waldr
15 posts
msg #50594
- Ignore waldr |
3/18/2007 11:34:03 PM
Dear Buddies,
As a newbie, I have been swing trading RSI(2) < 1 for 2 months and I had mediocre results so far. I think it has more to do with the fact that I can't apply the "wait for the green" method becuase I can't day trade due to my busy schedule at work.
Any suggestion how to improve my results? Maybe I need to combined it with increase volume or special candles.
Any suggestion will be appreciated.
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luc1grunt
622 posts
msg #50596
- Ignore luc1grunt |
3/19/2007 7:30:48 AM
Obviously if the stock is an uptrend and hitting a low RSI, the odds are more favorable. Bouncing off the lower bollinger band, hitting the lower trendline, a doji on the day for the close, no "bad news" looming etc,.
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waldr
15 posts
msg #50602
- Ignore waldr |
3/19/2007 11:09:47 PM
Thx luc1grunt
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corsino
259 posts
msg #50603
- Ignore corsino |
3/20/2007 12:01:58 AM
It may not be the filter or you, just market conditions.
I suspect that many filters for swing trading haven't been doing too well lately.I backtested the dozen filters I regularly backtest (I only use a couple), for the last 1-month period and only one had a good W/L ratio. The one that backtested well was one based on low pe stocks.
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TheRumpledOne
6,407 posts
msg #50604
- Ignore TheRumpledOne |
3/20/2007 1:34:49 AM
You can apply the WAIT FOR GREEN by using a BUY STOP LIMIT order.
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waldr
15 posts
msg #50608
- Ignore waldr |
3/20/2007 11:22:25 AM
TRO I try using buy stop but often the trade goes through and then the price drops.
I do have to say that I try to trade stocks between price 0.50 and 1.5. It often happend with stocks below 1.
Maybe I shouldn't apply RSI (2) on stocks below 1?
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maxreturn
745 posts
msg #50609
- Ignore maxreturn |
3/20/2007 1:49:27 PM
waldr, like Lucgrunt said...to be successful using RSI2 you should have other technical confirmations to take the trade, especially if your time horizon is longer than intraday.
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waldr
15 posts
msg #50612
- Ignore waldr |
3/20/2007 2:20:53 PM
maxreturn, I appreciate your input also.
That's really my struggle. So far I use increasing volume as the only indicator.
I will start using doji's and hammer candles also. Maybe I am not using the "buy stops" properly. I usually place them near half of the previous day candle.
The backtest using RSI (2) < 1 for stock price between 0.5 and 2, should I have my US$2000 around US$7000,- by now. So basically if I follow the formula blindly, I should not have lost. (in theory)
Any additional suggestions is appreciated.
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corsino
259 posts
msg #50616
- Ignore corsino |
3/21/2007 12:07:43 AM
waldr
You are correct in that, according to your RS(2)below 1 filter, the two-month results should have been good.For stocks in the 0.5 t0 2 price range,the filter shows a W/L ratio of 67/31. That's considerable better than the 45/54 ratio for stocks between 1 and 10.So maybe your entry system needs improving.Increasing volume by itself can be good or bad, depending on what the price of the stock is doing. For swing trading of three to five day periods, I like to wait for one or two higher lows and buy on the second or third day after it opens up. The point is that for swing trading, I feel you need a little more confirmation of a reversal than for day trading. You may be surprised how low rsi(2) can go !
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waldr
15 posts
msg #50618
- Ignore waldr |
3/21/2007 12:40:29 AM
Got it corsino.Indeed I notice if I can't find a way to waiting for greens I will continue to lose badly.
Thx for the support.
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