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Rough Rice by TrendFollower

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Rough Rice went up 246 points today and was up around 2.18%

There is a clear breakout. Trend identification is key. I do not know if this trend will get stronger or manifest itself into one hell of a 'Long' trade but identifying key trends to monitor is crucial to a trading strategy. This could lead to a potentially profitable trade. 

It does not matter which asset you are trading. The important point is that it is trending strongly and that you identify it as early as possible. If one can utilise leverage to take advantage of points per £ and the directional move is in your favour then it is about maximising potential profits against risk. 

I include the latest chart below. Rough Rice is trading above its 20, 50, 100 and 200 DMA. This is a bullish indicator signalling a 'Long' trade. 

41626451_RoughRice_20190523_20_13.png.398f75177401cc6693f898a9130a6f23.png

The volume (green bars) supports the price action and strong recent move upwards. This is another strong signal. I include the chart below to illustrate this point.

1398584670_RoughRice_20190523_20_19.png.2510b6f147b633f8d071d0157f8cb381.png

The Parabolic SAR is also showing the price above the green dots which is yet another bullish indicator. I include the chart below to show this point. 

1534474733_RoughRice_20190523_20_20.png.3d845d6dd4d3f7f90fc06a66af549857.png

Momentum is another key factor and this also shows in the favour of Rough Rice and I include the chart below to show this. 

506984756_RoughRice_20190523_20_22.png.8428e6e55a095ca0c2dc5e66ca79cb51.png

Now all the above things can be used in your 'trading basket' to aid you in making an effective as possible trading decision. Using the above will not guarantee that your trade will be both successful or profitable. What it can do is allow you an opportunity to trade with the trend rather than against it and increase the odds and probability in your favour. You will notice that I have not included anything too technical or complex above. These are all indicators available on IG's platform. Your trading style can be as simple as you want it. Trading does not need to be complex or difficult that very few can understand. 

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So what is Rough Rice doing at the moment?

It hit $11765.90 today which was its highest price point since the start of this year (2019). 

Now it is being reported that Sri Lanka is expecting a bumper harvest. However to balance this Bangladesh are having to deal with export issues such as government subsidies. There has been flooding near Arkansas river which has left a field of flooded rice. 

Rice may not be the sexiest asset to trade but sometimes the best trades are those you least expect. It is about identifying the trends and breakouts in the first place at the earliest opportunity and trading them to your advantage in the direction of the trend rather than against it.

 

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Rough Rice is trending nicely at the moment. Rice may not be the sexiest commodities to trade but the chart is looking good from a price action perspective. 

144875663_RoughRice_20190610_18_57.png.15b15f016a37c93f2afa9f97a9d1b7b6.png

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Rough Rice is very 'choppy' to trade but it is going up slowly though the price action is 'erratic' so it is not one of the nicer trends to trade in my personal opinion. There are far more better trends out there which are also stronger. I think 'Swing' traders may appreciate it a bit more. 

2000345167_RoughRice_20190721_09_51.png.0ee0e2070a63949a532969a2207ccaa1.png

The one thing I do is monitor the price action of various assets. So within Commodities I will monitor the price action of several / various Commodities to try and identify any trends as early as possible based on price action.

Trading is not just about monitoring the price action of what you are trading but monitoring the price action of what you are not trading. This is where experience, learning and knowledge can be acquired from. 

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  • Member Statistics

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    • Hi everyone,  so, those of you following my FTSE - Daily Trades thread may know, I'm looking for new strategies to tackle the market. Was starting to think about this today and made a few thoughts. First one I came up with in the process is the following and utilises 'Andrew's Pitchfork' a rather odd name for a simple principle.   Thought Process I was going back to the basics and starting to think about the fundamentals of trading: Buy low and sell high. Or go short high, and buy back low later. So the key of my new strategy has to somewhat depended on these fundamental trading principles. Next I was thinking, looking at a chart, in what region can the price considered to be "low" and in what region would I consider it to be "high". I was looking at a 5min chart and looking at the whole day. I was drawing one line at the low of day, one line at the high of day, those are obviously the extremes where everyone can agree prices are low / high. Then I draw a line right in the middle between the two, where the price is neither high nor low. Then I draw a line at 25% and one at 75% and said, if the price is between the low of day (0%) and 25%, I consider the price to be low. If the price is between 75% and high of day (100%) I consider the price to be high. In between (25%-75%), it's neither high nor low. If I'd somehow manage to always buy in the low range and sell in the high range (or go short vice versa), then this could be a decent strategy. The next problem I was facing is, I've done this analysis on the previous day, where we know high and low of day. How can this strategy work out for future price movements, where high and low of day are unknown. Andrew's Pitchfork This is where the Pitchfork comes in. The assumption I'm making is that if I extrapolate the 4 required levels (low of day, high of day, 25% and 75%) from the previous day to the following day, the strategy still works. This is because more often than not, prices move up and down around a certain level, without breaking away from it and moving onto the next level. (This obviously has to be proven with data - more to that later) The way the pitchfork works is exactly how the 4 required levels are drawn up. The pitchfork is defined over 3 points: High, Low and Mid-point. It then draws 5 levels on the chart: High (100%), 75%, Mid (50%), 25%, Low (0%) So how does it work The way I imagine it to work is the following: 1) Identify previous day's high and low 2) Draw the pitchfork in the chart with aligning its high and lows on the daily high and low. The mid point is exactly in the middle of daily high and low. This draws a horizontal pitchfork in the chart. 3) When the price of the asset falls below 25%, place a buy stop order at the 25% level. Once the price rises again and breaks through that level, the order gets executed. (vice versa with shorting above the 75% level) 4) Stop Loss is right below (size of the spread) the low of the pitchfork. Target is somewhere above 50%-75%. You have at least a 1:1 risk-to-reward ratio. Need to calculate target level by asset based on historic patterns. Does it work? Don't know yet. So far I've manually painted a few of those pitchforks in the chart for the past couple of days on FTSE100, NASDAQ, CL and NG and it seems it works more often than it doesn't. Cases where it clearly doesn't work is when there's a strong move to either direction, aka price breaks-out and moves to a different level than it was the day before. Interestingly when this happens, the strategy wouldn't necessarily always result in a loss, but sometimes the entry conditions would never be triggered in the first place. E.g. if we start the day already in the high region (above 75%) and then never fall below it - no order triggered on that day. On the negative side, huge breakout opportunities are missed with this strategy, so worth looking into a complementary strategy which works specifically for break-outs. Next steps Next, I'm trying to backtest the strategy. Will need to pull a whole lot of data and analyse. Hope to have that done over the weekend. Will update the thread accordingly. Data I'm trying to get: Win ratio, Where's the optimum take profit level, Time of day where this usually plays out (my idea is to hook this in with the ATR analysis I've done and trade this pattern at times of high ATR, aka FTSE, DAX in the morning, NASDAQ, NG, CL in the afternoon)  First success First successful example trade taken this afternoon on CL. You see nicely how the pitchfork is drawn on the chart and is derived by the high and low of the previous day. At 14.30 today the price dipped below the 25% level. I set the buy stop order at the 25% level, which got triggered at 14.35. The price afterwards makes a sweep move up to the 50% level, where my limit sell order gets triggered at 15.15. It would've been possible to play it up until the 75% level, but wanted to be safe, without having the data yet. Could've been luck - who knows.   What do you think of this approach?        
    • just to add to bigdeal's reply SBs can be either cash/daily funded bet or futures/forward which have a separate chart accessed from the dropdown box next to the chart title. for cash/dfb there is no expiry but you paid an overnight interest fee, this charge does not apply to futures/forwards which have a larger spread instead. see pic.
    • https://www.home.saxo/insights/content-hub/articles/2019/10/17/emerging-market-stocks-just-break-out-of-a-20-month-downtrend
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