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DbPhoenix
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Everything posted by DbPhoenix
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Don't know what you mean by "trading range stepping down", but re your last question in your previous post, if you're wondering whether or not to be "obsessed" over the "various waystations" on the road from S to R and back again because of the ease with which buyers took price back to the midpoint, ask yourself why buyers had so little trouble doing so. Db
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Did you prepare something to use as a map before the open? Db
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Five people. Not bad. Db
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Before this goes too far, I want to correct something. I've developed a bad habit. Even though "retracement" has been defined somewhere (probably the RRB thread), it's been overlooked, and I've added to the problem by equating "retracement" and "pullback". They are not the same thing. RETs, REVs, and BOs all depend on S&R. If S&R are not in the picture, then you aren't likely looking at RETs, REVs, or BOs. With regard to RETs in particular, a RET is an opportunity for those who missed the train to jump on later before it's gone. If traders don't feel that they've missed anything by not taking this particular move, then it's not likely to go anywhere. If traders are slapping themselves for having missed the initial move, i.e., the BO, then the RET will be successful. But if the move is inconsequential, or it's fake, the RET won't go anywhere. No one will pile on board. In fact, those already on board may jump off, and there you are, alone. Therefore, a pullback in a trend is not a RET; it's just a pullback. This is not to say that one is destined to fail if he takes any subsequent pullback after the RET (the first pullback after the BO), but the price risk is higher. I'll try not to be so casual with these terms in future. Db
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They are the first nine posts. Db
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Adding to the short position is another option. Db
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Though a few more people may contribute to this group therapy session, the day is getting on, and I want to point out first that what you are all going through is expected, and none of you should feel particularly stupid for being where you are. Second, you are your own ticket out. There are no secrets. There are no established protocols. Most of all, there are no shortcuts; those who try to take them in the belief that they are saving time will only prolong the process. Unlearning what you know that isn't true takes time. The more you know that isn't true, the more time it will take. Letting go of all that is very difficult because you have so much time invested in it (and perhaps money as well). But until you let it go, you will be holding yourself back. This is not to say that everything you "know" is useless; knowing what you disagree with and knowing what you have found to be crap puts you way ahead of those who just can't let any of it go. Beyond that, everything you need to know is here. Some of it may seem obvious. Some of it may seem ludicrous. Some of it may have seemed ludicrous a month ago but is now quite illuminating. Some of it won't make any sense for another month. Or two. But it's all here. I know that some of you, when observing price movement, are still thinking about where you could have entered in order to profit from what you're observing. Or, if you're actually trading, sim or real, you're thinking about where you could have entered. Or should have entered. As long as you're hung up on this particular pitard, you aren't going to be going anywhere. You cannot focus on price movement while you're thinking about trading, and what you did, and what you might do, and what you're going to do, and why were you so stupid to do what you did, and what has price been doing while you've been so wrapped up in yourself? Bloc's posts provide excellent examples of how to avoid this. But then bloc has paid his dues and has decided to stop shoving his arm into the thrasher. If you're going to succeed at this, you must commit. At a minimum that means posting your charts to the Trading in Foresight thread early enough so that you can see what others are thinking and so that you can share what you're thinking with others, no later than 0900 EST. If you're having trouble interpreting price in real time, then it makes sense to observe price in real time, preferably in chat, so that you can ask questions. If you're there by 0915, then anything that has occurred since 0900 can be discussed. Logging in at 0928 won't do it. Finally, you must review your day. Some may think that if they didn't trade, there's nothing to review. If no thought came to you in 90m, then that may be true. But I find it hard to believe that that can be the case. You are all too smart for that. These reviews can be posted in this thread or in the CWS thread or in any other thread that seems appropriate to whatever it is that is challenging you. Doesn't matter. What matters is the process, and reviewing your day is a large part of the process. In the meantime, if it all seems a hopeless tangle, I have two words for you: support, resistance. If you still don't know how to locate S&R, read the S&R thread and the Trading Ranges thread. If you've read them, read them again. Then practice for a few days and read them again. At some point, there will be posts that stand out, that carry some insight that opens a window for you. Copy those out and save them. There've been quite a few people through here before you, many of them very bright and very perceptive. Learn from them. That's what all these posts are for (well, not all of them; most of them are throwaway, but there's a lot of gold amongst the glitter). Go. Put your charts together. Post them. Learn from each other. Whether I'm around or not should have nothing to do with your progress, or lack of it. Whatever I've been saying lately is just a reiteration of stuff I've said before. Read. Study. Practice. This is not complicated. Don't make it so. Db
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Actually, none of this is about bull or bear candles, guessing, or predicting. It's about observing the behavior of price. While the kinds of exercises you suggest might be useful with some other approach, in this approach they would be several steps backward. I suggest that those who have followed along chime in and offer their opinions, suggestions, insights. I'm reluctant to jump in like the gurus do and offer quick and easy solutions to problems that are anything but quick and easy. But if you guys can't work it out, I'll offer my two cents. Remember that this is a process, and there's no hurry. Keep it simple. Db
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I was in chat for only the beginning of the session, long enough to point out the potential reversal off R. This occurred within a point of R. Price then found S in the same place it found it over the past several days. What happened inbetween is pretty straightforward. Price dropped to the midpoint of this range, waffled around while it waited for whatever report it was, then plunged to a TR between 63 and 67. This shifted to a slightly lower TR between 61 and 66 (+/-). There was never any reason to abandon price before it reached S. Once again, S&R rule. Trading is so complicated. Db
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Note: I've merged some posts from an old, closed thread into the beginning of the Rev, Ret, and BO thread. You'll find them at the beginning. Even though the charts won't open, you may be able to glean enough from the prose to understand the points that are being made. Db
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My comments were addressed to Niko in particular and beginners in general, not to you specifically. However, the fact remains that without even a tentative trading plan based on the results of testing hypotheses and electing instead to develop a tentative trading plan via RT trading, you are in effect working your way through an unfamiliar cave with a narrow-beam flashlight. With a trading plan, even one that is not yet thoroughly tested, you at least have a map. As for the setups being set in stone, no. The principles, yes. The best entries are made off support or resistance. Entries made within a range or long after a trend has reversed are much more problematic. If one wants to take them anyway, no one can stop him. But, yes, that's outside the boundaries of this particular approach. The fact that you're going through the process of observation and study is a giant plus in your column. By doing so you will be able to breeze through your backtesting and forwardtesting when you decide to enter that phase. However, it is next to impossible to avoid looking back, if even for only a few minutes, and thinking about whether or not one might have entered at a particular spot or level if one were trading, either sim or for real. This is the hazard of hindsight trading, or formulating a plan -- even if one is unaware of doing so -- based on "if only". I should also reiterate perhaps that there are only three setups: reversals, retracements and breakouts. Db
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Depends on your trade management. By the time 12 comes along, you've established a 4pt TR. If one is going to play this at all, he has to decide if he's going to short at R and go long at S. If he is, then sure. But if he's trading only to the long side looking at the more macro TR, then he has to decide if he's going to exit when price turns back before 14 or hold on and hope for the best (the latter is discouraged). In RT, of course, one doesn't know that 14 is in the offing. These are typical of the "if only" problems inherent in analyzing potential trades in hindsight. And though this is one of the primary features of backtesting, it must all be tested forward. It is during that process that one learns just how truly screwed one can get by taking these curve-fitted trades. I do understand that RT is sometimes viewed as an acceptable alternative to forward-testing. But the testing takes much longer this way, and even if it is "completed", one still has to look forward to the RT testing of whatever one has learned. Db
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There isn't much time in chat for elaboration. In fact, uv prb ntcd tht I uz a lt of abbrv n my psts thr. But the issue here is not so much the distance to R. As you point out, one cannot know in advance whether R will hold or not. The more important issue is that the entry is at 14, and if you wait, then your price risk increases substantially. If you enter at 15 rather than 14, your profit potential is less, your chance of being faded is greater, your chance of being trapped inside a hinge is greater, etc. This is not to say that you shouldn't take it, but to remind that there are risks involved in not taking the proper entry that should be considered before taking action. And even if the trade works out, one should not feel too satisfied as the market has just taught you a bad habit, and it will make you pay at some other point in the future. Db
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Yes. It all comes from Mamis. Opportunity risk is what you assume by electing to put your money into this rather than that, or this group of whatever rather than that group of whatever. One could also call it Greener Grass Risk. Db
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Another interesting day for the S&R follower, this one with a surprise in the middle. Price found S at 57, as several times in the last three days, then rallied to R at 70. When it came back to earth, it formed a downwave of equal length to the upwave, then rallied to a point which matched a rally before the upwave. Pattern people would recognize this as a potential "head and shoulders". Wyckoff, however, hated patterns. Instead he would have noted the fact that price made a lower high at exactly the same level as the pre-peak rally high. This made it a legit short. As for the target, it's typical H&S. Whether it occurs for cosmic reasons or due to a self-fulfilling prophecy, one can justify the downside target, even though it penetrates S by several points (in any case, there's no reason to exit since no SL is broken). Here, price hits the downside target within ticks, at which point a rally ensues. Trading is so complicated. Db
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Special Theory of Price Discovery (STOPD)
DbPhoenix replied to alibaba5055's topic in Trading Products and Services
Given the content of your posts, you appear to be eager to spend your money on stuff like this and it's unlikely that anyone is going to be able to stop you. But this is just plain old AMT: locate the range, find the midpoint and call that "0", then find first and second levels of S&R and label those "+1/-1" and "+2/-2". Otherwise it's the same old waffle: if and when price hits S, it will bounce, unless it doesn't, in which case it'll fall (flip for R). There are boatloads of posts on AMT here, and it doesn't cost anything. Db -
Well, if you really get into it and you're a completist, you probably will have to read it all. But don't be disappointed if you can't see the relevance of much of it. Keep in mind that we are talking about a time of hand-drawn charts and little to no information outside of a newspaper or broker's office. Going into what now seems like a lot of extraneous detail was a matter of survival. As for P&F, it's not difficult to see the necessity of it when there was no such thing as intraday charts. I filtered out what I considered to be the essential sections into the Wyckoff Lite list. But there are those who will insist that every word is essential. Whether or not they are making a living walking this particular walk or they are making it more complicated than it needs to be so that they can make themselves -- and their goods -- crucial is another subject. I agree with the maxim that The Truth Is In The Chart. Once you've read enough of the material to understand what you're looking at when you view and review a chart, then it's time to roll up your sleeves and start studying the charts. That's where whatever information you have acquired from the course will become knowledge, particularly when you begin to apply it all in real time. Db
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Each OHLC bar has a notch on the left to show the open and a notch on the right to show the close. Charts are posted premkt by participants in the Trading in Foresight thread. Since you've never posted here, I don't know what your objectives are. If you're just beginning, there's quite a lot of preparation to do before plotting S&R levels, much less entering a trade. If you have not already done so, I suggest you read the Stickies, beginning, naturally, with the Introduction. Otherwise, entering trades off S&R levels will be just another deadend. On the other hand, it's perfectly okay to determine for yourself whether or not others find success with this process in order to decide whether or not going through all this is worth the time and effort. The best way to do this is to compare results with intentions, i.e., compare what one plans to do with what one actually does. No other thread addresses this on a daily basis. Loads of people claim success in hindsight, but unless one knows what they planned to do ahead of time, much less what they actually did in real time, the hindsight claims are meaningless. Db
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Ticks don't have a range. If whatever programs and providers you're using don't provide you with anything satisfactory, try a 5s chart. The point is not so much to duplicate what somebody else is doing but to view price movement with as little separation from the activity as possible. Db
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While I'm sure there was more to it than that, this is in fact a legitimate form of Reality Therapy. Not unlike the old vaudeville joke: "Doctor, it hurts when I do this"; "Well, don't do that". Db
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Generally speaking (there are a couple of things that are not essential), this is sound. That I say this should come as no surprise since I've been arguing these points for years. The surprise is that Gary came up with it. Perhaps he's evolved. If you have a thoroughly-tested, consistently profitable trading strategy, then, yes, whatever problems you may be having are in your head. If focusing on these "HVAs" does not bring about the desired solution, then perhaps you do not have sufficient confidence in your strategy, and that confidence is essential if relying on these HVAs is to yield satisfactory results. Give it a shot. Record your internal and external behaviors and their results. Pinpoint the source of the difficulty. Then you'll know where to go from there. Db
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See my post in the CWS thread. You may also be interested in the discussions which follow. Db
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Thank you for this clarification. I had been concerned that you had become the victim of alien abduction and had been retooled to draw a trendline incorrectly. Whew! Db
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Or you can make it easier on yourself and just put up a tic chart alongside your bar chart (not on top/bottom) and see what's going on inside those bars. Though somewhere in your head you know how those bars are created (just as you know where the meat in the plastic package really comes from), seeing them being created enhances your perception of the process. If you're viewing charts in hindsight, a tic chart is the only way of opening up this process to you. If, for example, you have a given bar with open and close notches more or less in the middle, you have no way of knowing if price traveled to the top of the bar, then to the bottom, then to the middle to close, or to the bottom, then the top, then the middle. The two bars appear to be identical, but they each were created in opposite ways, and the two waves send different messages. This is not to say that what occurs in one interval has cosmic significance, but the flow is different, and it can be seen only if one "opens up" the bar. Candles won't help. Even though you may not be interested in the TICKQ, and you needn't be, there are examples of tic charts against bar charts in the TICKQ thread. Db
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Looking at longer timeframes can be misleading if one is doing it for TLs and SLs and DLs and even S&R. This can often lead to a bias that prevents the trader from seeing what's in front of him. It's not impossible to do it without forming a bias, but it is difficult. However, there are confluences that can prompt traders to throw in the towel. We've seen this more than once recently. Think of them as tipping points. Taking a wider view is not much different than looking at a closeup of somebody's nose and zooming out to get the wider view of the subject at a table in a cafe next to a park in a village... Key, then, is not to focus on one or the other but to put everything in context. The intraday is part of the interday, but it does have it own rhythm. It can, for example, make U-turns and roundtrips and wind up where it started. Stay tuned to both. Db