brownsfan019

Here's a follow up chart to my post there: The first red box was the big drop day on the dow (Feb 27th). As you can see, even after a big bear day, the Dow did not really plummet and head into a bear market as many predicted. It came down a little more and after we all realized the market was not going to the dumps, back up it came. I have to wonder what the fascination is with trying to pick the top. Look how many possible tops appear on that chart. I realize no one here would of tried to call those tops either, but someone, some where did. If anything, I would be a permabull if I had to choose. And outside of my trading accounts, I do. If you have time, the market has ALWAYS gone up. It may not be immediate, but if you can buy when you see great opportunities at -500 days, you are rewarded sooner or later. At the close of business on Feb 27th, the DJI was at 12,216. We are now wondering when 13,000 will be passed. That's approx 800 pts in 2 months or so... I realize this is not a long-term investor forum, but the point being that over time the market has always headed higher. Sometimes it takes years and sometimes it can gain 800 pts in 2 months... I do not use this information in my day-to-day trading as I am just trying to capture small moves and exit. But, for your retirement funds, children's funds, etc. going long the DIA on Feb 27th looks like a pretty smart investment!

Here we go again... trying to play guess the top... Here's my 2 cents - watch others attempt to catch the falling knives and join in once there's some sort of confirmation. What is interesting is reading the tops/shorts threads appearing here and elitetrader, meanwhile the market continues higher... hmmm.... Here's a simple 1 month DJI chart from Google Finance: If you are looking to enter the big move or are swing trading, I would have a real hard time taking a short now or soon. What is intriguing through all of this though is that all these new shorts have either been taken out or may be still holding a losing position. How many times have we seen one day where it just seems like there is a domino effect of heavy volume taking place... Should the market continue higher, I would not be surprised to see a day or two where the shorts say enough pain. Daytrading is a different topic altogether in my opinion. In daytrading, I am just looking for movements and my setups. I could care less what the dominant overall trend is (up now) or the possible upcoming trend (sooner or later it might head down). Side note - in a more investment portfolio, it's hard to debate the buy and hold strategy... Just buy some index ETF's and let them ride. Of course there's many factors here if this makes sense for you, but in general terms, the buy and holders are doing very well right now and they ALWAYS do fine in the long run. Always. NEVER has the market gone down AND stayed down. We are ALWAYS setting new highs and coincidentally bringing more top callers out as well. It's just a matter of staying the course when we do get the 'pullback' or sideways movements. On days like a 500 pt down move on the DOW, you have to be out there buying if you are a long-term holder.

I found bonds too boring. Not that it's a bad thing, but these things can take forever to move sometimes. Huge liquidity is nice, but I have to think there's a correlation between massive liquidity and smaller movements intraday.

Here's a 'prototypical' new traders journey: You start somewhere, such as TL and start looking for the system that will turn you into a multi-millionaire. You might not say it here, but we all are attracted to trading b/c of the $$$$$. You'll think you found 'it'. And there's a good chance you'll jump in and then be surprised that 'it' was not 'it' after all. Now that thousands of dollars are gone, you are going to do some hard soul searching. Most quit here and never look back. Those that can stick around for years, just might reach the level that we all dreamed about when we first started. Make no mistake, while time in the business is important, you have to work very hard and constantly make progress. What does this have to do with your question? Everything. There's no such thing as a perfect system. Every system has flaws. As was said here, you need to find out what you like. Daytrading is a word that can encompass so much - from hyperscalp trading to a few trades a day. Only you will know what you like. Once you find out what you like, then you can finetune your approach to education. I often get asked on forums and private messages about books that are good for building your library. I haven't finished it all the way just yet, but I attached a PDF to this post that will give you some great books to check out. I would suggest starting with books and videos. Knowing what I know now, I would suggest learning about many different topics and then deciding what topics interest you. It's much less expensive to purchase a book that is $50-$100 vs. one of these courses that cost thousands. Amazon.com books.pdf

tor - test out MultiCharts as well. They support EasyLanguage. They actually call it EasyLanguage. Basically, it looks like Multi is a TS knockoff with some more features. Just take a look at their web url: http://www.tssupport.com/products/multicharts/

tor - you cannot do constant in TradeStation. They do volume charts, but it is subject to their 'interpretation'. Basically, if you set something at 500 for example when it reaches 499 and if an order for 100 hits, your new candle is now 599. And it will change all day long. See my screenshot for explanation. Here I created a little tracker at the bottom that shows how much each candle represented there was over my threshold setting. For each larger yellow bar you see, that volume represented in that candle is OVER my setting, in this case a 5000 setting on the ES. The extremes you see here are over by 665, 670, etc. In those extreme candles, that's more than 10% of my setting... In summary, TradeStation does not support Constant Volume Charting and for anyone reading this, you would be wise to look for alternatives if you would like your chart to be formatted correctly. I personally do not see the value of random, periodic spikes on your chart. You have no idea when they will show up or by how much over they will be, they just simply show up.

My personal opinion - I really don't care which way it looks like things 'might' go. As long as the markets are moving, there are plenty of opportunities - up or down. I posted this on elitetrader and perhaps it's appropriate here as well... --------------- I just don't understand why traders get stuck on a direction of the market (usually up or down) and then live or die with their prediction. Why bother trying to make a prediction as bold as - Dow down 100 pts tomorrow! or Just bought a ton of DIA puts! etc. etc. We'd all love to call the tops/bottoms consistently, but that will never happen. Why not just go with the flow and make some money? Why put your money at risk with predictions that are so bold and possibly risk so much of your account in order to do so? It's interesting to see the threads pop up when there is some volatility in the markets and the predictions start to come out...

4/16/07 Update - Running MC today with TS and IQfeed.net data and all worked as planned. Nice, smooth constant candles. It's actually very different to view the charts in constant fashion vs. the sporadic movements on TradeStation. Much easier on the eyes and easier to trade in my opinion. Moral of the story - if using VBC charts, ensure that your charting platform is using 'constant' VBC's where each and every candle is the amount you set, not some randomly generated number.

So far, so good with MultiCharts and TS data. I am using TS data for now since I am paid for April. I just requested a trial from iqfeed.net for data as I plan to use that for data since they are less expensive than carrying a TS account as well. Will keep everyone posted but I haven't really found any 'bugs' as others have reported based on how I use the charts. Mine are pretty simple though.

walter - good question. I do not use WRB's for entries at all, just exits. Maybe Pivot can help there.

Nick - great points. I know what you mean. At first, I thought the same thing as well regarding exiting on the WRB, but watch them in real time and see how they look on your charts for exits. I mentioned this before, but I view the WRB as a temporary imbalance between the bulls and bears which will sooner or later be 'corrected'. I have found that WRB's on a VBC are powerful simply b/c the chart itself is comprised of volume and volume only. For a WRB to appear, some serious volume has to come thru; whereas a time chart may be different. I don't know as I don't use time charts anymore. It's worth looking at if nothing else in your own trading to see if there's something there that was staring you in the eyes all along...

Well Pivot, I guess this is a discussion for you, Mark and myself. Here's a brief update on my use of WRB's - as shown in previous examples here, the WRB's are great exit points in my opinion. Here's the downside to how I was using them - exiting all at one point then can lead to over-trading, which has lead to getting into a new position at the low/high of a move and taking a full stop. In other words, trade #1 would be a winner with a full amount of contracts. Trade #2 could end up being a full losing trade on a full amount of contracts. The overall result was positive, but not as much as I wanted. So I made a conscious decision - I know exiting is more of an art than a science. No way around that. In order to prevent over-trading and/or taking full losses, 1/2 of my position is exited at a level and the remaining 1/2 is trailed based on candles and/or WRB's. By doing so, I captured some much bigger moves this week when we had some nice volatility and it did not put me into losing trades. The catch of course is that when it pops in my direction briefly and then retraces, the trailing 1/2 is getting out around break-even. But, that was a conscious decision I had to make. Taking smaller wins on smaller moves and taking larger gains on larger moves is what it came down to. It also reduces commission costs as well.

Hey Nick - as I posted over here http://www.traderslaboratory.com/forums/f32/volume-based-charts-request-help-1630.html Depending on the type of charting you need, make sure to demo and test the softwares first!!!! I cannot stress that enough!!! Never assume ANYTHING.

Mark - great reply once again! I think you summed it up - taking one setup and utilizing it on multiple correlated markets can be very profitable. It will also be stressful and require quick execution. For me, that works. I actually enjoy this much more than picking one and staring at that one chart. And as I mentioned, you can actually make MORE money on the trades where you borrowed the signal simply due to your entry price sometimes being much more favorable b/c you did not have to wait for something to confirm. Don't get me wrong, you need confirmation somewhere. As for a trading platform that can do this, I haven't found one either. The best I have been told is to write or pay a programming guy to 'talk' to the trading software to do what you want. The other way to do this would be use of hot keys - where you just hit F1 and something happens based on what you program. That would be an easy workaround. I'm still debating on whether T4 is going to be best for me in this situation to be honest. I love the platform but it has limitations just like anything I guess. I'm wondering if XTrader could handle something like this. Maybe even Ninja. I'll have to contact Mirus and see what they think. If anyone knows of software the allows you to create hot keys or something along those lines, please let us know! Thanks!

Here's what I found out about pricing so far: Multi is $49/mo Data feeds vary: IQfeed.net is $99/mo for the data I need eSignal is $115/mo for the exact same data TS data is also $115/mo or higher I think the difference is that iqfeed.net is just a data provider, not also a charting company (I think). The other nice thing about Multi is you can buy it outright for $799 right now. Apparently that price has gone up in the last few months, so it's like 'act now, or else' type thing. But at $800 = 16 mo's of service at $50/mo, so in month 17 it has 'paid for itself'. Assuming of course you like the software. I am going to use it for a few months and then consider purchasing.

ez - I will be trying multi this upcoming week and will be sure to let everyone know how it goes. It appears to have what I need (which is not much to begin with) so we will see. I demo'd ESignal again today and just not impressed with it. Some basic features that I have grown accustomed to are not there. Ensign will be a consideration if there's any issues with Multi.

I'm sorry guys, I really did not expect this thread to get so complex and such. I was just curious how/if other traders use charts of highly correlated markets to trade. My apologies that it dragged out.

bh - the problem with 'randomly' based VBC charts is simple - I have no idea if my setup is legit or not when taking a trade. Again, as stated above, as soon as ONE candle is off, everything after that is off. Since I use candlestick analysis, having candles that aren't even true is completely misleading. Having a hammer on a true VBC chart is much different than a completely random TS chart. I can see at face value how a difference of 500 vs 600 does not seem like much, but you have to remember that EACH candle is COMPLETELY different in terms of how much volume is actually represented there. I mean, I have NO idea if the next candle will have 500, 600 or 700 contracts represented. With that info, plus knowing that my candlesticks are completely inaccurate, does that make sense?

Great ideas guys, thank you. I am testing Multi now and will take a look at some of the others as well. Multi came recommended from a few others using volume based charts. One nice thing I like about Multi is that you can buy it outright and then just pay for data. Not too bad in my opinion if you decide that software is for you. I'll have to read into how that works more, but never had that option with TS or ESignal.

bh - the 'shortcomings' you refer to are specific to TS. If you are using tick bars then this does look like a small thing. It'd be the same if you said your 233 tick chart is actually displaying 233-500 ticks each bar and you have no idea whether it will be 233 or up to 500 each bar. Would that impact your decision making? Could that possibly create scenarios where your setups either do not appear, appear to late, or appear when they should not? If so, that's the issue at hand here. Just b/c you do not use them does not mean this is a non-issue. It's a non-issue to you and you are attempting to discredit the importance of this simply b/c you don't 'get it'. Like I said, if your tick bars were off by as much as 30%, you'd probably care then.

I'm with Pivot on this one - I'm only interested in my best setups. I also know that the setups that I trade will be there daily, so I'm not concerned with if/when they show. I can see the concern however if your 'best' setup only appears a few times a week or month. That could be difficult to stick to and be the only thing you trade, even though it's the 'best'. But in a pure daytrading setup, I would think that signals would/should appear daily. Of those, I am only interested in the best of the best and willing to go heavier on those trades vs. trading less contracts on a setup that *might* work.

Here's another very important reason for my concern in case the entire picture is not clear (and for future readers of this thread): When just ONE candle is off due to a charting error in how the VBC is handled, everything else you may use is now off - whether that be moving averages, indicators, other candles that then show up, etc. For example - in looking at a TS chart side-by-side to a Multi chart, I was getting VERY different signals and setups throughout the ENTIRE day. It's amazing how just one little difference can alter the appearance of your chart dramatically. EVERYTHING is off as soon as ONE candle is not correct. If you think trading is hard, try doing it with a chart that isn't being displayed the way you thought it was...

Pivot - they are on the list as well, but right now Multi looks the best simply b/c you can easily move your Easy Language from TS into Multi. They have 'Easy Language Support/Importing' which obviously saves hours and hours of work... So, unless I see something that concerns me there, probably going with Multicharts and a IQFeed.net data feed into that.

Tin - yours is not nearly as exaggerated as mine, but you can see there where there are candles over the 500 setting. For a trader using VBC's like myself, that simply will not work. Thank you for sharing.

Well nothing like shooting down a trading day b/c of software issues... So far it looks like MultiCharts and ESignal are going to be good options for what I need - Constant Volume Based Charts (CVBC's). :rolleyes: MultiCharts link - http://www.tssupport.com/products/multicharts/ With Multi, you need to add a data feed as well. Here's the list of supported data vendors - http://www.tssupport.com/products/multicharts/datamanagement/ (scroll to the bottom). Depending on where you trade, you may be able to plug data into Multi from your broker and not pay the data fee. ESignal link - http://www.esignal.com/ Depending on what data feeds you need will dictate the cost here.