Short Skirt

Here's a question I asked in OF and Linda's answer.
Enjoy.
Ygol

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Question
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1 ) Is this a valid short skirt buy?

2 ) Where would be an entering point?

And is this one valid too?



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Answer
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yes - that is textbook short skirt on the dax that you captured!

basically a bull flag on short tiem frame,osc makes new hgihs,pushed through keltner channelse.

greatest oddds are when you are making hgiher highs or upside breakout from sideways line in otherwords, if narrow trading range day or consolidation, careful that it is not just a spike test of upper end of range.

Where do you enter:I like to enter about 2/3s of the way between the keltner and the moving average in other words,it may not fall back to the moving avarege - might fall short usually, I work a bid so I can buy it as the price is coming down.you can put your initial stop just above that lower keltner thent this is just a scalp trade so ideal is to exit as the price is moving hgiher - then sell on offer goal is to lock in clean scalp in the least amount of time!

The secod chart was not a failed short skirt because it did get its objectivei which was a higher high
SO when we tested this stuff we took
1) had to push outside the keltners,
2) bought retrace either partial or all the way to moving average..... you got higher frequency of trades if you did not have to wait fo t the EMA.
and then - exit on test of highs the only thing questionable about that second example was that it really did not have a strong push through the keltner channels

Not - your first example how you had that strong close outside the keltners...

ygol [08:30:17]> what where the results?

linda1 [08:31:22]> The test results show that it was profitable strategy whether you used, 20,25, 35, 45 period EMA also, did not matter if you use 2, 2.5 or 3 etc for Keltner channels had win/loss ratio of aroud 66% using no filters.....

ygol [08:32:08]> do we see it often (this setup)?

On Z days the system has a drawdown, cuz the tests tend to be spikey and set up false bull and bear flags at upper and lower end of the range in the morning session

On a trend day - you can get 8 - 10 winners in a row
We used to see it more often 8 years ago then we do now used to get 8 - 11 trades a day on a mechnical system now get less the main reason being the markets are more "urgent" bandwidth faster, electornic platforms and smarter market participants...

so now, once a market breaks out, it is more of a momentum dogpileb with fewewr pauses along the way whereas before you would get 4-5 short skirts, now might get one and you have to be careful if it is coming very late in the move

ygol [08:35:20]> thank you again Linda.