UPDATE: 4/18/24 added overview of indicators used and why, explanation located below chart image
The market has three moves: Up, Down and Sideways. My goal is the trade these movements using the simplest of indicators to head me in the right direction. It works on all time frames (the best being an hour or less).
Chart Link: http://tos.mx/VNpyI0T Click here for --> Easiest way to load shared links
mod note:
an overview the indicators and labels UPDATE: 4/18/24
First we’ll discuss the Labels at top of the chart:
ATR: This label represents the Average True Range for Daily/Weekly expected movement. Since candles move 6-10 (average) on any time frame this one is set to (9) for a nine period trend for Days or Weeks. It could be changed to any lookback number you choose.
PSAR Trans: PSAR is defined as “Parabolic Stop and Reverse” showing candle change in direction and listing how many bars ago the change took place. This Label is coordinated with the Yellow Dotted Line down on the chart with Label words “Last PSAR Transition” showing candles above/below that line. PSAR indicates when a price trend breaks ahead of a potential reversal (i.e. Follow the Money).
StackedEMAs 8-13-21-34-55: These are all Fibonacci Levels (levels frequently used as turning points by algorithmic computer traders). When the label is Green these levels are lined up positive (probable uptrend); when Red they are lined up negative (probable downtrend); when Yellow the market is probably choppy with no completely defined direction. I use EMAs instead of SMAs (Simple Moving Averages) since EMAs favor current trend rather than overall historic trend.
5-8 EMAs: This is a Red/Green color label to show an initial trend change possibly taking place.
ORB Yellow Bordered Label: (OPENING RANG BREAKOUT) This label is only active during actual trading hours. It will designate if the stock (ETF) is trading within, above, or below the Opening Range Breakout. On the chart it is a broken line while during the first 15 min. breakout and a solid line the rest of trading day. I am using a 15 min. Breakout Range whereas some traders prefer the first 30 minutes.
TTM Trend Label: The TTM Trend (free oscillator on TOS) is a lower oscillator showing a four color movement. My label only shows Green/Red for trend up/down. My Red/Green Candles are coordinated with the oscillator as well (but again only in the 2-color mode).
The next Label shows trend as Green “OVERALL BULLISH”; Red “OVERALL BEARISH”; or Yellow “CHOP HOLD.”
My chart is setup using Heikin Ashi Candles. If you use these make sure you find an explanation for these as verses regular candles. Basically Heikin Ashi candles are good for a day trading trend, with the shadows (wicks) showing direction (rather than a potential reversal as on a regular candle). Flat bottoms/tops show strong based direction with an upper/lower wick and the Green/Red Candles giving a visual overall trend.
Last PSAR Transition Yellow Dotted Line was explained above.
The Long/Short Chart Bubbles are an indicator I developed showing probable change in direction.
A solid Red/Green Line also shows a high/low probable transition trend point.
The shaded (cloud) Red/Green Box-like areas are Support and Resistance areas.
The larger White/Yellow arrows are trend reversal areas. The smaller Green/Cyan show a continuation trend for up to 8 candles. Strong reversal indications are when two or more arrows overlap each other and/or a long/short bubble is present. Because indicators repaint my goal is to have more than one indicator showing a change taking place
The White Dotted Lines show PDHi (Previous Days High) and PDLow (Previous Day Low). These are frequently Resistance/Support areas unless Stock/ETF in a breakout mode above/below yesterday’s close.
The PRICE POINTER is one of my favorites which moves up/down with actual price.
The Blue/White lines are the 8/20 EMA trend lines. The 8 moves the fastest in correlation with the 20. Both levels are Fibonacci related (I’m using a 20 instead of the 21 since the 21 is a frequent change in direction area (the 20 gives me a heads-up). Also notice when the Blue Crosses the White (Crossovers) as many individuals trade only the crossovers. Be careful with these lines approaching each other, however, as it may be a pivot rather than a crossover?
The market has three moves: Up, Down and Sideways. My goal is the trade these movements using the simplest of indicators to head me in the right direction. It works on all time frames (the best being an hour or less).
Chart Link: http://tos.mx/VNpyI0T Click here for --> Easiest way to load shared links
mod note:
Chart Image: I only day trade one chart (SPY, SPX, or QQQ) following my indicators (knowing that they repaint - but so does life!). I try to never trade up in a down market, nor down in an up market. I also watch for 8/20 crossovers and will exit a put if it crosses up, or a call if it crosses down (some traders trade only the crossovers).
an overview the indicators and labels UPDATE: 4/18/24
First we’ll discuss the Labels at top of the chart:
ATR: This label represents the Average True Range for Daily/Weekly expected movement. Since candles move 6-10 (average) on any time frame this one is set to (9) for a nine period trend for Days or Weeks. It could be changed to any lookback number you choose.
PSAR Trans: PSAR is defined as “Parabolic Stop and Reverse” showing candle change in direction and listing how many bars ago the change took place. This Label is coordinated with the Yellow Dotted Line down on the chart with Label words “Last PSAR Transition” showing candles above/below that line. PSAR indicates when a price trend breaks ahead of a potential reversal (i.e. Follow the Money).
StackedEMAs 8-13-21-34-55: These are all Fibonacci Levels (levels frequently used as turning points by algorithmic computer traders). When the label is Green these levels are lined up positive (probable uptrend); when Red they are lined up negative (probable downtrend); when Yellow the market is probably choppy with no completely defined direction. I use EMAs instead of SMAs (Simple Moving Averages) since EMAs favor current trend rather than overall historic trend.
5-8 EMAs: This is a Red/Green color label to show an initial trend change possibly taking place.
ORB Yellow Bordered Label: (OPENING RANG BREAKOUT) This label is only active during actual trading hours. It will designate if the stock (ETF) is trading within, above, or below the Opening Range Breakout. On the chart it is a broken line while during the first 15 min. breakout and a solid line the rest of trading day. I am using a 15 min. Breakout Range whereas some traders prefer the first 30 minutes.
TTM Trend Label: The TTM Trend (free oscillator on TOS) is a lower oscillator showing a four color movement. My label only shows Green/Red for trend up/down. My Red/Green Candles are coordinated with the oscillator as well (but again only in the 2-color mode).
The next Label shows trend as Green “OVERALL BULLISH”; Red “OVERALL BEARISH”; or Yellow “CHOP HOLD.”
Now a look at the Chart itself:
My chart is setup using Heikin Ashi Candles. If you use these make sure you find an explanation for these as verses regular candles. Basically Heikin Ashi candles are good for a day trading trend, with the shadows (wicks) showing direction (rather than a potential reversal as on a regular candle). Flat bottoms/tops show strong based direction with an upper/lower wick and the Green/Red Candles giving a visual overall trend.
Last PSAR Transition Yellow Dotted Line was explained above.
The Long/Short Chart Bubbles are an indicator I developed showing probable change in direction.
A solid Red/Green Line also shows a high/low probable transition trend point.
The shaded (cloud) Red/Green Box-like areas are Support and Resistance areas.
The larger White/Yellow arrows are trend reversal areas. The smaller Green/Cyan show a continuation trend for up to 8 candles. Strong reversal indications are when two or more arrows overlap each other and/or a long/short bubble is present. Because indicators repaint my goal is to have more than one indicator showing a change taking place
The White Dotted Lines show PDHi (Previous Days High) and PDLow (Previous Day Low). These are frequently Resistance/Support areas unless Stock/ETF in a breakout mode above/below yesterday’s close.
The PRICE POINTER is one of my favorites which moves up/down with actual price.
The Blue/White lines are the 8/20 EMA trend lines. The 8 moves the fastest in correlation with the 20. Both levels are Fibonacci related (I’m using a 20 instead of the 21 since the 21 is a frequent change in direction area (the 20 gives me a heads-up). Also notice when the Blue Crosses the White (Crossovers) as many individuals trade only the crossovers. Be careful with these lines approaching each other, however, as it may be a pivot rather than a crossover?
That pretty much covers my AGAIG Best Trading Chart Setup. Thanks to useThinkScript members whose indicators I am using, or have modified, for my chart!
My background in life was mostly in a visual profession. Notice that I don’t use any lower indicators as it’s difficult (at least for me) to comprehend an overload of competing information.
When I taught in The Options Club here in The Villages (largest retirement community in U.S.) my moniker was “Visual Options Trading” because:
“if you can’t see it how can you possibly trade it?”
My background in life was mostly in a visual profession. Notice that I don’t use any lower indicators as it’s difficult (at least for me) to comprehend an overload of competing information.
When I taught in The Options Club here in The Villages (largest retirement community in U.S.) my moniker was “Visual Options Trading” because:
“if you can’t see it how can you possibly trade it?”
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