Grey1

I once told an ignorent that the probability of throwing a coin is 50/50 and he told me look FACT ,, I just threw the coin 3 times and i got 3 heads so it cannot be 50/50 I did not continue the argument Grey1

Agree,,,the main time frame for tweezers formation or exhaustion is 1 minute,, the 30 and 60 time frames are only to meausre the OB/OS levels using any available oscillator such as RSI or CCI .. if you was position trading trading then the best time frame to meausre OB/OS would be daily /weekly /monthly or any proven S/R Grey1

The tweezers formation ( double exhaustion ) is best when it either hits 3 Over bought levels/Oversold levels or hits S/R... 10 , 30 , and 60 min are the time frames for intra day trading. As soon as these levels are reached look either for tweezers or shooting star . These are high probabality reversal pattern. Now,, in extreme trending market the retest of exhaustion levels( tweezers levels) is very possible ,, so if your entry is not spot on then the price might go your way first to come back to haunt you before eventually going your way ,, one Further point :- if tweezers are formed against the strong trend ( this is what most traders do and is in correct ) then this is counter trend trading and over a long period the reward does not justify the risk as statistically not more than Reward/Risk= 1 is attain able. How ever if the tweezers are formed in the direction of trend then this is where the major wins are and trader should take a Full postion ( against 1/2 position if anti trade trending ) Grey1

A new trend is born when the reward to previous trend diminishes.. If you use Multi time frame analysis the use of multi time frame analysis can shed light to the end of the previous trend and birth of the new one ,, For example if Index ( any index is good enough as they are all as efficient of each other) in 10 min and 30 min and 60 min time frame is OB then the risk is to up side Hence the chances are that a new trend should born ,, In pro environment where i used to trade we did not trade any particular trend but only pull the trigger based on the correlation between Risk /Reward at any given time and that is basically using Multi time frame ,, ( We how ever do not use oscillators we use Neural net work to identify the R/R in various time frames) Any way for traders who are after simple trend reversal R/R system the use of MLT is a stepping stone ,, The basic strategy for reversal detection is as follow short if 1) INDEX IS OB in 3 time frames and 2) Price exhausts in the form of either shooting star or spike and immediate sell in the next bar Grey1

Excellent,,,,,,,,,,,,,,,,,,,

Market is a counter initiative mechanism and human use their initiative to trade it,, Through out your life you have been told to use your intuitive to do things right way and suddenly you are facing a mechanism that punishes you for using your initiative,,, strange hey ,, what is the solution ? open a position lets say with 3 contracts close 2 contracts as soon as you have moved 0.5 unit of volatility in your favour with stop to break even point and walk away and I mean away from the PC for the rest of the day ,,, your position does not need your round a clock analysis and all it needs is to walk away and let your position run and run ,, I totally understand this is not a very clever strategy but it works best with those who are loaded with millions of confused strategies and their initiative works against them by finding an excuse to close a perfectly sound trade instead of letting it to run and run ,, I also like to add a note on stop loss.. instead of continuously thinking where to stop loss I think you must spend more time on TREND identification and not where to put that stop,, The trick in stop loss is not to stop at this or that level,, the trick is to reduce your position size and have a wider stop based on the instruments volatility and instead let the profit run ,, this is the back bone of risk analysis and traders should concentrate on putting less pressure on their CAPITAL than having a larger pos size and tighter stop loss. Grey1

One object( particle) can be in two different places ( on moon and on earth ) at the exact same time ... sounds flawed logic but it is not,, it just looks and sounds flawed to ignorant Millions of ways of pulling the trigger to buy or sell but only very few ways of having risk adjusted returns and most trader here do not understand or have the knowledge of risk based trading models.. This is why 90% of traders lose ,, this is why they deserve to lose ... Grey1

The main reason for supports/ resistance not holding is the pattern recognition algo's used by block traders... These algo's once confirm a trending down / up in a major index then no longer use their oscillator based module to trade and hence support or resistance becomes far far less effective in their exit strategy . ( hence going through support ) There was a very strong support on GS @ 160 but there was over 12 block trades ranging from 1.2mil to 5 mil last past two trading days to cut through the 160 level like hot knife through the butter,,, hope this makes sense Grey1

Institutions use VWAP as bench market to enter or exit . They have their own algo to execute @ VWAP how ever some large block traders ( non institution) use Brokers such as IB to execute their order.. It is important not to trade against block orders hence the importance of this vital bench marke.. How ever if you donot know and donot want to know and happy with what you doing and making loads of $$$$$ then Good on you,, http://www.interactivebrokers.com/en/trading/orders/vwap.php grey1

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Some indicators such as VWAP line is bench market for block trading .. This indicator is a must for stock traders ,,,, Other indicators which are close to price action and designed to eliminate noise are very good too ... Most commercial indicators are of no or very little value though .. Grey1

To become a profitable trader you must realise 1) Classical TA on its own is power less in market forecast, 2) Understand the concept of risk and how to diversify risk 3) learn modern TA and not stick to classical TA specially how Block trades are moved intra day ( vwap execution ) A profitable Trader is not blind to news even though most news are priced in , A profitable Trader understands risk .. Hence he concentrates on entry than exit.. A profitable Trader understand volatility and exhaustion theories in modern TA,,, I used to trade for a bank for years and in 5 years did not see a single soul trading charts and classical TA to make a dime over the long period,, ( I have seen traders to have a lucky run though for few days ) ALL above IMHO ofcourse Grey1

Wishing all traders an awesome holiday ... Hopefully This time next year you all be millionaires Grey1

The market seems to have now discounted the DUBAI's problem and getting ready to continue its previous up trend ,, I feel the up trend move should exhaust in around 4 weeks time with a spike in DOW to above and a sell off from high . The market will then look for a catalyst to retrace to below 10000...( IMHO ) .. The equity market is trading well above its VWAP and most institutional traders know this ,, as a result they will be selling / reducing their long position by selling into the spike... Grey1

I have now read many of the internal over night reports from ( JPM .Goldman .MLynch ) and the problem is not as big as an average trader thinks , of course the spill over effect within UAE is not some thing one could over look but I doubt if this is going to be a next leg down ,, I feel fear element is un warranted and the market should soon continue the move to upside, ( as early as mid next week ) ...I am thinking of going LONG few top quality stocks such as AAPL ,AMZN ,BUCY mid week and hold them till End of DEC.. Program Trading :-- Most program trading use neural net ( dynamic pattern recognition ) and they are dumb in a way, they don't understand the reason for the move but still the move is seen as a down ward sell off and a sell off from highs, is very bearish ( even if we assume the sell off from high is bearish the market has to come back to near the previous high for Double top formation before major correction ) , As a result most intra day activity for the next few days will be on the short side but the fundamental reason for continuation of the previous trend should prevail and we should be above 10500 by xmas,, ( all in my opinion ) ,. FA explains the reason behind a move TA is blind to the reason and only sees the move,,, don't bet your farm on TA only because if you do then you are setting your farm on fire ,, ( IMHO ) of course Grey1 IMHO this will not be any where near the subprime bust