How to trade with an oscillator

[umeshlp]

Today was a strong trending day right from the beginning.....use trend following methods on such days...add and trail your stops to successively higher support levels which the market was making today.

Smart_trade

ST Da,
According to your experience, for how much time we should observe the chart to confirm trending day & then apply trend following methods?
Regards

 

[umeshlp]

http://imageshack.us/photo/my-images/820/dlf130412.png/

ST da,
This is intraday (5min) chart of DLF. If I am long on DLF since morning, when to cover my long trade based on oscillator? Best time would have been between 11.30 & 12.00, but there is no clear indication. (stochastic coming in neutral zone but after staying in OB zone for more than 5 bar, I don't see negative divergence also.).
Regards

 

[Smart_trade]

ST Da,
According to your experience, for how much time we should observe the chart to confirm trending day & then apply trend following methods?
Regards

Some days markets are trending right from the start.....some days they continue their earlier day's trend in the morning session and reverse in the afternoon session ( like today)....some days they open in yesterday's range and do sideways movements all through the day.......but after 1 hour we get some indication of what kind of day we may have...

Smart_trade

 

[Smart_trade]

http://imageshack.us/photo/my-images/820/dlf130412.png/

ST da,
This is intraday (5min) chart of DLF. If I am long on DLF since morning, when to cover my long trade based on oscillator? Best time would have been between 11.30 & 12.00, but there is no clear indication. (stochastic coming in neutral zone but after staying in OB zone for more than 5 bar, I don't see negative divergence also.).
Regards

In my charts, today 11:30 bar gave a negative divergence....then below 12:05 low one should get out of any long positions....

Always give more importance to price action....

Smart_trade

 

[timepass]

http://imageshack.us/photo/my-images/820/dlf130412.png/

ST da,
This is intraday (5min) chart of DLF. If I am long on DLF since morning, when to cover my long trade based on oscillator? Best time would have been between 11.30 & 12.00, but there is no clear indication. (stochastic coming in neutral zone but after staying in OB zone for more than 5 bar, I don't see negative divergence also.).
Regards

In your chart, the stochs entered the OS zone after having stayed OB for >5 bars, that perhaps was the time to exit longs, if any since morning.

 

[murthyavr]

http://imageshack.us/photo/my-images/820/dlf130412.png/

ST da,
This is intraday (5min) chart of DLF. If I am long on DLF since morning, when to cover my long trade based on oscillator? Best time would have been between 11.30 & 12.00, but there is no clear indication. (stochastic coming in neutral zone but after staying in OB zone for more than 5 bar, I don't see negative divergence also.).
Regards

Hi,

Here are few illustrative suggestions over the possible places where the longs could have been exited.

If you are familiar with TDST, and have that afl on your charts, there is no way you can be long below the point [3] marked in the above chart.

Hope some of the above help you in your trading..

 

[umeshlp]

In my charts, today 11:30 bar gave a negative divergence....then below 12:05 low one should get out of any long positions....

Always give more importance to price action....

Smart_trade

1. Why I am not getting negative div.? Let me check. Can you help me? I tried 15,3,5 / 8,4,4 settings.
2. If Price action has to be given importance, then why should we not exit below the close of 10.05 or 10.40 candle? Do you suggest to exit below mid of big green candles? Then we would have exited below mid of 10.30 candle.
Sorry for many questions.... But better to clarify than remained confused.
Regards.

 

[umeshlp]

In your chart, the stochs entered the OS zone after having stayed OB for >5 bars, that perhaps was the time to exit longs, if any since morning.

Thanks for the reply but I was not sure about this exit since 1. there was no negative divergence, 2. price would have bounced back since it did not remain below OS for > 5 bars.
I think you are suggesting because position was in profit as I was entered in morning. (But nobody likes to take small profit. ). Or it was not a stock for going long for intraday?
Regards.

 

[umeshlp]

Hi,

Here are few illustrative suggestions over the possible places where the longs could have been exited.

If you are familiar with TDST, and have that afl on your charts, there is no way you can be long below the point [3] marked in the above chart.

Hope some of the above help you in your trading..

Thanks. Looks more logical. (learned that divergence line to be drawn on %D curve, support lines helps)
Few questions...
1. I can see negative divergence here. But why you did not draw line on %D for top of candle at 10.35 & 11.35 ? 9.20 high < 10.35 high <11.35 high.
2. Is it okay to consider yesterday's candles while drawing trend line on intraday chart? (as it was gap up today)
3. What is TDST?

Regards

 

[murthyavr]

Thanks. Looks more logical. (learned that divergence line to be drawn on %D curve, support lines helps)
Few questions...
1. I can see negative divergence here. But why you did not draw line on %D for top of candle at 10.35 & 11.35 ? 9.20 high < 10.35 high <11.35 high.
2. Is it okay to consider yesterday's candles while drawing trend line on intraday chart? (as it was gap up today)
3. What is TDST?

Regards

1. At the timeperiods mentioned by you, stoch has not made any peaks or troughs.
Divergence is taken note of, when there are peaks or troughs in stoch. Please go
through this thread, you will get lot of good inputs on this subject.

2. Depends on the behaviour of price. In the instant case, it opened higher above
the immediate PH, the correction has not come below the previous PH, and then
made a higher high. The uptrend was intact upto 11:35. So there is no harm in
including the price levels of yesterday to draw the trendline, since the prices
are following a logical sequence.

3. TDST is a concept introduced by Thomas R DeMark. You can find ST's
useful posts in his other thread - Thoughts on Day Trading.