This is an interesting case of when an analysis using together such indicators:
- Price Zone Indicator (or Volume Zone Oscillator, not appliable in this case on FTSEMIB since volume data are not avaible) * in the graph below consider the trading rule in a non trending system (as represented in the concerning article), since ADX < 18
- Put_a_stop_to_it indicator
The case:
at the end of October market trend reverses from uptrend to downtrend. The last previous maximum is at about 17.000 points.
During the change of trend, market falls: in 2 day it losts more than 2.100 points (> 10%).
So indicators "Put-a-stop-to-it" give (in the second day after the change of the trend) the result of 14.079 as final target. Too distant
Never reached
First, a throwback for compensing the high selling period. Then a sort of "re-equilibrium" of the market.
This means, that considering the final target (14.079), was sensibly too far from the last peak (17.000) and, in use with other indicator, entering short at 14.800 would be a severe mistake.
This has been also signalled by the movement of the PZO: from below to up to levels of 0 and 15.
The second target of 14.778 - 15.167 is much more reasonable and exploitable for a profitable trading.
Just use PZO or VZO (or other indicator) to isolate too distant final levels (according to "Put-a-stop-to-it" article) in your trading system.
Any source
- Price Zone Indicator (or Volume Zone Oscillator, not appliable in this case on FTSEMIB since volume data are not avaible) * in the graph below consider the trading rule in a non trending system (as represented in the concerning article), since ADX < 18
- Put_a_stop_to_it indicator
The case:
at the end of October market trend reverses from uptrend to downtrend. The last previous maximum is at about 17.000 points.
During the change of trend, market falls: in 2 day it losts more than 2.100 points (> 10%).
So indicators "Put-a-stop-to-it" give (in the second day after the change of the trend) the result of 14.079 as final target. Too distant
Never reached
First, a throwback for compensing the high selling period. Then a sort of "re-equilibrium" of the market.
This means, that considering the final target (14.079), was sensibly too far from the last peak (17.000) and, in use with other indicator, entering short at 14.800 would be a severe mistake.
This has been also signalled by the movement of the PZO: from below to up to levels of 0 and 15.
The second target of 14.778 - 15.167 is much more reasonable and exploitable for a profitable trading.
Just use PZO or VZO (or other indicator) to isolate too distant final levels (according to "Put-a-stop-to-it" article) in your trading system.
No comments:
Post a Comment