Pincher Trading Guidelines
1. Study the PPO/ADX pincher charts
2. Find the major MA's 10, 20, 50, 100, 200 (32MA and 64MA)if 20MA to 100MA have a big spread!
3. Find the RSI's, always look for a 30/30 cross on these. It's a buy signal for the PPO/ADX pincher. To confirm this buy signal, look on a 15minute chart with a 200MA...it must cross the 200MA. So the 30/30 rsi's cross in conjunction with a 15min 200MA cross is the pincher buy, with volume!
Note: on subs, (below a penny)...wait for a Psar or 20MA break and hold as a buy signal. If they break back down the Psar, sell. Note: if the RSI 14 breaks the 50MA, the PPS will more than likely go higher!
4. Find the Psar…is it below or above the 20MA? If the Psar is below the 20MA ...buy as it crosses the Psar. If it does not break and hold the 20MA...sell. If they back off the Psar...sell.
5. If it holds the 20MA...well, now it’s a turn chart. The 50MA will be up next…sell if it backs off the 50MA.(32MA could be placed between 20MA and 50MA if spread to big)sell if it backs off 32ma!
6. If it holds the 50MA ...we are now in uptrender territory. Up next is the 100MA …if it backs off the 100MA...sell.(64MA could be placed between 50MA and 100MA if spread is to big)sell if it backs off 64ma!
7. If it holds the 100MA …up next is the 200MA…sell if it backs off the 200MA.
8. If it holds the 200MA, dont let it fall below the 20MA...take some profit.
9. Never buy back until it again breaks and holds the 20MA.
10. An RSI 14 break of 70 to 90 is a sell.
11. 15min chart rule: 'an RSI 5/2 cross of 50-70, as the MACD histo crosses 0 with better then normal volume, is a great buy signal'…especially for bottom busters...it works best when the MACD and PPO are turning up off the bottom of the daily.
