How to Apply the Trend Catcher Chop Filter Indicator to the Chart and Trading Rules to Help Filter Out Chop


#1

Here is the latest webinar covering the 3 entries, stops, targets and how to take profits:

5-19-2015

CONSERVATIVE ENTRY & EXIT RULES

  1. Cyan alert - heads up
  2. Solid arrow - get ready for possible entry
  3. Chop Filter confirms direction of trade (red = sell, green = buy)
  4. Enter 2 or 3 ticks below the low or above the high of the bar that the chop filter changes on.
  5. Set stops - bar size plus 2 ticks for a scalp or the MVP line for a trend
  6. Exit a trend when the MVP line hits the price action.

Explained: When you get a cyan arrow, look below at the chop filter.
A. If the chop filter color is the same color as our trend catcher line (red trend catcher line and red chop filter or green trend catcher line and green chop filter), then you can enter the trade 2 or 3 ticks above the high of that bar on a long or 2 or 3 ticks below the low of the bar on a short… B. The conservative rules that everyone should start with on stops for scalp stops should be your bar size plus 2. If you are trending, trail your stop with the MVP predictor triangles. When they run into a bar, exit the trade. C. NOTES: After you are profitable and have the rules down, then you can move on to more sophisticated methods of setting profit targets as you learn to read the market and watching magnet levels. Darrell explains how to find them in the following webinar:

Volume Webinar Lesson for Magnets

For more ideas and to add onto the basics, see this video:

Magnet Levels and Expected Time Indicator from Thursday 5/20 Webinar

Quick Review:
Long trend catcher, short chop filter: No entry. Short trend catcher, long chop filter: No entry. Long trend catcher, long arrow, short chop filter: No entry. The arrows mean nothing for entries in this method. Long trend catcher, short arrow, short chop filter: No entry.
Long trend catcher, long chop filter: Enter a tick above the high of the bar where everything lined up. Short trend catcher, short chop filter: Enter a tick below the low of the bar where everything lined up.

IS IT A SCALP (Profit Target trade) OR TREND TRADE

  1. Use the MVP arrow to determine if it will be a trend trade or just a scalp. If the MVP arrow appears on bar 3 or 4, that indicates a trend trade. The bar with the cyan arrow is bar counted as bar 1. IF the MVP arrow appears on bar 1, 2, 5 , 6, etc., then it is a scalp trade. IF the MVP arrow appears on bar 3 or bar 4, then it is a trend trade.
  2. What should my profit target be for a scalp? A good rule of thumb is the bar size minus 2 ticks. A more advanced way to determine a profit target is to use magnet levels. The link for a recent webinar about using magnets will be listed here as soon as it is available.
  3. How many scalps can I take within a single trend? The scalps that are consistently profitable are the first in any trend. If you have a slingshot setup and then an elevator (In that order), they often will both be winners. If you have an elevator first, then a slingshot, taking the second in that series, i.e.,the slingshot, the instance of profitability is less. If you take a scalp before the MVP arrow appears, you can take an additional scalp after the MVP flips within the same trend.

ADD-ON ENTRIES INTO THE TREND Potentially the scalp entries below could be considered add-on entries.

ADDITIONAL SCALP ENTRIES

The “SlingShot” Setup A bar that has a cyan arrow against the current Trend Catcher direction but closes in the same direction as the current trend is a slingshot setup. You must wait for this bar to close before entering. The entry would be a tick above or below the high or low of the slingshot bar. See screenshot below:

The “Elevator” Setup Conservative Elevator setup is if you see a trend and there is a bar that signals a direction reversal with TC, i.e., it’s signal is against the current trend, but in the next bar it returns back to the original direction, this is an ELEVATOR setup. To be a valid elevator entry, there must be at least 2 bars in the “trend” direction prior to the elevator bar. Example: If you have a short trend, there must be 2 red or down close bars before the elevator in order to make it a valid elevator setup. If not, it may be just chop. An advanced Elevator entry would be to exceed the high or low of the first bar that closes in the opposite direction of the MVP (there can be more than one bar in this instance).

Where do you enter the “elevator” trades? You enter when the high or low of the elevator has been broken or the high or low of the next bar, whichever is a higher high or lower low. If the elevator bar had a long wick, this may take a few bars, but that is acceptable. NEVER enter an elevator trade until at least the next bar has closed. You have to make sure this is not a reversal and actually is an elevator entry. If there are 2 or more bars that change color, it is NOT a valid Elevator.

You may notice the elevator in this screenshot is not the first in the trend. The market is ZB which is a market that allows for more scalp setups than any other market.

How many scalps can be taken in any given trend? The best setup is always the first one in a trend. However, you can take 1 before the MVP flips (or more but there will not normally be more) and then you can take another after the MVP flips. If, within a single trend, there is a slingshot followed by an elevator, the elevator usually stil has a high rate of success; however, if the elevator comes first followed by a slingshot, the slingshot is usually not as powerful to make it to your intended goal. The bonds market is an exception as it trends so well, as long as you are following the major trend, any number of scalps can be taken.

Here is an image that illustrates an important rule to keep you out of potential chop. This rule ONLY applies to trend setups (when the MVP arrow appeared on bar 3 or 4) It is called the Predictor Close Rule:

MISCELLANEOUS SETUP EXAMPLES: This is a screenshot submitted by a trader with lots of examples of different trades from ZB. I marked up what setups were what. It might help you to see entries more clearly .

TEMPLATES AND SETTINGS

The template in the toolkit used in this video is called _TrendCatcherChopFilter as illustrated in the image below.

Here are screenshots of the settings you should use for the Trend Catcher with this method. Be sure to note that it is VERY important to use a trend measurement period of 7 in the trend section and to set stats and sim trades to false. Stats and sim are not yet linked to the Chop Filter Indicator, so the positive effects of this filter will have NO effect on them whatsoever. They will be linked at a later date which is not yet determined. We will announce it when it has been linked.

Trend Catcher settings

Chop Filter settings

It is also recommended that inside the trend catcher you set the predictor line inside the trend catcher to transparent so that you do not confuse the MVP predictor line with the Trend Catcher predictor line since we are now using the MVP predictor to trail the stop.

You can adjust the chop filter settings somewhat. Below is the video Darrell did on Friday as well with some tips and tricks on optimizing and making adjustments to the chop filter indicator.

It is recommended that you include the measurement period in the label of your filters you have added for testing. This can be added under the Visual panel in the Chop Filter as shown in the image below. This will allow you to know at a glance what size filter is which.

To learn how to apply this to spreads click this link:

http://apexinvesting.net/forum/futures-forex-spreads-trend-catcher-chop-filter-new-446/trading-trend-catcher-using-chop-filter-spreads-3235.html#post10434


Optimal bar sizes for trend catcher
Loosing Day but should have been profitable, what am I missing?
My Best Trade: "Learnt From The Best Coaches"
#2

Darrell and the APEX Team,

This is the best training video/training ya’ll have done so far!!!

All training, videos, webinars have always been fantastic!

Thank you for what you do! You are changing lives for the positive!

Apologies if this next bit offends - but God Bless you and yours! Thank you for sharing the favor He has shown onto you!

John Houston Temecula, CA


#3

Most excellent! Very excited about this since “Chop” has been the biggest challenge with TC trading futures that I have seen so far. Outside of that TC is phenominal!

I don’t think this was explicitly stated, but regardless of instrument we are trading we load the same template and chop filter for now?

Your example is on the TF and appears to work very well. However if I want to trade the NQ or CL regardless of prior TC parameters i just load up a chart with my chosen bar size on my instrument and then load the template?

Obviously we can tweak the chop filter to find more ideal setting, but in the interim that is the plan correct?

Thank you Darrell and team!


#4

Thank you and no offense at all God Bless :slight_smile:

[quote=jch92592]Darrell and the APEX Team,

This is the best training video/training ya’ll have done so far!!!

All training, videos, webinars have always been fantastic!

Thank you for what you do! You are changing lives for the positive!

Apologies if this next bit offends - but God Bless you and yours! Thank you for sharing the favor He has shown onto you!

John Houston Temecula, CA[/quote]


#5

Yes regardless of instrument same template that has chop filter ie for cl or gc. Gc i would probably use smaller bars like 8

Cl i would either use larger bars or a larger period on chop filter

[quote=ronin50]Most excellent! Very excited about this since “Chop” has been the biggest challenge with TC trading futures that I have seen so far. Outside of that TC is phenominal!

I don’t think this was explicitly stated, but regardless of instrument we are trading we load the same template and chop filter for now?

Your example is on the TF and appears to work very well. However if I want to trade the NQ or CL regardless of prior TC parameters i just load up a chart with my chosen bar size on my instrument and then load the template?

Obviously we can tweak the chop filter to find more ideal setting, but in the interim that is the plan correct?

Thank you Darrell and team![/quote]


#6

I have been testing like a mad man. First I would like to point out that testing by stepping through bar to bar is one thing and very helpful to get the basic rules down. However! Once you get that down I HIGHLY suggest you go back and test your entries with Market Replay or with Sim account on a live market.

For example I am now a little confused on the trail of the stop. With the step through method like in Darrell and Lori’s videos its pretty obvious that the stop line is trailed with the trend line on the “CLOSED” bar/candle. However during live simulation and during market replay there is often a moving and repainting trend line that is closer to the live Bar/candle. For sake of clarification, WE DO NOT move our stop line to the new repaint of the trend line of a live bar/candle correct? We WAIT FOR THE BAR TO CLOSE, then move the stop line to the new trend line, correct?

Thank you for your time. For some reason this all of a sudden became an area of confusion as in past TC I was moving my stop to the new pending flip line (blue line) which is no longer relevant.


#7

Short scenario

Initial stop a tick above high on tc bar that flipped. Then tc line. Then a tick above closed reversal swing bar if it happens see step 3. Then tc when/if flips back. Then if both tc and chop filter flip then exit and enter opposing direction.


#10

I have downloaded the Apr 10 (not beta) version of TC. I notice that when I don’t use the TC template that my settings are different, for example if I use just the TC indicator, not using the TC template, I don’t get the @ symbol in front of the Trend Catcher Label, same with the Trend Catcher Chop filter label. Is there any difference in using or not using this new template?

TC using Template - jwhudson’s library http://www.screencast.com/users/jwhudson/folders/Apex/media/3f4a69bc-2965-424d-95d8-90052c90cefe


#11

Could someone comment on this chart which shows trades that I would have taken today using the new Trend Catcher Chop template with 14 tick data settings, 10 trend measurement and 24 on the Trend Chop indicator. I’m wondering how many bars past the cyan (turned red for short, green for long) is it permissible to enter after getting correct trend chop indicator confirmation??? Please see this chart:

2015-04-16_19-05-14 - jwhudson’s library http://www.screencast.com/users/jwhudson/folders/Apex/media/3141751b-defa-498f-b030-c4b3254067d0


#12

Please see this post for how to share images: http://apexinvesting.net/forum/how-share-charts-other-traders-230/how-capture-screen-images-share-them-forum-rooms-specific-simple-steps-432.html

[quote=bohumil1919]Just wanted to check my settings for GBP/JPY. Where do we paste settings again. getting a little confused. Thak you for your assistance

[/quote]


#13

Your exiting before chop flips

See updates to beginning post on how to be able to scalp use tighter stops and to know how to let it loose on a trend by using MVP with it.

[quote=jwhtrades]Could someone comment on this chart which shows trades that I would have taken today using the new Trend Catcher Chop template with 14 tick data settings, 10 trend measurement and 24 on the Trend Chop indicator. I’m wondering how many bars past the cyan (turned red for short, green for long) is it permissible to enter after getting correct trend chop indicator confirmation??? Please see this chart:

2015-04-16_19-05-14 - jwhudson’s library http://www.screencast.com/users/jwhudson/folders/Apex/media/3141751b-defa-498f-b030-c4b3254067d0 [/quote]


#14

Darrell, Do you recommend trend catcher be used with spreads now that it has a chop filter?..I saw the post but didn’t see any of your comments on it…


#15

Here are some of the entries I have made using Trend Catcher with chop filter on Nadex Spreads. I am training myself in demo to make sure I get it down pat but so far I like it!

Here is an entry I made on Gold this morning. Trend Catcher gave me plenty of time to get in.

Here are some entries I made on the Small Cap Russell 2000 (TF) a notoriously difficult market to trade:

Another Entry on Gold from Wednesday:

More Entry notes from trading Gold on Monday. There was even a binary trade in the mix :slight_smile:

And more notes on entries with Spreads:

And finally, even grabbing some gold at night while making dinner. :slight_smile:

I might be going out on a limb here, but I think I can recommend it. :slight_smile:


#16

LOL - love it keep up the great work :slight_smile:


#17

Are there any new videos with the latest trading futures TC with the MVP predictor? The images are kind of confusing to me. After the settings forums were taken down I’m lost here. I’ve been out a bit so I’m getting back to a bunch of changes to the whole system and seems like I have to relearn everything and start over.


#18

They are doing a redo of the post this weekend to make it a little less confusing and incorporating all the lessons that have been learned over the last couple of weeks.

Happy trading!!! Brad


#19

Awesome thanks! Look forward to it.


#20

Can the TC with the chop filter be used on spot forex?..


#21

Yes! :smile: it can be used on Spot Forex!


#22

Are there any videos on the settings and about using TC on spot forex using ninjatrader