Trading NR7 setup

[Satyen]

Dear Aw10 no i have not done much work on it wanted to bring this concept to 60 min flow as RK knows 60 min flow very well he can share some of his thoughts ........

 

[rohangawale]

NR7 Stocks triggered on 7th Oct:

[B]STOCK		HIGH		LOW[/B]
CIPLA		284		276.5
NTPC		210.7		208.4
TATA POWER	1304.4		1282

NR7 Close as on 8th Oct:

		7-Oct			8-Oct	
STOCK		HIGH	LOW		Close	Trigger
CIPLA		284	276.5		293.65	Up Break
NTPC		210.7	208.4		211.90	Up Break
TATA POWER	1304.4	1282		1311.05	Up Break

 

[rohangawale]

NR7 Stocks triggered on 8th Oct:

[B]STOCK		HIGH		LOW[/B]
GRASIM		2500		2445
HDFC LTD	2758		2691
ICICI BANK	934.9		912.9
REL CAP		921.8		905.5
SBI		2134.6		2096.6

 

[rkkarnani]

Karnani Sir, Welcome back. Was missing your presence here and all your posts but now you gave me one more reason to chk TJ frequently.

Regarding your doubt on which Open/Close level to use ?

What I have described here is a setup, not a precise trading strategy with buy pt/sell pt. To get NR7, we are bothered about high/low of the day which
is not impacted by open/close on majority of the days. (I did a quick chk and found that in last 300 days, only for 22% of the time, we had the situation when H/L of the day was
same as either open or close).

While interpreting the contraction, we need to be a bit subjective and look at bigger picture. For example, if last 10 day's average of daily range is 100 pts, and if todays range is 70 pts, then it indicates contraction. If the number comes to 73 or 75, it is still contraction. So as a first check, one can use H - L to get the range for the day and find out if it is NR7 or not.
But smarter way will be to also look at today's range and compare this with 10day (or any other periods) average range and see if it is < 80% then flag today as contraction day.

To take a trade on this, I will certainly support your idea of putting small filter on NR days H/L and then take trade entry.

Satya has been working on using NR7 setup trigger to swing trade on 60m chart. Maybe he could also share his thoughts on precise entry/exit levels.

Hope this helps.

Happy Trading

Thanks for your kind words AW!! Not very sure how much time i may be able to devote here. Surely not as much as before. Hats off to you all guys who do so much for others!! :clapping:
I do understand that you have thrown out an Idea, a very very workable idea to be transforemd into a 'system'. Though most of the work has already been done by you.
IMHO 22% isnt a small figure, yes not very BIG either, but needs to be addressed to!!!
I look forward to posts by satya on 60 minutes chart. Moreover I am more inclined now a days NOT to take home any positions!!! Have worked well for me!! Missed out some really BIG moves but had the solace that was also saved from a few whiplashes too!!! But as usual we need to have a look at history to decide our future course of action which I see people are already doing.
Also veryvery useful are the Excel files posted by you, Sunil and others.
Thanks and regards
-R K Karnani

 

[asnavale]

Hi AW10 & Murtaza,

I have completed the NR7 Exploration AFL. I am enclosing the screen shot of the Report. The Report shows three columns (in addition to Date, Symbol and Range). The first column is colored Light Blue if the bar is an "Inside Day" and contains a number denoting the multiple. If the number is 1 it is the first Inside Day Bar. If it is 2 then it is second Inside Day (Meaning the previous bar also was Inside Day) and so on. Similarly the next column is for NR4 and is colored Dark Blue. The number denotes the multiple. Similarly the last column is for NR7, colored Green and containing the multiple. If the Inside Day column and any one of the NR column are both colored then it is an IDNRx bar. Note that if NR7 column is colored (meaning that bar is a NR7 bar) then the NR4 column is not colored although it qualifies as NR4 by default. This is done to avoid confusion.

Your comments and suggestions are welcome. If this report is satisfactory I will post the AFL code. In case any modofication is suggested, then I will post the AFL after modification.

-Anant

 

[mfadhd]

Dear Asnavale,
I could not find ur uploaded screen short pls upload it again so that the seniors n other members can view n give their feedbacks

 

[asnavale]

Dear Asnavale,
I could not find ur uploaded screen short pls upload it again so that the seniors n other members can view n give their feedbacks

Hi,

I had checked it when I uploaded it. It was ok. Now it is not being shown. It appears that there is a problem with the server. I will try to load it again.

Thanks for pointing to this.

PS: Now the image is available.

-Anant

 

[Shreenath]

Hello everyone
I read this post and thought I could post a thought or two here. I believe studies has already been done by a few traders regarding the subject of comparing say today's range with the past 10, 20 days or any historical range.

A few trader's divide today's range with a historical range(say 20 days) and call it historical volatility ratio. In addition to Nr7 or an ID/NR4, using historical volatility ratio calculations could serve as a good tool to trade breakouts. In other words, you don't have ot get an NR7 or an ID/Nr4 or even a NR4 sometimes but when the volatility drops, say to a ratio of below 0.5, markets tend to undergo range expansion. I know of at least two big traders who use this to filter futures/stocks on the daily charts(while doing end of the day analysis) and then switch to breakout mode the following day just like they filter NR7 and ID/NR4. Although I don't exclusively trade breakouts intraday and/or end of the day, I do use the above as filters to switch to breakout mode when needed. Why? It's easier to get into a sleepy mode trying to grind little profits day-in day-out only to get our heads chopped the day we get range expansion.

You can find more information about this in LBR's 'Streetsmarts' and a couple of Larry Connor's articles.

Hope this helps.
Regards
Shreenath

Thanks for your kind words AW!! Not very sure how much time i may be able to devote here. Surely not as much as before. Hats off to you all guys who do so much for others!! :clapping:
I do understand that you have thrown out an Idea, a very very workable idea to be transforemd into a 'system'. Though most of the work has already been done by you.
IMHO 22% isnt a small figure, yes not very BIG either, but needs to be addressed to!!!
I look forward to posts by satya on 60 minutes chart. Moreover I am more inclined now a days NOT to take home any positions!!! Have worked well for me!! Missed out some really BIG moves but had the solace that was also saved from a few whiplashes too!!! But as usual we need to have a look at history to decide our future course of action which I see people are already doing.
Also veryvery useful are the Excel files posted by you, Sunil and others.
Thanks and regards
-R K Karnani

 

[AW10]

Hi AW10 & Murtaza,

I have completed the NR7 Exploration AFL. I am enclosing the screen shot of the Report. The Report shows three columns (in addition to Date, Symbol and Range). The first column is colored Light Blue if the bar is an "Inside Day" and contains a number denoting the multiple. If the number is 1 it is the first Inside Day Bar. If it is 2 then it is second Inside Day (Meaning the previous bar also was Inside Day) and so on. Similarly the next column is for NR4 and is colored Dark Blue. The number denotes the multiple. Similarly the last column is for NR7, colored Green and containing the multiple. If the Inside Day column and any one of the NR column are both colored then it is an IDNRx bar. Note that if NR7 column is colored (meaning that bar is a NR7 bar) then the NR4 column is not colored although it qualifies as NR4 by default. This is done to avoid confusion.

Your comments and suggestions are welcome. If this report is satisfactory I will post the AFL code. In case any modofication is suggested, then I will post the AFL after modification.

-Anant

Anant, the output looks fine to me.
As you are showing 2 NR4 days by count of 2 in NR4 column..it is fine..
By definition, these days call called as NR5 day.. I guess to keep it simple and
without getting into too much of complexity, you output is fine.

So as long as NR4, or NR7 column has got any value, we got to pay attention to the scrip. If ID column also has value, then it is much better.

Thanks a lot for nice and perfect work. Highly appreciate it.

Happy Trading

 

[AW10]

Hello everyone
I read this post and thought I could post a thought or two here. I believe studies has already been done by a few traders regarding the subject of comparing say today's range with the past 10, 20 days or any historical range.

A few trader's divide today's range with a historical range(say 20 days) and call it historical volatility ratio. In addition to Nr7 or an ID/NR4, using historical volatility ratio calculations could serve as a good tool to trade breakouts. In other words, you don't have ot get an NR7 or an ID/Nr4 or even a NR4 sometimes but when the volatility drops, say to a ratio of below 0.5, markets tend to undergo range expansion. I know of at least two big traders who use this to filter futures/stocks on the daily charts(while doing end of the day analysis) and then switch to breakout mode the following day just like they filter NR7 and ID/NR4. Although I don't exclusively trade breakouts intraday and/or end of the day, I do use the above as filters to switch to breakout mode when needed. Why? It's easier to get into a sleepy mode trying to grind little profits day-in day-out only to get our heads chopped the day we get range expansion.

You can find more information about this in LBR's 'Streetsmarts' and a couple of Larry Connor's articles.

Hope this helps.
Regards
Shreenath

Hi Sreenath, Welcome to this thread. Your posts will brighten this thread and make it lot more valuable to readers.

The point you are mentioning (comparing today's range to last 20 days range or HV and looking for the days when range is 50% of the 20 days HV ) is mentioned in streetsmart book by Linda Raschke. Certainly the idea is good and it helps in filtering many NRx days but highlight real contraction days by comparing to HV.

IMO, that is one more approach to identify contraction in the market. This approach does have higher success rate, but # of triggers are less.

Happy Trading