Simple Yet Very POWERFUL Swing Trading Strategy

D

DDW

New member
if you use it on tick chart or renko or range charts , ur results will be 30 to 50% more then above mentioned , as time charts are limited to time

in 1 minute market can move 100 points or 10 points , both moves will be showen in 1 candle itself , which is not fair at all ,
You recommend tick/renko charts for smaller time frames (intraday) or do you recommend them for longer time frames as well (swing trades)? Generally I would use 5 minute chart for intraday scalping and 60 minute for multi day swing.
 
mc01439

mc01439

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@DDM

I use Tick and Range Bars for one product only - futures contract for oil (CL). I trade CL with 3200 tick and 8 range bars. I used 5 and 10 min charts years ago when I was auto trading. The issue most have with range and tick charts is that you must be in front of the computer at all times when trading at the levels I do.

I have tested Renko Bars but do not trade them. I found they look great, but do not work for me in the real world.

The charts you use all depend on your style of trading and what you can make money using.

I have tried many different styles over the years and only became successful when I discovered what works for my personality and style of trading. I will use ideas from others but always convert them to what works for me.

As far as 60 min charts I do not use them. Other than "CL" I am a longer term trader and use weekly and monthly charts for instruments such as Corp Bonds and ETF's for a global sector rotation strategy.
 
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Y

ykd2018x

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You recommend tick/renko charts for smaller time frames (intraday) or do you recommend them for longer time frames as well (swing trades)? Generally I would use 5 minute chart for intraday scalping and 60 minute for multi day swing.

i suggest use renko / range chart for your entries and exits and less focus on time charts ,

tick charts are good but u have to sit in front of computer as mentioned in @mc01439 comment also

try to focus big picture & try your best to hold your self longer when you are in profits , (its not as easy as said sometimes)

becoming a day trade is hard job if you are new to trading focus for longer term & bigger size renko range charts


in trading / stock market , the longer your timeframe or bigger your tick size for range / renko chart , the indicators works very well ,

i can bet there is no indicator who give less then 50% fales signal on 1 min time frame , but there are many good ways to overcome this problem on longer time frame charts

one should focus for making money for themself , not for broker by doing day trading , i mean if they are new to this world

the most important thing remains is PRICE focus to PRICE AND its movement try to watch a chart without any indicator for few days a live chart,
you will realize it will start talking to you , when you can listen chart (without indicator) , you are ready

reds
yogesh
 
dougn

dougn

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RSI Crossover is built into the platform. Custom script not required.
 
raghavag2004

raghavag2004

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Took what I understand you to be saying with RSI (7) and put it to code for your use. The main code came from TOS.

declare lower;
input length = 7;
input over_Bought = 60;
input over_Sold = 40;
input price = close;
input averageType = AverageType.WILDERS;
input showBreakoutSignals = no;
def NetChgAvg = MovingAverage(averageType, price - price[1], length);
def TotChgAvg = MovingAverage(averageType, AbsValue(price - price[1]), length);
def ChgRatio = if TotChgAvg != 0 then NetChgAvg / TotChgAvg else 0;
plot RSI = 50 * (ChgRatio + 1);
plot BEAR = over_Sold;
plot BULL = over_Bought;
plot UpSignal = if RSI crosses above BEAR then BEAR else Double.NaN;
plot DownSignal = if RSI crosses below BULL then BULL else Double.NaN;
UpSignal.SetHiding(!showBreakoutSignals);
DownSignal.SetHiding(!showBreakoutSignals);
RSI.DefineColor("OverBought", GetColor(1));
RSI.DefineColor("Normal", GetColor(7));
RSI.DefineColor("OverSold", GetColor(5));
RSI.AssignValueColor(if RSI > over_Bought then RSI.color("OverBought") else if RSI < over_Sold then RSI.color("OverSold") else RSI.color("Normal"));
RSI.SetLineWeight(2);
BEAR.SetDefaultColor(GetColor(8));
BULL.SetDefaultColor(GetColor(8));
UpSignal.SetDefaultColor(Color.UPTICK);
UpSignal.SetPaintingStrategy(PaintingStrategy.ARROW_UP);
DownSignal.SetDefaultColor(Color.DOWNTICK);
DownSignal.SetPaintingStrategy(PaintingStrategy.ARROW_DOWN);
AddCloud (RSI, BULL, Color.green, Color.Current);
AddCloud (BEAR, RSI, Color.red, Color.Current);
AddCloud (BEAR, BULL, Color.current, Color.yellow);
While Creating this script in TOS its saying " exactly one plot expected" error coming any idea how to fix it? can u you share the link for the script?
 
T

Tradervic

New member
HI TRADERS / FRIENDS

Let me share a very simple and powerful tool which i have been using in my trading from very start point until now.

I found here many many indicators developments some are really very useful but i hope you will accept that.

OLD IS GOLD & SIMPLE IS EVEN MORE POWERFUL IF YOU CAN CHANGE THE WAY OF YOUR LOOKING INTO IT.

I am discussing one of my best SWING trading system.

RSI :- RELATIVE STRENGTH INDEX

PERIOD (7) :- because its short term swing trade , the longer the period will be the longer the term will be of a trade cycle but that doesn't mean you should use rsi with 2 periods for day trading coz it wil give you a feel of a doctor sitting at OT watching LCD saving someone from a stroke anyways lets come back to the point.

BUY LINE :- 60
SHORT SELL LINE :-40

I DONT CALL ABOVE OVERBOUGHT OR OVERSOLD because thats a wrong definition of RSI.

Entry for long :- on daily charts RSI(7) MUST , be above 40 , and on 1 hour chart its going above 60 and closing there itself.

Entry for short :- on daily charts rsi(7) must be below 60 and on 1 hour chart its going below 40 and closing there in previous candle.

Exit :- dont bet it a way that like you are long by past few days and you are betting that if it goes below 40 u will sell and take your profits , because if that happens it will screw ur 40 to 50% of profits , so the longest trade suppose to be is
long when its goes above and close above 60 then either consider take profits when its above 80 or 85 or else wait when its trying to close below 60 from above

Same goes for short.

If anyone need more details for this with pictures and back test feel free to comment me I will provide.

It's a tested technique for markets but dont think its easy , in markets nothing is easy and u have to consider lots of facts before openinig a position or closing.

From 40 to 60 when rsi stays u will realize market was in sideways , not good for trades so i have skipped them alrdy



ykd2018x: Thanks for sharing this. I normally trade the SPX with some custom indicators and your method is a great addition to my trading strategy. You are right OLD IS GOLD, SIMPLE IS BEST. Keep as few indicators as possible and look for confluence on a majority of them as no indicator is perfect. Your tweak of the RSI is so simple but you are right, its powerful. I will trade this and report back later on how it goes. Thanks again.
 
T

Tradervic

New member
Hi All, I would like to create a scan for this RSI so that when it reaches 60, it appears in the scan as a buy, and when it hits 40, it appears as a sell. I think I know how to do that but how do I make the scan show that this has just occurred within 1 or 2 bars. In other words, I don't want a scan showing a stock with an RSI > 60 but that 10 bars had already gone by.
Thank you so much in advance.
 
H

horserider

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RSICrossover("length" = 7, "crossing type" = "below", "threshold" = 40) is true within 2 bars

RSICrossover("length" = 7, "crossing type" = "above","threshold" = 60) is true within 2 bars
 
T

Tradervic

New member
RSICrossover("length" = 7, "crossing type" = "below", "threshold" = 40) is true within 2 bars

RSICrossover("length" = 7, "crossing type" = "above","threshold" = 60) is true within 2 bars
Thank you so much horserider. I finally figured it out but thanks for your time and post!
 
Y

ykd2018x

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lets extend the code even further
but i dont think we can possibly have code for it

trend reversal using same technique :-
long to short :- when rsi(7) start failing go above 60 to 65 area atleast twice and showing resistance at this area after a good or nice upside move
go short
stop loss :- trend reversal indixator stop loss or
few ticks above swing high or high fractal above
the good part of this is your stop loss itself is a go long indicator which means
1. if u believe 1000% and hve been making lots of money from this technique you can reverse yoyr trade at ur stop loss levels i.e.
short 100 shares then keep a stop of buying 200 shares because if market is enough crazy to hit yoir such stop loss its itself a going long singal where atleast you can make what u have lost in stop loss hit just now
use 20 ema and never try double stop in a flat 20 ema coz its side ways market



short to long reversal :-
vice versa of above


since now i can post with images let me post a seperate post for whole system today with pictures
with all setting and charts


HAPPY TRADING
 
S

Sree

New member
use 20 ema and never try double stop in a flat 20 ema coz its side ways market
Hi Yogesh,

Are you saying the trade can be stopped out either on long or short side when 20 EMA is used as a stop in sideways market? Didn't quite understand what you meant by double stop.

Thanks!
 
Y

ykd2018x

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Hi Yogesh,

Are you saying the trade can be stopped out either on long or short side when 20 EMA is used as a stop in sideways market? Didn't quite understand what you meant by double stop.

Thanks!
I GUESS it was a typing mistake , i wish to say dont take the trades on RSI (7) 60/40 system nither long nor short when u see 20 ema is flat
when 20 ema become flat below 40 level become buy and touching 60 levels become sell
as side ways market buy low sell high works only ,

i usually stay away coz never know which side it will blast finally and which way the email will trun but

if someone really love to trade sideways he can follow the daily charts for his trend and rsi however in a sideways flat ema if daily is up ,

buy low sell high
if daily is down sell high buy low

anyways on truing points of market and trend reversals u will be caught also some day

there is no one system which can make 100/100 trades correct......................
 
Y

ykd2018x

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As requested.

5 Days = $9,920 with 108 Trades

20 Days = $9,570 with 401 Trades

90 Days = $17,310 with 1842 Trades

180 Days = $27,450 with 2950 Trades

You can continue testing and making the changes you want with the code http://tos.mx/QAEfBm. Add to create strategy.

Here is a simple "youtube" you may want to watch about building strategies.
.

##############################################################################################

input length = 7;
input over_Bought = 60;
input over_Sold = 40;
input price = close;
input averageType = AverageType.WILDERS;


input showBreakoutSignals = no;

def NetChgAvg = MovingAverage(averageType, price - price[1], length);
def TotChgAvg = MovingAverage(averageType, AbsValue(price - price[1]), length);
def ChgRatio = if TotChgAvg != 0 then NetChgAvg / TotChgAvg else 0;

def RSI = 50 * (ChgRatio + 1);
def BEAR = over_Sold;
def BULL = over_Bought;
def UpSignal = if RSI crosses above BEAR then BEAR else Double.NaN;
def DownSignal = if RSI crosses below BULL then BULL else Double.NaN;

#RSI ALERT
def Bearish = RSI crosses below 60;
def Bullish = RSI crosses above 40;

Alert(Bullish, ” EMA Possible SIGNAL UP ”, Alert.BAR, Sound.Ding);
Alert(Bearish, " EMA2 Possible SIGNAL DOWN ", Alert.BAR, Sound.Ding);

#For Orders
def TradeSize = 2;

def Ent = RSI("length" = 7)."RSI" crosses above 60 ;
def Ext = RSI("length" = 7)."RSI" crosses below 60 or RSI("length" = 7)."RSI" >= 85;

AddOrder(OrderType.BUY_TO_OPEN, Ent, close, TradeSize);
AddOrder(OrderType.SELL_TO_CLOSE, Ext, close, TradeSize);

#request by ykd2018x
#1. 5 MIN CHART time frame ,
#def TradeSize =2;
#def Ent= RSI("length" = 7)."RSI" crosses above 60 ;
#close condition , if/when rsi =85 close it /// OR cross below 60 close it

##############################################################################################
@mc01439
is it possible to convert this code to custom colum add code of watchlist i want to see on the watch list if there is a buy or sell signal
but the problem is time frame , if i cannot select the time frame there and i must tell the time frame here in advance for the code
then it should be 5 min time frame

on the watchlist the column added with code should trun green if buy signal appear , should trun red if sell singal appear ,
if no signal should remain normal background , or possible it remain green for a while and then trun back to normal

is it possible to have such code ?
 
mc01439

mc01439

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@mc01439
is it possible to convert this code to custom colum add code of watchlist i want to see on the watch list if there is a buy or sell signal
but the problem is time frame , if i cannot select the time frame there and i must tell the time frame here in advance for the code
then it should be 5 min time frame

on the watchlist the column added with code should trun green if buy signal appear , should trun red if sell singal appear ,
if no signal should remain normal background , or possible it remain green for a while and then trun back to normal

is it possible to have such code ?
Install the following in Custon Quote Formula.

Code:
input length = 7;
input over_Bought = 70;
input over_Sold = 30;
input price = close;
input averageType = AverageType.WILDERS;
input showBreakoutSignals = no;

def NetChgAvg = MovingAverage(averageType, price - price[1], length);
def TotChgAvg = MovingAverage(averageType, AbsValue(price - price[1]), length);
def ChgRatio = if TotChgAvg != 0 then NetChgAvg / TotChgAvg else 0;

def RSI = 50 * (ChgRatio + 1);


def count = if RSI crosses above 60 then 1 else if RSI > 60 then count[1] + 1 else if RSI crosses above 40 then 1 else if RSI > 40 then count[1] + 1 else count[1];
AddLabel(1, count, color.black);
AssignBackgroundColor(if RSI > 60 and RSI[1] < 60 then Color.GREEN else if RSI < 40 and RSI[1] > 40 or RSI >= 85 then Color.RED else color.current);

#End of Code#

 
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Yazzy2589

Yazzy2589

New member
VIP
@mc01439
is it possible to convert this code to custom colum add code of watchlist i want to see on the watch list if there is a buy or sell signal
but the problem is time frame , if i cannot select the time frame there and i must tell the time frame here in advance for the code
then it should be 5 min time frame

on the watchlist the column added with code should trun green if buy signal appear , should trun red if sell singal appear ,
if no signal should remain normal background , or possible it remain green for a while and then trun back to normal

is it possible to have such code ?
@mc01439
is it possible to convert this code to custom colum add code of watchlist i want to see on the watch list if there is a buy or sell signal
but the problem is time frame , if i cannot select the time frame there and i must tell the time frame here in advance for the code
then it should be 5 min time frame

on the watchlist the column added with code should trun green if buy signal appear , should trun red if sell singal appear ,
if no signal should remain normal background , or possible it remain green for a while and then trun back to normal

is it possible to have such code ?
Thank you for sharing your strategy. My trading had improved. I made a scanner for it and I actually made a RSI column that u mentioned.
 
mc01439

mc01439

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Thank you for sharing your strategy. My trading had improved. I made a scanner for it and I actually made a RSI column that u mentioned.
@Yazzy2589 - You are welcome. The nice thing about this site, there is a wealth of knowledge and a willingness to share that knowledge. Wishing you the best.
 
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Rojo Grande

Rojo Grande

New member
Used this strategy today for first time. Up $400+ and left another 200+ on the table due to being a rookie at this. I expect to get better at entries and exits. Many thanks ykd2018x.
 
J

jay2

New member
please do post images when you have time. trying to understand this strategy
 
Yazzy2589

Yazzy2589

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@Yazzy2589 - You are welcome. The nice thing about this site, there is a wealth of knowledge and a willingness to share that knowledge. Wishing you the best.
I’ve always used the 1m chart before using this strategy then I began using the 5m but I see that the 15m is better. With a pullback on the 15m the RSI comes very close to 60 RSI then rises again and it keeps the trend almost all day. The 5m falls below then changes the trend.
 

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