Hubert Senters here.
Let’s walk through how I think about rotational trades because it might help you with your entries in your excess too. So first identify an uptrend or a down trending market. And all the times I’ll use the default Ichimoku.
Just to find if it’s below the cloud I know I should probably be shorting that thing. So in this case when we use bonds as an example. You can see it broke down below the cloud here, bounce back up or down below.
I’m definitely in a downturn in bonds. “But how do I avoid the up move back into the turning line and the up move back into the turning line?’’
So here’s the way that I like to do it and it may help you out too. So what I use is just an algorithm. An algorithm just a fancy way of saying a mathematical calculation. So in the same example let’s walk through this is a 10- minute chart and then other chart we were looking at was a daily chart.
So now I know OK I’m coming off of see this little green here. Well, this algorithm or mathematical calculation is going to avoid this if you still believe you’re in that major downtrend which I do. So then it turns red right here and I see red. So then all I have to do is pick one red dot and short off of that and then I can trail my stop-loss off of that major downtrend line there and then boom it goes back up. So I’d be short from in here and then I would cover right there.
You can see that went green and then went red again. So then I could re-short here and then I would cover right here. Now, I would avoid the red transition that goes from red to green so. In other words I’m going to avoid the transition or the rotation from red to green. So when it goes green I’m going to cover, I’m not going to go long here and then short here. That’s craziness.
I’m just going to cover let the green turn back red and then I’m going to short it out there on a red dot and then manage it along the way. You can’t catch all sides of the market so stop trying to go long, short, long short, short, long. Pick a direction and then hunt for your trade.
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Good luck. Hope it helps. See you on the next video.
Hubert.
