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Strategies & Market Trends : Systems, Strategies and Resources for Trading Futures -- Ignore unavailable to you. Want to Upgrade?

To: Matthew L. Jones who wrote (39836)	11/3/1999 5:41:00 PM
From: Robert Graham	Read Replies (2) \| Respond to of 44573

I use similar S&Rs as you do, but some are different. And I probably use them a bit differently. First, I use the H&Ls of the past three days. I use the Globex H&L in the morning which may or may not have relevance later in the day. For key MAs, I use the 20, 60, and 100 EMAs. I primarily use the 1-min and 5-min charts with peeks to the 15-min and 45-min charts. The 45-min chart I find very worthwhile to look at for some types of junctures in the market. Even though I trade patterns that show up basically on the 5-min chart, I use the 1-min chart to monitor the market. In some markets, all-together NOT infrequently, setups show up better on the 1-min chart, and in one kind of market, the setups that show up strictly in the 1-min time frame work the best and follow through well. So much of the time I look at the 1-min chart, and then I frequently look at the 5-min chart for confirmation of setup or S&R. The 1-min chart allows me to take the setups that show up in a marginal way on the 5-min but still are valid. Also importantly it allos me to better assess a specific instance of a setup and determine the risk associated with taking such a setup along with the potential for whipsawing and price reversals after the breakout occurs. I can also at times tell when the price will break out in the reverse direction to what normally happens with a given setup. The 1-min chart in particular allows me to pick out S&R that is more tailored to the price action that I am seeing on the chart, where for instance I can manage the profit potential to risk profile of a trade better by getting in on a trade earlier if I need to. This is where my elaborate explanation of S&R comes from. I find much of the time I can choose good resistance on the 1-min for trades that are based more on the 5-min chart in this way. Resistance determined in this way are good enough to where the price has come many times right up to within a tick of my stop before it reversed and ran the other direction. One shortcut to this procedure is to take resistance on the 1-min that dovetails well with that found on the 5-min. But this is not always possible. From the daily chart, I use the 20 EMA, 50 EMA, and 200 EMA, along with any spikes or swings that stand out. I also look for obvious swing points from the intraday charts of the previous three days. I find this works for me too as important H/Ls that were put in during those days that did not end up being the final H/L of a given day. Just more food for thought. Bob Graham PS: Some people complain of being whipsawed out of positions before the price runs the direction that they expected it to. I assume they are choosing their S&R properly, and allowing for at least a preset number of ticks before the resistance for their stop. I find that there is another aspect of stop placement that comes into play here. Depending on the price action, not only is position important, but time is important too. The TIME you start placing stops on a setup can also help to determine your success in not being stopped out before an anticipated move occurs. The market is two dimensional with respect to price and time. I think the dimension of time is frequently ignored by aspiring traders.