How to trade with an oscillator

[vssoma]

Only my opinion
1) IMO it helps to check the overall trend first
2) Since it has been a downtrend, and also today was also going down so longs giving high probability trades based on OB> 5 bars is less.
3) Buying at dips after Oscillator staying at OB zone for more than 5 bars is high risk/quick trades stuff.
4) Finally no system is 100%

dear,
there is no system or formula in this world give your 100% success.
but there is a way to make it 100% by your MM.

 

[Smart_trade]

There is no positive divergence....normal or hidden because the divergence to be checked with two price peaks after a rally.....today after the opening market went sideways, it cannot be called a price peak for comparing divergence.....

There is a properly qualified sell signal below 12:35 bar which was the best trade of the day....

Wrong interpretation will lead to wrong trades resulting into trading losses.....

Smart_trade

 

[rangarajan]

There is no positive divergence....normal or hidden because the divergence to be checked with two price peaks after a rally.....today after the opening market went sideways, it cannot be called a price peak for comparing divergence.....

There is a properly qualified sell signal below 12:35 bar which was the best trade of the day....

Wrong interpretation will lead to wrong trades resulting into trading losses.....

Smart_trade

Thank u Smart for finding time to give inputs.
But,i had stated Negative Divergence & Not positive.
From yr reply,i presume that there should be rally,up or down to compare & not consolidation.
What about the 5 bars in the O/B zone which the methodology says ,Buy on Dips due to which whether 12.35 bar sell should be acted upon?
There was no clear downtrend till 14hr,unless we take yr other theory of ATP into consideration which worked brilliantly.But,that is a diff one.

 

[achopraa]

There is no positive divergence....normal or hidden because the divergence to be checked with two price peaks after a rally.....today after the opening market went sideways, it cannot be called a price peak for comparing divergence.....

There is a properly qualified sell signal below 12:35 bar which was the best trade of the day....

Wrong interpretation will lead to wrong trades resulting into trading losses.....

Smart_trade

Hi ST,

But didn't the oscillator remained in the OB region for 5 bars?
I thought the rule was of 5 and more than 5 bars and the very reason I thought it may go long but was not sure hence no trade.
Please enlighten.

Thanks,
AC

 

[achopraa]

Can someone please confirm if it was a SELL signal or a BUY signal(5 bars) at 10.45 candle today.

Also, was there a hidden positive divergence from 10:40 to 11:15 bar?

If someone can answer these queries during Market hours, it will help me to understand the system better.

Thanks.

 

[Smart_trade]

Rangarajan, achopra,

Both of you are right .....there was some error in my charts anf my chart was showing that we stayed in OB region only for 2 bars and at 12:35 there was a downclose and the osc came out of OB area . That is why I mentioned qualified sell signal....but when I took the data backup this morning again, it is showing that we did stay in OB zone for 5 bars. My mistake...you guys are right ...

Always give more importance to what the market is doing on the price rather than what the oscillators are indicating....they are just the indicators....price is the real action....give more importance to price....remember that yesterday the price opened with a gap and broke the earlier days low....it never took out ant meaningful top throughout the day.....

Smart_trade

 

[Smart_trade]

Can someone please confirm if it was a SELL signal or a BUY signal(5 bars) at 10.45 candle today.

Also, was there a hidden positive divergence from 10:40 to 11:15 bar?

If someone can answer these queries during Market hours, it will help me to understand the system better.

Thanks.

As per my chart Stoch stayed in OB region for 4 bars .....5th bar is 10:55 and it came out of OB zone....hope there is no data error....

There is a negative divergence in the tops you mentioned....one can go short here....stoploss 11:20 high

Smart_trade

 

[achopraa]

As per my chart Stoch stayed in OB region for 4 bars .....5th bar is 10:55 and it came out of OB zone....hope there is no data error....

There is a negative divergence in the tops you mentioned....one can go short here....stoploss 11:20 high

Smart_trade

Many thanks for answering my query. This does makes some concept clearer.

I have read about divergences all through the thread but unable to digest HIgher Highs and Lower Lows.

If I am not wrong, during the above duration, the Price Made a Higher-High while in Stochs, it made a corresponding Low. This is negative divergence?

If the above is correct, please enlighten by mentioning 2 lines about how this would have been positive divergence?

 

[Smart_trade]

There is a support at 4802....if short, take some profits here around 4802

ST

 

[achopraa]

There is a support at 4802....if short, take some profits here around 4802

ST

But isn't Stoch's not in OS region now for almost 5 bars(there was a small up as well, but its gonna stay in OS region in all probabilities).

Negative Divergence + Stoch's in OS > 5 = ?