forrestang

Here is a look at the G/U currently. Ignore the red line stop for now, it was placed originally with the 30pt target and 15 point stop.

I shorted 95.50 After breaking through that 15 min 2Test you can see on your chart, got up to 2points in unrealized P&L before being taken out at BE. Bleh. ----Addition(10:27EST)-------- Adding some NQ observations right now. Attaching current 5min activity(hope it's easy to make sense of), and a S/R chart. We just probed down through support thus far. ----Addition(10:51EST)-------- Added another picture of current NQ activity. ----Addition(10:56EST)-------- Both NQ and ES putting in HLs on 15min after probing through support. See next two pictures.

That just doesn't sound right

Interesting. I was just reading about this and clearing this concept up in my head. I read your post but didn't get what you where saying, until a few hours later I realized I was reading about this same behavior you describe and then it kind of clicked. This very behavior you describe is in "The Law of Charts" on pages 8-10. The main point was when either Congestion, a Trading Range or a Ledge forms. The idea was to take the break of 1-2-3 (HL/LH) patterns, and the subsequent breaks out of correction points (ross hooks). The text mentions to be careful when you don't get a correction, and an immediate break of the correction, to be careful of either a Ledge forming(4-10 bars), which may then lead to Congestion(10-20) bars, and finally a trading range which is greater than 20. The idea was to not take the very first break of the range, as that is usually just potentially a fake BO, or even if not just wait till the first correction (minor pullback), with an almost immediate move out... then trade the BO. By doing it this way, the range is usually formed of opposing 1-2-3 patterns, i.e. opposing LHs or HLs..... so when we finally get a BO of the range we will have likely put in that 1-2-3 formation. Attaching a cliff note version with some additions to the chart from the book. The text probably does a better job of describing this than I did.

Good deal. I am glad you're enjoying reading them! Something I am hoping to get a feel for is when to pull the 'rip cord' as you often say. Since I am mainly interested in trading the BO of something, I would like to see a strong move in my favor immediately. I'm not sure if this is just a sense you would develop over time, or if it something that can be taught? There was a period in this thread where it was discussed to not let price run your ISL....... Anyways, when you post some trades again, commentary based on this topic again would be much appreciated. ---- Addendum ----- For intraday trading futures for example, would it make things more obvious looking at a smaller interval chart, like a sub minute chart to make it obvious that price is not breaking out meaningfully? I.e. entering the trade, and exiting w/o movement with volume on a small interval chart?

We are currently in the middle of the price bracket from about 1810 ~1800. And it is lunch. But here are some more observations of what is happening RIGHT now. I took the entry on the first hook(First Blue Line), but after taking a few tics for my fees on on part, small profits on my next third, was stopped BE on the 'runner' portion of the trade. We've gotten that bounce off Resistance above, heading lower. We've hooked twice, this 2nd hook is in play. Potential entries shown on chart.

Here is some more stuff based on Thales' weekend reading. We somewhat based off of support shown on the 60 min, even though we did take it out by a bit. But we did put in a 1-2-3 low(albeit this 1-2-3 was a bit unsymmetrical, in that the '2' point was waaay away from the 1.. And are now headed right into resistance so it should be interesting to see what happens up here, whether we develop a 1-2-3 high or not? But at any rate, here are some observations. Will update this post as things develop. Also, notice how many more hooks or swings that get put in place on the range chart on the right, some of which could easily have been traded. I am mainly using the 5min as depicted, but still I am observing the 1 point range chart. -----UPDATE (11:08est)------ See the 2nd picture. We are in an uptrend after putting in that 1-2-3(HL) bottom. But the 1-2-3 is a bit skewed and is a possibility of filtering trades. We put in a hook which could lead to entry, and there is a 'S' for an early entry before the BO. Note that we are at a potential resistance area and it might be good to see what develops up here. -----UPDATE (11:26est)------ See the 3rd picture. Comments are on chart and should make sense with current action. It's possible nothing develops all day, so this exercise of mine might just be purely academic. -----UPDATE (11:46est)------ See 4th picture. To avoid creating another useless post, this will be last update unless something happens. Here is the latest in what price has done.

My NQ analysis for 15December2009. As of this writing; and all levels are not exact figures but general zones in which I am attempting to contain various brackets of price movement: 1810~1800 - Current bracket we are in right now 1800~1792 - This and the bracket below basically create a large range, with 1792 being about a midpoint 1792~1779 - See above bracket comment 1779~1759 - Lower Bracket price may or may not reach.

At the risk of possibly opening up a can of worms, I am posting an intra day NQ chart based on some things I read in the Ross book. I started reading it, and found his money management techniques interesting, and couldn't put it down and read the entire book(it's a quick read). I personally did not trade any of these occurrences, but I was able to observe and mark them down real time. There are possible entries on the chart depending on how you may want to trade based on what I saw. I also looked at this with a 4 range chart and found some interesting correlations. I think this fits in well with this thread.

You must be having a bad day?

I regret not taking this. It fit my rules EXACTLY for a early morning ES trade. Only thing that had me worried was I thought we were coming into support.

Post away man! If you look back there are dozens upon dozens of trades that are not using that hook for an entry. I'm looking forward to some big picture "Jon ES trades myself!"

Just an observation, i wouldn't take this because of the blip to the left. And particularly not till HOD was broken OUT of this range.

Target Hit. Entry was 06.75, target filled at 1110.00! ----edit----- Attaching a 'swing point' picture. --edit----- Just another comment, price went right up to 10.50, which was the original fill before dropping off quite a bit. You'll notice 10.75 was that nice little resistance area overhead, and price stopped there almost to the tic before retreating quite a bit.

Sorry for the lack of details, I am wondering if we get some upside continuation above on a break above 06.50 in the morning session? May be small resistance over head, break of about 08 after break ing the aformentioned level will be the tell, if anything breaks at all? ----Edit----9:41EST There was movement but follow through seemed to have stopped quickly. Stop below last swing low below 04. Looking for 10.25 for target.

I couldn't agree with you more! If it weren't for the psychological barrier of trading the way I have observed in your journal, everyone would be doing it. I do think the 'lofty' targets and all in/out is an excellent approach, it's just hard for a lot to deal with watching a big winning trade evaporate into a BE or a loss. Like you mentioned when I look back at all my trades, if I would have held tight, I'd probably be unhappier short term, but overall thrilled at the results at the end of each month.

Just about this thread, I appreciate that it is the ONLY thread that deals with the 'hard right edge.' Which is what trading is about. Not saying dead charts are useless or anything, as explaining things on them are sometimes necessary, but showing someone what the right edge looks like prior to a trade is an awesome perspective. And that most trades posted are kind of swing/position trades lends itself well to be able to show someone your 'right edge read.' So I am appreciative of all those that have put themselves out there showing what they see on their 'right edge read,' irrespective of whether that trade was a winner or loser.

Has this thread made you a better trader, explaining what you do? I realize you've been doing this for a looong time so you've surely been proficient at what you do for a while, but did this thread make you better? By better I don't jst necessarily mean better in terms of the amount of 'time' this thread has been active, but is there anything special you've learned from your postings here?

Nice! I myself have been doing 1.5 times the spread usually. Sometimes I get a much better fill on a limit if price doesn't immediately rocket to the moon.

Here is another outlook on intraday ES action. Earlier produced a pretty good trade. Let's see what happens here. This first chart is a 15min and 5 min chart. You'll see the blue line tested twice on the 15min thus far. On the 5 min, this same blue line is constructed. I would like to see a bit of a retracement culiminating into another HL. You can see the HLs that have been occuring( black lines). There is a bit of resistance over head though, and this is somewhat sideways, not clean moves. I'm not trading this just posting the observation.

Not sure what will happen but based on this wondering if follow through to downside occurs, there is pending news as well. If something develops will update. ----EDIT-----10:08est no real follow through on that one as you'd like to see with a BO. ----EDIT------10:16EST Break below 2nd picture red line should provide some movement. Will explain as soon as i can but trading and posting is a PITA ----EDIT-----10:23EST Finally some movement, particularly after the red line was pierced to the downside. ----EDIT------10:43EST Blue line was entry, red line is tightened stop. green line is target need one tic to push through.

Would you be moving your initial stop to above that swing high since it formed?

I was slow on this one, but the chart looked beautiful on the ES. I think these are clear and obvious trades. How often would you say the ES presents opportunities like this on a weekly basis. I have been slacking off on looking for early morning opportunities.

That's all well and good what you are saying, relating it to a plan and all. And I generally agree with you. Although I generally disagree with you that the cliches work..... And by that I mean they don't work by themselves. They all MUST contain some degree of relativity to be useful. Someone saying 'buy low sell high' is absolutely useless and arbitrary...... and so are all the other cliches without the proper context. Thales likes to Buy High and Sell Lower at times, which to someone else and what they are looking at might not be buying high. It's all relative. I guess my point of posting that was just to say that us harping over someone using the word 'predict' vs. 'anticipate' is a rather moot point. I suppose this is like "the chicken and the egg." All these cliches are IMO relative. For example, the axiom 'buy low sell high' is completely arbitrary.... and only has meaning relative to some point. On a chart there are ONLY two absolute points, and that would be the the lowest and highest price ever traded for that instrument. Everything else is relative to whatever price someone is looking at, bar interval or time frame. Now if you say Low relative to a certain price then we're talking! The truth is still there, that the ONLY way to make some profits at least without doing something exotic with options, is to pick a direction (no matter what word you use to describe HOW you picked that direction), and for price to move in that direction long enough for you to cover your entry. And all I am saying is that whether you call it 'reacting to price' after some resistance before you sold, or you 'predicted' that price would move down further after bouncing off resistance doesn't matter, it's just semantics in how you chose to word the phenomenon that occurs on your charts. I almost mentioned this point as I think it is a good one. But I guess I was thinking that it was understood that none of us can actually see into the future and KNOW with certainty where price is heading. So maybe in that particular case that might not be the best word to use in that situation.

Not as though this is a big deal, but whether or not one says 'predict' the future, or 'anticipate' a certain thing happening, or an 'educated guess' is just a matter of semantics. In that it's just how one chooses to phrase a phenomenon. The point is that we ALL take some guess as to where we think price is going to move, and place a trade based on that belief. That's the ONLY way we can make a profit. Whether you call it a 'prediction' or an 'educated guess' or 'anticipation' has no bearing whatsoever on whether or not a profit is made or if the trade selection was logical. I think it just sounds cool to say things like, "I don't predict where the market is going, I just react to what it does," is just one of those trader cliches that sounds awesome and mystical.