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stretch 5/19


was hoping to get short ym at its 2.618, where r2 was lying too but the 10am news spoiled the action for me...the 1.618 on ym looks like it worked out ok but without the 10am news help it would have been a sore loser (it was 20 sthg pts under water before the 10am news hit). The fact that r1 was below that 1.618 and got broken made me pass on the 1.618 short and wait for the 2.618 that never materialized.
didnt trade so far. the high wasnt high enough and low wasnt low enough. lol

I decided to have a look at gold, silver and Nas100, got an outer limit hit on Silver and Nas and a good hit on USDCAD, as I thought the other indexes needed a bit lower, I waited for a retest on CAD which never came. No trade better then a failed trade!
Just as an FYI, when the system is trending up lighter retracements work......
On YM, the Long of RL=Close-(stretch*.382) Level has worked twice since previous close......the short RL=Close+(stretch*1.618) worked once today with 1 stop out (15Ticks). Its hard to short an ascending market.

On NQ they bought the close - stretch......
Mo just turned down off the YM 1.6 short level....system took a short.....lets see if the elephant is tired yet.
i don't see the 1.618 of ym having worked today, a stop lower than 25 pts or so would have been taken...

grednfer, how do you see the 1.61 working once today ? did u short it on the way down after the 10am news ?

Originally posted by grednfer

Just as an FYI, when the system is trending up lighter retracements work......
On YM, the Long of RL=Close-(stretch*.382) Level has worked twice since previous close......the short RL=Close+(stretch*1.618) worked once today with 1 stop out (15Ticks). Its hard to short an ascending market.

On NQ they bought the close - stretch......
grendfer, would you mind posting your chart showing what you commented below about the mo ? no rush of course

thanks !

Originally posted by grednfer

Mo just turned down off the YM 1.6 short level....system took a short.....lets see if the elephant is tired yet.
Here you go.........
Shorts are tough...they do work...but swimming upstream.
Click image for original size
ym519
thanks for the chart!

what period mo are you using for the yellow and blue lines and to what chart are they applied (1min, 150 tick, etc)

you said the mo turned down off the 1.61 level...which mo's slope are you refering to? or simply waitng for the cross between them around any level of your interest?

did your machine take the short after the first or second highlighted red arrows?

sorry for the multiple questions and thanks for your time
Its a WIP, so its still pretty dumb....
But it is automated at this point.

This is the 133T chart (no Human time frames allowed)
Its trading the 1EMA off the RLs...so 1 closure below and it goes short...or above it goes long. I mispoke before...10 tick stop, not 15.

If you look at the action.....you could've bought the previous close twice and made the 60 points per.....Thats actually an old school bull strategy..."buy the previous close"......works in an uptrend.

This one yielded 220 points today.
So you see where they closed it?
594....they are so funny!

The stretch number has significance as do its RLs.


I've been researching this stretch thing.....and I guess it actually has it beginnings in Commodities trading. But the theory is more geared toward momentum above or below the stretch, not trading the RLs....

The theory is... go long above close + stretch and short below close -stretch. Conceptually is tries to capture a breakout to a new high or low.
And it was meant just for the opening...not for after hours or later in the day.......They called it ORB (Opening Range Breakout) and the factor they used was the stretch number......no fibs though.

Anyway...learn something new everyday.
here is USDCAD today, the high coincided with the morning high US session. There was a stretch range earlier but not from settlement, so I guess one should be on the lookout for them.
As I said earlier I spotted the sell but wanted confirmation from other markets, very overlapping day. Part of the challenge is getting a feel for it being a fast or day or not, as the currency markets were slow today, less confirmation was required.

Click image for original size
cadst
thanks grendfer