ETF SWING & DAY TRADING

[Little Chico]

Jonr,

I wasn't trading yesterday, due to work conflicts, but backtesting on the ER2 shows better results than you cite.

Using the 3/8 EMA crossovers, with a confirmation of DMI lines crossing in the expected direction, the 30" chart gave a short trade signal at 7:30 a.m. EST (premarket) @ 740.60. Just holding short all day, the exit at the end of the day would have been at 729.80 for 108 ticks, or $1,080. per contract. If you were also watching the 5" chart and went to cash when it showed a counter trend (but not long since the 30" chart would not agree), that would have resulted in 83 ticks, or $830 per contract. So, it seems that once you are in a 30" trade, it is best to hold your position and exit at the end of the day, or when the chaikin oscillator tells you to (this is a good indicator, advocated by Gloe), or when support/resistance levels are reached, as shown on a P&F chart. You could have had a even earlier entry on the 5" chart, yesterday a.m. at about
6 :15 a.m. EST (@742) but the 30" chart was not yet in agreement. Those additional ticks would have evened-up the results but would have entailed more risk. There was no way to know if the market would continue to go down as it did, or go up. The 30" chart gives the answer.

Chico