Monday, January 26, 2009

Monday 01/26/09 - Loser Bucket Trade Setup

Too many meetings on Mondays so no real $ trades today. In other news, I will be opening an account with Infinity Futures due to their low intraday margins, extremely competitive commission, and excellent trading platform (AT platform). Click here if you want a 30-day demo of the AT Platform.

Now I'd like to share a Trade Pilot Pro setup that I've personally used with good success. I haven't back-tested the method but I've seen it work in live market conditions over and over, so feel pretty confident about it. I'm using the TPP indicators for this method, but it's essentially buying a pullback in an uptrend or selling a bounce in a downtrend. Since I'm bearish I'll use a Short entry for my example.

Open the following chart in a new window to follow along:

In the Loser Bucket setup, for a short signal, you're looking for the on-balance volume indicator to be negative, and then you look for a price bounce with the Vol Osc positive. You can then enter into a short position when price bounces back to resistance, or you can use a bearish candle as an entry signal. In this situation, the OBV MA indicator is displaying continued selling pressure, and the Vol Osc turns green from the price bounce (probably due to short covering), and then the primary trend resumes, which in this case is down. You would cover at an area of support or if you saw a bullish candle signal. I've highlighted this setup on the chart above for my short trade. But if you look at the earlier part of the day, the same method can be used to buy pullbacks (OBV is green, but Vol Osc turns red). Again, I realize this is a simple trend continuation setup but the indicators help me since I can just take a quick glance at the chart and know what setups I should be looking for.

ES/TICK (3-min)

Market Balance (5-min)


  1. You did a better job of explaining that than the 2 guy's normally do. Along with the chart example, now I finally understand that setup.


  2. hehe...thanks Michael. I'll be posting more TPP setups in the coming weeks. Btw, I encourage you to ask questions in the TPP room. Joe and David genuinely want to educate the people in the room, and they would love more participation from the members. Joe is also having his website re-designed, and there will be a Blog on his new site where he will post more details on the setups with charts, so that will be an excellent resource for TPP members. You can also email me if you have questions on a specific TPP setup since I'm familiar with most of them.

  3. Playing WITH the trend? Blasphemy!!! God if you keep this up you're gonna be making huge sums of money before me.

    Dude stop it. So short an uptrend so I can be more successful than you! ;)

  4. LOL I thought we were partners in One-Lot Trading LLC!


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