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TheNegotiator

Market Wizard
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Everything posted by TheNegotiator

  1. TheNegotiator
    As this is perhaps one of those things which is a real pain for traders to research and then switch if necessary, I thought it'd be good to share with you some of my experiences with various charting and trading platforms. The various different considerations have to be:- Functionality Reliability Speed Cost Computing resource requirements Data feed compatibility Ability to trade from it(I know this is a function) Firstly I'll just tell you which programs I have used in the past to various degrees. These are:- CQG Integrated Client CQG Trader ESignal Linnsoft Investor/RT Multicharts Market Delta Ninjatrader Trading Technologies X-Trader Pro Next I'll tell you what I believe I need and what the ideal setup is:- Dedicated trading PC Charting/Internet PC Charting Programmability Depth-of-Market Ladder - DOM Good Market Profile, Volume Profile and Volume Data Type Indicators The first thing you have to note is that using two PC's means having two data feeds. This costs money. If you use a single PC but want a different charting package to your execution platform, you'll need two data feeds. This costs money. So here's a quick rundown of a few pros and cons of each of the platforms I have mentioned. CQG Integrated Client Excellent platform which I have used extensively in the past. You can do most things with CQG and if you can't do something, there is usually some solution. It's solid, you can trade from it and the data is reliable and on tap. Feed is included. Very good. Very expensive. Last time I checked, it was £400/$800pcm. Really, it offers way more than most traders require. CQG Trader Usually free or built into the brokerage costs. Robust and good data as with CQG IC. Good DOM which can be altered to some extent for how a user wishes to use it. Can open multiple side by side DOMs. No charting as far as I am aware, so you must have an additional data feed to chart as well as use CQG Trader. No SIM unless you do the free trial. So there's no messing about if you are a first time user. You make a mistake, you lose. ESignal Not used this in a long time. At the time it had a lot going for it. Lots of features, lots of symbols. Feed included. Reliability had been an issue for me in the past so I just have avoided it. Not that cheap but I think they have different options now. Linnsoft Investor/RT Does a lot very well at a very reasonable price. Excellent for the charting features which I require. Makes you work hard to do things. Symbols really annoy me. Should be flexible as it is, but be much more straight forward when trying to load charts with common symbols. You have to pay for an additional data feed and they generally aren't cheap. However, if you do most of your analysis out of hours, DTN Market Access is perfect as it's only $15 pcm and gives you(I believe) access to all the symbols which DTN covers. It has a trading ticket I think but no DOM. Programmable for advanced indicators (I don't program but I often use indicators others have written). Lots of indicators on offer. No free trial offered. Multicharts I'm not too familiar with Multicharts. I believe they have just done a major release. I have looked at the free version and honestly, there is nothing I can see that differentiates it from something like Ninjatrader. So unless I see or hear of something that changes my mind, I wouldn't chose to look at it further. I know plenty of people are out there who use it, so it must have something to offer. Market Delta Market Delta is driven by the same engine as Linnsoft Investor/RT. Linnsoft I believe license it out to Market Delta. It has the same basic functionality as IRT and anything you do is done in pretty much the same way. It needs a data feed which you must pay for. It does however go further than IRT with the amount of volume type indicators you can set up out-of-box so to speak. The biggest benefit to me is that you can chart a "delta footprint" and a chart displaying volume traded at price per bid and ask. It's expensive imo. It costs $129 right up to $249 pcm. They do offer a 1 month free trial. Ninjatrader Really useful for beginners. Usually 'free' with costs built into brokerage commissions. You don't get the ability to use automated strategies or use the chart trader function(unless you were grandfathered in with chart trader). To use automated strategies and certain types of orders, you'll need the full version which I beleive you can lease ($50pcm I think) or buy for $1000 one off fee. Very flexible and can do pretty much anything. Not enough indicators which are useful to me. The more custom indicators you install and use, the more the system resources are put under pressure. DOM is very poor. No way of customising it. The way the volume data is displayed makes it very difficult to 'read the tape'. There's no scrolling back on a time & sales window either. Good that charting and trading are in one package though. Trading Technologies X-Trader Pro TT still have imo the benchmark platform when it comes to DOM (or MD as they term it) trading. They originally designed and patented it and in the past there have been issues with different software vendors because of this. It is the fastest, slickest, most robust and useable DOM platform I have used. It now comes with a degree of charting too I believe although I don't actually use it anymore. It is very expensive. Needlessly so imo. It used to be something like £800 per month for Pro. I needed it at the time, but I think there was a standard version which offered the ability to have fewer different contracts up at the time and no advance features for about half the price. I think this is probably the version which brokers offer for 'free' but built into commission structure. I haven't checked but maybe will at some point in the future. The autospreader was very good too. T&S excellent and very useful position window. They also have something called "Orders and Fills Window" which "Combines Order Book, Fill Window, Trade Book and Fill Recapper functionality into one new window. An order toolbar provides one-click order actions along with the ability to uptick, downtick and repeat orders." apparently! Very good product. The platform of choice in arcades. I'd just like to finish off by saying that these are the products I have used and for the features I need, these are my opinions. There are loads of other products out there, good and bad, so feel free to add your comments on what I have written or on your thoughts of other platforms. One thing I may do is take another look at TT at some point and perhaps take a free trial of Sierra Charts. I'll report back when/if I do.
  2. TheNegotiator
    Nice one DD! Thanks to you too!!
  3. TheNegotiator
    Schatz:Bobl:Bund (intentionally skipped Buxl as I didn't find the data yet!) 15:6:4 Schatz:Bobl spread is charted 2.5:1 Bobl:Bund spread is charted 1.5:1 Please if you have the correct values for the US, post them. But to get an idea, it looks like they are something like:- 2yr:5yr:10yr:30yr 30:15:6:2 2yr:5yr charted 2:1 5yr:10yr charted 5:3 10yr:30yr charted 3:2 I actually don't believe these are accurate so please take with a pinch of salt. The Schatz:Bobl:Bund I believe is far more reliable though.
  4. TheNegotiator
    To begin with, the German Bund is the benchmark in Europe and US Treasury Notes are the benchmark pretty much worldwide for government debt. The futures on these contracts are therefore very liquid as they are traded and held for a multitude of different reasons. For simplicity's sake, I'll just outline the basic structure of each product set. There are many more contracts involved in these systems, but right now I'll just tell you about the main ones which you may be interested in to trade. So for the US, please bear in mind that I have little experience in spreading in the US so if I miss something here please point it out, you have 2's, 5's, 10's, 30's. As the futures are based on a basket of maturities, there is a range for each of the mentioned duration of maturities. The futures for these are in order ZT, ZF, ZN, ZB. For the German Bonds, you have the same 2's, 5's,10's, 30's but they are called Schatz, Bobl, Bund, Buxl. As far as trading goes, there are outright position traders in individual contracts and very importantly, there are spread traders who look to profit from changes in the yield curve. This yield curve is based on the rate of return you are likely to get on your money depending on the length of time you hold it for. Generally, a 'normal' yield curve, is one which curve up in yield as time to maturity increases. This is because it's more certain what is likely to happen in the short term than it is in the long term and so less risky and so you expect a lower return on investment. Many different things can effect the nature of a yield curve. The main ones are interest rates, inflation, global risk events, central bank programmes. The general premise though is that when there are interest rate changes, this effects the short end of the curve more as longer maturities could see the interest rate fluctuate back and forth. Inflation generally effects the longer end more as over a longer period of time, the value of your money will change more. Inflation is bad for bond values as money is worth less so value has to go down to get the same real return on investment. Interest rate hikes are bad for bond values as this means new issues of the same bonds have higher rates attached to them, so to counter this the current lower interest rate bond is discounted so it will return the same amount on the investment. The inverse is generally true for both, although other factors will be at play too. When economic figures come out, often you have the case, more so when the economy is doing well for a longer period of time, that good figures send prices down. This could be in expectation of higher chance of interest rate hikes down the line. Protracted bad period could lend themselves to when poor numbers are released, bond prices go up with the view being one of a loose monetary policy environment likely to continue. The other main factor is the flight to safety/quality principle. When specific thing happen like disgruntled people targeting the west(or anywhere else) or massive natural catastrophes happen, stocks can be adversely affected and amidst uncertainty they usually are. But people need to put there money somewhere and it's usually the likes of bonds, gold and the dollar. So events such as these will send the bonds rocketing up. As far as the spreads go, you basically sell one contract and buy the other in a particular ratio or vice-versa. Also common is the fly spread which is say buy one spread so e.g. long 2 yr- short 5yr and then short the next down the line in the curve so short 5yr- long 10yr. So you end up long 2yr-short 5yr-long 10yr in the specified ratio. All of this should mean you are less exposed to risk as these contracts are very much linked. With that, spread traders usually do bigger size and more round trips. Brokers normally will give them favourable margin and round turn rates because of this. Anyway, that's a quick(and I do mean quick) overview of these products and spreading them. I'm not saying that you have to spread them, but I think you need to be aware of the spreads and what they are doing if you want to trade them. I do think that especially the US Treasuries are pretty technical and useful to monitor with market profile, but I don't think you absolutely have to use mp either. I'll have a look to see if I can get the current spread ratios between all these products and post some charts of the spreads at some point. If anyone has the current ratios and wants to chip in, that'd be useful too.
  5. TheNegotiator
    These kind of things happen all over the world. It helps those who are in positions of power to stay there.
  6. TheNegotiator
    Of course these other things must be monitored when placing the trade. I agree wholeheartedly on the lowering the tf when we get the volatility we have had last week. I think it's really important to maintain a bigger picture view within the day, so make myself look at a 15/30min chart but I tend to look at a lowish volume profile. Say something like 1500/2500. But it depends on the market. As for that particular trade, I'd just like to point out that I am not advocating bottom fishing in a market like this. But over the past week I have noticed that at the really 'good' levels you're not really being given two bites at the cherry so to speak. But if you get in and monitor the trade carefully and make sure you're decisive, you give yourself a very good chance of taking a good trade. I think an example of a level which didn't work so well was around the 1218 mark. I think you have it on your chart steve. It didn't really show much of a profit on the way down, but you could have got in an at least not lost money for the opportunity. I think the important thing to note when the markets are behaving like this is just wait for the better opportunities. The areas that you wouldn't normally imagine could be tested will probably be. Above all have patience. Don't be a margin call statistic if you can avoid it.
  7. TheNegotiator
    Welcome to TL Marek! TL is a great place to learn for sure. Make sure that you don't rush to go live. Also, make sure that if you're sim is the sort which touches a price and fills you immediately, that you look at each trade to see if the price went through your order subsequently. Otherwise when you go live you are likely to see a big discrepancy between what you are doing now and the results you get with real money.
  8. TheNegotiator
    I watched an interview with the head of the bls about how the jobs data is compiled. Guess what, for a large part they use an algorithm to 'estimate' figures. Wow. I don't like the jobs report. I think it sucks and just gives huge traders chance to adjust their positions!
  9. TheNegotiator
    What a day in the markets! I wanted to share a trade I did today. It kinda sucked. I made 10 points overall on it. I bought 1163.75. Damn! Here is a chart of the lovely rejection of the nearest major volume level. 1163.25 on the button. Sweet as you like.
  10. TheNegotiator
    So we've had a bit of a move across the board over the last week or so. I was actually fairly surprised that the range was as big as it was yesterday in the ES etc. given that non-farms were due today. There were discussions going around that technically the similarities in the US indices just at the end of 2007 and up to 27th July(ish) this year were pretty clear. Some things were off here and there(I believe in 2007 we were below the 200 day ma). The markets may currently be teetering on the edge of meltdown once more. The market has been artificially pumped up with quantitative easing and other measures in the hopes that the real economy would recover. It hasn't. Numbers are still appalling, housing markets are not good at all, debt laden countries have their backs to the wall at the hands of the markets, the rich are hoarding cash and yet there is talk of a QE3 programme. Well, I think perhaps what the world needs is some economic leaders who don't have their heads in the clouds(or perhaps up their own rear ends). Stimulus by giving rich people more money(effectively) when they won't lend is going to help guess who? Rich people. This whole talk of QE3 is absolute rubbish imo and it has to stop. Otherwise what may come is an economic crisis which makes the last look like a sideshow. On a final note, call me a cynic but those nfp and jobs numbers were suspiciously good. Who would have bet against them being good I wonder given the backdrop of the week so far? If indeed these suspicions have any fact to them and I am well aware that it is speculation, but we know how this world works, what in actual fact are they expecting to gain from it? Do they believe that one good jobs report is actually going to convince 'intelligent' people that everything is really okay? Or is there someone who need to unload a position I wonder??
  11. TheNegotiator
    Hi everyone, I'd like to start a thread to discuss contracts such as ZN, ZB, FGBL, FGBM, FGBS etc, etc. I feel that they are under represented and have great potential for guys at TL. Obviously they have different drivers to the stock indices but actually with rates looking like they will start to change worldwide, this could a chance for government bond futures to shine.
  12. TheNegotiator
    I like it! I definitely have some thoughts on your answers though. Firstly, you haven't traded for very long right? So the prerequisite of only trading a stock you would hold for at least 6 months is based on what precisely? Not saying it is wrong. But is it down to volatility, liquidity or what? Also, why does it matter that you would hold it for 6 months if you are a day/short term swing trader? A thought on this too is that have you considered at all trading fx or futures of any kind as you are so short term? As far as news goes, I prefer to be aware of big stories and monitor any important releases inc eco figs such as the biggy we have this friday. I don't actually trade off the news though so I don't feel I need a newswire. So this really depends on how you use news.
  13. TheNegotiator
    Welcome gabmus & hapa.trader! Lots of things to see at TL. Great knowledge is to be found, but try to participate. That's the key. As far as trading goes, you must try to learn as openly as possible. Observe yourself as much as you observe the markets. Good luck!
  14. TheNegotiator
    Hi cash123, Welcome to TL! Thanks for the Thai hello! I'm sure you'll learn a great amount here at TL. At least have some great conversations! You must have some great stories from the pit to tell... You're definitely right about electronic trading being a different game. Everything has to go out the window. At least initially. The other thing is that I think there are definitely some significant differences since the 5 years have passed since your retirement. Market phase, Central Bank intervention, crazy algo's to name but a few. Maybe you could start a thread about your journey from floor to electronic trader...
  15. TheNegotiator
    I have dtn and cqg. .............................
  16. TheNegotiator
    try @DX# ............................................
  17. TheNegotiator
    Fail there at 1280.75 was important. See if there's any more to the downside here. Bigger DX chart attached.
  18. TheNegotiator
    Sorry, missed the important bit off the chart!
  19. TheNegotiator
    I agree totally with the retracement idea. However, the manner in which we have sold off makes me more than a little suspect. So right now, I'm not too worried if I miss a big move up although I'm switched onto the possibility of one. As for dollar index, you sure you don't have it? Which feed do you have?
  20. TheNegotiator
    Right. Quick in, quick out and don't get married to any trade as it'll kill you! You can easily take say 4 x 2-3 pt 'scalps' but picking a 10 point winner... I'm just not sure it's necessary.
  21. TheNegotiator
    I think it's quite telling to look at a TICK chart next to ES. Didn't seem to be as much consensus with the stocks early on so maybe the sell-off was futures driven. I actually took a 5 tick loss buying the Friday POC/close but I'm quite happy I took it off where I did! Well played on your trade mate! (Don't give it back!!) The low in ES was pretty good so I suspect that it'll hold unless we start to look weak again. Then who knows! Test down to 1266 and beyond maybe... Dollar index is vertical at this moment.
  22. TheNegotiator
    29.25 point IB in ES so far in just over 30 minutes of RTH. That's pretty crazy.
  23. TheNegotiator
    I'd just like to put up a quick note here on trading US economic releases. Don't bother. If you take a look at the minis today from RTH open, the selling was sustained into the ISM figure. So to me, this is more than just responsive selling. Someone had the nod on what was a terrible figure. Happens frequently. If we go much lower here though, who knows, another 5/6 day in the making?
  24. TheNegotiator
    Hi David, Welcome to TL. There's a wealth of knowledgeable people here so after 5 years of trading I'm sure you'll fit into that category!
  25. TheNegotiator
    Of course it's a very important thing to look at because trading is about multiple trades and not just one. So it's very important that we should be able to measure our performance and consistency of performance over time to gain a better understanding of our efficacy as a trader. What rather amazes yet does not surprise me, is that people write books on these things which boil down to being risk:reward ratio and average trade return. What is even more interesting is that people need them to write books on it. I believe a good deal of trading is about diligence and common sense. Yet all too often, people who wish to be successful traders, just aren't willing to put in the leg work and face the facts that may come to light because of it. People are all too often deluded and far happier to blame someone or something else for their poor performance. Do the work, look at the facts, improve your trading. Just my take on things.
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