The "E" set up

IAbout "E".

To give you an "E" set up (not a perfect trade but the perfect "E" look at BIIB on a 10 "E" chart at 3:00 PM on 9/6/13.

To make this a good trade you need "E" on the 3,5,10 and a HRFP on the 21 and 55. No HRFP no trade....no "E" no trade. "E" is not a guarentee your trade work but if you have all of the above mentioned happening your chances are better than average that your trades will work.

Remember this is a very choppy time in the market and September is the worst month for stocks...that's why September is the BEST time to buy stocks! I do practice the Printing Press and W/O. So far I like the Printing Press the best.



Edited 1 time(s). Last edit at 09/09/2013 08:41AM by Darcy2.

Darcy,

when you practice the printing press and W/O, do you mainly use stock splits like Gary suggested?

No. I buy off a gap and play from the gap. For instance Apple....selling a call on the Printing Press using the gap from 1/23 and 1/24 (Daily) as resistance. 1?23 gap is strong because of the gap from 1/11 to 1/14. Until the 200 moving average gets below the 50 moving average I will continue to sell the calls on the weekly.

On W/O I use a weekly - monthly chart buying at the lowest point and holding until the weekly is near or reached over sold. I do not buy any stocks in W/O that have gaps going down.

I seldom use stock splits.

Darcy,

I dont trade this way but I am a "trade junkie" so I break everyones trades down in this forum just to understand. THe way I trade is VERY boring and I have to have a reason to open Qcharts.

BIIB 9/5 I dont see a fat pitch or HRFP on the 21 or the 55. I see a perfect E on the 3 a messy E on the 5 and no E on the 10. Just want to make sure I am breaking the same thing down that you are.

BCT

I looked at the BIIB trade as well. I saw the perfect E on the 10E chart at 3:00 PM on 9/6/13 instead of 9/5/13. Maybe a typo in Darcy's original post?

Yes I meant 9/6. When you aren't trading but painting the days just run together. I was just using the 10 chart to show a perfect E at 3PM 9/6.

I like to have a HRFP on the 55,21 and E on the 10 and 5 entry on the 3.

Thanks BCT and trendtrader1 for bringing this to my attention. I'll fix the message....and then I begin my yard clean up for fall.

Thanks Darcy.

Cant help but to notice that particular trade was against the grain of the market. DO you require the market to be in your favor to make the trade?

BCT



Edited 1 time(s). Last edit at 09/09/2013 10:39AM by BigChartTrader.

makes alot of sense to trade gaps for W/O -you'll have alot more quality trading opportunities (and repeatable).

thanks for the insights.

best,

walle



Edited 1 time(s). Last edit at 09/09/2013 03:33PM by wallemac.

Yes I do almost always Sometimes the news about a company can break and that can cause a quick pop. However all I was intending to show was an example of what an "E" set upooks like on only one chart.

I trade as follows...

HRFP on the 55,21 and "E" on the 10, and 5
with the 3 as my action.

No HRFP (or a real good FP that must have the MACD) and no "E ..."

no trade

As I said at the beginning this was not a perfect trade but a perfect E.



Edited 1 time(s). Last edit at 09/10/2013 08:20AM by Darcy2.

Darcy,
Thanks for this post... I'm still very much learning the gary material using the 233, D, W charts, however, in the mean time I find this E chart style trading interesting for the summer zone and I'm trying to follow here on the forums... I've picked up the dummies guide but haven't yet got to the E chart chapter... I do have my charts setup like you have mentioned, a 3 min, 5 min, 10 min chart each w/ the 5,10,and 20MA (and money flow at the bottom)... and the 21 and 55 gary charts...

do you look for your trade primarily on any chart? an E on the 3 or a HRFP on the 55? or just look at all of them at once? I'm assuming you need to have the E on the 3, 5, and 10 charts on or about the same candle? Do you use the money flow similar to the RSI or MACD to determine an approaching over/under sold position? What is your exit criteria?

Thanks for the questions.

You will not find an "E" chart chapter in the TAD book. Look for information on moving averages.

Here is how my S/O and I trade...understand you may want to skip some of these if you are using bigger charts.

1) Look at the basket of stocks and see what is moving. S/O and I have a sheet made up of the following stocks that we write down their open. These stocks are: CMG, AMZN, CF,NFLX,AAPL,VZ, FSLR,WLT, LNKD, WYNN, EQIX, MON, MA, BIDU, BIIB, TSLA. We refer to this sheet before we get into a trade. What we are looking for is movement. Having this list allows us to look quickly for movement.

2) We look at the 21 chart for a FP, or HRFP.

3) We look at the 34 chart for a FP or HRFP.

4) We look at the 55 for a FP or HRFP.

* We believe if you see a FP or HRFP (A good one not an exhausted one) you are highly likely to see one begin to develop on the 55. (34+21=55)

5) We look at the 5 "E" chart to see if we are beginning an "E", then the same on the 8 "E" chart, and then the 10 E chart for the moving average signal.

6) We then look at the ADX (found in the directional movement on GW's charts). We have the ADX set at 13 (fibnoccia #) with emphasis on the thickness with the color black. ADX must be above 25 for a good reading. Below 25 and the stock is flat. ADX will go up even if the stock is going down IF there is strength in the move.

7) Money flow on "E" charts should be curving up for a Call, or down for a Put. If money flow is down and stock is rising NO TRADE! Money flow means exactly what it says...money flowing into the stock or money flowing out of the stock.

8) Then we check options for a spread. If the option begins to decrease we look at our charts to see if we are in a pull back on the smaller charts and not a turn around. We enter a trade when we see strong sentiment in the option of a positive move and the charts agreeing with the move.

EXIT...It depends on what chart we use to enter. If we use the 55 generally we exit on the 55. We have held over night but only depending on the 233 and Daily. I (S/O doesn't) mark on my chart approximate entry depending on the chart I entered on. If my moving averages turn and cross I generally am out of the trade IF it appears that the stock is returning to my entry, I usually exit leaving some on the table because I use the moving averages to make my exit decision. If I haven't exited my trade by 3:30 I look at my larger charts to see if I have more upside. I use the moving averages to also make that decision as well as any Gaps on the 233 or Daily.

Most of the time when I enter a trade I expect to make at least $500 but I do not base my exit on how much I have made...but what the charts tell me. I have exited off the 5 which sometimes is early but I like two safe nickel's rather than one risky dime. S/O) is a gunslinger. I am not.

I look for short moving averages crossing longer moving averages up or down. These are generally signals floor traders look for as well. When a short moving average crosses a long moving average going up the trade is up. Then more charts confirming this the more likely you will have a positive trade. The same goes if a short moving average crosses a long moving average going down the higher the possibility of the stock going down. Look at moving averages as people. One person weighs 50 lbs and another weighs 200. What would happen to the 50 lb person if the 200 lb person sat on him? Same thing when a 200 moving average sits on top of a 50 moving average.

Darcy,
Thanks so much for clearing that up! That helped greatly... as an example, I did (am doing) a practice trade today (9/13) at 10am on V, FP on the 55 and the 21 also looked good to me for a call... the E on the 5 formed at the close of the 9:45am candle, then then E on the 10 formed at the close of the 10am candle and i got in... your thoughts?



Edited 2 time(s). Last edit at 09/13/2013 12:31PM by ChairmanFaust.

ChairmanFaust "(we call it straight line information with 3 of 4 or 4 of 4 indicators)"

Probably the same thing and although I have been free of the non-disclosure I would never do or say anything that could affect GW's studies for the future. I can only refer to what GW's taught in my 1-5 class as a FP or HRFP.

As far as your V trade yes on the 10 "E" chart you have "E" at the candle close @ 10 AM. At the candle close on the 55 @ 10:24 you did not have a HRFP... no signal on the MACD according to my charts. 5 "E" chart shows a pull back happening at its close @ 10:05.. 5 and 3 "E" charts shows entry at 9:45 candle close.

I can't tell you when to exit. You must make that decision based on what chart you will use for exit. I will say look at your daily and 233 for toppyness....

Or exit when you are happy with profit. Usually when S/O and I use small chart for direction not entry we exit with that chart.

Thanks for all the help, I sold V at 2:15, made a small profit, the 21 looked about done at 2 and it didnt appear to be going anywhere... i'm happy with it as a first time test... I'll be more aware of the 233 and D next time, this stock was already oversold on those charts but i was still able to eek a bit out of it

How can I learn about the "E" indicator that is mentioned so much.

rebwayne Wrote:
-------------------------------------------------------
> How can I learn about the "E" indicator that is
> mentioned so much.

"E" chart is a name my S/O and I gave a moving average chart. To learn about these charts purchase Technical Annalysis for Dummies and read about moving averages. The chart set up we use is a 3,5,10 chart with these averages as well as setting these in our 8,21,34,and 55.

In the TAD book the chart they use is a daily only and they use it for buying stock.

We use these along with GW's charts giving weight to GW's equal to the "E" Chart but wanting a FP or HRFP on the 55, 34 and 21.

I'll post the investopedia site to use also as a study guide.

Addidum:

[www.investopedia.com]



Edited 1 time(s). Last edit at 09/13/2013 02:37PM by Darcy2.

You could start by reading through the posts. Darcy has explained it at least 25 times.

I did find a post that explained it very well. I have set up the charts with these indicators and see very clearly what the "E" is. Thanks for your patience in explaining it again!!!

The information Darcy has provided is about 80% of the way I trade. Heck, I took time to tear her trades apart, follow the concepts along with what I know, and as a result, my little intraday style is pretty solid.

In addition to the information provided, I want to see a break on the previous day's low or high-in most cases. For me, this action provides me with an additional source of momentum and confidence. I have recently started to look for that break later in the day (opposed to shortly after A/Hour) and placed trades based on that major level of support/resistance being broken.

90% of my entry points are 9:56-10:22. Amatuer hour is over at about 9:45 and the big boys start tp play. By 10:00, I can see where the heavies are jumping in or out, so I ride it up or down while they are taking positions or selling positions. I know they have normally run it up a bit much or the opposite, so I see a small pul back or pop- and then a flattening at around 11:15-11:30 (no later than 12). Remember, stocks go to lunch also. I want to be out before I get caught in that little pullback or pop. I look to run about 3 or 4 good candles on my 13, and I am Happy in Seattle. This is why I am usually in by 10:09 and out by 11:00-11:30. As soon as I see a doji or any reversal signal form, regardless of where it forms after entry, I am OUT! I do not want to get caught in that little pull back. I really believe this is why my intraday trades are nearly 95%. I will quickly take a little gain of a $200 and not subject myself to a loss-regardless if that reversal signal is a "headfake" or not. I am OUTTER THERE!

I also want to make sure I am on the correct side of my 8MA (below on puts, above on calls). I look for this on my decison chart.

I am almost always on the right side of the market. If it is red, I am looking for puts. If it is green, I am looking for calls. Recently, I have started to understand that if the market is red, but the 3, 5, 8 charts (Gary's charts) on the Dow and Nas are showing positive movement UP, I could buy calls. I am still a bit nervous about those decisions, but recently, I have placed those type trades and been ok. It is all about momentum, momentum, momentum. The more momentum you have going your way, the better chances of it being a good trade.

-You must look for that "E" on the smaller MA charts-as stated. One reason my trades were ubelievably short was because I was looking for the "E" on my 13 chart. Well, it developed, but I had missed a large part of the move because the 13 was too big of a chart to wait on that development. I needed to look for the development on my 5, 8, and 10. Again, these concepts are for intraday traders because of the size of charts you are using to trade. I definately would not suggest this to those who are recently out of class and trying to learn the main focus of how Gary teaches. All of this is based on the foundation of Gary's approaches, but these smaller charts take a lot of precision and indicators must be in alignment "RIGHT NOW" before place a trade. If they are not all there NO TRADE! It will be almost impossible to trade intraday with out a high, high level of discipline. I am so disciplined until, I simply do not go back into trades after I am in and out for the day. I do not want to see that market after I am out. I do not want to be tempted. It is tough and I have slipped, but when I do, it is almost never a positive trade-batting about a .100 on that process. I hope some of this helps. Now I am back to studying these big charts. I not even close to ready to place a real money trade. My success rate right now off big charts is only about 65%. That has to raise another 25%.

I hope this helps- Trade hard!

Thanks for the info rookie30. I am about learning all I can that does not cause me to stray from the fundamentals taught by GW. I really appreciate the part about being disciplined enough not to do another trade once you have gotten out. I will hold that nugget because it will probably save me many dollars and much anguish.

Just in the few short weeks ive been looking at this i can tell you really only get one trade per stock per day... the good ones tend to rise after open creating the E signal, continue, then sag around lunch, some fall, some pop, some go flat after lunch but the most gains seem to be made after 10am and before 1pm... this is a great strategy to use while waiting for the next major market wave to start your larger chart trades

Darcy2 Wrote:
-------------------------------------------------------
> No. I buy off a gap and play from the gap. For
> instance Apple....selling a call on the Printing
> Press using the gap from 1/23 and 1/24 (Daily) as
> resistance. 1?23 gap is strong because of the gap
> from 1/11 to 1/14. Until the 200 moving average
> gets below the 50 moving average I will continue
> to sell the calls on the weekly.
>
> On W/O I use a weekly - monthly chart buying at
> the lowest point and holding until the weekly is
> near or reached over sold. I do not buy any stocks
> in W/O that have gaps going down.
>
> I seldom use stock splits.


Darcy,
I'm slightly confused by what you are saying. As the one always very interested in W/O and Printing Press, I'm very interested in all discussions on these topics.
Going back I see big gaps down on AAPL in that time frame. Based on what I've been reading in Dummies and also heard, a stock tends to run in the direction of the gap. So I wouldn't expect that you would have purchased AAPL after those gaps. I guess you are saying that the gap serves as a strong resistance line helping you see when to buy and sell calls. Regardless, you would have to own the stock ahead of time.

When discussing W/O, you say you buy at the lowest point. How do you know it is the lowest point when you buy it? Also, when you say oversold, are you referring to the MACD level, or something else?

Thanks as always for your generosity with your knowledge.

Kars Wrote:
> Darcy,
> I'm slightly confused by what you are saying. As
> the one always very interested in W/O and Printing
> Press, I'm very interested in all discussions on
> these topics.
> Going back I see big gaps down on AAPL in that
> time frame. Based on what I've been reading in
> Dummies and also heard, a stock tends to run in
> the direction of the gap. So I wouldn't expect
> that you would have purchased AAPL after those
> gaps. I guess you are saying that the gap serves
> as a strong resistance line helping you see when
> to buy and sell calls. Regardless, you would have
> to own the stock ahead of time.
>

Yes I owned AAPL ahead of time. I purhased AAPL off the 55 chart on 1/15/13 when it hit a triple bottom on the 55. Since I trade off a 55 this was the chart I used to purchase AAPL. when I buy or sell I buy or sell off the gap. What I mean is when I sell (STO) I sell off the gap and when I buy it back I buy it back off the gap (explaination below). On AAPL I buy a weekly and allow it to expire. Because of the gaps I can usually tell if AAPL will go above where I have sold my option.

The daily (AAPL) lowest point would have been 4/19 or 6/28. On the daily draw a ray line off the candle close (do not include the wicks) and extend it forward. You will note it hits the candle close of 6/28. You could have bought on 4/19 and sold on 5/6 or 5/7, 5/8 or 5/9 when that daily candle hit the bottom of the gap of 1/24.

Playing Printing Press it really doesn't matter about the high or low at least it hasn't for me) but in W/O it does.

AAPL has worked very well in the Printing Press because of the gaps. And as you can see it would work well for W/O.

AAPL has a strong resistance off the gap of 1/23. I mean to say A STRONG RESISTANCE OFF THE GAP FROM 1/23 TO 1/24. (Think of this as GW shouting here!!!!) On the Daily chart from the gap of 1/11 to 1/14 AAPL rose and hit the center of that gap on 2/11 -2/12 and it was quite a while before it ever broke that center gap again (8/13). When it did it went to the resistance off the gap of 1/23 where it met strong resistance.

Every time AAPL hit resistance off the gaps I waited until Wed or Thurs to "sell to open".



> When discussing W/O, you say you buy at the lowest
> point. How do you know it is the lowest point
> when you buy it? Also, when you say oversold, are
> you referring to the MACD level, or something
> else?

Looking at the weekly for AAPL the lowest point would have been 6/23 (that time frame). You know the lowest point on the weekly is when AAPL hit the 200ma and it held as support. Over sold on the weekly would be the StochRSI.
In W/O look for the low and see if it is the LOWEST point in 1 year. Use candles to measure and look at the indicators.

>
> Thanks as always for your generosity with your
> knowledge.

I do not know if you saw some of my other posts concerning gaps but I use a method I have developed for gaps using a measure of the gap and a measure of the center gap. I can't say always since there is seldom an always in the market but generally gaps close. If a down gap doesn't close it could reflect a problem with the stock. AAPL has not closed its daily gap off 1/23 - 1/24. If you look at AAPL on the daily you can also see the 200ma above the 50ma. This too is not a good sign. On 9/11/13 the 200 ma moved above the 50ma. This is known as a golden cross and a sign that a stock will rise.

When I look at gaps, up or down, I also look at the positions of moving averages. Moving averages especially the 20, 50 and 200 are good for support and resistance.

Hope this helps.



Edited 3 time(s). Last edit at 10/12/2013 06:06AM by Darcy2.