a trade however the key point that i forgot to mention was that Bar A was the last part of a weak background before the Top Tailed Bar. Bar b was irrelevant because the trend had reversed but the supply was drying up and nr7 pointed that out in advance , the next bar was a shakeout and demand started swamping supply but there was no evidence of accumulation.

So to conclude we had two nr7 bars which were runners up to the top and bottom of the day. I'm not interested in picking tops and bottoms i let them pick themselves however this is as close as it gets (atleast in this chart).So a simple shift in my attitude is actually giving nr7 bars more credibility as long as the Background and the Trend is assessed properly. I'll put up a chart at the end of my trading session tomorrow and perhaps all of us could run across a few ideas/views.

Cheers

 

[MurAtt]

wrt the above discussion -- having a look at the left side of the chart on an NR7/IDNR7 would help taking trade rather than just taking a trade keeping in mind the single bar (which I was doing till now ...)

 

[SavantGarde]

While This Has Nothing To Do With NR Setup....But Specific To Inangia Posting MCX Silver Chart....

Any Dollar Denominated Commodity Trading Currency Being INR Should Be Overlayed Or Looked At In Conjunction With USD/INR Chart.

Happy & Safer Trading

SavantGarde

 

[Placebo]

Thanks for the suggestion SavantGarde. That makes a lot of sense. Although i don't believe in co-relations the usd/commodities relationship cannot be ignored as well. Incase i start looking at both usd/silver charts to base my trading decision there will be at times when i will be on the sidelines because silver charts and usd charts would not necessarily be in tandem all the time. There is co-relation of -1 alright but not on all ticks.So this will take me to the problem of analysis/paralysis and no trading. Its good to have an overview and see how the two assets act and interact. But i shall keep the suggestion in mind.


Cheers

 

[Placebo]

I was searching for Nr7 in my saved charts/data and in most charts the nr7 stood out like it was begging to get noticed. The reason i posted this chart is because we had two nr7 bars with opposite meanings and opposite implications on bank balance.

For a minute i will be stepping out of VSA/Wyckoff and MP. The aim will be to try to look at nr7 bars in isolation. We have rising prices with increasing volumes and 90% of the technical analysts would say that price will continue to rise further and then Bar A is our entry point for going long as now we have a bargain price to go long. I really don't know how a technical analyst would analyze bar b but i'm sure that most probably its not going to be correct.

Now lets combine VSA/Wyckoff/MP and Nr7. Early in the day weakness was spotted in the background and transfer of ownership started as the professional money began to dump their holding to the weak holders. MP indicated that an extension was due as time hit the initial balance period. A few hours after that we have a nr7 bar which shows no supply but the background is weak so we do not enter long. Later in the day weakness started growing and then we have our popular no-demand bar which took out the low of the day. Nr7 used in conjunction can be and will be very rewarding.

Sorry to say this but the only thing i have derived so far is that in isolation if the nr7 is traded then you might as well take all your savings and dump them in a river in partly installments unless. There is an exception to this which could make isolated nr7 profitable: Book Profits at a small gain and use extremely tight stops and trailing stops.

This is my conclusion as of now. Any criticism or feedback is welcome.

 

[VJAY]

Dear AW10,

am backtested NR7/IDNR7 &IDNR4...from oct2008 to upto date.though your backtesting sheet not showing correct figures.please find the attchment...also see the PL sheet .have gained 1271 points without diducting brokerage etc.Please check it and give some guidence and improvement for trade....

 

[AW10]

Great work Vijay. Pretty immeculate work.. or writing your observation for each trade.
Keep it up. Buddy. highly appreciate it.

Plz give me some time to look into the sheet.. seems the way u have entered data is different then what I expected in original sheet.
But leave that to me. I will post the correct result sheet in a day or two.

I will also post my observations on this backtest so that it becomes easy to interpret the findings.

Happy Trading

 

[rohangawale]

NR7 Stocks Triggered on 12th Oct:

[B]STOCK		HIGH		LOW[/B]
ABB		793		779
AXIS BANK	1022.4		996.7
BHARTI AIRTEL	353		344.45
CAIRN		266.35		262.25
DLF		427.7		417
HINDALCO	129.35		126.1
IDEA		63.9		62.25
L&T		1661		1630
MARUTI		1529.9		1481
POWER GRID	108.75		107.65
SUZLON		87.05		85.5
TCS		584.25		563.55
TATA MOTORS	555.75		539

NR7 close on 14th Oct:

		12-Oct			14-Oct	
STOCK		HIGH	LOW		Close	Trigger
ABB		793	779		803.15	Up Break
AXIS BANK	1022.4	996.7		1032.40	Up Break
BHARTI AIRTEL	353	344.45		340.15	Down Break
CAIRN		266.35	262.25		280.50	Up Break
DLF		427.7	417		431.70	Up Break
HINDALCO	129.35	126.1		135.40	Up Break
IDEA		63.9	62.25		61.60	Down Break
L&T		1661	1630		1690.05	Up Break
MARUTI		1529.9	1481		1519.60	No Breakout
POWER GRID	108.75	107.65		111.15	Up Break
SUZLON		87.05	85.5		85.55	No Breakout
TCS		584.25	563.55		592.95	Up Break
TATA MOTORS	555.75	539		574.75	Up Break

 

[rohangawale]

Till now i am not able to extract NSE bhavcopy thru getbhavcopy, so not able to update fresh NR7 stocks.
will do it as data is downloaded.