Friday, March 21, 2008


Dave is asking for the template I posted in my So long note. I will not put that template online, as it was a step back into complexity. A template opening a multitude of options in real time, with no clear path to take at any given time. But I will post the new template I'm trading for the last 2 months.

First the chart: DAX M8-DTB (Thursday, March 20)


And here are the 2 templates used:

  • Template for chart time-frames below 30 minutes
  • Template for chart time-frames higher than 30minutes

With these charts I trade price action patterns on the short time frame in the direction of the longer chart. So if the 30 min chart shows me an uptrend, I look for retracements long on the 2min chart. If the 30min is oscillating flat, I trade the ranges and if the 30min is trending down I trade retracements short. Simple, yet effective and less risky than anything I did in the past. Only thing you need is a lot of patience and no need to make a trade every hour or minute. I usually make my daily goal with 2 to 5 trades and sometimes I get no trade for hours, then have two within minutes which make the Daily goal. That's trading.

Btw: The one thing you might not recognize on the charts are the 50, 100...400 and -50, -100...-400 lines. These lines tell you how many ticks a contract is trading above or below yesterdays close. Just be aware, that these lines are in ticks, not in points. So if DAX is up 100 (as seen above), the DAX futures are up 50 points from yesterdays close. I use ticks instead of points to make charts comparable despite different minimum tick-sizes. These numbers tell you a lot better than any oscillator when a contract is trading in extreme territories and when you might expect a retracement. They work like round numbers, so you look for confirmation before you take the trade.