There is a new ZoneTraderPro BloodHound template that adds to its functionality by adding 3 templates that use the $TICK as a potential trade trigger, trade exit and trade confirmation signal.
Additionally, this update addresses an issue in BloodHound that would give a erroneous output unless the SPY was added as a second data source. That issue is now resolved with this update.
A complete explanation and illustration of each template is included below, along with a link to the new file.
ZoneTraderPro customers can write me on Skype for the $TICK template and make any adjustments that you see fit.
There will be a video about the $TICK templates in the very near future.
What is in each BloodHound Template
Trend Templates
Now that NinjaTrader is setup to use the ZoneTraderPro BloodHound template, what is in each option that you have? What does each option do?
Trends – There are 4 templates that have a trend option. A trend option is just that. It’s not meant to call a high or a low. In fact, at highs and lows, it is more than likely that all of the signals are all either bullish or bearish. It is intended to show us at a glance, what the majority of the charts being analyzed are saying.
- Old ES Trend is one of the 1st versions that was created. It is included for 2 reasons. The 1st is that traders may like the solutions that it gives, so it is available for legacy reasons. Second, it is a completely different formula, so it can be used as a confirmation.
- Higher Vix – With the higher VIX option, it takes longer to get a BloodHound signal to change. It takes more of a move in the VIX and COR90D to change a signal. There is a caution to using this High VIX option. The 1st is that the market is normally not in a high VIX environment. The second is that the lower VIX option described next, may offer a better solution, even in a high VIX environment.
- Lower VIX – With the Lower VIX option, the zigzags of the VIX, VIX9D, COR90D, and VVIX were studied. The challenge was to find zigzag values of what would be a normal pullback in a trend. So if we get a pullback and a new zigzag, that is normal and expected. If those indexes continue to exceed a normal pullback, then the trend might be broken and our trade may not succeed. This is why we look at the live VIX charts and the $TICK chart for confirmation that what is normal is being exceeded, and would advise against taking a trade.
- Lower COR90D – This solution was added to address the falling COR90D value in a very bullish market. When the original solutions were created, this index sat in the 40-50 range, so zigzags were created based on the numbers. In 2024, as the market was making new highs, there were fewer puts being bought as protection, so the value has fallen to the mid 20’s. In version 14 of the ZTP BloodHound template, this option was added so new zigzags are created with smaller moves in the index.
One last note. ZoneTraderPro identified a bug in a BloodHound solver that was used in Version 14 and below. ZoneTraderPro had previously advised that the SPY had to be setup in a second data series as a work around. In version 15, a work around was implemented that does not need SPY added as a second data series.
Trigger Templates
Triggers – There are 3 VIX Trigger charts. They are meant to match the zigzags for the accompanying VIX chart template.
- Higher Vix – With the higher VIX option, the zigzags have a higher value to make a VIX chart bullish or bearish. The same cautions apply to this template as the Higher VIX trend charts.
- Lower VIX – With the Lower VIX option, the zigzags of the VIX, VIX9D, COR90D, and VVIX were studied. The challenge was to find zigzag values of what would be a normal pullback in a trend. So these have lower zigzag values to indicate bullish and bearish.
- Lower COR90D – This solution was added to address the falling COR90D value in a very bullish market. This solution was created when the COR90D fell below 30. The zigzag values for VIX, VVIX and VIX9D remain the same, and the zigzag value for COR90D was reduced.
$TICK Templates
In the illustrations, the ES data is included to show how the price and cumulative delta moved. Also included in the chart template is the cumulative delta to show you the strength at which contracts are being bought or sold.
There are several purposes for these templates. They are trade entry, trade confirmation, and trade exit. They should be used in conjunction with the VIX, ES and SPY charts.
- Trigger – This is the simple version of the indicator using $TICK
- Trigger1 – this is a more complex version of the basic $TICK Trigger indicator
- Confirmation – More criteria have been met and the $TICK is trading above and below the 0 line. What is interesting about this template is that there will be white space between bullish and bearish displays. For example, if you entered a long trade and you had green confirmation as you entered, but shortly there after, it turned white, you should be checking the real time charts to determine if you wanted to stay in the trade.
$Tick Illustration
Here is an illustration of 6 potential trend trades, 5 short and 1 long
Note the relation of triggers to entries and exits
And our confirmation chart
$TICK Chart with ZoneTraderPro Template
Analysis Using $TICK Chart
We want to analyze what our real time chart, the $TICK is telling us. It has the confirmation template being used. This chart is being used to show that there are both good and poor setups, and that not every possible divergence on the ES chart gave us a good setup. The middle panel is the ES cumulative delta. The lower panel is the ES.
- The 1st short trade gave us a bearish confirmation after entry. Near the apex of the low, the template goes white, giving a good exit signal. The $TICK is living below zero.
- The 2nd potential short trade never gave bearish confirmation, and if the trade had been taken, could have been exited profitably when the opposing bullish confirmation occured (red arrow).
- The third short trade had a confirmation signal that was bullish when the bearish trigger was given. The $TICK value was below zero when the trigger occured.
4. The fourth potential short trade had a confirmation signal that was bullish when the bearish trigger was given. The $TICK value was above zero when the trigger occured. The trade did work, but the $TICK did not present an ideal setup. However, it’s important to note losing the green confirmation to white as we enter.
5. The fifth potential short trade, was avoided as the confirmation signal turned bullish at the location of the short trade, and a loss could have been averted.
6. The sixth potential trade was a long, which had green confirmation at the entry signal. On the $TICK picture at the right the confirmation went bearish at the high and price reversed, which was an excellent exit. Also, the fact that the signal did not return to bullish confirmation as price rose, was a potential warning and indication to take profit.
Takeaways
- The ES was under heavy distribution. Price fell 18 points while the cumulative delta rose over 4000 contracts. Other ZoneTraderPro tools demonstrate this. The ZoneTraderPro divergence tool picked up this large distribution.
- We can use all the ZoneTraderPro BloodHound tools, to identify a trend, divergences on ES and SPY, and trigger us into the best trade setups, obtain confirmation the setup is valid, and exit a trade when real time indexes give us the information.
Nailing It
An Interesting Divergence
Download the VIX File
The file is the SharkIndicators BloodHound template file.
The picture below shows that path.
NOTE: The most current Live Vix file was updated 7/20/2024. It is now Version 15.
ZTP BloodHound Version 15 Right Click and Save AS
