Quote:
Originally Posted by dpaterso
It would seem to me that using kaalilaatikko's now 'fixed' and 'smoothed' ADX/ADXR the only SURE FIRE WAY of KNOWING WITHOUT A DOUBT that an instrument or pair is trading in a range for the RTS is WHEN ADX IS BELOW BOTH +DI AND -DI (AND < 20) as per 'the old man'!!! Take a look see!!!
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Doing work as told. Here is a quick walkthrough about all those pairs that have their ADX < 20 in my latest CSI rank. Disclaimer: I won't take any responsibility if anybody opens any position based on these comments. But I would highly appreciate any view on these, with or without the smoothed ADX indicator. The order numbering is from my CSI file. I don't consider here whether it would be a B, O or S day for RTS, let's leave it for the readers.
3. GBP/JPY ADX = 16.69
ADX is below DIs and going down, AC red and very close to 0, LRC is quite steep but the price has been quite close to the middle line.
6. GBP/USD ADX = 19.34
ADX above DIs, which may cross soon. ADX going down. Deep bear today. I would like to see the bounce before trading this with RTS.
7. USD/JPY ADX = 14.29
Much like GBP/JPY. AC red but a bit higher above 0.
8. AUD/USD ADX = 16.77
ADX is below DIs but almost touching. AC descending and red. Has gone below B1 today. Start of a trend, last 10 days look like that? Needs a bounce before entering RTS?
9. EUR/USD ADX = 15.19
Much like AUD/USD. LBOP broken today.
11. GBP/CAD ADX = 17.86
ADX is breaking above +DI, already above -DI. LRC very steep. AC green and ascending, but today has been bearish. Difficult to categorise?
12. GBP/CHF ADX = 17.85
ADX is between the DIs and rising, DI gap is widening. Has given a VS signal for me a couple of days ago to go long, but the price is now a bit below that. I'm considering entering VS here.
13. USD/CHF ADX = 13.00
ADX is below DIs but almost touching -DI. DI gap widening. LRC quite steep, recent 10 days look like start of a trend. HBOP broken today. Needs a bounce before entering RTS?
18. AUD/JPY ADX = 12.10
ADX below DIs and all of them going quite horizontal. LRC very gentle. AC has been long quite close to 0. The next reversal would be in the direction of a longer trend that has prevailed a while ago. This one I would rank as a good candidate for RTS!
19. EUR/CAD ADX = 16.00
ADX is between the DIs. LCR very gentle and AC close to 0. Do I dare to say that there is some resistance visible both above and below the current price? Despite of ADX I might see some potential for RTS here.
The rest of the pairs are below 20 in by rank. Selected pickings:
22. CAD/JPY ADX = 9.95
Big gap between ADX and the DIs. LRC very gentle and AC long close to 0. Good for RTS.
28. CAD/CHF ADX = 11.35
ADX below the DIs. AC close to 0, LCR rather gentle. At least upper resistance might be identified. Rather good for RTS.
30. AUD/CAD ADX = 14.04
Much like EUR/CAD.
34. EUR/AUD ADX = 11.57
Much like EUR/CAD. AC a bit more active.
My conclusion: For me it seems that if all or at least most of the following hold, then the pair is quite ranging and RTS should be a good bet:
- ADX is < 20 and below the DIs, the more the better. All of these should be quite horizontal.
- AC is and has been close to 0 recently.
- LRC is rather or very gentle. Signs of upper and lower resistance.
This was a more educating excercise for myself than I had hoped!
I have asked Dale to add the smoothed ADX indicator in his collection, so I hope his Delta clients will receive it in some point of time.
J.