YMH2, (3, -1) formula, fading 1.618% Stretch, 1 February 2012

1 February 01:23PDT, short March $5 Dow (YMH2) futures at 12647. Last trading around 12655.

Short YMH2 12667 on a volume spike. Who would have known that 500 contracts would push through 1.618% of the Stretch above unchanged, 12577 + 65 = 12640

Originally posted by Hunter

1 February 01:23PDT, short March $5 Dow (YMH2) futures at 12647. Last trading around 12655.

I see it went to 12677.

Where is your stop?

Today is a uni-directional day and the (3, -1) formula hasn't printed. Unchanged + 4.25% of the Stretch should provide the opportunity to reverse my small loss.
The stop is always at the lesser Fibonaccis of the Stretch calculation, 0.236%, 0.382%, 0.5%, and 0.618% of the Stretch.

Originally posted by Hunter

Today is a uni-directional day and the (3, -1) formula hasn't printed. Unchanged + 4.25% of the Stretch should provide the opportunity to reverse my small loss.

Are you saying "unchanged + 4.25% of the Stretch" would be a good place to go short?

How much will you risk?

The stop is always at the lesser Fibonaccis of the Stretch calculation, 0.236%, 0.382%, 0.5%, and 0.618% of the Stretch.

How do you decide which Fib to use?

Where was your stop?

I had the top at 12734

Previous close was 12580 (its computed and data is aggregated, but it should be close, sometimes its off)
Used a stretch of 36 (also computed)
and Fib value of 4.236 (fixed)

4.236*36=152.5
then
12580+152.5=12732

High at 7:26am was 12734 (total resistance for 3 hours)

Hunter's stuff is very accurate. I am always impressed.

My program was trading long from yesterdays close. It trade momentum rather than retracements. It doesn't short when the trend is up. It exited at 706.

Originally posted by grednfer

I had the top at 12734

Previous close was 12580 (its computed and data is aggregated, but it should be close, sometimes its off)
Used a stretch of 36 (also computed)
and Fib value of 4.236 (fixed)

4.236*36=152.5
then
12580+152.5=12732

High at 7:26am was 12734 (total resistance for 3 hours)

Hunter's stuff is very accurate. I am always impressed.

My program was trading long from yesterdays close. It trade momentum rather than retracements. It doesn't short when the trend is up. It exited at 706.

Thanks for posting. I'm starting to make heads or tails of this. The frustrating part of this is Hunter frequently posts information that is more confusing than helpful, i.e.

The stop is always at the lesser Fibonaccis of the Stretch calculation, 0.236%, 0.382%, 0.5%, and 0.618% of the Stretch.

You're left wondering do I risk .23 or .618?

Or his explanations for entry don't match up to what I see on the chart.

Additional, he regularly talks in lingo, leaving me wondering if/where he entered and exited trades.

The reason I've been pressing him, is I decided I wanted to learn his system. Instead of just being confused, I want to know what I'm looking at and see if it's as impressive at it sounds.

If any S&P traders are reading this, Hunter's formula of Close plus (4.25 x Stretch) was 1325.25. Today's high 1327.

1.616 x Stretch = 6.44

1327.00 - 6.44 = 1320.56
1325.25 - 6.44 = 1318.81
Late afternoon low - 1318.75

Grednfer,
Beautiful symmetry, and your price measuring objective was achieved so very accurately! Thanks for sharing your two good eyes, ... the 4.236% of the Stretch price measuring objective tool.

ETM, The YM : ES ratio is about 9 : 1.

There are multiple techniques when trading the Hunter Model.
I'm not a big fan of stop losses so I really can't help you there.
It depends what you feel comfortable with.....40 points is $200/contract.

I think it helps understanding to look at the model over a period of days. It will show you the cycle.

Like Monday.....level 4 was a buy....yesterday level 3 buy...last night level 1......like walking up the stairs.

For example....you could just ONLY buy level 3,4,5 and never short....and that strategy works in an uptrend....The low to high move for YM was on Monday and Tues was 200 points! $1000 per contract!


How you trade the model is up to you and nothing is perfect....but I think the math can really give you an edge. And these days you can't underestimate the importance of the EU open....the market can just take off or get destroyed on almost no volume.

Another important concept is day to day Upper/Lower stretch support and resistance....

If it has lower stretch support....its most likely going up...conversly with the upper as resistance. Like AH now with NQ nearing a whopping 2500 there is resistance....not big....and not "selling pressure" at the upper stretch of 2494.

Successive Previous day Close failure and Upper Stretch failure is the best short....but its hard to short a market thats trending up.
Most of the drops lately are corrective....need a big impulse drop...like a fast 30 down on ES.....