How did you find the threshold values and where did this idea come from? Hours of deep diving? Great insight! I always enjoy to read how others think about the market and which strategy or idea works for them. :)
Yes, very much hoping to spark some ideas, not for people to copy me! The idea about ATRx came from Jeff Sun and Ariel Hernandez. A few other traders I chat with also reference it, plus it makes sense for my strategy. You might describe it as the natural extension to the journey I shared in the "DON'T Buy the Breakout?" stack from earlier this year.
As to exact values, I realised that the different traders I've seen using this indicator use different values as their thresholds, which made me realise that it's personality- and strategy-dependent. Then there's also discretion based on market awareness. I played around with the values a bit, and then yes, studied charts of the kinds of liquid leaders I like to trade. Which values made most sense to me, and what am I comfortable with?
I can see me tweaking the thresholds as I gain more experience and my account grows, but these numbers (with a bit of discretion) have been working well for me.
Use alerts on a breakout price just above for continuation, and generally think on a breakout, lottsa profit takers....buy the pullback if you have conviction..
What's great is once a comment is written, it can flow into other articles, and a refresher,......and you've written great articles....I find the discussions equal to any trading video.....keep going it's becoming a must read..
I love this, the bars are a little bit too much for me but love the idea of having the extension in the toolbar. The only problem I am having is actually saving the formula as a PCF and then getting it added. Its great how we can use AI to work on TC2000, I used it to help me to add a cloud area around the 20 day EMA to stop me thinking in absolutes when it comes to MA's.
I get that the conditional formatting isn't for everyone! I like it; I like that the bias these coloured bars are giving me (vs the bias you might get from candles) is more justified.
Great use case of AI for you! Thank you for sharing.
Thank you for taking the time to do that. I had missed the save button on Edit PCF and it was instead trying to add it to a chart when I clicked OK instead. Thank you for stopping me thinking I was going mad.
Thanks for volunteering some of your process information. Much will help doing deep dive on the price action in correlation of the MA's,.....or draw trend and when price is stretched from that, take something off the table for a return to trend. Important to read price action. Boun Apetito
I hope you don't mind, I found this article really helpful so knocked up a trading view version, This is the link to the published indicator, its open source etc.
Thanks for the comments, I’m hoping I’ve understood correctly it has red and green borders around the candles so you can make sense of which way round the open and close is. I’ve been switching the indicator between visible and non visible on the chart and like the way it gives quick feedback. Thanks for the offer on retweet I’m off the platform not sure if that’s a good or bad thing ! Cheers keep up the great content 👌
So you did (re candle colours), my bad. I do find that harder to spot than to just use OHLC bars though! But whatever works for you :) And I'm glad that you're finding value in the indicator.
X is a bit of a mixed bag. Lots of noise, but it's also an excellence source of good ideas for both my trading and writing. I like taking a break from it every now and then though.
Glad you found it helpful! Interesting idea to bring it back into TradingView, which is kinda where it started anyway :)
One thing: the example chart is using candles rather than OHLC bars, which makes it ambiguous which is the opening and which is the closing price if you then don't use a 2-tone colouring system.
If you wanted to share it to a bigger audience, please feel free to tweet about it and tag me. I'll be happy to retweet.
Thanks, Jaimin! I think the key is to focus on value more than length.
The AI idea really came from Daniel. Didn't just use it for this ATRx indicator idea from Jeff, but also a few other things, including a pullback scanner. Work in progress.
Good to think about how AI can help with execution, I think, but not planning to outsource the thinking to a robot!
That's true! AI can be used for faster execution once we have a roadmap of what we want to accomplish. I was feeling hesitant to use it and felt like cheating but now that it is already out there, might as well use it to make our work more efficient and faster.
I suspect that as AI use proliferates, the ability to come up with strong ideas (for AI to execute, at least in part) becomes more valuable. Makes it more important than ever to keep exercising our thinking muscles.
Yes. And I think there is a fine line between using AI for execution and relying on it to do the actual work which will limit our own thinking. What are your thoughts on that?
Is the activity a needle mover for you? Does it reflect a key skill; something you need to put in the reps for as part of your deliberate practice?
Setting up my charts is not (for me). Flipping through charts manually is.
In terms of writing examples, any intellectually challenging writing projects must be done by me, such as TTRH stacks. But tweets that promote stacks don't offer me that intellectual exercise, so perhaps I'll hand those off to AI one day, if I want to go hard on the marketing. Growing TTRH has become way less of a priority for me though; I think the size of the community is good right now. So, not something I'll do for now, but want to remain open-minded about the option.
Nice idea absolutely, but why do you consider selling the whole position if ATR is 10x or more ? I think we need to look at the bigger picture sometimes and give the stock a little room to breathe. I analyzed thousands of winners in the last decades, and came to conclusion that big majority of them respected the 20 day EMAs for a long time and bounced back often. When they reach the 50 day it often signals they need a little more time to consolidate but not that they will roll over immediately. Anyway what I found best works for me is that I sell 50% on a close under 10 day EMA and another 50% on a close under 20 day EMA. If the stock goes not more than a few % under 20 day and bounces back again over it, I‘ll often get again in with 50% position. If it respects 20 day and goes again through the 10 day on a good volume I‘ll add again to full position with stop losses on 10 and 20 day EMAs. With such strategy I nailed over 400% on $APP and 300% $PLTR last year. Sometimes we need to give them a break. Such strategy saved me from losing a significant amount on $SEZL a week ago. Burst through the 10 EMA, but bonced from 20 day like from concrete and reached new highs like 2 days later.
It depends on recent performance. If I've had a few recent stop-outs and I see things failing on my WL, I go into capital protection mode. That stock may well just retrace to a key MA, and if it finds support there I'm happy to rebuy. (And have done this several times.) But I must protect my capital first, mental and financial, and want to keep the EC as smooth as possible.
Selling *all* into strength is not my default if the overall market is good. Perhaps I shouldn't have even mentioned that possibility in the stack, as it's a matter of discretion and, again, not the default.
How did you find the threshold values and where did this idea come from? Hours of deep diving? Great insight! I always enjoy to read how others think about the market and which strategy or idea works for them. :)
Yes, very much hoping to spark some ideas, not for people to copy me! The idea about ATRx came from Jeff Sun and Ariel Hernandez. A few other traders I chat with also reference it, plus it makes sense for my strategy. You might describe it as the natural extension to the journey I shared in the "DON'T Buy the Breakout?" stack from earlier this year.
As to exact values, I realised that the different traders I've seen using this indicator use different values as their thresholds, which made me realise that it's personality- and strategy-dependent. Then there's also discretion based on market awareness. I played around with the values a bit, and then yes, studied charts of the kinds of liquid leaders I like to trade. Which values made most sense to me, and what am I comfortable with?
I can see me tweaking the thresholds as I gain more experience and my account grows, but these numbers (with a bit of discretion) have been working well for me.
Does that help?
Use alerts on a breakout price just above for continuation, and generally think on a breakout, lottsa profit takers....buy the pullback if you have conviction..
Yeah, choppy action around classic breakout areas: https://tradingresourcehub.substack.com/p/dont-buy-the-breakout-trader-journey.
The better entry tends to be within the base, but stock selection is *vital*.
What's great is once a comment is written, it can flow into other articles, and a refresher,......and you've written great articles....I find the discussions equal to any trading video.....keep going it's becoming a must read..
🙏
Wonderful, thank you very much. Great thought process. :)
I love this, the bars are a little bit too much for me but love the idea of having the extension in the toolbar. The only problem I am having is actually saving the formula as a PCF and then getting it added. Its great how we can use AI to work on TC2000, I used it to help me to add a cloud area around the 20 day EMA to stop me thinking in absolutes when it comes to MA's.
Thank you for all your work.
I get that the conditional formatting isn't for everyone! I like it; I like that the bias these coloured bars are giving me (vs the bias you might get from candles) is more justified.
Great use case of AI for you! Thank you for sharing.
Re how to add the formula to your toolbar, I've just posted this step by step: https://x.com/KayKlingson/status/1936472698038767742.
Thank you for taking the time to do that. I had missed the save button on Edit PCF and it was instead trying to add it to a chart when I clicked OK instead. Thank you for stopping me thinking I was going mad.
Glad it helped!
Steve's posts and his ATR matrix spreadsheet have been very useful:
https://x.com/SteveDJacobs/status/1935967577873784938
Thank you for sharing! Will check this out :)
Thanks for volunteering some of your process information. Much will help doing deep dive on the price action in correlation of the MA's,.....or draw trend and when price is stretched from that, take something off the table for a return to trend. Important to read price action. Boun Apetito
Yes, do your own studies. What works well for your personality and strategy?
Glad you found the article helpful!
I hope you don't mind, I found this article really helpful so knocked up a trading view version, This is the link to the published indicator, its open source etc.
https://www.tradingview.com/script/o2WQV9aw-ATRx-Extension-Helper-Distance-from-50-DMA-in-ATR-Multiples/
Thanks for the comments, I’m hoping I’ve understood correctly it has red and green borders around the candles so you can make sense of which way round the open and close is. I’ve been switching the indicator between visible and non visible on the chart and like the way it gives quick feedback. Thanks for the offer on retweet I’m off the platform not sure if that’s a good or bad thing ! Cheers keep up the great content 👌
So you did (re candle colours), my bad. I do find that harder to spot than to just use OHLC bars though! But whatever works for you :) And I'm glad that you're finding value in the indicator.
X is a bit of a mixed bag. Lots of noise, but it's also an excellence source of good ideas for both my trading and writing. I like taking a break from it every now and then though.
Also, I've now shared it on X myself: https://x.com/KayKlingson/status/1937645982532944337. Thank you again!
Glad you found it helpful! Interesting idea to bring it back into TradingView, which is kinda where it started anyway :)
One thing: the example chart is using candles rather than OHLC bars, which makes it ambiguous which is the opening and which is the closing price if you then don't use a 2-tone colouring system.
If you wanted to share it to a bigger audience, please feel free to tweet about it and tag me. I'll be happy to retweet.
Hi Kyna - I like both, short and long form content from you.
Thanks for sharing this. I have also been dabbling with AI at my work, not much in trading though.
Thanks, Jaimin! I think the key is to focus on value more than length.
The AI idea really came from Daniel. Didn't just use it for this ATRx indicator idea from Jeff, but also a few other things, including a pullback scanner. Work in progress.
Good to think about how AI can help with execution, I think, but not planning to outsource the thinking to a robot!
That's true! AI can be used for faster execution once we have a roadmap of what we want to accomplish. I was feeling hesitant to use it and felt like cheating but now that it is already out there, might as well use it to make our work more efficient and faster.
I suspect that as AI use proliferates, the ability to come up with strong ideas (for AI to execute, at least in part) becomes more valuable. Makes it more important than ever to keep exercising our thinking muscles.
Yes. And I think there is a fine line between using AI for execution and relying on it to do the actual work which will limit our own thinking. What are your thoughts on that?
Is the activity a needle mover for you? Does it reflect a key skill; something you need to put in the reps for as part of your deliberate practice?
Setting up my charts is not (for me). Flipping through charts manually is.
In terms of writing examples, any intellectually challenging writing projects must be done by me, such as TTRH stacks. But tweets that promote stacks don't offer me that intellectual exercise, so perhaps I'll hand those off to AI one day, if I want to go hard on the marketing. Growing TTRH has become way less of a priority for me though; I think the size of the community is good right now. So, not something I'll do for now, but want to remain open-minded about the option.
Those two are very nice examples and easy to understand.
Something creative and which shows our own authenticity need to be done by us and something repetitive and boring can be handed over to AI.
A mix of both. Short and long form content would be great 👍🏻
Appreciate the comment, Rishab. I guess it comes down to subject matter: how much is there to say about the topic? Always put value first!
Nice idea absolutely, but why do you consider selling the whole position if ATR is 10x or more ? I think we need to look at the bigger picture sometimes and give the stock a little room to breathe. I analyzed thousands of winners in the last decades, and came to conclusion that big majority of them respected the 20 day EMAs for a long time and bounced back often. When they reach the 50 day it often signals they need a little more time to consolidate but not that they will roll over immediately. Anyway what I found best works for me is that I sell 50% on a close under 10 day EMA and another 50% on a close under 20 day EMA. If the stock goes not more than a few % under 20 day and bounces back again over it, I‘ll often get again in with 50% position. If it respects 20 day and goes again through the 10 day on a good volume I‘ll add again to full position with stop losses on 10 and 20 day EMAs. With such strategy I nailed over 400% on $APP and 300% $PLTR last year. Sometimes we need to give them a break. Such strategy saved me from losing a significant amount on $SEZL a week ago. Burst through the 10 EMA, but bonced from 20 day like from concrete and reached new highs like 2 days later.
It depends on recent performance. If I've had a few recent stop-outs and I see things failing on my WL, I go into capital protection mode. That stock may well just retrace to a key MA, and if it finds support there I'm happy to rebuy. (And have done this several times.) But I must protect my capital first, mental and financial, and want to keep the EC as smooth as possible.
Selling *all* into strength is not my default if the overall market is good. Perhaps I shouldn't have even mentioned that possibility in the stack, as it's a matter of discretion and, again, not the default.