Td Combo Sell Countdown

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which these phases can commence. Whereas TD Sequential can begin, at its earliest, on the 9 bar of the completed Setup phase, provided it meets the rule of TD Sequential Countdown, TD Combo can begin, at its earliest, on the 1 bar of the Setup phase, provided it meets the rules of TD Combo Countdown. However, keep in mind that the Countdown phase cannot begin until the Setup phase is completed. But how then can the Combo Countdown phase begin on the first bar of the Setup phase? The answer is that once the Setup phase is completed, one then must go back to the first day of the Setup phase and perform the three comparisons necessary to fulfill the Countdown requirements. For each bar that meets these requirements, a number is recorded. Therefore, if each bar of the Setup phase meets the rules for TD Combo, then the Countdown phase could record a count of 9 at the same time that TD Sequential has recorded its 1 count. This gives TD Combo a head start over TD Sequential to give the indicator a greater chance of running to completion as opposed to canceling itself prior to a 13 count.

There are also two versions of TD Combo: version 1 and version 2. Version 1 is simply the three Countdown rules applied to each count of the Countdown phase, from 1 to 13. However, because these rules are so strict, and as time passes and the trend exhausts itself it becomes more and more difficult to obtain a 13 count before a price reversal occurs, we have created an alternative version to generate more low-risk buy and sell or call-buying and put-buying indications. This second version is the more preferable of the two. TD Combo version 2 states that the three Countdown rules are applied to the market until a count of 10 is recorded. Once the Countdown phase reaches a 10 count, all that is necessary to obtain the last three counts (11, 12, and 13) is to have a closing price that is lower than the previous Countdown's count in the case of a buy Countdown, or to have a closing price that is greater than the previous Countdown's count in the case of a sell Countdown. In other words, all that is necessary for a completed buy Countdown is that the" close of 11 be less than the close of 10, the close of 12 be less than the close of 11, and the close of 13 be less than the close of 12; conversely, all that is necessary for a completed sell Countdown is that the close of 11 be greater than the close of 10, the close of 12 be greater than the close of 11, and the close of 13 be greater than the close of 12. Once this 13 count is recorded, the Countdown phase is completed.

As with TD Sequential, the completion of TD Combo typically coincides with a point of price exhaustion, where the market is vulnerable to a major price reversal. However, unlike TD Sequential, because the rules required to obtain a completed TD Combo Countdown series are so strict, no qualifiers are necessary.

TD combo examples. Figure 6.37 demonstrates how TD Combo can be applied intraday to obtain low-risk buying (call-buying) and selling (put-buying) opportunities. This example presents a chart of the five-minute OEX Index (S&P 100).

FIGURE 6.37 The five-minute chart of the OEX Index using TD Combo records a low-risk 13 selling (put-buying) opportunity at the exact high of the price rally. The advantage of the timing of this indication is that it occurred within the first 30 minutes of trading, allowing the trade much more time to develop for the day trader.

_OEX - OEX iBdex (S&P 100), 5 Min_ CQG ® 1999.

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FIGURE 6.37 The five-minute chart of the OEX Index using TD Combo records a low-risk 13 selling (put-buying) opportunity at the exact high of the price rally. The advantage of the timing of this indication is that it occurred within the first 30 minutes of trading, allowing the trade much more time to develop for the day trader.

_OEX - OEX iBdex (S&P 100), 5 Min_ CQG ® 1999.

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