MOF Defined
Indicator Reference:
Bollinger Bands: 8, 1.8
Fast stochastic: 7,3,3 exponential
(smoothed for Ensign)
Slow stochastic: 21, 10, 4
exponential (smoothed for Ensign)
MOF is an
acronym for money on the floor, a fancy name
coined some months ago which has stuck. The
thought was that it is money just lying
there on the floor waiting to be picked up,
or in other words, a very high percentage
trade.
The trade
works in any time frame, although I believe
it is especially suited for tick charts 133t
and higher. There will usually be 2-8 such
setups on a 210 tick chart (my favorite) in
a typical day.
The setup
is simply described as the first band touch
after the slow stochastic has crossed from
up to down or down to up, preferably from an
overbought or oversold condition. For
example, for a long, the slow stochastic
drops to below 30 and then the two lines
cross upward, price goes up a bit then pulls
back to touch the lower bollinger band. If
the slow stochastic is still crossed up at
that point, the long entry is entered at the
band, or as close to it as you can get. This
situation will usually be the first higher
low marking the end of a downtrend. There
are no other specific rules. MOF setup
examples are shown on the charts below.
