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Strategies & Market Trends : Chart Formations -- Ignore unavailable to you. Want to Upgrade?

To: Casaubon who wrote (826)	7/30/2005 12:21:14 PM
From: sean sanders	Read Replies (1) \| Respond to of 967

What's the san-pei formation? havnt heard of that one. Also what's your opinion on setting stops (either mental or real). Is the best way to do a stop is look for a close below your stop? (your stop would have to be mental); or is it best to look for just a price break. Example Lets say were going to play off a hammer bottom and the consensus is to buy in after the close of the candle if it closes above the hammer's high. So you bought in at the next candles close if its above the hammers high. Your sell stop (mental or mechanical) would be below the hammer body. So my question is do you wait for a close below that hammer body to exit your trade since its going bad? or just put a mechanical stop in and exit if there is any breach below that price? what's your opinion? or maybe its safer to set the mechanical sell stop a few ticks below the hammer body; so many options Sean

To: Casaubon who wrote (826)	7/30/2005 1:07:43 PM
From: sean sanders	Read Replies (1) \| Respond to of 967

geocities.com/seans1_ta/hammertest.gif (for some reason the ling for the chart doesnt work - not sure if its geocities or what). (ahh I figured out how to get it to work; you need to copy and past the above (I left out the http etc; should work now) cont ... I made up a chart to show what I'm talking about What I have here is a 15 min chart of the YM future on the dow; This was just some manual back testing I was doing ... 1. I decided I was going to buy at the close on this candle which was at 10042 - stop would be below the recent doji hammer ie 10024 2. Actually I have another question here; where's the best place to place a stop if you would enter at 10042 at the close of the large white candle? Whould it be below the doji hammer body? or below midpoint of the large white candle body? I remember steve nison talked about this in one of his books to set a support line at the middle of a large candle; although that candle wasnt that large so maybe this one doesnt count. 3. If the stop was below the doji body (ie 10024 or 10023) - then you would have been stopped out. But if you set a mental stop or a stop a few ticks below the doji body ie the cross then you would of stayed in. So whats your thoughts on all this? Sean