• Trading Software
    • TradingView
    • NinjaTrader
    • MT4
    • Thinkorswim
    • TradeStation
    • MultiCharts
  • Online Classes
  • Trading Courses
  • Free Resources
    • Economic Calendar
    • Blog
    • Webinars
    • Newsletter
  • Sign Up
  • Sign In
Trade The FifthTrade The Fifth
  • Trading Software
    • TradingView
    • NinjaTrader
    • MT4
    • Thinkorswim
    • TradeStation
    • MultiCharts
  • Online Classes
  • Trading Courses
  • Free Resources
    • Economic Calendar
    • Blog
    • Webinars
    • Newsletter
  • Sign Up
  • Sign In

Education

Home » W5T MTF Dot Cloud on Stocks – The Big Picture
image of INTC stocks signals header

W5T MTF Dot Cloud on Stocks – The Big Picture

  • Posted by Paul Bratby
  • Categories Education
  • Date September 3, 2018
  • Comments 5 comments
0shares
  • Share
  • Tweet
  • LinkedIn
  • Reddit
  • WhatsApp

Using the W5T MTF Dot Cloud on Stocks – The Big Picture

For this trading journal article I wanted to take a step back and show how the W5T MTF Dot Cloud indicator from our “Day Trading Add-On Suite for ThinkorSwim” can be used to quickly analyze stocks ON ANY TIME-FRAME.  The intent here is not to get into a specific setup on a particular stock, but rather for YOU to build a small list of stocks that YOU would like to analyze to trade.  Therefore, how this indicator can help you in that endeavor.  Let’s say you have built a list of your favorite growth stocks that you want to look for opportunities to trade on a daily time-frame.  Your trading plan calls for buying pullbacks on strong trending stocks. (the trend can be up or down.)

Here is how you can use the W5T MTF Dot Cloud Indicator to rapidly find the opportunities out of your list to find stocks that may be setting up for trading on a Daily time-frame: (Click on all images to enlarge in a different window)

  • For using the MTF indicator with stocks you have to change the settings of TOS to not use the extended hours timeframe and you have to uncheck the aggregation period setting.

image of W5T MTF Dotcloud equities settings

  • For trading on the daily timeframe I like to set the dot cloud times to Monthly, Weekly, 4 Days, 2 Days, and Day timeframes. Note that when you set your chart timeframe to daily that this makes the top two rows identical (both daily).

image of W5T MTF Dot Cloud Settings adjust

  • The bottom rows are what I call the anchor trends, these are the monthly and weekly timeframes. Look at these FIRST – spot the main trend.  THEN look into the lower timeframes and try to spot whether there is a pullback going on. (pullbacks are colored opposite the main trend.  For example, if the monthly is green indicating a bullish trend do I see red’s above that line indicating that the smaller timeframes are pulling back?)
  • Now rapidly go through your watchlist or key stocks you are analyzing making note of the stocks that appear to be in pullbacks. Once that is accomplished begin looking for trend following setups and make your trades!  Here are a few examples:
Can you see pullback opportunities in AAPL, GOOGL, MSFT (spots where the overall bullish trend as noted in the bottom GREEN rows turned against the main trend on the lower timeframes)?

image of W5T MTF dotcloud on AAPL Chart

image of W5T MTF dotcloud on GOOGL Chart image of W5T MTF dotcloud on MSFT Chart

Can you spot LULU’s pattern in the box and its breakout?

image of W5T MTF Dot Cloud on LULU chart

How about bearish trades and then a reversal in TWTR? Is TWTR potentially setting up for another long after a pullback against the now bullish trend (yes I think it is!)

image of W5T MTF Dot Cloud on TWTR Chart

Would you buy pullbacks in these ETF’s or are you trying to short them? They look bullish to me…counter trend trading can be done but you have to know when to take profits…don’t counter trend trade until you master trend trading!

image of W5T MTF dotcloud on IWM Chart image of W5T MTF dotcloud on XLF Chart

A couple of stocks on extended pullbacks. Looking for potential long setups…time will tell!

image of W5T MTF dotcloud on BABA Chart image of W5T MTF dotcloud on WTW Chart

NOW YOU PRACTICE THIS WITH YOUR LIST.

Go through a selection of stocks and ETF’s.  Can you spot pullbacks that ended up being great opportunities to get into a stock or ETF?  Can you spot trend reversals (where your anchor time-frame switches trend)?

Do you want to trade on a shorter time-frame like perhaps an hourly chart? Ok…set your rows to Week, 2 Day, Day, 4 Hour and 2 hour, on an hourly chart. Therefore, the Anchor time-frame is the weekly and 2 day chart rows so look for pullbacks on shorter time-frames. Then setup trades in the direction of the main trend using our other W5T tools such as the “Elliott Wave Indicator Suite for TOS“. That’s it!

Summary

We’ve gone through a simple but very powerful use of the W5T MTF Dot Cloud indicator from our “Day Trading Add-On Suite for ThinkorSwim” that can be used on stocks as well as futures.  Today’s journal showed how to setup the indicator to use it as a pullback or trend reversal spotter on the daily time-frame. Helping to quickly go through a list of stocks, ETF’s and futures to determine where in their trends they are. Once the list of prospects is gone through, one can then use the strategies and indicators contained in the “Elliott Wave Indicator Suite for TOS” for identifying particular setups for trade entry and exit. (refer to other trading journal articles for those setups!).

Trading pullbacks versus chasing trades perhaps far too late in their trends is what separates the “fear of missing out” amateurs from the pros.  These powerful indicator tools can help one along the journey of becoming a successful trader.

Tag:Day Trading, elliott wave, elliott wave indicator, long stocks trade idea, Nasdaq, Swing Trading, swing trading journal, thinkorswim, trading education

  • Share:
author avatar
Paul Bratby

    Previous post

    Gold Futures /GC Day Trading Journal - 40 Ticks Winner
    September 3, 2018

    Next post

    RACE - Stocks Signals Video for potential Long Swing Trade
    September 4, 2018

    You may also like

    🆕Potential Long SwingTrading Opportunity on $W Wafair Inc
    19 January, 2021

    Brief video setting up a potential Long Swingtrading opportunity on the Wayfair Inc Stock using our Elliottwave Indicator suite

    🆕Elliottwave indicator suite calculates and prints the elliottwave count
    16 December, 2020

    Quick video to show how our Elliottwave indicator suite calculates and prints the elliottwave count, the probability pullback zones and the automated 5th wave target zone..

    image of tradingview stocks swing trading chart trade management
    Trade Management for Stocks Swing Trading
    9 July, 2020

      5 Comments

    1. Steve Andrews
      September 3, 2018
      Reply

      This is something I wanted to know if this could be done, I am going to do some research with this. Thank you for sharing this item, it is very good information.

    2. ESTEVE ANDRE
      September 4, 2018
      Reply

      1. Who sets up the software on my computer, you or me?

      2. How does this software work on shorter time frames?

      3. Does it only work on time charts, or can you combine time charts and tick charts, and renko charts with daily charts?

      4. Most of what you show are stocks. How does your software work with futures or forex?

      I await your reply……………..

      • Paul Bratby
        September 5, 2018
        Reply

        Hi Esteve, In answer to your questions:

        1. We send you the software files and a simple installation video and you set up the software on your machine. Its very simple.
        2. Works well on shorter time frames, examples in recent trade journals are here http://www.wave5trade.com/w5t-trading-journals/gold-futures-gc-day-trading-journal-40-ticks-winner/ and here http://www.wave5trade.com/w5t-trading-journals/day-trading-journal-nasdaq-emini-futures/
        3. Works just as well on Tick and Renko Charts on all timeframes
        4. Works great on forex and futures and examples are in recent recording of September webinar here http://www.wave5trade.com/education/w5t-september-support-webinar-recording/

        Hope this helps

        Paul

    3. Peter Greco
      September 10, 2018
      Reply

      Is this the Ichimoku cloud you are plotting?

      • Paul Bratby
        September 10, 2018
        Reply

        No its our W5T EMA Cloud Peter

    Leave A Reply Cancel reply

    Your email address will not be published. Required fields are marked *

    Categories

    • Blog
    • Daily Videos
    • Education
    • Trading Journals
    • TradingView
    • Uncategorized
    • Videos
    • Webinars

    Archives

    USA Office: 19 W 34th Street, Suite 1018,
    New York, NY 10001
    US Phone: +1 (415) 992-7787

    Ireland Office: Unit 3D, North Point House,
    North Point Business Park, New Mallow Road,
    Cork, T23AT2P, Ireland

    Copyright © 2020

    Learn More

    • Trade Ideas
    • Contact Us
    • About Us

    Legal

    • Privacy Policy
    • Terms of Service

    Latest Tweets

    Tweets by tradethefifth

    Swing trading, Day trading, short-term trading, options trading, and futures trading are extremely risky undertakings. They generally are not appropriate for someone with limited capital, little or no trading experience, and/or a low tolerance for risk. Never execute a trade unless you can afford to and are prepared to lose your entire investment. All trading operations involve serious risks, and you can lose your entire investment. No trades are recommendations or advice and we cannot be sued for losses of capital. All trades are for educational purposes only. Contact your broker or RIA for execution, margin, and other capital requirements. All users and viewers of wave5trade.com adhere to ALL terms of service on www.tradethefifth.com

    Hypothetical Performance Disclosure: Hypothetical performance results have many inherent limitations, some of which are described below. no representation is being made that any account will or is likely to achieve profits or losses similar to those shown; in fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk of actual trading. for example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all which can adversely affect trading results. Past performance is not necessarily indicative of future results.

    Testimonial Disclosure:  Testimonials appearing on this website may not be representative of other clients or customers and is not a guarantee of future performance or success.

    Trade The Fifth