SPX Trading Strategy for ThinkorSwim

[sean1970ss]

I have used this on 3 stocks so far. LCRX/GOOGL/AMZN All profits. I think I probaly cut my profits a little short but hey I am ok with that. One thing I noticed with the AMZN/GOOGL They both move sideways often and consolidate and boom explode. AMZN is easy on scalps as well with 10-20 point swings.

 

[wtf_dude]

I noticed after fiddling with the MACD_BB (and it may be obvious, but it took me a while to realize) When you're messing with settings the macd line of 36 isn't what matters for coloration. For all intents and purposes, the bollinger length acts as your macd line. It's where the initial crossover hits, which means it's where the coloring change takes place. If ya don't believe me, put your BB bands back on the chart and watch how they affect the crossover. The macd_length ONLY determines the crossover of the zero line, if bb length is less than macd_length.

TL DR
If you want to change when the dots change color, change bb length. If your zero line crossover needs tuning, change macd length.

 

[Sbollapa]

Thanks @Hypoluxa @barbaros for the awesome indicator. I was backtesting for last few days but still scared to get with real money.
Finally I tried it with AMZN put when arrow showed up and all other indicators lined up and quick scalped in less than 2min for $200. If I hold on for another 5min, would have gone for 600$ profit.. For first timer, am happy.. God bless you both.

 

[Hypoluxa]

Thanks @Hypoluxa @barbaros for the awesome indicator. I was backtesting for last few days but still scared to get with real money.
Finally I tried it with AMZN put when arrow showed up and all other indicators lined up and quick scalped in less than 2min for $200. If I hold on for another 5min, would have gone for 600$ profit.. For first timer, am happy.. God bless you both.

thats awesome! But back test the crap out of it for AMZN since its built for SPX.....adjust as needed

 

[wtf_dude]

thats awesome! But back test the crap out of it for AMZN since its built for SPX.....adjust as needed

Some promising tools for filtering out false breakouts. Consider higher frame (1 hour) on the accumulationswing or the stochRSI. Experimenting with it now

https://usethinkscript.com/threads/...mtf-indicator-for-thinkorswim.5245/post-63000

 

[Sbollapa]

Any idea how to get alerts show up on phone when there is buy/sell alert? I get other alerts but not from this strategy. I think none from any other strategy also.

 

[wtf_dude]

Any idea how to get alerts show up on phone when there is buy/sell alert? I get other alerts but not from this strategy. I think none from any other strategy also.

It's a strategy combined with several indicators so unless you program an actual strategy with buys and sells, there's no way for you to get alerts...

 

[Sbollapa]

Thank you.

 

[rad14733]

Any idea how to get alerts show up on phone when there is buy/sell alert? I get other alerts but not from this strategy. I think none from any other strategy also.

@Sbollapa Thinkorswim does not support phone alerts from within Studies or Strategies... Only from Chart Alerts and Scan Alerts...

 

[Rodrigov]

From my post on page one:

Option call logic:
1. The SMA's have to cross first.
2. For a call opportunity, you will then wait to see if the MACD dots cross above the MACD zero line. Its critical here to wait until one dot has cleared the zero line...you MUST see a gap....never enter with the dot on the line. Dots must be consistent as well...if its going up...then they must all be white...if a red dot populates between the time a white dot hits the zero line and the time one crosses clear....don't enter. I have a screenshot below showing this example - 13:00 a red dot appears.
3. The ErgodicOsc HAS to be green when the MACD dot crosses above the zero line. You can hold the trade most of the time until this turns from green to red....but I always set a sell limit just in case it whips back in the opposite direction.

Option put logic:
Obviously its the complete opposite of what I've described above for a call. BUT - the SMA's still have to cross first.

I backtested this 90 days and it came back with 95 opportunities. 75 were positive and 20 were breakeven or didn't move more than $1-$2 on the next candle before it changed to the opposite color candle.

For the positives, SPX only needs to move a minimum of $3 for the option premium to move to quick and decent profit. I generally buy 10 contracts with a delta of at least .35 or higher. So there were 75 times the past 90 days that SPX moved $3 or more (up or down) to be claimed a positive for me.

FYI - Since SPX doesn't begin trading until the opening bell, make sure you have your chart set to at least 1 day/10 mins. The 1 day will allow you to get a clear view of the chart and indicators, otherwise it will fill your entire screen if you use current day.

Hypoluxa: in the past days have you entered trades? I entered on friday (loser) and today (loser)... i have a doubt, you enter a trade and when the option is $1 above you close? or you aim for and increase in SPX $3usd and you close without caring of the option price? if its a 10%, 20% or 50% gain? thanks

 

[Hypoluxa]

Hypoluxa: in the past days have you entered trades? I entered on friday (loser) and today (loser)... i have a doubt, you enter a trade and when the option is $1 above you close? or you aim for and increase in SPX $3usd and you close without caring of the option price? if its a 10%, 20% or 50% gain? thanks

I actually haven't used this set up in a little while....when the volatility of the market changes....you have to adapt to that and tweak what you have. This setup is now 5 months old...but it still has a good basic start to something that can be tweaked.

 

[Sbollapa]

I agree.. I keep fine tuning the values on weekly basis to make sure there is no change.

 

[sinistralleo]

Long time lurker, first time commenting.
Just wanted to thank @Hypoluxa @rad14733 @barbaros and @BenTen for their hard work and effort with this. I practiced "on demand" with this setup for about a month and went live last week. Made $4000 in 4 days, all green! (Lost $458 today because I didn't follow the rules...) lesson learned.
@Hypoluxa, you stated how the settings change as time progresses and volatility shifts. Can you elaborate on what needs to change and how do you know when it is "right" (or close enough)? What am I looking for? If I change the macdfast length, macdslow and macdlength, How do I know if it is better or worse?
Thanks in advance!

 

[Hypoluxa]

Long time lurker, first time commenting.
Just wanted to thank @Hypoluxa @rad14733 @barbaros and @BenTen for their hard work and effort with this. I practiced "on demand" with this setup for about a month and went live last week. Made $4000 in 4 days, all green! (Lost $458 today because I didn't follow the rules...) lesson learned.
@Hypoluxa, you stated how the settings change as time progresses and volatility shifts. Can you elaborate on what needs to change and how do you know when it is "right" (or close enough)? What am I looking for? If I change the macdfast length, macdslow and macdlength, How do I know if it is better or worse?
Thanks in advance!

Honestly....when it makes me lose money more than winning, it's time to adjust.

 

[sinistralleo]

Honestly....when it makes me lose money more than winning, it's time to adjust.

Thanks for the reply.
I'm pretty sure you do not just arbitrarily change the numbers though. lol
What do you look for to reel it back in?

 

[Hypoluxa]

Thanks for the reply.
I'm pretty sure you do not just arbitrarily change the numbers though. lol
What do you look for to reel it back in?

what got me in the bad trade, I change the indicators until they get me out of it. A rather simple and common sense approach to it.

 

[Tradervic]

what got me in the bad trade, I change the indicators until they get me out of it. A rather simple and common sense approach to it.

So what is the best settings for today's markets? How would you tweak your original settings?

 

[Hypoluxa]

So what is the best settings for today's markets? How would you tweak your original settings?

sometimes you have to change indicators all together. You need to tweak to your comfort and add and remove indicators until you feel confident. Its hard to tell anyone the exact method.

 

[Delukious]

From my post on page one:

Option call logic:
1. The SMA's have to cross first.
2. For a call opportunity, you will then wait to see if the MACD dots cross above the MACD zero line. Its critical here to wait until one dot has cleared the zero line...you MUST see a gap....never enter with the dot on the line. Dots must be consistent as well...if its going up...then they must all be white...if a red dot populates between the time a white dot hits the zero line and the time one crosses clear....don't enter. I have a screenshot below showing this example - 13:00 a red dot appears.
3. The ErgodicOsc HAS to be green when the MACD dot crosses above the zero line. You can hold the trade most of the time until this turns from green to red....but I always set a sell limit just in case it whips back in the opposite direction.

Option put logic:
Obviously its the complete opposite of what I've described above for a call. BUT - the SMA's still have to cross first.

I backtested this 90 days and it came back with 95 opportunities. 75 were positive and 20 were breakeven or didn't move more than $1-$2 on the next candle before it changed to the opposite color candle.

For the positives, SPX only needs to move a minimum of $3 for the option premium to move to quick and decent profit. I generally buy 10 contracts with a delta of at least .35 or higher. So there were 75 times the past 90 days that SPX moved $3 or more (up or down) to be claimed a positive for me.

FYI - Since SPX doesn't begin trading until the opening bell, make sure you have your chart set to at least 1 day/10 mins. The 1 day will allow you to get a clear view of the chart and indicators, otherwise it will fill your entire screen if you use current day.

Thank you posting this as I am trying to streamline my trading. Would you enter into a put if the red dots appear above the 0 line in a downtrend or would you only take puts if the red dots are below the 0 line.

 

[Hypoluxa]

Thank you posting this as I am trying to streamline my trading. Would you enter into a put if the red dots appear above the 0 line in a downtrend or would you only take puts if the red dots are below the 0 line.

I'm copying and pasting my instructions from the post:
Option call logic:
1. The SMA's have to cross first.
2. For a call opportunity, you will then wait to see if the MACD dots cross above the MACD zero line. Its critical here to wait until one dot has cleared the zero line...you MUST see a gap....never enter with the dot on the line. Dots must be consistent as well...if its going up...then they must all be white...if a red dot populates between the time a white dot hits the zero line and the time one crosses clear....don't enter. I have a screenshot below showing this example - 13:00 a red dot appears.
3. The ErgodicOsc HAS to be green when the MACD dot crosses above the zero line. You can hold the trade most of the time until this turns from green to red....but I always set a sell limit just in case it whips back in the opposite direction.

Option put logic:
Obviously its the complete opposite of what I've described above for a call. BUT - the SMA's still have to cross first.