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High reliable divergence methodology of trading

  • #101
  • Jul 13, 2010 4:39pm Jul 13, 2010 4:39pm
Quoting frankkn
what kind of extra care?

what do you think of this bullish PB of the 50%.

there is a hidden divergence correct?

do you change your settings for osma depending on the timeframe?
Extra-care, I mean that are some situations where it needs to lock on profit really fast on classic divergences setups.
I do not trade on candlestick patterns on this strategy, sorry.
Yes, a hidden bullish divergence.
I do not change the settings for osma, I keep it the same: 12.26.9, as you have already know that.

Here is your example, break on the trend line will trigger a buy trade as it shows the image below:

Attached Image (click to enlarge)
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  • #102
  • Jul 13, 2010 5:48pm Jul 13, 2010 5:48pm
thank you buddy

i think its really cool that you don't trade candlestick patterns

when you say break, are you referring to a close of the candle across the line, or do you enter as price crosses the line?

also, what is MZ?

thanks for your feedback
  • #103
  • Jul 13, 2010 5:54pm Jul 13, 2010 5:54pm
sorry for posting so many charts in your thread, let me know i'll stop if its too many

please share your thoughts on this chart. is this how you would do it?


i was looking at a scalp i took last friday on th 1M. there was a strong down trend, and price retraced making a lower low. macd histogram (osma) made a much higher high than the previous, and the resulting move was powerful.

these last couple hidden divergences have not been with the trend. do you have a preference? for example would you pass on these trades for ones that were with the trend?
Attached Image (click to enlarge)
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  • #104
  • Jul 13, 2010 6:10pm Jul 13, 2010 6:10pm
Quoting frankkn
sorry for posting so many charts in your thread, let me know i'll stop if its too many

please share your thoughts on this chart. is this how you would do it?


i was looking at a scalp i took last friday on th 1M. there was a strong down trend, and price retraced making a lower low. macd histogram (osma) made a much higher high than the previous, and the resulting move was powerful.

these last couple hidden divergences have not been with the trend. do you have a preference? for example would you pass on these trades for ones that were with...
Please read the beginning of the topic, I have explained in detail, all the necessary steps to identify divergences and take trades and only if you did that and still not understood it, post example.
It's my pleasure helping you and other traders.

Bye
  • #105
  • Jul 14, 2010 10:33am Jul 14, 2010 10:33am
Short opportunity developing on the Aud/Jpy and wall street daily charts
Attached Image(s) (click to enlarge)
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Click to Enlarge Name: Spot FX AUD_JPY (14-JUL-10).png Size: 12 KB
  • #106
  • Jul 14, 2010 11:24am Jul 14, 2010 11:24am
Quoting baksonlee
Short opportunity developing on the Aud/Jpy and wall street daily charts
Attached Image (click to enlarge)
Click to Enlarge Name: Spot FX AUD_JPY (14-JUL-10).png Size: 25 KB


Attached Image (click to enlarge)
Click to Enlarge Name: Wall Street Daily (14-JUL-10).png Size: 26 KB


Also, draw the management zones. Cheers.
  • #107
  • Jul 19, 2010 1:36am Jul 19, 2010 1:36am
Gold is looking good for short
Attached Image (click to enlarge)
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  • #108
  • Jul 19, 2010 2:09am Jul 19, 2010 2:09am
Quoting baksonlee
Gold is looking good for short
Your Management Zone (MZ) will placed on the last low. You'll have to establish the targets with Fibonacci Expansion. Nice job.
  • #109
  • Jul 21, 2010 12:32am Jul 21, 2010 12:32am
Nice thread. Keep at it.

Juicyt
"Even if you fall down face first, you still went forward."
  • #110
  • Jul 21, 2010 8:21am Jul 21, 2010 8:21am
Although time will be the true test if this works out nicely, at this stage a double divergence of Osma and MacD is a good sign to short here. I will target other side of BB.

Juicyt
Attached Image (click to enlarge)
Click to Enlarge Name: Double Divergence.jpg Size: 176 KB
"Even if you fall down face first, you still went forward."
  • #111
  • Jul 21, 2010 8:39am Jul 21, 2010 8:39am
Quoting juicyt
Although time will be the true test if this works out nicely, at this stage a double divergence of Osma and MacD is a good sign to short here. I will target other side of BB.

Juicyt
Sorry, dude, I don't establish the targets with Bollinger Bands, only with Fibonacci expansion. Even so, the inferior side of it is in constant motion, so how do you proceed? Do a lot of testing before entering on trade on a system no matter how good it might look.

Good luck.
  • #112
  • Aug 20, 2010 1:50pm Aug 20, 2010 1:50pm
i think that you're strategy works. please bring more examples. are you on a hollyday or something?
  • #113
  • Aug 21, 2010 1:01am Aug 21, 2010 1:01am
Quoting deltatrade
i think that you're strategy works. please bring more examples. are you on a hollyday or something?
No I am not in holiday, I want some implication from the others too for me to continue posting it. I am not sure the other members understand that, it is in their own interest to contribute with their own view.
  • #114
  • Aug 21, 2010 1:21am Aug 21, 2010 1:21am
Confirmed hidden bearish divergence case:

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  • #115
  • Aug 22, 2010 3:36pm Aug 22, 2010 3:36pm
how many trades do you find with this method /month?
  • #116
  • Aug 22, 2010 11:04pm Aug 22, 2010 11:04pm
Quoting deltatrade
how many trades do you find with this method /month?
It depends how many pairs do you use, the time-frames from each one and of course, the daily schedule of trading. For example, if you are trading one pair, during two sessions, European and American, from 30 min to weekly time frames you might find a maximum of 5-6 trades a day.
  • #117
  • Aug 23, 2010 5:35am Aug 23, 2010 5:35am
Pretty tread indeed. But divergences - regular as well as 'hidden' - depends a lot on parameters. Toothman told us that he wonts at least 4 bars and no more than 30 bars (or 6 days in the 4h chart). It looks he uses an RSI 8. Being so, he employs divergences that happen to be inside the range of data processed by the indicator, as well as those which are outside. This seems a substantial difference to me. I'm I wrong? What do you think makes more sense? Comparing different slices of the oscillator's history it's quite common, but how comes to make sense? Does it has to be comparing close slices, or can there be a 'mute slice' in between? Divergences are interesting signal indeeds, and great are the reverse ones, but... have you ever found some material that sprinkles some math or just some sounded precise observations on such an ambiguous topic? If yes, I beg you sharing....
  • #118
  • Aug 23, 2010 6:06am Aug 23, 2010 6:06am
By my part, let me put something useful on the table. When looking for divergences, do not use a bar or candlestick chart. Remember your oscillator is probably based on closes, so it is safer to compare it to an equally based price line chart. Otherwise you risk seeing divergences which are not really given, just because a high/a low that happened to be far from the close.
  • #119
  • Aug 23, 2010 8:14am Aug 23, 2010 8:14am
From my experience what I can tell is that you need a statistical approach from each setting of the oscillator. Even the numbers of candles that should be analyzed has to be based on a statistical optimized database.
The documentation is rare and inconsistent, regarding the divergences, to be sincere. Even my method is not optimized for better results. All the time, we can make major changes and improves to our strategies, for achieving almost perfect results in trading.
  • #120
  • Aug 25, 2010 1:10pm Aug 25, 2010 1:10pm
can macd be used for such divergences? why do you use 3 types of indicators?
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