Why The Change From 6 to 12?

#1

As I browsing the APEX YouTube Channel today I was in search of any information in relation to trading CL just to watch something as I was eating lunch. I came across a few videos about CL and I noticed that on those particular videos that the tick car settings of the CL were 6 ticks.

Now for some odd reason I just now realized that I have been trading CL on 6 ticks bars. I did not do it on purpose. I had set up my charts and just assumed that everything was set up properly in each of the templates.(Which was foolish for me and will never happen again) But to my surprise I have been doing quite well.

But I just wanted to know why did you decide to change the settings of the CL from 6 to 12?

This is no dispute or against your decision but more of a student raising his or her hand in class just wanting to know why.

12 Tick CL Chart

12 Tick CL - TradeNumberz’s library

6 Tick CL Chart

6 Tick CL - TradeNumberz’s library

Now granted there is a lot of chop in the CL when looking at the 6 tick. But for one who is still learning how to trade momentum scalps the Elite MVP Reversal would have been nice on the 6 tick whereas on the 12 tick it was purely momentum scalps.

And no I am not doing this to avoid learning momentum scalps. This is just pure learning and understanding for me. That’s all!

Thanks!

#2

MM - we used to trade everything with a 4, 6 or 8 tick bar. Over time, Darrell and his crew have found that larger tick sized bars provide “smoother” trades. You are right, on a smaller tick bar you are going to generally get a lot more trades, fewer trades on a larger tick bar. The larger tick bars are going to keep you out of more chop.

As far as momentum scalps (I don’t do them as I only trade NADEX), it really comes down to risk vs reward. On momentum scalps we are already using more initial risk than our potential reward. We are less than our desired 1:1. So, on TF, our initial position, has 17 ticks of risk, and a reward of 11 ticks (assuming the bar doesn’t have a wick). If you go down to a 6 tick bar, you are looking at 9 ticks risk to 5 ticks reward. So, you go from a 64.7% reward to risk, to a 55 % reward to risk. Practically, that means you need more trades to be successful to make money.

Hope this helps.

Happy trading!!! Brad

#3

[quote=dca78_00]MM - we used to trade everything with a 4, 6 or 8 tick bar. Over time, Darrell and his crew have found that larger tick sized bars provide “smoother” trades. You are right, on a smaller tick bar you are going to generally get a lot more trades, fewer trades on a larger tick bar. The larger tick bars are going to keep you out of more chop.

[/quote]

As far as the chop goes I am personally fine with that. The way I see it is that price is going to go where it wants. Weather its a “Momentum Scalp” on a higher tick size or an “APEX Entry” on a lower tick size price is going to go where it goes. How you trade is all about personal preference. And if this way of thinking is wrong please let me know.

6 is only half of 12 so I don’t see how it can be a problem. The big swing I saw today on the 12 Tick CL was an APEX Entry on the 6 Tick. And at this state I am more at ease with the 6 tick as my account size will not be that large when I go live.

Another thing that I am noticing is that the larger the tick size the larger the stop loss.The way I have been sim trading is with the same amount of money that I will be trading with when I trade live. The only thing that I wish would happen is that I LOSE.

Yes I said it. I need to LOSE a trade. All this winning is fine but I need to experience some losses so I can be ready for losses when I go live.

Thanks again for the wisdom Brad!

#4

Note you can do momentum scalps on nadex I have a thread on it check it out :slight_smile:

If you do smaller bars that is not a problem But we take profit after ie 3 or 4 bars etc. versus just after 1 bar after entry. And it works great.

You should not be okay with chop when doing a trend trade. A A.P.E.X. Pattern trade MVP reversal BMX revesal etc. is a trending trade and to capture trends you need trends not chop. Its not a personal preference thing its a what is the reason for the specific system and set settings accordingly.

You can go with 6 tick you can do 12 tick - some will use 12 tick for trend. Enter on the 6 tick and trail with the 12 tick etc… ie multi time period (bar size) trading so they get more entries (but have wide enough stops with the smoother 12 tick mvp line etc…) But you will get more choppy entries as well its a 6 tick bar.

Do not base your bar size on your account size. This is trying to make the market fit you and that is always a bad idea. You have to fit the market. You can try mini oil at $5.00 a tick, you can do Nadex spreads at 1.00 a tick etc. but DO NOT change the charts to fit your risk ability. Change your instrument or derivative thereof to fit it.

If 6 is better regardless of your account size then great use 6 the bar sizes are not etched in stone. If its not then don’t force it. Bad habit to start and wont help you last long. Use market replay to speed up the learning curve.

Obviously I am writing this for future readers not just you. Your rocking it lol

Love to haar you having the problem of not losing! And don’t get upset when a breakeven day happens (you would be surprised how many people complain about not having trades or breaking even lol - i’m like you have not traded anywhere else or very long or have forgotten what its like out there :))

Glad to have you on board :slight_smile:

Darrell

#5

When I wrote this I meant to clarify and say that I am ok with waiting for the chop to get a proper entry. The last thing I am wanting to do is go through chop but I don’t mind sitting on my hands and waiting for it to end so I can enter a proper trade. I should have been a lot clearer with that I wrote there.

And as far as the tick size I do understand that you recommend 12 based off of the experience of the strategy. When I realized that I was trading on 6 tick I was surprised because I was doing quite well with it. For me it works really well and suits my trading personality. So thanks for clarifying that! It gives me the assurance that I am moving in the right direction.

BTW I finally got a chance to watch the videos about the Profit Poppers and I’m amazed at how little that strategy is talked about. I have a lot of questions about that strategy in particular.

Thanks again for everything!

#6

lol we will make more and more videos - only so many hours in the day :slight_smile:

Keep up the great work - all your time is paying off :slight_smile: