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As much as I'm sure you're able to do it, I'd love to keep up with how it's going. I've seen people do challenges like this, and they're always very interesting. Wish you the best on this experience.

Thanks for your feedback Db, your comments on how you would have traded this was exactly what I was looking for. If a hinge does fail (so no direction), at what point do you "realize" this and stop trading it? Something like a test, return, test and return in the opposite direction?

See someone who is very knowledgeable in this area. I mention this because there are several other "solutions" that have come about in recent years that may be a better fit. I'm in the research process right now (I have astigmatism as well), so we'll see.

Since hinges are very easy to spot real time, and they occur rather frequently, I wanted to examine some "failed" hinges, and how we can protect ourselves. Here's an example. The market and timeframe don't matter (assume this encompasses a larger sized move). This hinge occurred in a longer term downtrend. I mark midpoints for hinges, because they frequently are tested again and can act later as supply or demand areas. As you see, price broke out of the hinge to the upside and went higher than the past two bull traverses. However, bullish interest soon died, and price returned back down, broke the midpoint, and continued down. I've noticed that this occurs somewhat often. In this case, I was stopped twice (entered on the break, stopped soon; entered on midpoint test where it momentarily bounced; stopped) before the break down below the midpoint (I prefer rather small stops, and don't mind re-entering). It must be noted, however, that the pattern did indicate a large market movement. How do you handle these? Was these a warning sign here? At what point is a hinge "invalid"?

To the best of my knowledge, yes. If not, it's for a while, and once it runs out, you could probably open another demo account.

You can get free simulator of NinjaTrader from several brokers (AMP Futures, Mirus futures, etc), which will include a data feed. I know AMP provides Zen-fire, which is a great data feed to begin with. Many of the demos don't have a time limit. I'm not aware of any free MP solution for NinjaTrader, but if you find one, any data feed will work.

When you say breakout, are you referring to the breakout of the two lines that form a hinge (the "wedge" area), or of a previous swing high? I've found that breakouts of swing highs can be a more reliable entry, because often, a possible developing hinge can turn into a springboard for a longer congestion area (which is easy to see in retrospect, but harder real time). That said, a breakout entry here obviously does give up some price movement. If the hinge is small enough (often on a much faster timeframe), I frequently can place stops below the midpoint to allow for a re-test. For most other hinges, I do see myself re-entering often due to that midpoint retest. I've also noticed a false breakout in the opposite direction of the eventual movement is fairly common.

If it's really good, break it up into two projects for different programmers, and leave all variables out. Other than that, figure out the best way to pay. In general, programmers prefer per hour, since it's hard to estimate the size of a job. However, make sure you can trust the efficiency of the programmer. I've found that you get what you pay for. Picking the lowest bidder (if you have bids) isn't always the best idea. Get some past work/samples from the programmer to at least test their competency.

Mind elaborating on this?

For that matter, can people see the listing of a private thread (like in the forum threads display)? I'm sure that in general, if someone wanted a thread "private", they wouldn't want it to be displayed around (not really the case for mine, but seems like it could be important).

Personally, I think you would be more successful and have an easier time identifying your "rules" by trading the extremes, and leave trading the middle chop alone. What you listed sounds good, but as you know, you have a lot to add to it before you can even think about execution.

Lame answer: whatever works for you. It probably depends on position size, and trading timeframe. I tend to group my contracts in 1/2's and 1/4's for exits and re-entries.

(second time typing this, browser error..bleh) In chat, the topic of position management can up. Specifically, fixed size exits vs market based exits. When I first started trading (past 1 car), I used an immediate scale out at x ticks ("locking in profits!"). The underlying reason was because I traded scared, and wanted to get size off ASAP. This is not a winning strategy. Soon after, I moved to all-in-all-out (realizing my fear, and simply removing the practice entirely). Phantom of the Pits changed my view on entries, so I started scaling in (for example, I may add to a winning position when I get another unique entry setup). Db helped me also view exits differently, suggesting that scaling out maximizes profits (for him). Trading isn't a game to be "right" or hit home runs, it's all about the P/L. I spent several hours going over previous trades, and realized that I would have profited more by scaling out at "exit setups". I've since moved to a scale in - scale out position management strategy, and am very content. My exit position management is based on S/R and climaxes. I do not exit in anticipation of S/R, but will scale out (or exit completely) at a S/R confirmation where price does not move through. I also (aggressively) move my stops up just under previous s/r areas. Most significantly, I scale out on climaxes (which, if they present themselves, can give you very good exits). I'll get an illustrative picture in here eventually graphically explaining what I'm talking about. Thoughts? I'm no expert, so please feel free to share what works for you.

Hm, would it be possible to make the text wrap? Currently, it just keeps going, so it's unreadable anyways. Hehe, thanks for getting on this.

Here's a longer term chart I posted this morning.

I was thinking we could use a thread to easily share charts and make more detailed comments regarding something that was discussed. I've had a few chat discussions bleed into PMs because of the more "formal" setup, so we might be able to get some use out of this. Inviting the regular chat crew, if I forgot you originally, whoops. Likewise, if you'd like to be removed, let me know.

I think you mean "collecting premium". Regardless, I recommend that newbies never short gamma. You're potentially exposing yourself to extreme risks. As a general rule of thumb, even if you've found an "amazing" options strategy... if it's that easy, the edge would be beaten out long before you get there.

I'm all for shorting REITs to hedge, but watch out on possible hidden beta exposure. I believe (don't have the hard facts with me right now though) that REITs are more market sensitive than the actual housing market.

Yeah, that doesn't make much sense. I've never heard of a bookie shutting down a line because of overwhelming bets on one side.. just change the line (even if you have to change it a lot), and it will balance.

To clarify, this is just describing what I'm looking for. It's not any different than a traditional climax, where volume spikes, and volatility contracts. No new concept here, just is specifically what I'm looking for.

Bingo. As I understand this, this pipeline is the only thing keeping Russia from an oil monopoly in the region. It's almost funny how both sides are using propaganda to their advantage: "law enforcement agencies" vs "aggression forces", "aggression forces" (from the other side) vs "peacekeeping operations". I know this always happens in war, but it's fairly clear here. I don't think either side is "right". Georgia should have held the cease fire, and Russia shouldn't have entered. We can only hope peace talks can make some progress.

Ah, welcome to 21st century war. Russia's biggest news source has been on and offline for the past couple of days (it's slooooowly loading for me now). Georgia's central government web site has been on and offline as well (didn't load). Both sites are presumably being DDoSed by the other side. Interestingly enough, Russia Today says: "Russian President Dmitry Medvedev has ordered an end to the military operation in Georgia. He said the objective - “to compel Georgia to peace” - has been achieved. Medvedev also ordered the Russian military to “eliminate the aggressor” in the event of Georgian forces resuming hostilities. " For some reason, I find "resuming hostilities" to be subjective enough for pretty much anything to cause them to "eliminate the aggressor". Sheesh.

Not sure. I've heard some second hand sources (which is better than you can get on the news) who have said this is very real. Georgia doesn't really benefit from being invaded, imho. Georgia is a soverign country with a slightly different ally base. The speculation I've heard is that the Georgia president used the Olympics to try to make this as small issue as possible. Whoops. Now, why Russia cares so much is another issue...

Exactly. I like the idea, so let's keep discussion kosher. I'd like to see more live examples if you could, EMC2, as well. Also, feel free to stop by the TL chat room (link is above) during market hours. I'd love to hear what you're seeing real time.

Largely, the international community has been against Russia's actions, as they have gone quite far past "peace keeping" operations. Dick Cheney, quoted from yesterday: "Russian aggression must not go unanswered, and that its continuation would have serious consequences for its relations with the United States, as well as the broader international community." (Source)