Notes

vishal7176

Well-Known Member
#1
Please friend dont post anybody on this thread , i just copy and paste forum post here for my personal read.

Below post from varunji post (credit goes to varunji)

Kumudhan ji and others, i can understand your dilemma. You are all always confused, what to use when. When to use 36EMA/200EMA/LV bar... etc. Let me try to simplify it for you. There is a popular saying Horses for courses. One thing that you need to be focussed on is that we are primarily trading of price and volumes (OBV). Now let us talk about the LV bar concept why it gets formed was made very clear earlier on. Now the concept of BO/BD from LV bar amounts to wresting control from the other camp (Bulls and Bears) by either of them. There are 2 types of BO/BD one is price and the other is OBV they both may be linked but they are different. If we see addition of OBV from LV bar then it shows BO. Now OBV (as i have many times said) is truer. Meaning that once it BO/BD it stays that way for some time (Most often the rest of the day after the final LV bar gets formed) but many times we see the Price LV bar tested and sometimes breached after BO. (Price is fickle) at that time you have to take cue from the OBV LV bar line to enter longs again when strength in price resumes. The LV bar/PDC/36EMA/200EMA/Channels/Hourly bands...etc are just parameters to gauge the strength/weakness of price/OBV. That is what we are doing in all our methods, to analyse this strength/weakness and take trades.
varunkochhar,
We take the help of the nearest parameter to determine the strength and weakness of the underlying. These LVB/PDC/36EMA... may be looked upon as supports and resistances. Some of these like LVB/PDC/LVB are fixed S and R whereas the EMA's are dynamic S an R (as they are not constant in value and keep going up or down).
 

vishal7176

Well-Known Member
#2
This is for people using kite??

Ok so here it goes. Just plot the MACD line only of say 36,200 and plot another macd line 4,12 on that. Take adds in shorts everytime the 4,12 line goes below zero till 36,200 is below zero. Your sl for adds would be the pivot high above the last add. Vice versa for longs. Plot only the MACD line not the signal line or the Histogram. Chart follows.

how to plot MACD On kite

Plot both MACDs in different panes...so when 36/200 MACD crosses 0 line from below, the set up is bullish and we take initial long position here...then from second pane when smaller MACD rises above 0 from below...it is add time....continue till the 36/200 is in buy mode .....
 

vishal7176

Well-Known Member
#3
Following improvements are needed in the macd method to make it tradeable.

1) We need to keep some stoploss at some important swing point if the 200 ma line is far off .We also have to keep trailing the stops or profit taking to some important swing points.

2) We should take subsequent adds only if the add comes in lower level than the last add in case of shorting....we should not keep adding on smaller MACD when the price is going against us.....

If the above two are incorporated then this system will be very good. The backtest results posted few posts back show few days when the loss is 200 points ,which is probably happening because the above two points are not incorporated and we kept adding when the market was moving against us.

Giving these views only to make the system more useful for traders in actual trading.If not found useful, please ignore ....

Smart_trade

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So when do you go long. When Price is above 200EMA. The SL for the initial long is just below the last pivot low below 36EMA. Now when do you add. You add when the price goes back into the cloud and comes back above it. The SL for the 1st add should also be below 200EMA if it is nearby or else keep it below the last pivot low. The TSL in all adds would be the last pivot low before the last add. The TSL for the initial lot would be a few points below the 200EMA only.
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