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Slowkeys Intraday Setup Using Slope Strength and Diff
https://www.stevehopwoodforex.com/phpBB3/viewtopic.php?t=651		 Page 9 of 17
Author:  zah1231 [ Sun Jul 15, 2012 9:55 am ]
Post subject:  Re: Slowkeys Intraday Setup Using Slope Strength and Diff
slowkey wrote:
zah1231 wrote:Hi Slowkey,

I have few questions, hope you won't mind.

1)When trading H1 chart, only one SDC(With lookback=6 days) is enough, right?
2)Is it advisable to take trades against the SDC slope?
3)Can we take trades from the middle of SDC channel? Or should we wait for the price to go to SDC extremes?


Thanks
1)When trading H1 chart, only one SDC(With lookback=6 days) is enough, right?
More than enough to trade intraday. There is really not much difference between 5 and a 6 day look back. I increased it from 5 some just because criminals are not consistent on there server times. Think of intraday trading as trading with in a Single Daily candle. Even with a trading a period as large as the hourly you get 24 candles in a single Daily candle. With in that Daily candle you are using the SDC to tell you if you are in a position to sell the Rally for instance or buy the Dip. When each day candle occurs it will plot a trend in a specific direction. All the look back is doing is making the SDC sensitive within a trading week to the trend of the Daily. So too long would cause the SDC slope to change to slowly and too short would probably not be long enough to establish proper deviation levels based on an average peek to trough range of a pair and also cause the slope to give false signals. The SDC slope and deviation channel will give you good levels to plan your trades around. When in a retrace for instance and a reversal back into the main trend occrurs on the Daily so will SDC slope on the houly. The difficulty lies in knowing when this reversal may happen. So I draw some Fibs off of the Daily to see where that resistance or support may signal a reversal or a continuation of the main trend. Than I observe if price is consolidating around a certain level. Maybe it is around the 61.8 for instance. I than avoid trading into the support or resistance at this level which ever it is until I have a clear picture of what is happening. This way of trading may seem simple but is not easy because it requires you to think every day about the intraday range.
2) Is it advisable to take trades against the SDC slope?
You have heard of that old adage sell the rallies and buy the dips. Inherent in this concept is that it is safer to Sell a Rally in a Down Trend and Buy the Dips in an uptrend. So right now you may hear Sell rallies in the EURUSD. So the SDC gives you a clear picture of where a Pair is in the intraday range and whether it is in a down trend or uptrend. If it is pulled back to lets say the 1.62 upper outer Channel in a down trend you would be at the top of a Rally most likely. Now if you find out that most of the Offers in the market are slightly higher or lower than the present level that also can give you an idea where most of the players are going to Sell from. Always be aware of news. News includes where the likely bids, offers, and stops are in the market and can give you an idea of what the big players in the market think the intraday range is. News can ruin your plan so make it part of your plan. Even at this level of the 1.62 if a Bad Jobs report comes out in the US for instance the Euro might gain even if it has been in a down trend.

The exception to the rule here is sometimes there will be a big move in the stock markets around the world starting usually in the US or a summit ends with some agreement in the Euro zone for instance that gives short term hope to the outlook there. But something will spur risk on-trading. So Commodities may become really hot and every one hops on the AUDUSD long for instance which has a paying interest rate right now of about 12 US dollars per lot. This can be a nice advanced trade against the trend. Generally I am looking to trade with the trend.
3)Can we take trades from the middle of SDC channel? Or should we wait for the price to go to SDC extremes?
Absolutely, you CAN trade for instance from the middle channel. Sometimes in steep trends price is not going to pull back very far. In fact if the Pair is all the way back to the 1.62 or even 2.62 it may be that the trend is stalling some. So there is a lot of judgement involved with trading and that is why it is easier to trade with the trend. However when the trade is pulled back deep against the trend it does usually suggest a good level for entry. The SDC is a really nice Fibonacci tool. Price will tend to react to it at different deviation channels. That is why it is neat to look back and see what channels price has pull back to before. The SMI and TrueTMA hopefully will confirm price movement to an oversold or overbought reading and with the SDC you might get some good correlation. However this method of trading is not like waiting for a MA cross over of another MA and than an entry after confirmation with a Stochastic for instance. This is really a setup to understand the intraday range and make informed decisions based on the totality of the setup and not just one part of it. I think we can confirm indicators and the SDC but that does not make for as good an entry as also knowing other things like news too. Than properly and artfully placing a pending order at a good location. It may make it simple to do this to some extent but it is not easy. So it requires more trading experience to use. That is why I have resisted calling it a system so far. It is a setup that makes it easier to plan trades intraday. The more systematic I can make it the better but I am not sure that makes it a system. Because what I am shooting for is a consistent way to think about my trades. So if I do not always have a successful trade I can be confident that I always had a well thought out plan and in the long run the odds should be in my favor. You must always listen to price.
Hi Slowkey,

I really appreciate your detailed explanation about the SDC. Your inputs are very useful and would definitely help a lot of fellow members. Thanks.
Author:  slowkey [ Sun Jul 15, 2012 11:30 am ]
Post subject:  Re: Slowkeys Intraday Setup Using Slope Strength and Diff
zah1231 wrote:
Hi Slowkey,

I really appreciate your detailed explanation about the SDC. Your inputs are very useful and would definitely help a lot of fellow members. Thanks.
Your very welcome,

Zah
Author:  slowkey [ Mon Jul 16, 2012 1:11 pm ]
Post subject:  EURUSD15 minute
eurusd 15.gif
I would be looking to sell the rally off of a disappointing US retail sales report.

"Offers 1.2250/60 (real money, sovereigns) and 1.2290/00 (funds) buy stops up through 1.2300"

Probably I would get in above the real money for a sell. If there are some big offers usually they do not get dumped into the market all it once. Easy enough to keep an eye on it though.
Author:  slowkey [ Mon Jul 16, 2012 2:05 pm ]
Post subject:  EURUSD
So I put a Sell limit above the 1.62 around 2270 ... Right now it does not look like it will get hit. If it does it will be a nice little rally trade Sell.
Author:  slowkey [ Mon Jul 16, 2012 3:35 pm ]
Post subject:  EURUSD 30
eurusd 30.gif
So my Sell limit is hit at 1.2270. Now I am in above the 1.62 deviation channel. Should be a nice short if all that big money is really there and gets dumped in.
Author:  zah1231 [ Mon Jul 16, 2012 6:08 pm ]
Post subject:  Re: EURUSD 30
slowkey wrote:
eurusd 30.gif
So my Sell limit is hit at 1.2270. Now I am in above the 1.62 deviation channel. Should be a nice short if all that big money is really there and gets dumped in.
Hi Slowkey,

Shouldn't you wait for smi and NTSlopeHisto to give sell signal before entering this trade? Thanks.
Author:  slowkey [ Mon Jul 16, 2012 9:34 pm ]
Post subject:  Re: EURUSD 30
zah1231 wrote:
slowkey wrote:
eurusd 30.gif
So my Sell limit is hit at 1.2270. Now I am in above the 1.62 deviation channel. Should be a nice short if all that big money is really there and gets dumped in.
Hi Slowkey,

Shouldn't you wait for smi and NTSlopeHisto to give sell signal before entering this trade? Thanks.
This is a very good question of course and I would answer this way.

Every trader must define his "own" risk. You must do your own trading. So my trade is based on the setup but it was inherently more risky than a monitored trade. However it was at a deviation channel I thought would be an acceptable risk for "me".

My plan did not include monitoring the trade. I was going to take a nap and eventually did just now getting up. I actually did not think it looked like the entry would get triggered that far out but if it did I thought it was a safe location for a trade I was not going to monitor. I make pending trades like this all the time. I did notice that it did get hit by the time I was getting ready to lay down and posted it. I did not know what was going to happen and was confident I was in at a safe level.

If I was going to monitor the trade you are absolutely right I would have waited. However this was a pending trade built off my confidence in the SDC and my understanding of what level of price I thought news was telling me the market was trading from. I was going to be far enough out on the SDC when I got into the trade to be within an acceptable level of risk for "me". The setup can give you some idea about where a trade might be safer to enter. The setup does not give you a plan. I think it helps me to know what is going on, than I make the plan that best suits my needs at the moment. What that plan is depends on your level of experience and the risk you you feel is an acceptable risk. This was an acceptable risk for me. I am not giving the trader a plan but just a nice structure or setup to make his own plans around and he must define his own risk. So you could have monitored this and got in nicely right about now probably. I am just 3 or 4 pips lower than price. So not a bad plan. Now I can get out if I think price is just going to consolidate or stay in though the Asian session and monitor the trade. So I think it was a good plan with an acceptable level of risk for me. Would I like to be 60 pips into profit right now. Sure. However that does not make the plan a bad plan. If the market was 60 pips above me it would though.

I was serious when I said that I thought that NB 10.2 was the best system for a new trader. One of the reasons of course is that this is not really so much a system as a structured setup I use to plan trades around. I am giving as much detail as I can to demonstrate how much confirmation is possible but my experience as a trader means I may not always rely on it. I know what level of risk can work for me and may only use the setup to get a good location for a pending trade. I think pending trades actually make you have to think harder about where the range is and what is the best level to get in at. So that requires more experience.

I want to put trades in the thread like this to show the variety of ways I use the setup to trade. I try to make the setup a good one for both monitored trades and non-monitored trades.
Author:  slowkey [ Mon Jul 16, 2012 10:05 pm ]
Post subject:  Pending Trades
One thing I will constantly state is that pending trades are an excellent way to enter a trade. They require that you make a plan that takes into consideration important levels in the market. Experienced traders plan there trades. They enjoy planning there trades and the process of trading. That is what I like about the SDC and the setup is that it allows for this planning. So I am sharing more my experience of how I use the setup to trade and not a system. My trades may or may not be monitored or be able to be confirmed by indicators at the time the pending trades are triggered but I always have a plan.
Author:  shr1k [ Mon Jul 16, 2012 11:59 pm ]
Post subject:  Re: Slowkeys Intraday Setup Using Slope Strength and Diff
Nice looking method! fits in with how I trade. Thanks for sharing. Is the template shown in the last two posted pics somewhere on this thread. I thought that the download links on the first post were updated but I must have missed something. Thanks
edit>> I think I found it after rereading the thread again
Author:  slowkey [ Tue Jul 17, 2012 2:48 am ]
Post subject:  Re: Slowkeys Intraday Setup Using Slope Strength and Diff
shr1k wrote:Nice looking method! fits in with how I trade. Thanks for sharing. Is the template shown in the last two posted pics somewhere on this thread. I thought that the download links on the first post were updated but I must have missed something. Thanks
edit>> I think I found it after rereading the thread again
Yes, I need to make that easier. I have been busy playing with Steve's Slopey Beast.

Enjoy
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