ATR
USDJPY - LONG POSITION, Break above previous structure.EHaving broken structure looking left, there may be cause to expect price to further rise.
Daily Trend - Identified as Bullish
4hr - Previous structure highs broken, printing a doji currently however, end of trading will be affecting over the weekend.
Entering next bar market if no engulfing candle is present, or large jumps.
Stops placed an ATR below the minor level of structure, previous red candle.
Targets currently at lowest Fibonacci level identified. - Try extending Fibs from previous extension, fib inversion, etc. Lots of matching levels.
Risk/Reward currently above a 1:1 however, have to check before possible entry.
Tutorial | How To Calculate "Flush Zones" Using ATRHoly sell-off Batman. Today we finally had some volatility, and a 2-3% down day in the stock indices. This range expansion seems like a perfect day to come back with another lesson on market tendencies and using ATR to calculate flush zones. What's a flush zone you ask? It's where the weak hands get flushed.
For this lesson, I'm using prior session lows as the levels to measure the zone, but you can apply this concept to any significant level. And remember, you can do this with any instrument. Try it in AAPL or BTCUSD or your favorite symbol.
SPY Average True Range, Rising Wedge, Volume and FibsAverage True Range Analysis
Price action on SPY has been getting tighter and tighter as it comes deeper into this rising wedge structure. This is most clearly viewed on the Average True Range. I have taken the standard 14 period look back and times it by 7 to get the weekly look back and we can see clear divergence. A falling true range means that there is a tightening of volatility in the market which suggest a big move is pending. I prefer the ATR to other measures of volatility, such as the bollinger band width because simply, it is easier for me to visualize the ATR and the divergence thereof.
Taking a wider view on just the Average True Range and price action we can see that for the last 5 years when the weekly ATR is declining while price action is increasing we have a very strong move to the upside but then a very quick spill once the rising support is breached. As the chart also shews for the last 3 times each spill was worse than the one before.
Rising Wedge Analysis
Bitcoin and crypto is its own beast, but a quick look shows that rising wedges have been performing violently in a separate part of the broader market. In the first green instance the cloned trend line completely failed to act as support for price action and instead was resistance when price action basically teleported to the bottom of the wedge. On the current blue wedge we see that the cloned trend line has begun to act as some support. I personally think that it has a high chance of becoming a bear flag, but that still remains to be seen.
This diversion to look at bitcoin was to shore up my supposition that we will see some potential action at the cloned trend line of SPYs resistance. We cant tell yet if it will act as resistance or support just yet.
Fib and Volume Analysis
A look at the top chart shows there has been almost no volume participation in this uptrend since $390. That is about a 13% drop from here and if the wedge begins to perform as suspect it may that 13% will be gone rather quickly. Price action above the upper value area often goes away impulsively. From there I would look for retracements that align with fib retracements from the C19 spill and we see a lot of activity between the previous high at 339 down to the 0.618 area at $292.
Quite clearly I can't predict if/when support will give. I have an assumption that the 1.618 to 1.66 level will hold as resistance and we will see a lot of profit taking at that level. Which means SPY could walk sideways out of this rising wedge and have a slow roll over. That would be a minority position of mine. What we do see from the C19 dump is a very technical ABC correction. The ABC correction often sees Wave C go to a 1.618 extention of Wave A or greater. We see from the chart below that price action began to find support the 1.618 level and had a final stab down at the 2 level.
Very likely if this breaks down as I suppose we will see an ABC correction and point B will give people a last chance to get out before price proceeds downwards or will give shorter a technical place to deploy their strategies. Once we see a prospective B wave completing the time to do the fib extension will be upon us. And as I look for that ABC correction hopefully point C will line up with some of the target areas from the main chart, supported by volume nodes.
Not to layer t0o many suppositions on top of one another but I suspect we may see a bear flag/bwave around the potential channel support at the 1.414 level and we can take our ABC wave fib extension from there. The target will of course depend on how much upside that B wave shows.
The chart below shows the NQ1!/SPXUSD. That paring gives us the most price action we can get on the Nasdaq and S&P500 but it comes at the cost of not being able to do any volume analysis. In general NDX does what SPX does, just with more volatility and the chart shews that. So far the pair price action has not been able to get into the previous wedge structure that it was consolidating in. That suggest to me that people are distributing NDX holdings more than they are SPY holdings and we may see NDX go down quicker than SPY From there I would be watching for a potential higher timeframe bull trap. I expound on the NDX/SPY paring in my linked ideas which are a couple months old at this point.
DAX Increase - Upwind or even less volatility ??Hello trader,
The DAX is facing the biggest reform since it was introduced in 1988. In September next year, the German benchmark index is to be expanded from 30 to 40 corporations. In addition, companies will have to meet stricter regulations in the future - also in response to the Wirecard scandal.
On the other hand, after protests from investors and armaments companies, Deutsche Börse decided against the previously discussed banishment of companies that do business in controversial weapons, for example.
The new 10 stocks can be found in the diagram. 8 are already determined, the 10th candidate will be either beiersdorf or Qigen. While the US markets are behaving strongly, the DAX only moves 130 times a day, so I will concentrate on other markets in the near future.
ETF investors can stay relaxed: The changeover takes place automatically, without any active intervention. ETF providers will purchase securities based on the weights. The index will be calculated on the new basis from the reference date. The new companies will make up almost ten percent of the total DAX volume.
The switch is not a disadvantage for investors. A Dax ETF is suitable for optimizing your regional diversification in your portfolio - we recommend, however, a look at broader European indices such as the EuroStoxx 600, or take a look at the US markets, which are behaving very strongly the DAX only scores 130 points per day.
I would like to mention that all I post are just options and my own opinion !
if you like my posts smash the like👍👍 button, comment or follow me.
Thanks for reading my ideas,
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The Nasdaq 100 (NQ1!) ATR Says It's Due For A Fall Everyone can see the Nasdaq 100 is extended. Heck, the index has added nearly 1000 points in only the last few weeks. But despite the price strength, we have a sign/signal that the mighty may be ready for a fall.
The 7-Day Average True Range (ATR) of the Nasdaq 100 Futures Market (NQ1!) hit the lowest level of year, and is down over 60% since May 20. I've linked to a related Video Idea on ATR below.
How we're expressing a short idea:
Keeping it simple. When the NQ1! hit 15670, we bought the QQQ Sep10w 375 Puts for a 1.02 debit. We'll likely spread if the trade moves in our favor this week. Risk is 50% of premium paid regardless of underlying so we stop out around .50
Tutorial | How To Use ATR & Volume Profile To Project Highs/LowsThere are many ways to project price levels when looking at un charted territory (e.g. new highs). Elliot Wave, Gann, fractals, Fibonacci, or a measured move, all are methodologies that can provide levels to watch to predict range expansion when there is no price to reference.
In this lesson, I show how to use another approach, utilizing the 7-Day Average True Range (ATR) and the prior session Point of Control (POC).
Settings
ATR
Period: 7 Day
EMA
P.S. I didn't mention in the video, but check out how well an ATR Projection worked leading into Jackson Hole Friday. 4470 prior day POC to a high the next day at 4510. I went to California schools, so math ain't my strong suit, but I think that's 40 points or 1 ATR.
Futures Levels | Look Ahead For the Week of Aug 15There's nothing much to see in the stock indices as the trends, or lack thereof (RTY1!), have continued. This week I'll be watching the 10Y rate to see if a retest of the recent lows matters at all to the broader market.
When things are slow, it's good to measure just how slow. I like to use the 7-D ATR to gauge volatility and I explain how to do so in this post.
Is Bitcoin in real trouble?Well, some sneered a few weeks ago when I pointed out the 1D trend switch, that created a probability of a 50% correction. It happened. There was a deafening silence thereafter.
As I say too often trend switches create probabilities which predict nothing.
In this chart I'm looking at the 3D time frame where price has moved up to touch the ATR line. This is usually a critical point. It doesn't mean that price is bound to reverse.
If you believe Bitcoin is going to $500,000 this is your opportunity to put your money where your mouth is.
If you believe price is likely to vacillate at this this level and travel further south then you short it - at your own risk of course.
If you are a sensible trader and you want to wait - avoiding FOMO - then do that.
The great thing about trading is that you can do whatever you want!
Disclaimer: This is not advice or encouragement to trade securities or any asset class. This is not investment advice. Chart positions shown are not suggestions intended to assure you of an advantage. No predictions and no guarantees are supplied or implied. The author trades mostly trend following set ups which has a low win rate of approximately 40%. Heavy losses can be expected if trading live accounts or investing in any asset class. Any previous advantageous performance shown in other scenarios, is not indicative of future performance. If you make decisions based on opinion expressed here or on my profile and you lose your money, kindly sue yourself.
How to Stay in a Risk Defined Trade: AMZNNASDAQ:AMZN tanked on earnings down to a Support level I liked for a long trade. I talked about the Support level and drew up the trade during my Livestream last Friday.
This morning's price action breached the Earnings low and I was made aware by an alert. It did not trigger my Stop Loss though. A lot of new traders may try to play bottoms such as this but not have clearly defined risk. This can prove disastrous if price does break the level and continues to move against the trade.
One way that a trader can define their risk is to use a multiple of Average True Range (ATR). ATR is a measure of the average range of a user defined number of bars in history. It is a great tool for assessing the volatility of the instrument being traded as it will be relative and responsive to the specific instrument. An instrument that moves in a tight range for a period of time will have a low ATR and an instrument that moves a lot will have a high ATR. If the instrument experiences a price movement that exceeds the recent ATR it can often signal a significant change.
Using ATR for setting Stop Losses defines the risk at the start of the trade so that the position size can be calculated and standardized. Rules such as this are important for standardizing a strategy and making it consistently profitable.
In the example of Amazon I used a Stop Loss that was set 65% of ATR below the Earnings Low. This allowed price to do a false breakout of the low but left enough space for the trade to remain active.
Rising Wedge on 4 hour with Bearish DivergenceToo my surprise XRP actually broke out of it's descending broadening wedge and reached full measure moves; i certainly flipped bearish on this one too soon the first time. But now that we have reached full targets i would expect that any bearish signal we get up here will carry more weight so i will be getting bearish up here again to see if i can catch another big move.
DJI (4H) - trend switch in sightTrend switches of the ATR on the 1D and 4H usually mean something on most charts. What they mean is a greater probability for price movement under the switch for short positions and above the switch for long positions.
On this chart it does not mean that price cannot rise from under the switch. This is not how ATRs work. ATR's create probabilities. The situation is not predictive. No indicator can predict anything. If that was the case then everybody would just follow indicators and make millions. That's not going to happen.
The snapshot picture is for a trend following setup which can be engaged on a lower time frame e.g. 5 min to 15 min. Note the hefty disclaimer below because trend-following set ups are high risk and very high gain. They are not easy and require significantly large stop-losses.
Price can certainly move significantly north and head for the moon.
Disclaimer: This is not advice or encouragement to trade securities or any asset class. This is not investment advice. Chart positions shown are not suggestions intended to assure you of an advantage. No predictions and no guarantees are supplied or implied. The author trades mostly trend following set ups which has a low win rate of approximately 40%. Heavy losses can be expected if trading live accounts or investing in any asset class. Any previous advantageous performance shown in other scenarios, is not indicative of future performance. If you make decisions based on opinion expressed here or on my profile and you lose your money, kindly sue yourself.
Bullish Bat 30-50% Upside Potential if it plays out.If we can hold the 886 and especially not make a lower low then i expect us to see significant retrace upwards as Crypto continues to remain sideways within it's massive range.
ATR From ScratchHi, traders!
The volatility is one of the most important market indicator that could describe the instrument’s behavior. That’s why it’s deadly impossible to use it to predict the further price movements. But what is volatility? It’s the measure of price changing. The more volatility is, the more you can earn or lose, the price is prone to change. So, dear subscribers today we’ll speak about Average True Range (ATR), one of the most powerful indictors of volatility.
Well, from the very beginning, let’s speak about True Range (TR) and understand how to calculate it. True range is maximum of pairwise absolute difference between high and low, open and close, maximum and minimum.
TR=MAX(|high-low|,|high-close|,|low-close|)
So, it shows us how much the instrument’s price has changed during the one bar. It’s Whereas the Average True Range is Average of TR during some period.
ATR=sum(TRs of period)/length of period
It’s considered to be rather informative, but it’s kinda difficult to make any decisions. For example, is you see on the chart above we have two coins: MAKER and Bitcoin. The definition of ATR of the first is bigger sometimes, but the real volatility (price change) of the second is much higher. Thus, we would advise you to use ATR Normalized, cause you can make it in percentage scale and considering any period you like to make it more representative and smart.
The ATR may be used by market technicians to enter and exit trades, and is a useful tool to add to a trading system. It was created to allow traders to more accurately measure the daily volatility of an asset by using simple calculations. The indicator does not indicate the price direction; rather it is used primarily to measure volatility caused by limit up or down moves. The ATR is fairly simple to calculate and only needs historical price data.
The ATR is commonly used as an exit method that can be applied no matter how the entry decision is made. One popular technique is known as the "chandelier exit". The chandelier exit places a trailing stop under the highest high the stock reached since you entered the trade. The distance between the highest high and the stop level is defined as some multiple times the ATR. 2 For example, we can subtract three times the value of the ATR from the highest high since we entered the trade. Also it can be used as the tool that can help you to choose tokens that suits your strategy.
DISCLAMER: Information is provided only for educational purposes. Do your own study before taking any actions or decisions at the real market.
GBPUSD shorts after price action i am watching gbpusd around 1.39273 to short this pair back into recent lows we have multiple confluences in this zone
1. structure break and retest
2. 0.618 fib confluence
3. atr for today is around this area
if we see clear bearish rejection i will be looking to short this pair
COCA-COLA 1D BEAR FLAGBear Flags are a Range and they are repeatable trading chart patterns.
Bear Flags are ascending chart patterns that will have a directional bias depending on the previous incoming trend.
Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern.
What ever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart).
Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place.
Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement.
When you see descending Volume bars and descending ATR line (which indicates volatility) this shows
a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern.
Trade Management after there is a breakout candle close.
1 - Position size (compare volume bar to volume ma line).
a - Breakout candle must be 100% of volume average for a full position size.
b - If 75% of volume average then ½ position size. (To find 75% of Volume
look at the charts volume settings – divide smaller # into larger # = 75%+)
If not 75% then stand aside from the trade.
2 – If candle breaks out of a trendline, 15m before the close of the day prepare your buy/sell order.
Enter two trades. 1st trade will have a SL & TP. It will close automatically when the 1st TP is hit. 2nd
trade only has a SL and will be allowed to run. When 1st TP is hit move the SL to breakeven. Look
at ATR and prepare SL at 1.5 of ATR. Prepare 1st trade TP at 1 of ATR.
3 - SL for both trades will be 1.5 x ATR.
4 - 1st trade TP will be 1 x ATR.
5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price.
6 - When 1st TP hit – move 2nd trade SL to breakeven.
7 - Adjust the 2nd trade SL to follow price.
*8 – After Breakout candle – if price closes back into chart pattern close trade don't wait for SL to be hit.
*9 - When breakout candle is more than 1 ATR from breakout candle open.
a - Enter 1st trade at candle close with ½ position size.
b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open.
c – Price should pullback to that pending limit order for 2nd trade.
d – If Price returns back into chart pattern close trade before SL is hit.
NZDCHF 1D BULL FLAGBull Flags are a Range and they are repeatable trading chart patterns.
Bull Flags are a descending chart pattern that will have a directional bias (long) depending on the previous incoming trend.
Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern.
What ever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart).
Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place.
Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement.
When you see descending Volume bars and descending ATR line (which indicates volatility) this shows
a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern.
Trade Management after there is a breakout candle close.
1 - Position size (compare volume bar to volume ma line).
a - Breakout candle must be 100% of volume average for a full position size.
b - If 75% of volume average then ½ position size. (To find 75% of Volume
look at the charts volume settings – divide smaller # into larger # = 75%+)
If not 75% then stand aside from the trade.
2 – If candle breaks out of a trendline, 15m before the close of the day prepare your buy/sell order.
Enter two trades. 1st trade will have a SL & TP. It will close automatically when the 1st TP is hit. 2nd
trade only has a SL and will be allowed to run. When 1st TP is hit move the SL to breakeven. Look
at ATR and prepare SL at 1.5 of ATR. Prepare 1st trade TP at 1 of ATR.
3 - SL for both trades will be 1.5 x ATR.
4 - 1st trade TP will be 1 x ATR.
5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price.
6 - When 1st TP hit – move 2nd trade SL to breakeven.
7 - Adjust the 2nd trade SL to follow price.
*8 – After Breakout candle – if price closes back into chart pattern close trade don't wait for SL to be hit.
*9 - When breakout candle is more than 1 ATR from breakout candle open.
a - Enter 1st trade at candle close with ½ position size.
b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open.
c – Price should pullback to that pending limit order for 2nd trade.
d – If Price returns back into chart pattern close trade before SL is hit.
ETSY (DAILY TIME FRAME) GENERAL ANALYSISDespite ETSY reporting earnings that surpassed analysts expectations ETSY shares still slid as management expects the total sale of goods on its platform to slow in the second quarter as it faces tough comparisons to last year’s pandemic-boosted results.
Based on the current price action I'm operating under the assumption that ETSY is in a downtrend. The gap down is a red flag of the weakness on the buy side of ETSY. I would stay away from any immediate rallies up until the price exceeds $192 or closes above the mean. After the price gap down this does look like an opportunity to buy but I would caution against blindly buying the dip as ETSY can shed a lot of dollars should it break its support of $153.50
(Conduct your own due diligence, or consult a licensed financial advisor or broker before making any and all investment decisions. Any investments, trades, speculations, or decisions made on the basis of any information found on this site, expressed or implied herein, are committed at your own risk, financial or otherwise.)
UBER (DAILY TIME FRAME) GENERAL ANALYSISUBER beat its earnings estimates however, it missed on its first quarter revenues. As a result, UBER gapped down after its earnings report and in my view is currently on a downtrend and I would operate under that assumption until it fills that gap. Conservatively speaking I'm looking for a gap filled price that closes with a daily price of about $53.
Based on everything I'm seeing I would look to short UBER when it provides some form of mean reversion at -2ATR or a more favorable -1ATR.
Looking at potential Buy opportunities I would look to the weekly time frame and I would look to start scaling in my position at -2ATR with a price of around $42.50-$41.75.
(Conduct your own due diligence, or consult a licensed financial advisor or broker before making any and all investment decisions. Any investments, trades, speculations, or decisions made on the basis of any information found on this site, expressed or implied herein, are committed at your own risk, financial or otherwise.)
