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Joshua Lukeman’s Followers (2)
Joshua Lukeman
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The Market Maker's Edge: Day Trading Tactics From a Wall Street Insider
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published
2012
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“The right way to use the MACD histogram is: 1. Trade in the direction of the slope of the histogram. If the slope is positive, trade from the long side; if it is negative, trade from the short side. 2. Sell longs or trade from the short side when the histogram is above the zero line and the slope heads downward. This indicates that the bulls have lost steam and a reversal is in the making. 3. Cover shorts or trade from the long side when the histogram is below zero and the slope turns upward. This indicates that the bears are out of gas and the bulls are taking back the reins. 4. Go long with bullish divergence between lower prices and a higher histogram. 5. Go short with bearish divergence between higher prices and a lower histogram.”
― The Market Maker's Edge: Day Trading Tactics From a Wall Street Insider
― The Market Maker's Edge: Day Trading Tactics From a Wall Street Insider
“The right way to use stochastics for bullish signals is: 1. If prices make a new low, but the stochastics do not confirm that low by making a higher bottom, cover shorts or go long. This indicates bullish price divergence. 2. If prices are in an uptrend and the stochastic lines move below the oversold 30 line, and then cross above the 30 line, cover shorts or go long. This indicates a pullback within the context of an uptrend and presents the opportunity to reenter the uptrend from the long side. The right way to use stochastics for bearish signals is: 1. If prices make a new high, but the stochastics do not confirm that high by making a lower top, then sell long or go short. This indicates bearish price divergence. 2. If prices are in a downtrend and the stochastic lines move above the overbought 70 line, and then cross below the 70 line, sell longs or go short. This indicates a bounce within the context of a downtrend, and offers an opportunity to reenter the downtrend from the short side.”
― The Market Maker's Edge: Day Trading Tactics From a Wall Street Insider
― The Market Maker's Edge: Day Trading Tactics From a Wall Street Insider
“If prices break below the lower band, wait for a bounce above the lower band, and then go long. Place your stop just below the low price of the move beneath the band. Candlestick patterns can be used effectively when Bollinger bands are brought into the picture. For overbought conditions, wait for the first red candle to dip beneath the upper band before you go short. For oversold conditions, wait until the first white candle appears before you go long. Reversal patterns often form above or below the Bollinger bands. These patterns provide additional confirmation that a reversal is at hand. The right way to use Bollinger bands is: 1. After prices cross above the expanded upper Bollinger band, wait for them to fall back beneath the upper band, then trade from the short side, using a stop-loss on the short just above the high point of the move. 2. After prices cross below the expanded lower Bollinger band, wait for them to rise back above the lower band; then trade from the long side, using a stop-loss on the long just below the low point of the move. 3. When Bollinger bands have contracted to a narrow range, wait for prices to break above the upper band; then trade from the long side, using a stop-loss on the long just below the upper band. 4. When Bollinger bands have contracted to a narrow range, wait for prices to break beneath the lower band; then trade from the short side, using a stop-loss on the short just above the lower band.”
― The Market Maker's Edge: Day Trading Tactics From a Wall Street Insider
― The Market Maker's Edge: Day Trading Tactics From a Wall Street Insider
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