Creep-nothing stronger

At the moment we are going through a volatility expansion phase which will come to an end and the pendulum will swing to the other extreme

For that reason i start prepping early for a system approach that can harness this specific market environment and trading creep is one of the tools that come in handy at such times

We have a rule that states: "Nothing stronger than a creep."

The definition of a creep is a directional slow market on 5 or 15-minute charts with "bearded" (wicks) candles.

The reason why the creep is so strong is twofold:

1.The action/reaction principle can’t be applied, making it hard to fade since there is no washout or otherwise discernible action.

2.The even stronger aspect is its counterintuitive nature, as it feels like the direction will reverse any minute, prompting traders to want to fade the direction into the counter direction.

Example:

e mini futures market - 5 min chart

(Charts courtesy of TradeStation)

Entry on double bottom at 66.25 (stop at 4 ticks):

Exit half the position for 4 ticks to mitigate risk.

Exit 25% of the position for 13 ticks as the second target.

Exit the remaining 25% for 15 ticks as the runner (all out).

This is an example for times when ES ranges shrunk to 4-6 points average per day, but the creep principle can be applied as soon as volatility is disappearing