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Matthew 25:16,21 (ESV) … He who had received the five talents went at once and traded with them, and he made five talents more … his master said to him, ‘Well done, good and faithful servant. You have been faithful over a little; I will set you over much. Enter into the joy of your master.’


Counter Trends
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SalimHira
Posted 5/9/2012 9:00 PM (#3623)
Subject: Counter Trends



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Hi Everyone:

My question relates to counter-trends.

I prefer to use Moving averages to help identify trends on the higher timeframes which will help determine if I am setting up a trend trade or a counter trend trade. By detecting the demand and supply zones, I am somewhat able to determine the probability of the outcome and if it is a trend or a counter trend trade.

I do understand during sharp downtrend, support/demand would be pierced, as same for uptrend, resistance/supply would be pierced.

I am using MZ and Profit Band plugins, and WT Last Low and WT Last High to determine or attempt to where price will NOT go :-).

I need help or guidance to understand or detect "Counter-Trends" with advance indicators use in OmniTrader as I still continue to make mistakes in not recognizing them and falling into the trap.

Would love to hear how others are using in their planning process for intraday trades, and/or any other way to best capitalize on.

As always, appreciative of your help and thank you for the assistance.

-Salim
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SalimHira
Posted 5/9/2012 9:43 PM (#3624 - in reply to #3623)
Subject: Counter Trends



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I forgot to elaborate on stating "why I focus on where price could NOT go".

In looking at candles, we all know they represent trades already happened. I would like to concentrate for locating those unfilled orders .. which tend to be located in the white space on the chart, not where all the trading activity is on the chart. This is why I tend to be careful on MA's, as this is where all the filled orders sit... therefore, I need to know or find where the unfilled orders are.

One aspect I also look for too, is price has history and will sooner or later come to touch those zones, irregardless how far back I need to go look for it.

Hope it helps clarify a bit. Thanks.
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JimDean
Posted 5/10/2012 3:45 AM (#3625 - in reply to #3624)
Subject: Counter Trends



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Hi, Salim:

Here are some things you may want to consider.

First ... re the places as yet untouched. Frank Ochoa describes these as "Virgin Points of Control" (VPOC). They are typically related to Money Zone levels that have not yet been crossed. If you don't have his book yet (Secrets of a Pivot Boss), you might want to order it. VPOC's can be seen fairly easily on a chart. With some clever/complex OLang code, they can be searched for as well automatically.

Second ... re checking higher timeframes. I've written a lot about this before. Nutshell:
a. You can do this readily in the Filter and Confirm blocks in a Strategy for automated use
b. You can do this readily in an EZ-Setup column for discretionary use
c. It is difficult but possible to do this correctly from within an OLang Indicator or System or Stop.

Re that last point. Please note that, for example, a 50-day Simple moving average is NOT the same as a 10-week SMA - the price at any bar will be different for those two. The same is true for other indicators ... you usually cannot just multiply the fast timeframe's #bars by some factor, to see what would have been found for the slower timeframe.
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SalimHira
Posted 5/10/2012 6:12 AM (#3627 - in reply to #3623)
Subject: Counter Trends



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Good Morn' Jim:

Your last point certainly makes sense, did not think of it, just assumed all was at par and doing its thing.

As for VPOC or "fresh zones" or say the Coca Cola secret formula, I am being taught in advanced courses by Trading Academy (whom have over 25k + students), that this is where large institutions are hiding their orders from the public. This is coming out from instructors who are ex. market makers, floor traders, etc. They say, you can literally "set and forget" of placing your orders, if only we can detect them. Price does come to touch these zones and move away quickly, before public finds out, thereafter, becomes "not fresh zones" anymore and weakens it - cause everyone knows about its discovery.

I do have F.Ochoa's book, but was way over my head back when he first came out with it, but now can dive into it - you can see Jim how far I have come :-) from those beginning days of mine joining TradeTight and look forward to much more road to travel ahead.

From your mentions, these are the kind of stuff I feel would be invaluable to us fellow traders to coincide with N. products to see in practical examples and how to jump start of putting the pieces all together, than individual subsets of the EZsetups, HigherTimeF, etc. which can learn or do research on our own.

Hopefully, you may have some time to touch base in Austin during TradeTight meeting, but in any event, look forward to seeing all and enjoy the trip.

Thank You.

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