February 14, 2011
- in Uncategorized by schooloftrade
New Momentum Indicator & Renko vs. Range Charts
Questions:
– The range bar measures a set range of price movements and when that range is met the bar prints.
– 13RANGE = 13 TICKS OF PRICE RANGE IN EVERY BAR
– A renko bar does the same except the range has to be all in one direction for the bar to print.
– SIMILARITIES: they both print when the market moves (unlike time or minute)
– TIME CHARTS show the market moving when it really isn’t.
– We like to use RANGE for our trading, we make more money when there is a wider range, so why not use range to tell us when to trade.
– Renko benefits = hold the trade longer, stay in the trend, but you can also stay in a LOSING trade much longer. (disadvantage)
– You would use another type of chart to manage a stop
– Range charts show you the activity INSIDE the candle.
– Did we move up, and then drop? Did we go straight up? Or straight down?
– Bullish/bearish candlesticks, and we DON’T get those with Renko.
– CANT SEE the activity inside the candle on renko
– JJMomentum Indicator
o Download the indicator
o Download the chart templates
o Open the 13range and load Fast13
o Open the 21range and load fast 21
o That’s it!
o The 21range chart looks at the 13range
o The 13range chart looks at the 21range
o How it works:
o Green = both momentum indicators are pointing UP
o RED = both momentum indicators are pointing down
o Does not color if they don’t match
o Does not color GREEN if overbought
o Does not color RED if oversold
– End of March Quad Witching: the week of march 18th is a bad dream, that cn easily turn into a nightmare.
– Thursday and Friday will be nasty
– Wacky Wednesday will be a challenge, but still trade able
– End of Q1 and the 3rd week of March (quad witching)
