Side-Ways Trend

November 28, 2012 · Posted in Uncategorized, Volatility Zones · Comments Off on Side-Ways Trend 

Most traders have tough time trading side-ways markets. Many traders may be right on their setups or detecting the trend, but during the choppy side-ways markets they lose more money. In Intraday futures, I use BarTimes to measure the side-ways markets. On ES 1220 Tick Chart, I look for time to complete 1220 ticks. If the average of last 5 bars exceeds 150 seconds, I know markets are slowing and side-ways trading may be in order. I also look at Volatilty (VLTY) on the same chart to measure potential risk zones.

Today after market reversed its 12 point loss, around Noon, I noticed VLTY went above 50, signaling potential risk zone. Also, from 12.30p onwards, the ES 1220 chart showed VLTY > 50 on fiscal cliff news. So, I avoided trading any NEW trades until I see VLTY below 50 and BarTime falls below 150 sec.