freely203
19 posts
msg #38783
- Ignore freely203 |
11/9/2005 6:22:59 AM
Hi Everyone.
I am new here. Can someone kindly advise me how to find this -
The NR4/IB set up is a combination of a narrow range bar that is the smallest of the last
four days while at the same time is an inside bar against the previous days bar.
NR4) Narrow Range 4 Bar: (above) A NR4 is a bar with the smallest range of the
previous four bars to include the current bar.
IB) Inside Bar: (above) An inside bar is a bar where as the high is equal to or lower
than the prior days high and the low is equal to or higher than the prior days low. It’s
important to note here that only the high OR the low can be equal to the prior days high
or low – not both. It’s crucial that either the high or low be inside of the prior days range.
NR4/IB) Narrow Range 4 Inside Bar: (above) To have an Inside Bar Narrow Range 4,
the current bar has to be a combination of both a NR4 and Inside Bar as describe above.
Thx very much
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freely203
19 posts
msg #38785
- Ignore freely203 |
11/9/2005 6:36:30 AM
Hi
Anyone has any strategies using this NR4/IB or NR4?
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alf44
2,025 posts
msg #38787
- Ignore alf44 |
11/9/2005 11:02:17 AM
freely203,
This scan filter will get you more NR4/Inside Days than you can shake a stick at:
------------------
--------------------
These NR4s, NR7s, Inside Days etc...show areas of Range Contraction. They are often watched by short-term traders and played as what is referred to as Volatility Breakouts. The expectatation is that Range Expansion (ie. Wide Range Days) will follow Range Contraction.
An entry method could be a simple breakout above/below the previous High/Low. Another could be a breakout above/below the current Open...plus or minus some percentage of the previous days range. The idea is to look for Range Expansion to follow these Contraction areas.
Regards,
alf44
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freely203
19 posts
msg #38788
- Ignore freely203 |
11/9/2005 11:45:52 AM
Thx alf44
Btw, What do you think of trading using this method?
Is there a possiblilty of backtesting it?
Thx.
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alf44
2,025 posts
msg #38791
- Ignore alf44 |
11/9/2005 3:40:12 PM
Another great Key Reversal Day example...
...pull-up a 3 Month Daily chart of JPM !
Take a look at the Oct. 13 '05 candle !
JPM made a new 60 day Low on Oct. 13 (this was also a new 52 week Low)...it successfully tested and held Support from the Low made back in April of this year !
The OPEN was very nearly the Low of the day...the CLOSE was very nearly the HIGH of the day !
It was an Outside Day !
Text book example of a Key Reversal Day !
JPM has practically been parabolic since Oct. 13...up about 14% in 20 days !
Not bad for a stodgy ole DOW 30 stock huh ?
BTW, my filter (posted above) nailed this move to the day...as well as the WMT (Sept. 22 Key Reversal Day) example I pointed out in a previous post ! fwiw
Regards,
alf44
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alf44
2,025 posts
msg #38793
- Ignore alf44 |
11/9/2005 3:46:41 PM
yikes !!!
Sorry bout that...wrong message window !
I meant to post that over on the "Key Reversal Day" thread...jeeez !
My bad !!!
alf44
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alf44
2,025 posts
msg #38808
- Ignore alf44 |
11/10/2005 12:10:54 AM
freely,
Sorry for the delay in responding !
I DO like these "Volatility Breakout" plays !
You have to understand the timeframe though !
They are very short-term !
Typically, you're looking at 1 to 3 day trades ! Possibly even "Day Trades" !
You have to be very agile !
You have to have very clear entry/exit criteria...but, that should always be the case whatever the timeframe. I'm just saying that this type of trading might require a different mindset!
Obviously, strict Money Managment/Trade Management shold be exercised !
As for "backtesting" these signals...you need a clear exit strategy. That can be problematic with the current SF backtest feature. At least, that's the way I understand it. I WILL say though...there are many here that are MUCH more familiar with the SF Backtest feature than I am. Perhaps, they will offer more input !
Good Luck !
Regards,
alf44
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freely203
19 posts
msg #38813
- Ignore freely203 |
11/10/2005 8:08:18 AM
Hi
Thank for your reply.
Today i felt extremely mentally & physically tired! looks @ my account down 50%
Coz for the past 3 mths i have been :( on my Options positions.
Well Perseverance and Passion still in place!
But i m happy 2 find so many pple passionate here!
I will do my best to learn from your guys here.
The above Concept of NR4/IB is from a ebook called "RapidFireSwing Trading"
I have almost purchase many than 15 ebooks on strategies but did not manage to applied them.
BTW, My MSN messenger is workfreely007 at hotmail.com
Hope someone will look for me in MSN.
Thank you
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