Need some objective rules to stop-gain

#1
Need some objective rules to stop-gain

Hi.
I have problems about closing my positions.
Quite often I close too early, or miss the chance to close my positions.
I need to close my positions in "better" price (it doesn't need to be the highest/lowest as it's impossible).

Does anyone know if there're any objective rules or technical analysis which can help to determine the highs/lows of one wave?
I need to use it in both day & non-day trade.

Thank you!
 

Traderji

Super Moderator
#5
shan2611 said:
Can you please give more details about the three line break system.
Thanks
shan
Three Line Break Charts

Traders are always looking for ways to recognize market trends and direction. Many chart technicians use technical indicators to detect changing momentum, rising and falling trends and market volatility to determine price projections. A candle or bar chart is what is most often used to make trading decisions, however they seldom make it crystal clear when a stock has changed direction.

Three line break charts on the other hand usually help traders more accurately determine the current direction of the trend and alert them sooner when the trend has changed than do other methods (stochastics, moving average crossovers, etc). Three line break charts display a series of vertical boxes that are based on the closing prices. Every time there is a higher close a new green bar is created. When the price closes below the low of 3 green boxes the trend shifts to down and we start drawing red boxes. Every new closing low draws a new red box and so on. Three point break charts often can help a trader spot trend reversals quickly. There are many uses for 3 line break charts, you can use them for entries, exits, and make wonderful places to trail your stops to catch the majority of the move.

The term "three line break" comes from the criterion that the price has to break the high or low of the previous three lines in order to reverse and create a line of the opposite color. Three-line break charts are described in detail in chapter 6 of Steve Nison's book Beyond Candlesticks . Three line break chart development has also been guided largely by Dr. Russell A. Lockhart of Undergroundtrader.com. Dr. Lockhart discusses the use of Three-line break charts (which he refers to as Three-Price break charts) in Appendix A of The Undergroundtrader.com Guide to Electronic Trading by Jea Yu. Three-line break charts allow all periodicities, including daily, tick, or any minute interval.

The Three Line Break Charts are actually Any Line Break Charts. They are not limited to just a three line reversal. You can create Two Line Break Charts, or even Eighteen Line Break Charts, if you wish.

If you own MetaStock you can easily convert the regular bar chart by right clicking on the price bar chart and then selecting "Three Line Break" from the "Price Style".
 
#8
Traderji said:
Three Line Break Charts

Traders are always looking for ways to recognize market trends and direction. Many chart technicians use technical indicators to detect changing momentum, rising and falling trends and market volatility to determine price projections. A candle or bar chart is what is most often used to make trading decisions, however they seldom make it crystal clear when a stock has changed direction.

Three line break charts on the other hand usually help traders more accurately determine the current direction of the trend and alert them sooner when the trend has changed than do other methods (stochastics, moving average crossovers, etc). Three line break charts display a series of vertical boxes that are based on the closing prices. Every time there is a higher close a new green bar is created. When the price closes below the low of 3 green boxes the trend shifts to down and we start drawing red boxes. Every new closing low draws a new red box and so on. Three point break charts often can help a trader spot trend reversals quickly. There are many uses for 3 line break charts, you can use them for entries, exits, and make wonderful places to trail your stops to catch the majority of the move.

The term "three line break" comes from the criterion that the price has to break the high or low of the previous three lines in order to reverse and create a line of the opposite color. Three-line break charts are described in detail in chapter 6 of Steve Nison's book Beyond Candlesticks . Three line break chart development has also been guided largely by Dr. Russell A. Lockhart of Undergroundtrader.com. Dr. Lockhart discusses the use of Three-line break charts (which he refers to as Three-Price break charts) in Appendix A of The Undergroundtrader.com Guide to Electronic Trading by Jea Yu. Three-line break charts allow all periodicities, including daily, tick, or any minute interval.

The Three Line Break Charts are actually Any Line Break Charts. They are not limited to just a three line reversal. You can create Two Line Break Charts, or even Eighteen Line Break Charts, if you wish.

If you own MetaStock you can easily convert the regular bar chart by right clicking on the price bar chart and then selecting "Three Line Break" from the "Price Style".
Dear Traderji ,
Any formula for EXPLORER in METASTOCK to check out the breakuot ( up or down)?
 
#10
Traderji said:
Three Line Break Charts

Traders are always looking for ways to recognize market trends and direction. Many chart technicians use technical indicators to detect changing momentum, rising and falling trends and market volatility to determine price projections. A candle or bar chart is what is most often used to make trading decisions, however they seldom make it crystal clear when a stock has changed direction.

Three line break charts on the other hand usually help traders more accurately determine the current direction of the trend and alert them sooner when the trend has changed than do other methods (stochastics, moving average crossovers, etc). Three line break charts display a series of vertical boxes that are based on the closing prices. Every time there is a higher close a new green bar is created. When the price closes below the low of 3 green boxes the trend shifts to down and we start drawing red boxes. Every new closing low draws a new red box and so on. Three point break charts often can help a trader spot trend reversals quickly. There are many uses for 3 line break charts, you can use them for entries, exits, and make wonderful places to trail your stops to catch the majority of the move.
Traderji,
Thanks for your inputs.

It appears to me that , theoretically at least, this technique can yield far better profits than the strategy of long term investment such as a single BUY followed by a single SELL a year later ( in a rising scrip)

To illustrate , see Clutch Auto one yr (attached). The 12 mth gains of a medium/long term investor would have been limited to merely 100 %, but the short term trader will be able to make perhaps 1000 % by frequently getting in and out of the scrip , guided by the 3 line break tool you explained ... see the extremely frequent momentum changes here, against the backdrop of a gradual rise, through the year. ( If short selling were possible here, the % gains would be even higher as the trader would then exploit each correction as well)

Am I right ?

(By the way , I had got into Clutch auto at 23 in Oct 04 , but prematurely sold off in the 30's, 2 mths later , content with my percentage returns !!)

AGILENT
 

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