The Art of Trading with MTF Stochastics

Quoting ocelot

Disliked

Hi everyone,

I thought I'd toss my hat in and post my latest trades. I was watching the chart waiting for an MTF setup when I saw a cluster of doji candles form (just a few candles to the left of the red vertical line) these came at the end of a down trend so I entered a long trade on the close of the first bullish candle. This was a great trade and I took 48 pips profit. My stop loss was below the recent lows and my profit target was the nearest 'double zero' level, 226.00. I don't consider this a proper MTF trade per se because the hourly candle stoch hadn't closed above 20 yet.

Which brings me to my next trade --

As soon as the hourly stoch *did* close above the 20 I took another long trade, this is right on the red vertical line. I don't consider this a good trade because by then the 15 min stoch had started turning down. I took the trade anyway and set a profit target of just 10 pips with a pretty tight stop (below the low of the candle immediately prior to the red line). Too tight in this case as I got stopped out on the next candle, the profit target was eventually hit though.

After reading Jeff's reply to my last post I'm going to be a little more loose in terms of waiting for candles to close and incorporate more price action into my decisions. It really is more art then science and with a system like this I think it helps to think of it more as a framework that is flexible than a set of hard rules.

More trades as I take them!

Ignored

Quoting glenn5t

Disliked

hi.

To me my method is very simple, I find it intresting you say its complicated.
If you refer to my post 684 you will see I show the entry points with the MA cross to confirm...as far as a setup goes we look for the pair to turn at the top of the stoch range again confirmed by the bands and when it pases the fib level as showen on the chart thats the entry...of course a long move is reverse.
As I have said I have been trading for many years and I belive I have refind it to a stage now where it gives very good returns....

Glenn

Ignored

Quote

Disliked

k2kvHi Glenn,

I've taken a closer look, and you're right -- it's not so very complicated.

I need to learn more about the stochastic threads and what they indicate. I do understand MA crosses and fibs, though, and I like how you've put it all together. Would you be able to post your template so I can explore it further this week?

Thanks very much!

Quoting CanuckCT

Disliked

I haven't posted in a while but would like to share what I'm currently doing to perhaps generate some discussion. Last night took 2 trades during the asian session...the blue section on my H1 chart. The first trade was a couple of hours into the asian session...the H4 and daily charts were forming a bearish pattern...H4 5-3-3 stoch clearly moving down and there was a hint that the 5-3-3 on the daily might start to crossover.

On the H1 chart, the M30 stoch (blue) went above 80 and turned back down but H4 and H1 did not follow up, and the sexy stoch setup was a good sell setup. Sold at 226.69 and target was S1 or 226.25. Exited for +36 with no heat and thought I might be done for the day. Looked quite bearish so I waited.

A bit later hourly bar closed below S1 and I entered a second short trade at 225.90 (waited for price to go below 226) with target of S2 of 225.42, set the target and stop just above S1 and went to sleep. On this entry stochs were close to oversold or already oversold, but because I'm focusing on higher timeframes, I'm not so worried about what price will do when it hits 80 or 20 on the stoch and more focused on S&R and pivots for exits. This trade Closed at 225.42 while I was sleeping.

Today would have been another easy short from S2 to S3 but did not trade during the day. Here is what I would have done based on my current strategy...looking at H1 chart - hourly bar closed below S1...looking for price to move below 225 ...target would have been 224.33 for very little heat and + 50 to +70 move.

I'm currently focusing on GJ, looking at closed H1 bars for confirmation of direction of trade (sometimes M30), H4 and daily for trend and M5 to time the entry for minimum heat. Stochastics on each with a lot of focus on 5-3-3 on daily, H4 and H1 (you might refer to TEB2 system that uses 5-3-3 and multiple time frames), and I'm using spud without the M15 stoch and finally a view of spud's stochastics theads. I'll probably remove threads from M5 as not using it there. It's a combination of different stoch systems to give me view of bigger picture and less focus on faster moving M5 and M15 timeframes.

And I have this snake force thing that I quite honestly don't know what it measures...but is does help me pull the trigger.

The other thing I've been working with is stochastic momentum indicator, but it's not on these charts. It works like stochastic, but a bit smoother.

My trade target is 30 to 50 pips per trade and I'm thinking there are a couple of times per session where this is possible with GJ.

Cheers,
CanuckCT

Ignored

Quoting boxingislife

Disliked

hey k2
this isnt a new method
this is how i trade most of the time. the only thing i did is merge the 1h and 4h into 1 chart

im always trading mtf and for the past year i have not taken any trade unless i checked a higher timeframe with it

anyways ill post more later but i wanted to show u how during a trendy 4h stoch, even if u dont have a signal there and just direction, u can alway go down to 1h and trade the pullbacks there.

Ignored

Quoting k2kv

Disliked

Hi Canuck,

Thanks for sharing your trades with us.

One thing I can always say about your trades is that they are -- smart. I've watched many of your trades (both in the forum and in our trading room), and admire your ability to roll a variety of techniques into one golden trading bag; more often than not it brings you +pips.

Quick comment: When stochs are about to head into ob/s, this does not necessarily mean the trade is over. As you've noted, this did not stop you from entering the trade. Spud said that this is where the money is made, and stochs can remain ob/s for a very long time while pips continue to accrue. So, regardless of timeframe, folks should be aware of price action/pivots/S&R levels to best tell you when to exit.

Have a safe and healthy holiday, see you next week!

Ignored

Quoting CanuckCT

Disliked

I haven't posted in a while but would like to share what I'm currently doing to perhaps generate some discussion. Last night took 2 trades during the asian session...the blue section on my H1 chart. The first trade was a couple of hours into the asian session...the H4 and daily charts were forming a bearish pattern...H4 5-3-3 stoch clearly moving down and there was a hint that the 5-3-3 on the daily might start to crossover.

On the H1 chart, the M30 stoch (blue) went above 80 and turned back down but H4 and H1 did not follow up, and the sexy stoch setup was a good sell setup. Sold at 226.69 and target was S1 or 226.25. Exited for +36 with no heat and thought I might be done for the day. Looked quite bearish so I waited.

A bit later hourly bar closed below S1 and I entered a second short trade at 225.90 (waited for price to go below 226) with target of S2 of 225.42, set the target and stop just above S1 and went to sleep. On this entry stochs were close to oversold or already oversold, but because I'm focusing on higher timeframes, I'm not so worried about what price will do when it hits 80 or 20 on the stoch and more focused on S&R and pivots for exits. This trade Closed at 225.42 while I was sleeping.

Today would have been another easy short from S2 to S3 but did not trade during the day. Here is what I would have done based on my current strategy...looking at H1 chart - hourly bar closed below S1...looking for price to move below 225 ...target would have been 224.33 for very little heat and + 50 to +70 move.

I'm currently focusing on GJ, looking at closed H1 bars for confirmation of direction of trade (sometimes M30), H4 and daily for trend and M5 to time the entry for minimum heat. Stochastics on each with a lot of focus on 5-3-3 on daily, H4 and H1 (you might refer to TEB2 system that uses 5-3-3 and multiple time frames), and I'm using spud without the M15 stoch and finally a view of spud's stochastics theads. I'll probably remove threads from M5 as not using it there. It's a combination of different stoch systems to give me view of bigger picture and less focus on faster moving M5 and M15 timeframes.

And I have this snake force thing that I quite honestly don't know what it measures...but is does help me pull the trigger.

The other thing I've been working with is stochastic momentum indicator, but it's not on these charts. It works like stochastic, but a bit smoother.

My trade target is 30 to 50 pips per trade and I'm thinking there are a couple of times per session where this is possible with GJ.

Cheers,
CanuckCT

Ignored

Quoting melpheos

Disliked

remove snakeinborder, it repaints anyway... I garantee you that you wont miss it

Ignored

Quoting boxingislife

Disliked

hey k2
this isnt a new method
this is how i trade most of the time. the only thing i did is merge the 1h and 4h into 1 chart

im always trading mtf and for the past year i have not taken any trade unless i checked a higher timeframe with it

anyways ill post more later but i wanted to show u how during a trendy 4h stoch, even if u dont have a signal there and just direction, u can alway go down to 1h and trade the pullbacks there.

Ignored

Quoting CanuckCT

Disliked

Thanks melpheos.
I was noticing a repaint of one bar (maybe 2) on a new trend until the trend got esablished, and on lower timeframes, and I was waiting for 3 to 4 bars to build. I figured it was like stochastics, or many other indicators for that matter, they often look different at the beginning and end of a bar. It doesn't seem to be influencing my decision to trade very much except to help me pull the trigger once I've decisded on a direction...not sure if it's a keeper.
Cheers,
CanuckCT

the the

Ignored

Quoting marcin25

Disliked

my today trade for 10 pips
A couple of sekunds after i exited price jumped 70 pips in my direction,enybody know the reason it moved so rapidly?

Ignored