Chart Pattern Strategy For ThinkOrSwim

[brook0010]

I can't believe I am giving away my trading method.

All chart pattern success stories
Dan Zanger turned 10k into 18M in one year
Chris Kacher up 18,000%
Gil Morales up 10,000%
Phil Goedeker turned 5k into 2.8M
Cameron Fous up 600k
Thomas Bukowski retired
Tim Sykes turned 12k into 4M
William o Neil turned 5k into 200k
David Ryan investing competiton
Nicolas Darvas turned 10k into 2M
Ced Moses 379% investing competition
John Howell patterns
Ross Cameron does many small account challenge turning $500 into $ 1M
remember Tim Grittani (kroyrunner89),
he uses support and resistance and level 2 and is now a millionaire
turned $1k into $2M


Do you see the trend?
Good volume on the chart pattern breakout increases the probability of success. That is just a known fact!

1. Indicator in the following link must be cyan. plot go=rawRelDev >= MegaDev; in screener go must be true.
https://usethinkscript.com/threads/...n-and-average-for-thinkorswim.853/#post-66830
2. A chart pattern breakout must happen.
3. Take profit is 2 times with stop loss at low of breakout

Good chart pattern software. AIQ ninja add-ons meta-stock recommended for daytrading

patternz. http://thepatternsite.com/patternz.html FREEWARE use thinkorswim to screen like price greater than 1 and volume >X and
export just the symbol column. then paste symbol in data downloader.
https://ninja-addons.com/chartist-indicator/
https://www.metastock.com/products/thirdparty/?3pc-add-cpe
http://aiqsystems.com/chartpatterns.htm
https://marketsmith.investors.com/
https://www.patternsmart.com/cart/i...ath=65&product_id=409&sort=p.price&order=DESC


Good luck with Trading
Keith

 

[Stockbat]

I can't believe I am giving away my trading method.

https://usethinkscript.com/threads/...n-and-average-for-thinkorswim.853/#post-66830

All chart pattern success stories
Dan Zanger turned 10k into 18M in one year
Chris Kacher up 18,000%
Gil Morales up 10,000%
Phil Goedeker turned 5k into 2.8M
Cameron Fous up 600k
Thomas Bukowski retired
Tim Sykes turned 12k into 4M
William o Neil turned 5k into 200k
David Ryan investing competiton
Nicolas Darvas turned 10k into 2M
Ced Moses 379% investing competition
John Howell patterns
Ross Cameron does many small account challenge turning $500 into $ 1M
remember Tim Grittani (kroyrunner89),
he uses support and resistance and level 2 and is now a millionaire
turned $1k into $2M


Do you see the trend?
Good volume on the chart pattern breakout increases the probability of success. That is just a known fact!

1. Indicator in the link must be cyan. plot go=rawRelDev >= MegaDev; in screener go must be true.
2. A chart pattern breakout must happen.
3. Take profit is 2 times with stop loss at low of breakout

Good chart pattern software. AIQ ninja add-ons meta-stock recommended for daytrading

patternz. http://thepatternsite.com/patternz.html FREEWARE use thinkorswim to screen like price greater than 1 and volume >X and
export just the symbol column. then paste symbol in data downloader.
https://ninja-addons.com/chartist-indicator/
https://www.metastock.com/products/thirdparty/?3pc-add-cpe
http://aiqsystems.com/chartpatterns.htm
https://marketsmith.investors.com/
https://www.patternsmart.com/cart/i...ath=65&product_id=409&sort=p.price&order=DESC


Good luck with Trading
Keith

@brook0010 Thanks for sharing this. What timeframe do you use for this. Patternz works only with Daily timeframe and wanted to know if it supports Intraday data. Also, where do you get your intraday feed?.

 

[brook0010]

@brook0010 Thanks for sharing this. What timeframe do you use for this. Patternz works only with Daily timeframe and wanted to know if it supports Intraday data. Also, where do you get your intraday feed?.

@Stockbat

"No one has reported problems with the program but that could be because few are using it intraday. I know of one person who is using it intraday and he's happy with it"
-- Tom Bulkowski, author, stock market trader/investor

It can be done but few people use it for intraday. don't imagine using patternz for day trading will be very efficient.

I use patternz for trading stock options. the cyan with chart pattern breakout will predict very large moves in the stock since it is very large volume. I go for 6 months expiration. VTNR was a trade I took out of a high tight flag breakout. I would of been up over 100% if I took it right away.

Also note that you will find a smaller # of symbols when daytrading so you would have to adjust the settings. you will have to export the symbols from thinkorswim to a watchlist in another platform then scan the watchlist.

 

[Schmidt42205]

The PatternSite has a lot of great information. Are there certain patterns you are looking for, or will only trade after the Gap Up/Down? Are you trading only high-volume/liquid Nasdaq or S&P500 stocks? You mentioned buying options 6 months out on expiry, on average how long are you holding after the breakout from the pattern (I'm sure this can vary)? Any further insight would be very helpful to my strategy building as well. Thanks for the info.

 

[brook0010]

I feel good that you like my strategy. I have refined my trading method and will do my best to explain it.

First use the code above to scan unusual volume interest in a stock: plot go=rawreldev>=MegaDev; go is set to true.

Go to investors.com. you will need to subscribe for about $37 per month.
(the key with volume in a stock is you don't know what is happening, you just know there is activity.
There could be shorting, buying or selling.

Use investors. you will need to enter each symbol in the search tool.
You should only be focused on

Accumulation/Distribution (Acc/DisTM) Rating​

Exclusive rating in Investor's Business Daily. One of the IBD SmartSelect® Corporate Ratings, it tracks the relative degree of institutional buying (accumulation) and selling (distribution) in a particular stock over the last 13 weeks. Updated daily, stocks are rated on an A+ to E scale.

A = Heavy buying
B = Moderate buying
C = Equal amount of buying and selling
D = Moderate selling
E = Heavy selling

I focus on A(buying) and E's(shorting).

USE psar for making trades. when the reverse signal happens you exit. Not every trade will be winners but most will be. don't feel like you are missing up. Think 2% for 50 trades or 5% for 20 trades. 5% is the most I would risk per trade.
Psar is a final exit.
the low of the candle under the plot go=rawreldev>=MegaDev is a stop loss exit.
When that much volume there is no way the price will fall below the candle unless you are wrong about the direction of the stock.

CODE for psar. I use .05 for settings for accelerationfactor.

input accelerationFactor = 0.02;
input accelerationLimit = 0.2;

assert(accelerationFactor > 0, "'acceleration factor' must be positive: " + accelerationFactor);
assert(accelerationLimit >= accelerationFactor, "'acceleration limit' (" + accelerationLimit + ") must be greater than or equal to 'acceleration factor' (" + accelerationFactor + ")");

def state = {default init, long, short};
def extreme;
def SAR;
def acc;

switch (state[1]) {
case init:
state = state.long;
acc = accelerationFactor;
extreme = high;
SAR = low;
case short:
if (SAR[1] < high)
then {
state = state.long;
acc = accelerationFactor;
extreme = high;
SAR = extreme[1];
} else {
state = state.short;
if (low < extreme[1])
then {
acc = min(acc[1] + accelerationFactor, accelerationLimit);
extreme = low;
} else {
acc = acc[1];
extreme = extreme[1];
}
SAR = max(max(high, high[1]), SAR[1] + acc * (extreme - SAR[1]));
}
case long:
if (SAR[1] > low)
then {
state = state.short;
acc = accelerationFactor;
extreme = low;
SAR = extreme[1];
} else {
state = state.long;
if (high > extreme[1])
then {
acc = min(acc[1] + accelerationFactor, accelerationLimit);
extreme = high;
} else {
acc = acc[1];
extreme = extreme[1];
}
SAR = min(min(low, low[1]), SAR[1] + acc * (extreme - SAR[1]));
}
}

plot parSAR = SAR;
parSAR.SetPaintingStrategy(PaintingStrategy.POINTS);
parSAR.AssignValueColor(if SAR > SAR [1] then Color.GREEN else Color.RED);
parSAR.SetLineWeight(3);

Once you understand this system, you will easily see stocks that double or triple in price.​

The volume is so excessive(remember your stats class about standard deviation). with a high accumulation rating it will tell the trader that
lots of buying is happening in the stock. You don't want any blue bars near one that you are trading. this could be late entry into the big move.
GME and MRIN was a good example of this. you could still be right and make money but its best to be safe. also, no really low float stocks.

I hope this makes sense. Let me know if you have any questions. Good luck with trading!
Keith

 

[Schmidt42205]

I feel good that you like my strategy. I have refined my trading method and will do my best to explain it.

First use the code above to scan unusual volume interest in a stock: plot go=rawreldev>=MegaDev; go is set to true.

Go to investors.com. you will need to subscribe for about $37 per month.
(the key with volume in a stock is you don't know what is happening, you just know there is activity.
There could be shorting, buying or selling.

Use investors. you will need to enter each symbol in the search tool.
You should only be focused on

Accumulation/Distribution (Acc/DisTM) Rating​

Exclusive rating in Investor's Business Daily. One of the IBD SmartSelect® Corporate Ratings, it tracks the relative degree of institutional buying (accumulation) and selling (distribution) in a particular stock over the last 13 weeks. Updated daily, stocks are rated on an A+ to E scale.

A = Heavy buying
B = Moderate buying
C = Equal amount of buying and selling
D = Moderate selling
E = Heavy selling

I focus on A(buying) and E's(shorting).

USE psar for making trades. when the reverse signal happens you exit. Not every trade will be winners but most will be. don't feel like you are missing up. Think 2% for 50 trades or 5% for 20 trades. 5% is the most I would risk per trade.
Psar is a final exit.
the low of the candle under the plot go=rawreldev>=MegaDev is a stop loss exit.
When that much volume there is no way the price will fall below the candle unless you are wrong about the direction of the stock.

CODE for psar. I use .05 for settings for accelerationfactor.

input accelerationFactor = 0.02;
input accelerationLimit = 0.2;

assert(accelerationFactor > 0, "'acceleration factor' must be positive: " + accelerationFactor);
assert(accelerationLimit >= accelerationFactor, "'acceleration limit' (" + accelerationLimit + ") must be greater than or equal to 'acceleration factor' (" + accelerationFactor + ")");

def state = {default init, long, short};
def extreme;
def SAR;
def acc;

switch (state[1]) {
case init:
state = state.long;
acc = accelerationFactor;
extreme = high;
SAR = low;
case short:
if (SAR[1] < high)
then {
state = state.long;
acc = accelerationFactor;
extreme = high;
SAR = extreme[1];
} else {
state = state.short;
if (low < extreme[1])
then {
acc = min(acc[1] + accelerationFactor, accelerationLimit);
extreme = low;
} else {
acc = acc[1];
extreme = extreme[1];
}
SAR = max(max(high, high[1]), SAR[1] + acc * (extreme - SAR[1]));
}
case long:
if (SAR[1] > low)
then {
state = state.short;
acc = accelerationFactor;
extreme = low;
SAR = extreme[1];
} else {
state = state.long;
if (high > extreme[1])
then {
acc = min(acc[1] + accelerationFactor, accelerationLimit);
extreme = high;
} else {
acc = acc[1];
extreme = extreme[1];
}
SAR = min(min(low, low[1]), SAR[1] + acc * (extreme - SAR[1]));
}
}

plot parSAR = SAR;
parSAR.SetPaintingStrategy(PaintingStrategy.POINTS);
parSAR.AssignValueColor(if SAR > SAR [1] then Color.GREEN else Color.RED);
parSAR.SetLineWeight(3);

Once you understand this system, you will easily see stocks that double or triple in price.​

The volume is so excessive(remember your stats class about standard deviation). with a high accumulation rating it will tell the trader that
lots of buying is happening in the stock. You don't want any blue bars near one that you are trading. this could be late entry into the big move.
GME and MRIN was a good example of this. you could still be right and make money but its best to be safe. also, no really low float stocks.

I hope this makes sense. Let me know if you have any questions. Good luck with trading!
Keith

Wow Keith. Thanks for all the great info. I have some homework ahead of me with all this great info. I will let you know if I have any questions. Thanks again!

Chuck

 

[Schmidt42205]

I feel good that you like my strategy. I have refined my trading method and will do my best to explain it.

So I started the scan and got $CFVI, $TSN, and $CRNC for today's (2/7/22) "CYAN" days. I am using over 30 million shares to avoid low float stocks, only optionable assets, and the price above $1 and volume over 500,000. Is this a good filter for finding stocks? Any changes would be appreciated. IBD has the following (ACC/DisTM) ratings for these equities: CFVI "A", TSN "B+", CRNC "E". So following your guidance CFVI would be a good Long Option play and CRNC would be a good short/put play. If we are using Cyan (plot go=rawreldev>=MegaDev to find stocks but we want to avoid trading near those days due to being late to the party, when would we look at entering the trade? I was assuming the next day based upon IBD ratings but maybe I am wrong? Maybe a break of the Cyan Day to avoid trading inside the range? I was only looking at this on a Daily timeframe as well. Should I be looking at the weekly or 4 hour? Thanks again for the detailed description above, it is really an interesting strategy. Sorry for all the questions!

 

[brook0010]

Hello again.

Your analysis is spot on!. CFVI for long and CRNC for short.
Your volume filter may be too high but this is based on the trader's preference.
The Acc/Dis is based on the "in a particular stock over the last 13 weeks." so within this timeframe you don't want to see any blue bars.
ideally, the strong rating should be focused on this blue bar instead of any point in the last 13 weeks. it is more significant.

Also keep in mind that the psar is a trend following tool. you will see some trades exit before the big move. you will still have small losses compared to gains.

This tool below should be a better tool. exit is the opposite arrow.



INPUT PRICE=CLOSE;
#HMA/PSAR Crosses 11.17.2014 V.2

#Begin
input Signal_Settings = {default ""};
input signal_type = {default "BOTH", "SAR ONLY", "HMA ONLY"};
input signal_buffer = .5;

#PSAR
input Psar_Settings = {default ""};
input accelerationFactor = 0.02;
input accelerationLimit = 0.2;

Assert(accelerationFactor > 0, "'acceleration factor' must be positive: " + accelerationFactor);
Assert(accelerationLimit >= accelerationFactor, "'acceleration limit' (" + accelerationLimit + ") must be greater than or equal to 'acceleration factor' (" + accelerationFactor + ")");

def state = {default init, long, short};
def extreme;
def SAR;
def acc;

switch (state[1]) {
case init:
state = state.long;
acc = accelerationFactor;
extreme = high;
SAR = low;
case short:
if (SAR[1] < high)
then {
state = state.long;
acc = accelerationFactor;
extreme = high;
SAR = extreme[1];
} else {
state = state.short;
if (low < extreme[1])
then {
acc = Min(acc[1] + accelerationFactor, accelerationLimit);
extreme = low;
} else {
acc = acc[1];
extreme = extreme[1];
}
SAR = Max(Max(high, high[1]), SAR[1] + acc * (extreme - SAR[1]));
}
case long:
if (SAR[1] > low)
then {
state = state.short;
acc = accelerationFactor;
extreme = low;
SAR = extreme[1];
} else {
state = state.long;
if (high > extreme[1])
then {
acc = Min(acc[1] + accelerationFactor, accelerationLimit);
extreme = high;
} else {
acc = acc[1];
extreme = extreme[1];
}
SAR = Min(Min(low, low[1]), SAR[1] + acc * (extreme - SAR[1]));
}
}

plot parSAR = SAR;
parSAR.SetPaintingStrategy(PaintingStrategy.POINTS);

#HMA
input HMA_Settings = {default ""};
input lengthe = 20;
input displace = 0;

plot HMA = MovingAverage(AverageType.HULL, price, lengthe)[-displace];

###Logic###

def hma_signal = close > HMA;
def psar_signal = close > parSAR;

def short;
def long;
def location;
switch (signal_type){
case "BOTH":
long = hma_signal and psar_signal;
short = !hma_signal and !psar_signal;
location = parSAR;
case "SAR ONLY":
long = psar_signal;
short = !psar_signal;
location = parSAR;
case "HMA ONLY":
long = hma_signal;
short = !hma_signal;
location = if long then low else high;
}

rec last = if long then 1 else if short then -1 else last[1];

#Plotting
plot long_signal = if last == 1 and last[1] != 1 then location - TickSize() * signal_buffer else Double.NaN;
plot short_signal = if last == -1 and last[1] != -1 then location + TickSize() * signal_buffer else Double.NaN;
long_signal.SetPaintingStrategy(PaintingStrategy.ARROW_UP);
short_signal.SetPaintingStrategy(PaintingStrategy.ARROW_DOWN);


#Styling
parSAR.DefineColor("Up Trend", Color.GREEN);
parSAR.DefineColor("Down Trend", Color.RED);
parSAR.AssignValueColor(if close > parSAR then parSAR.Color("Up Trend") else parSAR.Color("Down Trend"));
parSAR.SetLineWeight(3);

HMA.DefineColor("Up Trend", Color.GREEN);
HMA.DefineColor("Down Trend", Color.RED);
HMA.AssignValueColor(if HMA > HMA[1] then HMA.Color("Up Trend") else HMA.Color("Down Trend"));
HMA.SetLineWeight(3);

short_signal.SetDefaultColor(Color.YELLOW);
long_signal.SetDefaultColor(Color.YELLOW);
long_signal.SetLineWeight(2);
short_signal.SetLineWeight(2);

#Alert
Alert(!IsNaN(long_signal), signal_type + ": Long Signal", Alert.BAR, Sound.Ding);
Alert(!IsNaN(short_signal), signal_type + ": Short Signal", Alert.BAR, Sound.Ding);



Good luck with trading and I am happy for your interest in my trading method. Feel free to ask all the questions you like. I don't want to lead you in the wrong direction.

 

[bspratt22]

Hello again.

Your analysis is spot on!. CFVI for long and CRNC for short.
Your volume filter may be too high but this is based on the trader's preference.
The Acc/Dis is based on the "in a particular stock over the last 13 weeks." so within this timeframe you don't want to see any blue bars.
ideally, the strong rating should be focused on this blue bar instead of any point in the last 13 weeks. it is more significant.

Also keep in mind that the psar is a trend following tool. you will see some trades exit before the big move. you will still have small losses compared to gains.

This tool below should be a better tool. exit is the opposite arrow.



INPUT PRICE=CLOSE;
#HMA/PSAR Crosses 11.17.2014 V.2

#Begin
input Signal_Settings = {default ""};
input signal_type = {default "BOTH", "SAR ONLY", "HMA ONLY"};
input signal_buffer = .5;

#PSAR
input Psar_Settings = {default ""};
input accelerationFactor = 0.02;
input accelerationLimit = 0.2;

Assert(accelerationFactor > 0, "'acceleration factor' must be positive: " + accelerationFactor);
Assert(accelerationLimit >= accelerationFactor, "'acceleration limit' (" + accelerationLimit + ") must be greater than or equal to 'acceleration factor' (" + accelerationFactor + ")");

def state = {default init, long, short};
def extreme;
def SAR;
def acc;

switch (state[1]) {
case init:
state = state.long;
acc = accelerationFactor;
extreme = high;
SAR = low;
case short:
if (SAR[1] < high)
then {
state = state.long;
acc = accelerationFactor;
extreme = high;
SAR = extreme[1];
} else {
state = state.short;
if (low < extreme[1])
then {
acc = Min(acc[1] + accelerationFactor, accelerationLimit);
extreme = low;
} else {
acc = acc[1];
extreme = extreme[1];
}
SAR = Max(Max(high, high[1]), SAR[1] + acc * (extreme - SAR[1]));
}
case long:
if (SAR[1] > low)
then {
state = state.short;
acc = accelerationFactor;
extreme = low;
SAR = extreme[1];
} else {
state = state.long;
if (high > extreme[1])
then {
acc = Min(acc[1] + accelerationFactor, accelerationLimit);
extreme = high;
} else {
acc = acc[1];
extreme = extreme[1];
}
SAR = Min(Min(low, low[1]), SAR[1] + acc * (extreme - SAR[1]));
}
}

plot parSAR = SAR;
parSAR.SetPaintingStrategy(PaintingStrategy.POINTS);

#HMA
input HMA_Settings = {default ""};
input lengthe = 20;
input displace = 0;

plot HMA = MovingAverage(AverageType.HULL, price, lengthe)[-displace];

###Logic###

def hma_signal = close > HMA;
def psar_signal = close > parSAR;

def short;
def long;
def location;
switch (signal_type){
case "BOTH":
long = hma_signal and psar_signal;
short = !hma_signal and !psar_signal;
location = parSAR;
case "SAR ONLY":
long = psar_signal;
short = !psar_signal;
location = parSAR;
case "HMA ONLY":
long = hma_signal;
short = !hma_signal;
location = if long then low else high;
}

rec last = if long then 1 else if short then -1 else last[1];

#Plotting
plot long_signal = if last == 1 and last[1] != 1 then location - TickSize() * signal_buffer else Double.NaN;
plot short_signal = if last == -1 and last[1] != -1 then location + TickSize() * signal_buffer else Double.NaN;
long_signal.SetPaintingStrategy(PaintingStrategy.ARROW_UP);
short_signal.SetPaintingStrategy(PaintingStrategy.ARROW_DOWN);


#Styling
parSAR.DefineColor("Up Trend", Color.GREEN);
parSAR.DefineColor("Down Trend", Color.RED);
parSAR.AssignValueColor(if close > parSAR then parSAR.Color("Up Trend") else parSAR.Color("Down Trend"));
parSAR.SetLineWeight(3);

HMA.DefineColor("Up Trend", Color.GREEN);
HMA.DefineColor("Down Trend", Color.RED);
HMA.AssignValueColor(if HMA > HMA[1] then HMA.Color("Up Trend") else HMA.Color("Down Trend"));
HMA.SetLineWeight(3);

short_signal.SetDefaultColor(Color.YELLOW);
long_signal.SetDefaultColor(Color.YELLOW);
long_signal.SetLineWeight(2);
short_signal.SetLineWeight(2);

#Alert
Alert(!IsNaN(long_signal), signal_type + ": Long Signal", Alert.BAR, Sound.Ding);
Alert(!IsNaN(short_signal), signal_type + ": Short Signal", Alert.BAR, Sound.Ding);



Good luck with trading and I am happy for your interest in my trading method. Feel free to ask all the questions you like. I don't want to lead you in the wrong direction.

Hey Brook0010 has your method continued to work well through the volatility recently?

 

[brook0010]

I am happy for your post...because..my trading method has changed and I do not want to steer anybody wrong or making continuous annoying posts.


Chart patterns are the way to go instead of the indicators that I have posted.

I recommend :

Marketsmith Monthly subscriptions are $149.95. Annual subscriptions are $1,499.00
https://ninja-addons.com/ one time fee of $995.
patternz (make sure that the price target hasn't been reached) : the paid are better but this is a free one.

the other ones do not have price targets.
I recommend chart pattern software with price targets.

omnitrader with chart pattern add on
metastock with chart pattern add on
AIQ systems
autochartist( no scanning function but has price targets and a rather cheap monthly subscription)

Here are my instructions:
1. First scan the accumulation rating on investors.com this is most important. A at the lowest B+ for longs I believe it is E for shorts and D+
2. then filter with chart pattern bullish chart patterns for buys and bearish for shorts
3. then with volume ATR filter ( you can edit the code to lower the dev amount. sogo=rawRelDev >= MegaDev at the lowest megadev should be 2.3 which is ExtraDev value. https://usethinkscript.com/threads/...n-and-average-for-thinkorswim.853/#post-66830
4. trade the stock with price target. one candle for stop loss and price target for profit exit.

there must be a better volume value. after the chart pattern breakout (climaxup for longs and climaxdown for shorts) because of candle direction. there could be a climaxchurn.

Here is the code. Remember the "smart money" control the markets.
https://usethinkscript.com/threads/better-volume-indicator-for-thinkorswim.108/page-2#post-93964



Hope you understand everything and good luck trading. Feel free to ask any questions you like!
Thanks for your time. --Keith

 

[bspratt22]

@brook0010
You are still working with daily charts? (not hourly) Have you tried smaller time frames? What chart patterns are we looking for? High tight bull flag or opposite for short? What does an entry look like? Can you share one chart of a trade you took? Forgive me if you have already covered this...

 

[brook0010]

Yes daily charts are used because of accumulation/distribution rating on investors.com. These are meant for daily charts. You would have to find some type of day trading tool. Any chart pattern would work. I prefer to stick to the common chart pattern discussed in William O Neil Book, How to Make Money in Stocks.

Just follow the steps and you should be fine. Right now I am busy and can't give a chart explanation.

 

[Gellidus]

This is rather interesting.... Would like to understand more on chart patterns.

Do you still use PSAR tool?