Teresa Lo worked at the brokerage business in the stock market for over ten years until his departure in 1998 to become a private investor. It is a technical trader and uses the model of «Edwards and Megi» Japanese candles, and the technique for the analysis of the market.
During the trading day you can hear references to terms like «buying bowls Grail» and «selling bowls Grail». As the community of traders has evolved, «buying bowls Grail» was called «depression», meaning the place where purchases can be made. «Sale bowls Grail» was called «belfry», meaning the place where the sale can be effected. This refers to the technique «The Holy Grail chalice», one of many useful methods for trade to any time scale from Linda Bradford Raška, as described in the book «Quick trade on Wall Street».
The basic concept is not something new. They are widely used by those selling on the trend of using moving averages. The key approach is to buy back when the current upward trend or sale ascending descending with the current trend and try to avoid trading in the side bands. Linda uses the index of average thrust Vellesa Vayldera (14-periodny ADX), to determine the effect of trend, and then it uses the exponential Moving Average 20 periods (20EMA), to determine support and entry points. When the ADX rises and its value becomes more than 30, it uses some criteria in order to buy when the price recovered back to 20-periodnoy EMA. This concept works well for the entry points during the ascending trend, and during the descending trend.
purchase of a rollback in the current upward trend or sale ascending descending with the current trend
During periods when the market develops a strong trend ADX with a value equal to 30 and more, to restore 20-periodnoy exponential moving average (EMA) is supported with the rising trend and descending trend in the resistance.
The principle underlying the installations «The Holy Grail chalice» is used in their rehabilitation, to enter in the direction of emerging or existing trend. «Restore» - this word is used to determine the setbacks in the current trend. These models, called flags and pennants were identified very early on by some authors, like Richard Shabakera in his book «Technical analysis and stock market gains». Later, Robert Edwards, together with John Megi, to popularize them in his book «The technical analysis of stock trends». A key principle of flags and pennants is that they are areas of consolidation and, therefore, should be formed on falling volume.
Engineering Linda Raška combines the use of classical image model with indicator ADX and Moving averages. In our experience with the technique of «Holy Holy Grail», established the requirement that the value of ADX was more than 30 is not critical, when the index reached the bottom and rises. We optimized the technique login using the method of calculating the bars Dannigana.
First of all, we believe that the trend index of ADX, but not its absolute value, is the most important. Some analysts also share this opinion. While the ADX index rises, we will seek recovery for the 20-EMA periodnoy to determine the point to enter the market. Secondly, we noticed that the ADX index typically has a value greater than 50, when the trend is nearing its culmination, and becomes vulnerable to a sharp turn, and we usually prefer to stand aside in these circumstances. Third, we draw attention to the flags in the falling volume.
Example 1
In this example, using a daily schedule «Lucent Technologies», from the peak on April 7 began to consolidate. Please note that the ADX and began to decline as the price of the triangle formed. 12 May, the market tried to break up the line downward trend (gray line on the volume). This was greeted the next day sales and the formation of a turn key day, when the price was higher than during the day, but closed below the closing on May 12. Players included in the market at the break, were estimated, because the price fell back to the border triangle, and the downward trend line has been adjusted to a new position (blue line). June 4, the market once again tried to beat the downward trend line on the volume, but the next day it was again greeted by sales. Please note that ADX went sideways, not down, since the lack of downward movement, combined with the upward movement of bars, began to affect the calculation of the indicator ADX.
«Lucent Technologies» revert back to the moving average, making only «descending» and «internal» bars until June 15, when the price was in a very narrow trading range, from 4 June. Please note that volume declined in the back, forming a nice bull flag. Since testing support at the 20-day EMA take place for the market of the moment of truth. June 16 «Lucent Technologies» broken line downward trend in the amount of bovine flag. ADX has moved up, as was the upward trend to grow only three days of decline, namely, June 22, July 7 and July 13.
Buyers in the bull flag had two options. Aggressive option was to stand on the purchase orders above the maximum of each «Downstream of the day» (lower minimum and lower maximum, as compared to the previous day) with the deployment of the initial stop-order and immediately below the minimum of the day when the warrant was executed. The conservative option was to stand on the purchase orders above the maximum of the first day raise, namely, on 16 June. Once a warrant for the purchase was executed, an initial stop-order will be placed immediately below the minimum of 16 June. Traders could then follow the market, through placement of a stop-order method for calculating the bars Dannigana.
Example 2
Here is a intra-day schedule is very liquid market instruments - futures contracts S & P. The morning of July 19, the September futures S & P made a «2B top trader Vika» and the market immediately fell right through the 20-EMA periodnuyu up to 1421 before recover it back. By the time he reached the 20-EMA on the five-periodnoy schedules, vendors, selling as a five-time scale, and at 15-minute scale, were in the vicinity of 1425, ready for sale. This is consistent with the installation of the first sale «The Holy Grail chalice». Aggressive traders can enter into the market by placing an order for sale under the bar dating back to the opening short positions. The second installation «The Holy Grail chalice» was exactly the same as the first. The third and fourth guidelines are more complex. Our position in the third case would be closed to close the stop-order and the fourth case, the position of not even be opened, as had the opportunity to turn the trend from the «1-2-3-testing trader Vika». Please note that each time the market fell back to test at least to push Bear Flag, where the goal was achieved. Any additional traffic brought additional profits.
Example 3
In this example, S & P closed at its minimum of the previous day. In trading on Globex, the maximum was 1296.60 with a minimum at 1283.60. Because many traders consider these points as an important support and resistance levels, we note them as a «reference» point, along with the minimum of the previous day at 1283. Clearly, the S & P was in a descending trend, but it opens with GEPom up and made three 5-minute «upstream» candles (higher maximum and higher minimum on the previous bar). We started the day by holding a horizontal line in 1283, with the potential installation «1-2-3 trader Vika».
When the movement reached the top of the resistance (up to 1296.60 and the 20-periodnaya Exponential Moving Average at 1297.44) and was not able to go higher, there were sellers. When at least a third of «upstream» candles at 1293.50, which is the white «shooting star» (the arrow) was broken, it was a signal to stand in a short position in anticipation of testing at least 1283. Sales, according to «Holy Grail chalice», was performed.
Trade was carried out in a short side immediately after the bridge marks 1293.50 deployment of the initial stop-order at 1295.80 - the morning peak in anticipation of testing at least 1283. The risk in this case amounted to 2.3 point to the expected return of 10 points in the testing grounds - the ratio of better than 4:1. Using conservative sliding stop orders that are placed on top of each «descending» candles (lower maximum and minimum on the previous bar), we would have closed the position at the test level, where price is no longer went down. Subsequently, S & P made a «2B» authority (which, perhaps, could be used in the same manner as shown above, but in the opposite direction) and the market rose to a peak of the day, outside the magnetic effect of the warrants to purchase imposed by mechanical systems that are bought breakthroughs in the first hour.
During the trading day you can hear references to terms like «buying bowls Grail» and «selling bowls Grail». As the community of traders has evolved, «buying bowls Grail» was called «depression», meaning the place where purchases can be made. «Sale bowls Grail» was called «belfry», meaning the place where the sale can be effected. This refers to the technique «The Holy Grail chalice», one of many useful methods for trade to any time scale from Linda Bradford Raška, as described in the book «Quick trade on Wall Street».
The basic concept is not something new. They are widely used by those selling on the trend of using moving averages. The key approach is to buy back when the current upward trend or sale ascending descending with the current trend and try to avoid trading in the side bands. Linda uses the index of average thrust Vellesa Vayldera (14-periodny ADX), to determine the effect of trend, and then it uses the exponential Moving Average 20 periods (20EMA), to determine support and entry points. When the ADX rises and its value becomes more than 30, it uses some criteria in order to buy when the price recovered back to 20-periodnoy EMA. This concept works well for the entry points during the ascending trend, and during the descending trend.
purchase of a rollback in the current upward trend or sale ascending descending with the current trend
During periods when the market develops a strong trend ADX with a value equal to 30 and more, to restore 20-periodnoy exponential moving average (EMA) is supported with the rising trend and descending trend in the resistance.The principle underlying the installations «The Holy Grail chalice» is used in their rehabilitation, to enter in the direction of emerging or existing trend. «Restore» - this word is used to determine the setbacks in the current trend. These models, called flags and pennants were identified very early on by some authors, like Richard Shabakera in his book «Technical analysis and stock market gains». Later, Robert Edwards, together with John Megi, to popularize them in his book «The technical analysis of stock trends». A key principle of flags and pennants is that they are areas of consolidation and, therefore, should be formed on falling volume.
Engineering Linda Raška combines the use of classical image model with indicator ADX and Moving averages. In our experience with the technique of «Holy Holy Grail», established the requirement that the value of ADX was more than 30 is not critical, when the index reached the bottom and rises. We optimized the technique login using the method of calculating the bars Dannigana.
First of all, we believe that the trend index of ADX, but not its absolute value, is the most important. Some analysts also share this opinion. While the ADX index rises, we will seek recovery for the 20-EMA periodnoy to determine the point to enter the market. Secondly, we noticed that the ADX index typically has a value greater than 50, when the trend is nearing its culmination, and becomes vulnerable to a sharp turn, and we usually prefer to stand aside in these circumstances. Third, we draw attention to the flags in the falling volume.
Example 1
In this example, using a daily schedule «Lucent Technologies», from the peak on April 7 began to consolidate. Please note that the ADX and began to decline as the price of the triangle formed. 12 May, the market tried to break up the line downward trend (gray line on the volume). This was greeted the next day sales and the formation of a turn key day, when the price was higher than during the day, but closed below the closing on May 12. Players included in the market at the break, were estimated, because the price fell back to the border triangle, and the downward trend line has been adjusted to a new position (blue line). June 4, the market once again tried to beat the downward trend line on the volume, but the next day it was again greeted by sales. Please note that ADX went sideways, not down, since the lack of downward movement, combined with the upward movement of bars, began to affect the calculation of the indicator ADX.
«Lucent Technologies» revert back to the moving average, making only «descending» and «internal» bars until June 15, when the price was in a very narrow trading range, from 4 June. Please note that volume declined in the back, forming a nice bull flag. Since testing support at the 20-day EMA take place for the market of the moment of truth. June 16 «Lucent Technologies» broken line downward trend in the amount of bovine flag. ADX has moved up, as was the upward trend to grow only three days of decline, namely, June 22, July 7 and July 13.
Buyers in the bull flag had two options. Aggressive option was to stand on the purchase orders above the maximum of each «Downstream of the day» (lower minimum and lower maximum, as compared to the previous day) with the deployment of the initial stop-order and immediately below the minimum of the day when the warrant was executed. The conservative option was to stand on the purchase orders above the maximum of the first day raise, namely, on 16 June. Once a warrant for the purchase was executed, an initial stop-order will be placed immediately below the minimum of 16 June. Traders could then follow the market, through placement of a stop-order method for calculating the bars Dannigana.
Example 2Here is a intra-day schedule is very liquid market instruments - futures contracts S & P. The morning of July 19, the September futures S & P made a «2B top trader Vika» and the market immediately fell right through the 20-EMA periodnuyu up to 1421 before recover it back. By the time he reached the 20-EMA on the five-periodnoy schedules, vendors, selling as a five-time scale, and at 15-minute scale, were in the vicinity of 1425, ready for sale. This is consistent with the installation of the first sale «The Holy Grail chalice». Aggressive traders can enter into the market by placing an order for sale under the bar dating back to the opening short positions. The second installation «The Holy Grail chalice» was exactly the same as the first. The third and fourth guidelines are more complex. Our position in the third case would be closed to close the stop-order and the fourth case, the position of not even be opened, as had the opportunity to turn the trend from the «1-2-3-testing trader Vika». Please note that each time the market fell back to test at least to push Bear Flag, where the goal was achieved. Any additional traffic brought additional profits.
Example 3In this example, S & P closed at its minimum of the previous day. In trading on Globex, the maximum was 1296.60 with a minimum at 1283.60. Because many traders consider these points as an important support and resistance levels, we note them as a «reference» point, along with the minimum of the previous day at 1283. Clearly, the S & P was in a descending trend, but it opens with GEPom up and made three 5-minute «upstream» candles (higher maximum and higher minimum on the previous bar). We started the day by holding a horizontal line in 1283, with the potential installation «1-2-3 trader Vika».
When the movement reached the top of the resistance (up to 1296.60 and the 20-periodnaya Exponential Moving Average at 1297.44) and was not able to go higher, there were sellers. When at least a third of «upstream» candles at 1293.50, which is the white «shooting star» (the arrow) was broken, it was a signal to stand in a short position in anticipation of testing at least 1283. Sales, according to «Holy Grail chalice», was performed.
Trade was carried out in a short side immediately after the bridge marks 1293.50 deployment of the initial stop-order at 1295.80 - the morning peak in anticipation of testing at least 1283. The risk in this case amounted to 2.3 point to the expected return of 10 points in the testing grounds - the ratio of better than 4:1. Using conservative sliding stop orders that are placed on top of each «descending» candles (lower maximum and minimum on the previous bar), we would have closed the position at the test level, where price is no longer went down. Subsequently, S & P made a «2B» authority (which, perhaps, could be used in the same manner as shown above, but in the opposite direction) and the market rose to a peak of the day, outside the magnetic effect of the warrants to purchase imposed by mechanical systems that are bought breakthroughs in the first hour.
Teresa Lo
www.hardrightedge.com
www.hardrightedge.com
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