February 15, 2011
- in Uncategorized by schooloftrade
New JJ-Momentum Technical Indicator for NinjaTrader7 and SchoolOfTrade.com
– New JJ-Momentum Indicator for advanced members
o Goal of this indicator is to confirm when MULTIPLE Timeframes confirm in the same direction on momentum
o When we have 2 timeframes confirming momentum, this dramatically increases our % for success
o When both momentum indicators are pointing DOWN we color it RED
o Unless oversold
o When both momentum indicators are pointing UP we color it GREEN
o Unless overbought
o When they do NOT agree we leave it BLACK/NO Color
o Very easy to use, just download the indicator and load the proper template:
o 21range = Fast21
o 13Range = Fast13
o You can ‘create’ for any market you wish to follow.
o Just have the JJMomentum point towards another timeframes.
o We’ll do detailed training on Wednesday for our members.
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– Trailing Stops and trade management
o Trade management is VITAL to your long term success
o I always find that a trailing stop can be HARD for a new trader to use correctly
o I don’t use a ‘trailing stop’ the way that most traders use them.
o Trail stop = the idea is great, keep locking in profit while the trade works out.
o The concern = you don’t want to tighten the stop TOO TIGHT, or leave it too wide.
o In the days of sideways markets, lack of trends, this trailing stop can be really bounce you OUT of a lot of good trades.
o I would rather use a very basic stop strategy and then focus on letting the trade run to fill my profit targets, rather than strangling the trade to death with a trailing stop.
o Trail Stop PROS:
§ Lock in profit immediately
§ Allows you to let a trade play out, seeking more for the final target
o Trail Stop CONS:
§ may not let the trade play out to its highest potential.
§ You need to give the price some room to breathe, so a trail stop may actually get you a WORSE fill when you get stopped out.
Looking for double-confirmation on days with slow speed, low ATR, and a concern over the personality of the market you’re trading.
Three reasons why gold is considered sideways:
1. flat trigger line (no slope)
2. slow speed, no volume
3. double-bottoms at the lows, 2-tops at the highs
– Buy the lows/support
– Sell the highs/resistance
– Avoid the middle (chop zone)
Same trade management strategy, and I’m taking profit conservatively at the highs or the lows.
The day’s personality will tell me how I manage the runner.
If speed and the market is slow, look to take profit at the highs or the lows.
Slow day = take your money and run
If the speed is fast and the day is moving, the markets personality tells me to expect the moves to be LARGER (feedback from the market)
If we’re really moving, the market tells me I can be a little more aggressive with waiting for a bigger winner.
Rather than getting out at the highs/lows, might want to try and push our target out, trail our stop and maximize the runner if at all possible.
“I cannot expect the price levels top break until the market shows me PROOF”
Therefor, ill trade cautiously and take profit quickly until the markets give me enough confidence (speed and volatility) to hold those trades much longer.
