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Williams %R Trading Strategies Explained

This document provides an overview of the BigTrends "ACE Trader" coaching course on using the Percent R indicator to identify trading opportunities. It discusses how the course instructor has adapted the Percent R strategy compared to its original formulation, including using a 30-bar setting rather than 14-bar, and scaling it from 0 to +100 rather than 0 to -100. The document also outlines the bullish and bearish entry rules for using Percent R to identify potential trade set-ups and confirmations. Examples of Percent R in action on stock charts are shown to illustrate the strategy.

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356 views12 pages

Williams %R Trading Strategies Explained

This document provides an overview of the BigTrends "ACE Trader" coaching course on using the Percent R indicator to identify trading opportunities. It discusses how the course instructor has adapted the Percent R strategy compared to its original formulation, including using a 30-bar setting rather than 14-bar, and scaling it from 0 to +100 rather than 0 to -100. The document also outlines the bullish and bearish entry rules for using Percent R to identify potential trade set-ups and confirmations. Examples of Percent R in action on stock charts are shown to illustrate the strategy.

Uploaded by

bigtrends
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
  • Introduction
  • BigTrends Coaching Overview
  • Percent R: Convention vs. BigTrends
  • Williams Percent R - The BigTrends Approach
  • Trading the Bubbles
  • Percent R: Bullish Entry Rules
  • Percent R: Bearish Entry Rules
  • Macy’s (M) - Example
  • United States Oil (USO) - Example
  • DryShips (DRYS) - Example
  • FXE (Euro Bullish) - Weekly
  • Conclusion and Questions

BigTrends “ACE Trader” Coaching

Percent R Rules

Course Instructor:
Price Headley, CFA, CMT
[Link]
BigTrends Coaching

Access to Big Trends and its coaching services is provided for


educational and informational purposes only. The information presented
here does not constitute a recommendation to buy or sell a particular
investment. You are solely responsible for your investment decisions, and
BigTrends and its staff are not responsible for any trades you choose to
make. Not all Big Trends products or services are appropriate for all
investors. BigTrends does not provide personalized financial, tax or legal
advice. Please consult your tax consultant prior to making any investment
that may impact your tax situation.

[Link]
Page  2
Percent R
Convention vs. BigTrends

Larry Williams BigTrends


 Created the Williams Percent R  Adapted Percent R to improve
indicator. Used 14-Bar setting. efficiency. Use 30-Bar setting.
 Scale was 0 to -100.  New Scale: 0 to +100.
 Oversold Level: - 80.  New Oversold Level: 20.
 Overbought Level: -20.  New Overbought Level: 80.
 Extreme levels of -80 & -20 used to  New Extreme levels of 80 & 20 are
signal reversal points. used to signal a trending security.
 Stocks can’t stay oversold or  Mid-Line 50 Level is KEY!
overbought for an extended period of
 Stocks often remain oversold or
time.
overbought for extended periods of
time.

[Link]
Page  3
Williams Percent R
The BigTrends Approach

Key Points
 Similar to Acceleration Bands,
Percent R can show big moving
stocks.
 Unconventional uses of indicators
can yield lucrative results.
 Less noise can lead to better trading.
 “Low Risk” entry points are critical to
managing your trades.
 Percent R can work on all
timeframes and for all traders.

[Link]
Page  4
Trading the Bubbles

 A “Bubble” in a stock is often viewed as a negative.


Bubbles
…BY TRADERS WHO MISSED THE BIG MOVE!

 Percent R allows you to spot when the trend is emerging


The Beginning before it becomes obvious to everyone else.

 This indicator also tells you when the “Bubble” is bursting.


The Insight
 Often happens well before the true collapse.

 Stocks that “Bubble Up”, eventually burst and break down, quickly.
KEY POINT  You can trade both sides of this move.

[Link]
Page  5
Percent R
Bullish Entry Rules

 BULL SETUP
Look for “overbought” reading above 80.
 BULL CONFIRMATION
A close above setup bar’s high, within the
next 5 bars.

 BULL RETEST
Once trend is Bull Confirmed, look for a move
below 80 (at 79.50 or less).
This bar’s Low is the new Closing Stop.
“Low Risk Entry Point” to start a position or
add to an existing position.

[Link]
Page  6
Percent R
Bearish Entry Rules

 BEAR SETUP
Look for “oversold” reading below 20.
 BEAR CONFIRMATION
A close below setup bar’s low, within the next
5 bars.

 BEAR RETEST
Once trend is Bear Confirmed, look for a
move above 20 (at 20.50 or more).
This bar’s High is the new Closing Stop.
“Low Risk Entry Point” to start a position or
add to an existing position.

[Link]
Page  7
Macy’s (M) –Example

[Link]
Page  8
United States Oil (USO) –Example

[Link]
Page  9
DryShips (DRYS) –Example

[Link]
Page  10
FXE (Euro Bullish) - Weekly

[Link]
Page  11
Do You Have
Any Questions?

[Link]
Page  12

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