Continuation of Uptrend Using the One Way Formula
Ok, on this chart I have included the latest updates to the OWF (One Way Formula) which show the swing lines and new ASC (ascending bottom) on 10/17. The RB (repeat buy) signals are shown on 10/21 and 10/28. The entry orders for these trade setups would have been entered the night before the actual entry date. Now I know what you are thinking. How did I know that the next day was going to be a signal day? The answer is I really don't know. All I can do is forecast the possible scenarios of a daily bar before the next days trading. In other words we can only have four possible scenarios:
1. We can have a higher high and a higher low. Therefore triggering an entry. This scenario is good because we either hold to the close for an exit or hold for a few more days.
2. We can have a lower high and a lower low. Therefore there is no trigger to our entry order and we simply cancel the order.
3. We can have an inside day. Therefore there is no trigger to our entry order and we simply cancel the order.
4. We can have an outside candle day. This would trigger the entry order and it would also give us a whipsaw loss for the day since it also declines below the low and takes out our stop. These days are annoying but thankfully they do not occur too often.
So you can see that in order to use this system you must be able to forecast one daily candle ahead of time. This type of skill does NOT come easy to the new trader. For further info on how to draw the swing lines and recognize the signals all I can tell you is to read the book "The One Way Formula" by William Dunnigan multiple times (like I did). If you have any questions ask me in a private message. Aloha.
1. We can have a higher high and a higher low. Therefore triggering an entry. This scenario is good because we either hold to the close for an exit or hold for a few more days.
2. We can have a lower high and a lower low. Therefore there is no trigger to our entry order and we simply cancel the order.
3. We can have an inside day. Therefore there is no trigger to our entry order and we simply cancel the order.
4. We can have an outside candle day. This would trigger the entry order and it would also give us a whipsaw loss for the day since it also declines below the low and takes out our stop. These days are annoying but thankfully they do not occur too often.
So you can see that in order to use this system you must be able to forecast one daily candle ahead of time. This type of skill does NOT come easy to the new trader. For further info on how to draw the swing lines and recognize the signals all I can tell you is to read the book "The One Way Formula" by William Dunnigan multiple times (like I did). If you have any questions ask me in a private message. Aloha.