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 Post subject: Re: Super trend strategy feedback
 Post Posted: Sat Feb 12, 2011 5:15 am 
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Joined: Sun Jan 23, 2011 9:12 pm
Posts: 4
Hi Harry,

Just started using Supertrend, in demo account, to intiate a trade, using 2H time frame on EURJPY & DJI30..it seems to work fine, filtering out the volatile noise. Of course, it's is not as strong as daily, but seems to work for intraday/swing for me....

Have u used supertrend to trade on smaller time frame than daily, like 4H, 2H,1H? If so what is your view of using it intraday? What is your view, if initate a position, for example on 2H time frame & just ride the supertrend till it forms a cross @ close on 2H & then just flip the trade to the other direction & ride it & flip again on next cross & so on & so forth?

So this means that you are always in the trade & can have a profitable one, if it trends for a bit longer...

When i see supertrend on charts, i see it going sideways 50%-60% of the time, that may not generate much profit/loss, but when it trend, say, 40% of times, the duration is quite long & can be profitable...

Please find attached a snapshot of Supertrend. It's in PNG format, wanted to upload jpg format, but file is too big. anyway, hope caopen & see it.

I would appreciate your view/insight on it, it's the only trading strategy, that i feel comfortable with..

Thank you

Warm regards
Raj


Attachments:
File comment: Supertrend Snapshot
Supertrend - 2Hour.png
Supertrend - 2Hour.png [ 83.41 KiB | Viewed 2478 times ]
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 Post subject: Re: Super trend strategy feedback
 Post Posted: Sun Feb 13, 2011 10:16 am 
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Joined: Wed Nov 03, 2010 9:10 pm
Posts: 147
Raj,

In terms of using this strategy to trade intraday I see no reason why it should not work. There is no reason why what you have suggested should not make money long term. The only problem I can see is in a long term sideways movement it could take a while for a decent trend to come along before you get paid off. As I suggest on my strategy page I like to see some other price formation in place before I make the trade. Like double bottom, bouncing off support etc. The problem with these is they are very hard to code into a screener so I always check the chart before placing the trade. I have never gone short with this strategy purely because I have never seen a good short opportunity in the 6 months or so that I have been trading it. Plus the overall market (FTSE 350) has been in an uptrend since then so you would expect to see more buying opportunities.

Using the logic of seeing an additional price pattern using the chart you have provided this would see long positions open at 4,8 & 10. 4 - previous double bottom, 8 - support, 10 - Support

On the short side the only potential one would be 7 but this is a bit subjective. There was quite a lot of resistance around 7 so this would be why it was a potential.

Unfortunately for me because I work full time I have no chance to trade this intraday and to be honest I have no desire to do so. I'm stuck in front of a computer screen for 8 hours a day now (Usually longer) which is exactly what I am trying to get away from.

I suspect what you are trying to do is create an automated trading system which is great. I would love to do it myself. I suspect that using the method you have suggested would generate a profit in the long run as you will be capturing most of the trend, but who can say for sure. The markets do what they like when they like and there would be no reason trading this strategy could also make you bankrupt.

What I have written here should not be deemed as advice or a recommendation of any kind. Just so we're clear please read my disclaimer.


If you do trade this I would be very interested to know how you get on, so please keep us informed.

_________________
May the markets be with you!

Harry,
The Spread betting beginner


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