Spud's Predictive MTF Stochastics

Despichtt a small question of clarification. Why do you still use the Stoch line window - does the color bars not cover the same settings?

The whole story; here it is..

About Stochastics:

I did a lot of short term trading in the past basicly on a 1min frame. My basic indicator has always been Stochastics. Its important to know all figures and understand what happened for the figure to became what it is. Since I’ve seen all figures on a rapid base watching 1min charts so often, I’m very familiar to all setups. I now use all knowledge on all timeframes. I use additional signals, besides from switching color bars, from stochastics for entrée and also for exit.
For special figures especially from 5 and 15min frame I use the confirming color from the TF’s as an entrée as well(don’t care for the color of 30min and H4 in this case). So if you see both lines deverging down from price and have confirming red bars after a 5min candle has closed. Its important to know if market is trending or not to know how to read the behaviour of stochastics. If you see market is trending up you switch thinking and start reading information from the bottoms in stead of from the peaks. This can give you valuable information on how strong the trend and if its likely to continue or not.
I wont bother you too much with all ins and outs(I can tolk for hours on the story) but I think one should know all from its main instrument.

MTF Stochastics:

If I talk about the balk it’s the area between 0-20 and 80-100; balk line: 20 and 80(from snooker!). I use 5min as main setup. MTF stochastics 5, 15, 30min and H4 in color bars and MTF Stochastics v2.0 for visualisation. I use some EMA’s for messuring strength of trend and to adjust stops. Most of the time I place my stops in between the 12 and 24 EMA. Emloyed Pivots Points and Trend Hull, that’s all.
Basicly: Look for situations where all color is green or red on the Stochastics color bar setup. Situation has to hold until the Candle from 5min closes. Reload Template from time to time. Important: CandleStick patterns(engulfing, doji’s, breakout patterns etc).
15/30 min cannot be overbought for going long/not oversold for going short(unless 5minStoch moved fast to the other side on little price change, typical in a trend with more to come). 4H have to be out of Balk if want to go long/short. H4 overbought is fine for going long as is H4 oversold for going short(all other lines no extreme values).
Pre-Announcements by the Bigger TF’s are often strong signals(15/30min announcing pre on the 5min: divergence!). Strong: 5/15/30 “Bundel” forces towards target. Little price chance and more inline colors from Stochastics is good building. All 5, 15 als 30Min Stochastics on groen/rood makes a strong case as well. If 4H crosses from balk to balk you see very nice crossings from 5 and 15minStoch; 15min leaving balk inline the crossing H4 is also a very str case. 5min overb/s not a problem if there is much room for the 15 and 30min to go and some very nice bias. If both 5 and 15min deverging > act on the confirming color if it’s a definite candle(cannot switch back from color). 5 and 30 getting green at the same time while 15 already green but H4 still in Balk balk is good to trade.
I always try to make smal improvements on price. Exit on a contra color bar from 15(Focus Stoch)/30min; exit on signal line theory from Spud or divergence from 5min Stochastics. In overb/s situations: tighten Stop. If 15 or 30min start to twinkle from color: shorten your stop as well. Adjust Stop and profit target to the scale of the currunt volatility(look at the changing scale of the chart).
I always evaluate the setup from all lines from Stochastics. It’s a bit of a grafity story in most cases. I than decide if it’s a weak or strong setup. Weak to me are situations where the action is below the H4 Stochastics and a short setup takes place. I like 15 and 30 both reaching the Balk area from 50 level at the same time(pipping time!). I take profit or shorten stop much faster on weak setups. Strong play’s: aim for Pivots or other sup/res/trend lines. Situations where H4 is crossing from balk to balk are often strong as well.

Hasty job; some more..
For the main 5min frame I’m looking at I use a Stoch(5,3,3); I like the fast signals. I’m also looking at another smaller 5min chart with settings(14,3,3) for the 15 and 30min Stochastics and the Signal 5min Stoch(14,1,1) trying to make sence of the Spud theory. Also small 1H setup for the longer gauge of some strong play.
I play Futures on CHF EUR and GBP. Using DJNW for news, Forex Calendar and Amplify to see if there are any Auctions.
Trading time: 0200-1100ET; extra momentum around 0200ET and 0800ET. For the past 2 weeks since I’m trading this strategy I had some amazing results; mostly finishing the day after a good run before 0800ET. Not quite sure how to messure the accuracy in the long term but very confident things will stay into the green.
Only play news inline sentiment(I use StopLim to hover on the right side of the price; in case the news is inline the current sentiment I might get fill and take a good ride). Expect the price to drop back to its point were it was before the news if the news was against the current flow. Usualy don’t trade around big Macro’s or shorten my stops if I’m in.
Very poor result from strong setup MTF Stochastics: I seriously explore the other side.

God bless you all!

Yes, it does but the colors dont tell you where the lines are so I like the visualisation as well!

Perhaps one could live without it when stricly following the rules, not sure.

I like to see all lines for developing patterns as well.

Cheers(Scottich..)!

For the EUR chart perhaps nice to mention is the strong setup before 1430 that failed to impress. All kind of devergence were going on here and you could have play the nice retreat.
I dont like to play before Payrolls so I waited for the first inline setup afterwards.

Also for the EUR chart: If you had played the EUR long at 1600ET..
You could have wait for the color switch on the 15 or 30min Stoch from the color bar.
But.. seeing all developing devergence from the same lines, you should have exit much earlier saving you a lot of profit!

Sorry, I mean developing devergence on the 5min and probably you could have seen it on the 15min as well.
You have te be carefull reading back the stories: real time isnt always that clear at first!

For Euro: The second setup at 17.55 or so was a weak setup.
The action was from the H4 Stochastics line; 1600 was a strong setup pointing towards the H4..

Oh dear..

Its no ET at all but the actual times on the chart; I think its Bulgarian time..

Could well be this fine 10Y Scottisch friend as well!

Cheers my friends, thats all!

I'm not going for some kind of journey but like to show some pitfalls I've seen today to finnish the story.
Brown vertical line is the time I usualy start trading.
I have to say I dont like trading monday morning and I started late today because of some malt wiskey from Sctotland last nigth..
I started around 1000u on the chart(0300ET). I read about the Greece downgrade and noticed the move down.
Here comes an important pittfall: when reading back the chart you see all green on the H4 but till 1040 chart time you would not see this. The color of the H4 till then was red!
I didnt see the situation live from 0930 chart time but I think this was a short on all colors before the downgrade, making it a nice entree with most of the action above the H4. The downgrade offcourse playing at your favor afterwards.
Next you see the white vertical line from 1035. Looking rigth now you dont see anything but real time this was all red! This was the time I just woke up and I almost pulled the trigger, thinking there was more downwards to come after failing resistance on the pivot..
How wrong I would have been.. I have to say it was a weak setup at this time but I could have taken this trade. But if had taken the trade, the next thing I saw was a green bar from 15min Stochastics. If I get such signals early in the trade I try to get out ASAP. I dont let them eat my stop but just take my loss. At the long term you save a lot of money playing like this, I ensure you!
I didnt trust the swich in this case: I dont like to go long after some downgrade for Greece you see..

First white vertical line on the chart you could have go short here but looking at the action: most of the action is below the figure and seeing the amplitude of the 15min Stochastics befor this one is probably just ranging..
It was.. but if you would have gone short: again you got early exit from the 15min chart and I almost always follow this rule.
For the next situation, 1315 chart time: weak setup moving from the H4. Could have been same small profit(note here that the H4 is red rigth now but real time it was still green at this point!). I didnt play again..
Last move at 1515: finaly a strong setup!!
Did I play this one? No, I didnt play at all because I had some dark forces around me and drunk to much wiskey last nigth!!

The chart from CHF I was talking about..

Do you use the 5 as the trigger kind of like spud taught in predictive stochastics or do you moreso use the elements of mtf stochastics which is moreso just the stochs in agreement with one another....just curious as to how you employ the five minute stoch...as I use it to look for additional confirmation and momentum of a move because I noticed that price moves with the five a lot so I had a lot of instances where the five would reach let's say a short trigger and by the time the others are turned down...it is already almost overbought or oversold and causes a larger drawdown...price a lot of times will move in the right direction but it will be a bumpier ride in a sense...or maybe that's just my experience...

Still dont use any of Spuds techniques, mainly because I think they lag a bit.
I'm just watching the smaller 5min TF chart to see if it makes sence and if there is more room to go for using (14,3,3)..
I think my own rules are more superior: you are in much faster and also out faster if you are wrong.
I take trades where 5min just was not overb/s in favorable situations as I leave them were they just were..

I traded this one on confirming news; played for the pivot down at 1.6165. Cashed just before the line..

Perhaps you are very rigth about this 5min Stoch; I've been thinking a lot about this.
It does spook me out many times if already overb/s..
Remembering Spuds words he only used 5min for a signal; perhaps better listen to him.
Its just the twist in me so much that I dont like those bigger Stops to use.
Still got all those scalping missery between my ears.
Took a while before I could dump the 1min chart as well for this reason(spooks you out even more!); perhaps its best to even drop this 5min chart as well!?
This big twist in me..

Having said that..
Most heavy pipping is done around this overb/s situation so if nothing materializes up here, it probably wasn't much of a trade anyway!

Why I took profit on the GBP so fast, not following my own rules?

Because I'm a bit of a coward as well and..

More bad habits from scalping probably!

You should try drawing trendlines on the 5 minute and 15 minute stoch in your stoch window and using that to help guide your trades and assess the situation as to whether you should hold or take profit at that trend line break...more times than not it does help...