I will now summarize the [B]4 Starc band trading rules[/B] that we have gone through.
[U]Starc Band Trading Rules[/U]
[B]1)[/B] When trading [B]level[/B]…
Short entries upper 0.45, exits lower 0.45
Long entries lower 0.45, exits upper 0.45.
[B]2) [/B]When trading Starc [B]going up[/B]…
Long entries mid band, exits upper band.
Short entries - nil.
[B]3)[/B] When trading Starc [B]going down[/B]…
Short entries mid band, exits lower band.
Long entries - nil.
[B]4)[/B] [B]Bollinger band approaches[/B]…
Wait until direction of Starc band is clearly seen.
If Starc follows (co-linear with) Bollinger band, then get best entry and do not exit until Starc band breaks away from Bollinger.
If Starc band does not follow Bollinger band, then the above 3 rules are relevant.
These 4 rules set the minimum requirements.
If opportunity allows you to get better entries and exits, so much the better for your trade.
There will be many opportunities when your entries and exits are better than the minimum!!
Well after trying with these new settings it all makes more sense to me, in fact bollinger bands in the 5 minute chart is so useful, now I know why I lose some trades.
So far I hadn’t found how to print screen in mac, but know that I know I�ll try to post my charts, plus I’ll be getting personal feedback of my trades from the master!!
Are we talking about a three red rosellas pattern??. I know it’s still too soon and I have many questions but I know these questions are gonna be solved with time so I’ll be patient. It’s just that I’d like to see the main pattern.
Plus I’d like to know how many retraces do you recommend to trade. I’ve found that more than two can be risky sometimes but maybe that is because I don’t choose really good quality patterns.
It’d also be helpful if we can talk about risk reward ratio in the examples, I’d like to know how you manage it.
Thanks so much. Have a great weekend!!!
P.S. I hope I can see more classmates here! It’d be more interesting and a even more learning experience to us all.
I am a little confused, how does this relate back to the 20-60m charts and the typical patterns? Do we find the pattern on the longer time frames, then play the 4 starc rules on the 5m?
In some of your old examples, you said that sometimes that the wick of the star is too long, hence placing the PCI stop loss 3 pips lower (for long) or higher (for short) isn’t necessary. My questions:
[ol]
[li]How long is too long?
[/li][li]Suppose the wick is too long, any hard rule on where we should place the PCI stop loss (eg. slash the wick in half)?
[/li][/ol]
In your original thread, aside from the evening star pattern, you also covered engulfing pattern in detail, as in you discussed how a quality engulfing pattern should be like, how the lower wick of the right candle should be lower than the lower wick of the left, etc. These are not mentioned in the Japanese candlestick URL you gave. I wonder whether you could also give the same treatment on other patterns. Thanks again.
There is a book called “Japanese Candlestick Charting Techniques” by Steve Nison. That goes into detail about this, definitely worth a read and im sure tymen will agree.
I took a bit of a break from the forum myself (Just working on my trading). Lucky I caught this thread before I missed too much.
Regarding that Candlestick book by Nison; definitely worth it, you could consider it your bible of sticks. I just finished it a couple of weeks ago. Another must read is Trading In the Zone by Mark Douglas.
So I’m definitely looking forward to what you have now.
Basically you can see when a wick is too long - it looks quite abnormal in the chart of candles.
I will have to check a Bollinger band reading - it could be something greater than 3 standard deviations.
It will set your stop loss at an excessively high figure.
I suggest cutting it down by at least 1/3, and very long ones possibly in half.
The best thing I do here is wait until we see such a case then try to set some rigid parameters.
If you see such a case, just alert me to it and I will analyse it.
A quick question for you tymen.
If you are trading a long pattern for example a Morning Doji Star.
The starc bands are heading up and we get our entry at the middle of the starc bands and everything is looking good for a few candles but then the bands turn level and then start heading downwards. Would you close the trade early and wait for the bands to start heading upwards again before getting back in the trade or would you just stay in the trade and hope it reverses itself and not hit the stoploss.
That will depend on the format of the starc bands.[/QUOTE]
I think this also depends on whether on the main chart we are still under 7 candles away from the reversal/continuation pattern. After 7 candles, the pattern’s validity basically expires. I welcome any correction.
There are so many Candlestick patterns but people know only some of them and
Each one of these patterns have some qualities and they are useful as well but you have to know about them first…have a look to this URL… Candlestick Patterns | Top 10 Best Patterns For Traders
