PositiveDev's trading journey

[Perishabull]

During a cycle yesterday I saw this;

 

 

It's been a while since we've seen one of these...

[Perishabull]

Currently in the middle of backtesting another strategy, in the meantime I'm also looking at whether I could incorporate some of Pesavento's patterns into my trading;

 

Here's one I made earlier, I've highlighted the Gartley. I may test this for a while on sim.

[drbubb]

Have you seen my TZA calls strategy on the DrB's Diary.

 

It might be a good way to play a possiblr rollover into a bear market.

On the otherhand, TZA may be tracing out a gartley pattern on the 15min chart

 

I noticed you are looking at Gartley's here.

Are you having some good success with that pattern?

[Perishabull]

Have you seen my TZA calls strategy on the DrB's Diary.

 

It might be a good way to play a possiblr rollover into a bear market.

On the otherhand, TZA may be tracing out a gartley pattern on the 15min chart

 

I noticed you are looking at Gartley's here.

Are you having some good success with that pattern?

 

Yeah I can see why you could use that to hedge gold positions right now, personally I'm exposed to gold and gold stocks, on the other hand my largest position is in US dollars, so overall it's balanced quite well, in the event of a serious sell off obviously the dollar would belikely to rally significantly.

 

I only started looking at using Pesavento's work yesterday, and I've also got his book "Trade what you see", so I'll be going through that soon. I haven't used any of this to trade with yet.

 

On TZA there are some Ficonnaci relationships on the daily timeframe chart;

 

TZA 1 year

[Perishabull]

These are the relationships Larry looks for, from the ensign website;

[Perishabull]

Very interesting set up looking at the Fib retracement ratios, I'm only testing this out using sim trading at the moment but it allowed me to short at the high today;

 

Entry on the NASDAQ;

 

There was a 1.618 retracement of the move lower, that culminated in the completion of a bearish butterfly pattern;

 

 

I'd also started looking at these patterns on the dollar index at the same time;

 

I've highlighted the equivalent point in time on the dollar index chart. What was interesting was that at the completion point for the butterfly, (point D where I entered the trade), the dollar index was at a point where two 1.618 retracements converged, along with two 0.886 retracements. All of these happening at the same time led to the decision to short.

 

This is approach worth researching further, looking for key retracement levels on the NASDAQ and Dollar Index at the same time.

 

The great thing about this is that my time can be spent monitoring how the market is developing, looking at the retracement ratios for rational entries, since all of these lines and ratios are automatically calculated and drawn by the system.

[drbubb]

Does this fit in ?

 

I think the rally could find its way up yo SPY-137.5

[Perishabull]

E-Mini S&P April 10th onwards (1 hour);

 

Nothing conclusive there that I can see there, I'd be looking for key retracements from both recent highs and lows converging on on more recent high, or low.

[drbubb]

Larry P was talking about a possible "important low in Gold"

after a 76% retracement yesterday

 

It is also bouncing off "my" 377day MA

[Perishabull]

from "Chart of the Week"

 

OJ

 

The last 3 years. From the high of $226.95 on 23rd January OJ has crashed down to as low as $112.3, more than a 50% decline.

 

 

 

Sentiment is desolate;

Chart from SentimenTrader Home

 

 

Thirsty?

 

You may need to stay that way, a search of an ETF database didn't release any juice. Still, there's always futures...

 

 

How things change, I bookmarked this article back in January;

 

Excerpt from Telegraph;

"Orange juice will soon be 'luxury'

 

 

Orange and apple juice, an integral part of many people's breakfast, could become an unaffordable "luxury", according to a report, which highlights how the price of fruit juice has rocketed.

 

A series of bad harvests from Florida, America to Shandong Province, China, combined with increased demand from Asian countries, has forced up the price of orange and apple juice on the world market. Supermarkets have started to react in Britain by pushing up the price of a carton of juice.

 

The Grocer, the industry trade magazine, reported prices are set to climb even higher making most juices a "luxury".

 

Experts predicted factory prices could rise by as much as 80 per cent for orange juice and 60 per cent for apple juice in 2011.

 

This would place further pressure on retailers to increase the price of orange and apple juices on shop shelves even though they have already gone up sharply. Over the past year, the price of a one-litre carton of Tropicana fresh orange juice across the five major supermarket chains has risen 22 per cent, from an average of £1.80 to an average of £2.19, while a one-litre carton of own-label apple juice from concentrate has gone up an average of 21 per cent, from 87p a year ago to £1.05 now.

 

Fruit juices are just the latest key household staple to be hit by the spike in global commodity prices, which has affected everything from a litre of unleaded petrol to a loaf of bread.

 

The Office for National Statistics has calculated that inflation, based on the Consumer Prices Index, increased from 3.3 per cent in November to 3.7 per cent in December, with food prices driving much of this jump. Food increased in price by 6.1 per cent during last year, with butter, fruit, lamb, tea and juices particularly badly hit.

 

Orange juice has been particularly affected by the bitterly cold winter in Florida last year, the main orange growing area in the world and which at one point was colder than Alaska. Cold weather in China, too, wiped out 40 per cent of the apple harvest in some parts of the country. China has become one of the main producers of apples in the world.

 

Richard Hall, chairman of food consultancy Zenith International, said orange and apple juice producers were already the world's largest, most efficient juice producers, so there was little room for them to absorb cost increases.

 

"Pricing for orange and apple juice this year could see the most radical change," he said.

 

Adam Pritchard, chief executive of drinks maker Pomegreat, which makes pomegranate and other juices, said costs had gone up 40 per cent and his company would have to pass on about 10 per cent increase.

 

"Part of the problem is the upward shift in demand from places such as China and India, who are spending more money on expensive drinks. This is putting pressure on the world markets."

 

[Perishabull]

Public Opinion data shows that sentiment for the US Dollar is at 77% bullish opinion.  According to Jason Goepfort of sentimentrader.com when it has crossed the 75% level from 1999 onwards, then over the next quarter the largest gain averaged 1.1% whilst the largest loss averaged -5.3%.

[Perishabull]

 

It's champagne all round on monday, Ms PositiveDeviant and I are getting married!

[drbubb]

It's champagne all round on monday, Ms PositiveDeviant and I are getting married!

[/left]

 

Hey, Congratulations, PD !!

 

[Peppa Pig]

Ah, you should have been more careful :-)

 

 

 

 

 

 

 

Great news, when is it?

[Perishabull]

Thanks guys, it's on Monday.

[Perishabull]

 

There's been some tumbleweed blowing through this way of late.

 

I've been backtesting a different trading strategy, looking at data from 1st Jan to 11th May this year. It's using a combination of two indicators I developed, working together, each acting as a filter for the other.

 

Trading strategy II

At first, I wasn't particularly impressed with this, on the other hand, based on the period studied, it looks consistent, and that's a useful trait if that replicates when I trade it.

 

 

What I also looked at, was the relationship between the results and the time each signal was given. In order to test this I reordered the signals given from the data range, to list signals in time order during the day, then charted them. So each subsequent signal of the next chart occured at a time later on during any given trading day.

 

Trading strategy II (Signals sorted by time - earliest first)

Signals from 7 to 45 represent 2pm to 4pm (UK time), and are clearly more favourable then after 4 pm. After 4pm the signals become less consistent.

 

 

 

What I also did was to look at previous test data for the previous trading strategy in exactly the same way, to see if the same type of result would be found (signals occuring between 2pm and 4pm (UK time) providing more favourable trading results);

 

Trading strategy I (Signals sorted by time - earliest first)

 

Broadly the same pattern is found, signals 5 to 43 represent 2pm to 5pm, so again the US morning session provides the most favourable period to trade, based on both strategies.

 

 

I start trading Strategy II from next week, although trading may be sporadic since I'll be married by then and may have to pay some attention to my newly minted wife.

[Perishabull]

First trade of new strategy yesterday at 20:52, a short at 2540.50, stopped out for a loss of 2 points;

[Perishabull]

Couple of trades so far today;

 

A long at 13:43, filled at 2564, market rallied up to 2570.50, moved stop to breakeven before market sold off taking out my stop at breakeven. Then a further long at 14:41, filled at 2565, market sold off taking out my stop for a 2 point loss. In fact there were a further 3 buy signals according to my new strategy during Bernanke's testimony however I'd decided not to trade during that, just as well since each of them would have been losing trades. Arguably I shouldn't have taken the last long 20 mins before Bernanke started talking...

 

 

[Perishabull]

Further trade at 19:05, went long at 2550.25, stopped out for a 2 point loss;

 

[Perishabull]

Yet another trade, positive this time. Sell signal came, went short at 20:00, filled at 2552.50, got in at the right point here. Market sold off down to my target, closed out using a limit order for a 10 point gain.

 

 

Pleased to end the day in profit on what was quite a treacherous day.

[Perishabull]

Buy signal at 14:50, filled at 2524.25. Although the equity futures had been sideways up to this point the dollar index had been rallying during this time, suggesting some underlying strength in the equities. This was a decent entry, market rallied up to as far as 2539, taking out my limit order for a 10 point gain;

 

 

A couple of days ago traders started rolling from M series contracts (June expiry) to U series contracts (September expiry). Contracts are quarterly, expiring on the third friday of each contract month. I'm trading the M series until volume moves over to the U series.

[drbubb]

Buy signal at 14:50, filled at 2524.25. Although the equity futures had been sideways up to this point the dollar index had been rallying during this time, suggesting some underlying strength in the equities. This was a decent entry, market rallied up to as far as 2539, taking out my limit order for a 10 point gain;

 

A couple of days ago traders started rolling from M series contracts (June expiry) to U series contracts (September expiry). Contracts are quarterly, expiring on the third friday of each contract month. I'm trading the M series until volume moves over to the U series.

[/size]

I presume you trade primarily thru futures.

 

Have you looked at Options on ETF contracts?

[Perishabull]

I presume you trade primarily thru futures.

 

Have you looked at Options on ETF contracts?

 

I've traded ETF options many times before but over time settled on futures, preferring the liquidity and spreads available. I'm confident over time I can make superior returns trading futures than I would options. After speaking to Jeff Quinto last year he advised it tended to be very much like that, having an affinity for one or the other.

 

I will trade options again in the future, but I'm concentrating on the futures for now.

[Perishabull]

I'd have loved to have been trading today but couldn't due to something I call "wurk".

 

The market popped higher on the opening overnight, following the Spanish bailout then proceeded to sell off all day. What's 100 billion euros?

 

Zerohedge summarises the Spanish bailout in one image;

 

[Perishabull]

There were 4 signals today, although I was only able to trade two of them (I'm not able to watch the markets as much as I'd like this week).

 

The first came at 10:02, went long at 2538.50, market rallied a few points, moved stop to breakeven market sold off taking out my stop for a breakeven trade. The second trade was very similar, a long at 10:54, filled at 2537.75, rallied up, stop moved to breakeven,stop taken out.

 

 

I wasn't able to trade the other two signals, one of them would have been breakeven, the other a loss of 2 points...