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YMM1, (-1,3), Stretch strategy, 22 May


Hunter I think your 1.618 retracement may work today.....
YM retraced to the 1.618 (406) level AH Sunday, with a low of (397).

It bounced from there, but still has Asia and EU sessions to get through.....

It should be able to get to the 503 level which is the upward stretch and approx 3* the stretch value.

It happend so fast, the closest fill my software got was 411....

There is something to these stretch things......but I'm especially watching the larger volume.....they seem to be doing the momentum stretch trade......selling the lower stretch and buying the upper for breakouts.
i am guessing this did not work today...not unless you faded the -4.23 stretch or had super wide stops...would love to know how hunter approached the day
I wasnt around to trade and missed the 423 low, it was a good day trade for 40-50 points., DX had topped earlier in the day and commodities had bottomed, so could be assured a bottom of some sorts was in

My own view at the moment is that 3,1 is only one of the many possibilities for any one day, if the market is going to move 120 to 160 points in a day , the stretch is a good way of framing the picture, ie 4.23 X 37 is 156 points, looking at the daily notes the 10 day average move is 155.
NickP, Thanks for your shared mutual interests. The Stretch (and Fibonacci of the Stretch) price projection reversal levels have been absolutely extraordinary.

I've established the posted threads YMM1, (3, -1), ... Stretch because they represent an accurate interpretation of the structure, and present tradeable probabilities. Please honor the source. There is a counter trend aspect of the formula, which also presents a similar structure balanced by the (3, -1) aspect.

Please allow me the structure of the post threads that begin with the e-mini $5 Dow futures front month: YMM1, (3, -1) profitable Stretch, or % of Stretch. I have groups of traders who follow my threads, and they could easily be confused with your similar subject title beginning with the e-mini $5 Dow front month. Thank you very much. :-)

Grednfer, My initial YMM1 short, 12444, was whacked in half, 12424, +$100, i.e., +14% per contract, with that quick bounce from that 4th to 5th minute sell off and reaction. I waited for the test of the high, and went short at 12432.

NickP, Today's worried fund managers were hitting the bid, mostly due to the likelihood of the Greece contagion. I sold again at 12432 and covered at -137 points (157 points = today's 4.25% of the Stretch calculation) below unchanged (always trade from unchanged) because ...
1.) 4.25% tends to provide intial reversal points and project daily trading ranges.
2.) ... and Friday's 137 point decline from high to settlement. I anticipated a correction before the -4.25% of the Stretch (157 points), i.e., 137 points at 12329. That's +103 points, i.e., +$515 which is a 76% profit,... not including the first trade that produced 20 points / $100 profit. I'm a happy trader. I'm going mtn biking.
i was out during the am trading so missed most of the action as well...we'll see what it bring tomorrow
i honor the source, don't get me wrong...i have been following your posts for a fair amount of time but sometimes i end up confused, that why i needed some clarification today...just wanted to see how the the (-1,3) formula worked.

I see you sold 432 and made money of it, that's great....but this is how i get confused with your framework, you were not fading any 1x (call 1x or 1.618x) move there...so where was the (-1,3) formula applied today? that is what i do not see. That's all. No offense of any kind intended, fwiw

Originally posted by Hunter

NickP, Thanks for your shared mutual interests. The Stretch (and Fibonacci of the Stretch) price projection reversal levels have been absolutely extraordinary.

I've established the posted threads YMM1, (3, -1), ... Stretch because they represent an accurate interpretation of the structure, and present tradeable probabilities. Please honor the source. There is a counter trend aspect of the formula, which also presents a similar structure balanced by the (3, -1) aspect.

Please allow me the structure of the post threads that begin with the e-mini $5 Dow futures front month: YMM1, (3, -1) profitable Stretch, or % of Stretch. I have groups of traders who follow my threads, and they could easily be confused with your similar subject title beginning with the e-mini $5 Dow front month. Thank you very much. :-)

Grednfer, My initial YMM1 short, 12444, was whacked in half, 12424, +$100, i.e., +14% per contract, with that quick bounce from that 4th to 5th minute sell off and reaction. I waited for the test of the high, and went short at 12432.

NickP, Today's worried fund managers were hitting the bid, mostly due to the likelihood of the Greece contagion. I sold again at 12432 and covered at -137 points (157 points = today's 4.25% of the Stretch calculation) below unchanged (always trade from unchanged) because ...
1.) 4.25% tends to provide intial reversal points and project daily trading ranges.
2.) ... and Friday's 137 point decline from high to settlement. I anticipated a correction before the -4.25% of the Stretch (157 points), i.e., 137 points at 12329. That's +103 points, i.e., +$515 which is a 76% profit,... not including the first trade that produced 20 points / $100 profit. I'm a happy trader. I'm going mtn biking.
NickP, I too must honor the source.

The (3, -1) formula was published by a physicist, not (-1, 3) as you have posted. He probably applied higher math skills to present this trading strategy to the trading world.

I don't know how he came to the conclusion that the "X" axis is represented by (3), and the "Y" axis is a (-1). His (3, -1) theory was published; and he presented it for application to inter-day trading.

I've applied his formula, (3, -1), to intra-day trading, basis the Stretch calculation and the Fibonacci of the Stretch calculations.

Try the following Delta Phenomenon Society formula exception, which allows for an alternate count of their equities formula count (which is not, according to them... not a cycle count, but you have check it out, as it is pretty khewl too), i.e., 1, 1A, 2, 3, 4, etc., to completion and repeat directly or inversely by the same sequence which is arranged over a few days. The 1A is the exception, before the sequence count continues. Google it. You should be able to identify the Delta Phenomenon's intra-day sequence, and then narrow it down to the 15 minute cycle. It took me a several minutes. (I won't take the fun out of the puzzle and give you an easy answer.)

Aside from the Greece contagion worry, which is why the market started on a soft note, the Delta Phenonenom sequence and the (3, -1) sequence may provide a little further insight to today's YMM1 price rotations. (12466-Stretch = 12466-59=12407) ... or ... from the 23 May A session high, printed within 15:04PDT, soon after the down gap opening, 12455 - Stretch = 12455 - 59 = 12396 (12396 is one tick above the low print, 12397, that held for several hours, ... but I digress). From that 12397 + Stretch = 12397 + 59 = 12356, which price (12456) never printed. So you started with the initial fade, correction that tested the opening high, which failed, which indicated follow through from Friday 20 May 123 point decline. The intermediate term trend is down. That's is saying that the trending formula (3, -1) is engaged, until the counter trend formula begins, again.

The fade started and failed because the news was overwhelmingly bearish. Nothing works perfectly everytime.

12455-59 = 12396
12396+59 = 12455 (12453 re-test of the high was the highest print)
12466 - 4.25% of the Stretch = 12309 (12311 = 23 May low print).
12466 - 157 = 12309 (12311 = 23 May low print)
I'm more interested in the stretch calc and momentum away from the number as that is where i'm seeing the volume.....not really in the retracements...1,2,4....


But....But from looking back as history...the 4.2 level is always a good trade, I think it how they are ending the cycles.


So I have this combo program going right now on two accounts....where one trades the retracements and the other trades the momentum away from the stretch.......I'm liking the latter and it should continue to work in the elevated volatility.

From what I'm seeing, the stretch momentum trade is very popular....its being used on ES, NQ and Euros as well....both directions.
Oh and put the -1 before the 3 in the -1,3 because it was the fade move trade.......down 1 up 3....but like with all retracement trading you have to be brave to step in front of the Mo.

If you look at the weekly chart.....you'll see 4 of 4 weeks of YM are in the red.....I'll be suprized if this week ends up red.....

So I'm looking for that breakout above 400......
Grednfer, Taking from one is plagerism. Taking from many is research. lol But let's be serious, placing the -1 in front of the 3 in the (3, -1) formula doesn't support the counter trend sequence because switching the "X" and the "Y" coordinates adjusts the algebraic equation to fit your descriptive needs. The title of a post sounds good, but the math doesn't work if you switch the "X" axis and the "Y" axis to justify the means. Again, I'm not claiming ownership, just honoring the physicist who published the formula, symbol for symbol, dots and tittles too.

By placing the "Y" axis = (-1) in front of the "X" = (3) the "Y" axis, the formula changes the basic rules of the trending and counter trending sequences. "X" is always before "Y"; and your adjustments to the formula, do not support the counter trend sequence.

Back to the fun of trading for the sake of having fun... did you Google ... the Delta Phenomenon? If you read one of the first several threads you should be able to find the facts described in the book that will lead you to the Delta Phenomenon sequence, which will also provide you with further understanding why the (3, -1) formula works as (3, -1).

It starts with (3, -1) but finds an alternate path that is supported by both the Delta Phenomenon and the counter trend formula, i.e., the trending formula is (3, -1).

Have fun with this puzzle. When you get back to me with the intra-day Delta Phenomenon sequences, we'll move along towards the next sequence of price rotations. The fade the first move applications to the (3, -1) formula is just the beginning. These are really khewl trading strategy sequences that lend themselves to great trading knowledge.

I'm serious. Read it. Reply and start the Delta Phenomenon conversation with it's applications to the trending formula, i.e.,(3, -1), and the respective counter trend formula.

The physicist who published this trending theory, i.e, (3, -1), and it's counter trend formula, described it as a specifically patterned fractal with variations in its quantitative expression. You'll find both, the respected physicist's formulas, i.t,. trending and counter trending, and the Delta Phenomenon to have much in common. The latter will explain why the math doesn't work if you switch the "Y" axis into the place of the "X" axis.
OK....sorry I won't mistate it again.

I really like this stretch number though.....
YM's been failing it all morning.....

You can really see in action today with ES today
Largest volume=Close+Stretch
Failed the 1.618 level

I've only been looking at it for a few weeks, but there seems to be a lot happening around it.

Does anybody else here on this site use the stretch in their trading?