TheDude

There are different ways of matching orders - FIFO is most common, but there is also pro-rata used in STIR contracts like Eurodollar. Search CMEGroup.com - should be info there. Why price will go to low volume/low liquidity levels is called 'price discovery', or more commonly known as 'stop running'. Remember the job of a market is to match orders. If you cant get your shopping done at Fred's Store, you'll go across the mall to his competitor to get your orders filled/complete your shopping list. There is money to be made by filling orders, just like a store makes money selling you goods on your shopping list. I hope I understood your question

We shouldn't forget the ags either. Corn and soybeans are great for TA. You can read them like a book. $ per tick tends to be a bit smaller as well. Consider this: why are all newbies drawn in to fx, NQ, YM, ES,... ? The underlyings are so much harder to decipher than the corn crop. Basic demand and supply. If we work on the premise that all good trades are based on a time frame larger than that the trade is managed on, then the softs, metals, grains etc are ideal as the majority of participants are fundamentally longer term. ES, YM, GBP/USD are stuffed with funds, HFT's, etc. Words like liquidity are meaningless to someone putting on a 1-2 lot trade. The reason why every newbie is suckered in to the ES etc is because the exchange give the lowest rates....commissions to the newbie/retail firms. They need new money to add liquidity for member firms HFT algo's to fleece day in day out. If you're gunna trade ES, EUR/USD etc you better know your stuff because thats where the smartest and biggest money is. Same for Bonds 10, 5, 2 yr (although the FI contracts are a bit easier IMO for the reasons above). Ags may not seem sexy or hot, but this is about money and learning. Sure you may get a limit up move. But thats a learning process. Also, you may get on the right side!!

Day trading or position trading? If you are looking to do something different from daytrading, look at trading spreads perhaps? look at Welcome to Moore Research Center for their seasonal suggestions

I dont think big volatility that you sometimes see in R2K is such a great thing for learning to trade. Swings in volatility often lead to swings in emotion, especially for a starter. I'd go for something like bonds or 10yr that still have their moments, but generally tick a bit slower and less $ magnitude.

Uli - Exactly. Your quote is the explanation of why it is so. Well done But, if we believe it to be true, does this mean it is? "I think, therefore I am" Descartes "I believe, therefore it manifests" His Dudeness

Maltz once said if you lie the same lie to others often enough, you start to believe it yourself!

Chad - You got it! Thanks very much. This is what I want to see. I use Ensign and it creates what it is given from IQ, although IQ admit they should be able to do this. However, from what you have said, it looks like Investor/RT could well be the better platform as it has a good work around from the limitations IQ imposes. I'm gunna take a look at your website - you may have a new customer....

I have no interest in continuation contracts at all! All I want is to be able to see a named back month in weekly bars from the day it listed to the current day. When I say current day, I mean where the specified back month is trading today. I wish I could post a simple chart of this, but I cant!!! Thanks

No it is not what I need, but thanks for the attempt. I need a weekly chart of a back month. A back month is not a continuation chart. Your continuation chart is just a weekly chart of the rolling front month. (eg Sep 11 crude is trading round 83, but as your chart shows, the price is trading round 78) Try posting a weekly chart of @EDU11 (Globex Eurodollar Sept 11). See what you get. I bet you get a chart, but it will not be of the back month. It will have the front months data instead - like your crude chart. Why would a trader want to see a chart of front month data when he/she has specified a back month? What I would expect to see is a weekly chart that contains weekly OHLC bars of Sep 11 data only - from when Sep 11 was first listed to current day. Ive asked this to be put on the programmers to do list, but no luck to date. Thanks.

TechT - as well as the explanation SIUYA gave regarding auto-spreaders adjusting quotes corresponding to other markets, some exchanges/products pay liquidity providers to quote similar to a market making scheme, but with little or no obligation to trade. LIFFE used to do this on some products, but I doubt it would ever happen on ES! I knew people who would link Excel to TT in order to auto-quote 5 ticks either side. They had no intention of ever getting filled. They just saw the opportunity of: Exchange Payment - TT costs = good profit. LIFFE stopped that gig a while back I think, but they still offer good pay on liquidity rebates (actual fills). Enoch - size tends to attract price. If the book is stacked with everyone (day traders & locals) on the bid, thats when Mr Hedge Fund sees an ideal opportunity to put his massive sell order algorithm in to the market and fill those bids. This is where the old mantra 'sell rallies, buy the dips' comes from. It's really for those shifting size so they have liquidity to trade against - before we all had DOM/Level II. Now we can see the same thing in a more granular level in microstructure. It's quite an interesting point how the local and swing/fund trader will operate. The local in contrast tends to look at the DOM in the opposite way to Mr Fund described above. The local sees 1000 on bid, 80 offered. He thinks the bid will be there longer, all things being equal than the offer as it will take longer to fill. Therefore, the 80 lots will go, and the market will move up. So he offers the tick above the 80 lots and then takes what he can of the 80 lots, assuming the other locals are thinking the same. He's using the 1000 lots as a support. This is a very basic level 1 type of local trading style. He gets steam rollered when Mr Fund marches in and stomps through the bids he's 'leaning' on

One thing that really bugs me about IQ Feed is it's inability to display weekly or monthly data for back month contracts. e.g. if you want to look at Aug11 Weekly crude chart or Sep12 Eurodollar in anything bigger than a daily chart, IQ defaults to the front month. This is a big issue for longer term commodity traders (eg people who trade spreads) If anyone knows of another data feed that can do this, please let me know as I'm thinking of ditching IQ because of this. Thanks,

I remember when BIDU first listed - from memory it was a year or so after the .con bubble burst. It went to the sky almost off the bat.

Well perhaps I should put some more definition on my statement. This is my view, and I understand and welcome different opinions: In some ways the past can be a useful insight into future events. By that, I refer to human emotion and it's corresponding behaviour. That you can see in the market, but it's quite difficult to backtest as you probably cant get a good feel for traders emotional levels looking at last years charts. In other ways the past is no use at all, especially when developing mechanical systems. If it were, then someone, somewhere, by now would have developed that killer system. How many traders around the world over time have developed and tested such systems based on indicators, candle shapes, TA, etc, then optimised, then forward tested, etc just to see it fall over? If such a system did exist, doesnt anyone here think it would have been discovered by now? Maybe that method did work in the past for a window of time, but by the time it takes to discover, back test, forward test etc, the cycle changes just as the trader starts to trade it. Magic? Nope. Victor N points out the same thing happens in horse racing. The gambler studies the form, realises a pattern has emerged, just as the others who study form identify the same or very similar patterns. The bookie then has to change the odds as everyone bets the same way and so the system no longer works.

You only think you do. If I were a gambling man (I'm not), I'd say you base these figures on past outcomes of a series of trades. However, the past is no guarantee of future events. That kind of puts the kyber on the idea of backtesting and the scientific approach to trading I guess. Ho hum. If you take the trade at the singular level, then MM is right. If you take the trade in the context of a series of trades you may be right. Thats where the skill of the (good) discretionary trader stomps all over the mechanical trader. The discretionary trader can see the probability unfold in real time. He is working and focusing and calculating all the time. He knows whether to let the trade run for more, or whether to cut it before a loss is incurred. Sometime he gets it wrong, but thats the market - it can do unexpected things suddenly. The mechanical trader is a lazy trader. He takes his trade and hopes it fits the average - probably while listening to music or something.

Good advise 1pip. If Attila is having trade management problems, but entry timing is ok, then perhaps a mechanical trade management plan should be enforced. Assuming the timing is discretionary, based around some criteria, once the order is filled, only adjust the stop according to strict criteria until stopped or target (if employed) is achieved. This should give some confidence back over time. Simple but effective I hope.

This is what he said: " Dear Americans, As BP - that evil British company continues to wreck our coast line, let us not forget the damage American industry has done to the world and it's environment. Let us not forget the American companies who are responsible for logging in Brazil and the destruction of the rain forests. Let us not forget that Haliburton and other American companies also had a part in the oil spill, but to date BP are the only responsible company helping clear up the unfortunate mess. Finally, let us not forget, that as President of the United States, I am in fact powerless to do anything about this oil spill. So are the rest of those dour faced codgers in congress. Further more, I better be damn careful how I tread when dealing with BP because the massive amounts of money Americans have invested in BP, and the number of Americans they employ. The only thing I can do is make churlish demands on BP, demand to see action plans etc and other futile acts which in fact just slow BP down in their attempts to clean up the mess. God bless America, just how America has blessed the rest of the world environmentally."

Im going to order The Fountain right now - Ive been stuck for films to watch recently. Requiem For a Dream sure is brutal. If you like that movie, you may also like Candy starring that dead bloke who played The Joker in Batman with Christian Bale (that live bloke). Also, Fractured with Anthony Hopkins is a real good movie too. The Wrestler is good, but a bit morbid IMO (not as morbid as RFaD obviously...) I liked the ending where......

I think Taleb's comments about MM & CTA's in Fooled by Randomness are worth remembering: Based on the assumption the markets are random 'most of the time' to the unaware, and that the highly educated CTA's stock/commodity picking skills are no better than John Doe, then each trade has a 50% chance of win or lose, same for each year end results. If 1000 new CTA's start trading, 50% will be fired, 50% kept on end of year 1. Year 2 we have 500 CTA's left Year 3 we have 250 .... Year 10, we have 2 super star CTA's who have achieved consistent profits year in, year out for 10 years. Everyone thinks they are demi-gods of trading, yet they are just the lucky product of random outcomes and have no skill at all. Just my

Not me but someone I used to work with when I started trading - he was a BIG options local. His daily equity swings were 100k-500k easy. Over time he became a mess through too many late nights etc - issues with his wife that affected his trading. Instead of taking some time out, he got more aggressive. One day he comes in after a bad drawdown of about 1mil. It wasnt his fault, but those idiots who do the settles he said. Anyway, he decided the only way to get out of the hole was not to hedge anymore (with the futures - we were usually delta neutral). Never saw him again after that day....

Thanks for your input DbP. You've clearly studied a lot of his works. Did you find the style a little different too? Or, am I just over sceptical? Cheers,

I'd agree Gringo - there is wisdom to be had from the old master, but if this is simply someone from recent day interpreting his words, then you have a derivative product - someone elses opinion. 2nd hand opinion. Chinese whispers - vital detail could be omitted. Take the first few pages that have the arrogance of telling us how to learn from the manual!! Everybody learns in different ways and at different paces. I can see that whoever compiled this has put a lot of effort in to the work for which we should be grateful. I just think it would have been better had they just presented the text as Wyckoff presented it.

It depends on the climate IMO. For the past 6 months or more, FOMC and minutes have been non events because of the wide spread understanding of the economic condition. Rates aren't rising any time soon and the market knows and expects this. The minutes are where the detail lies and can have more impact than the actual announcement. The last minutes release however was a bit of a non event from memory however. Historically however (speaking of ES) is that the FOMC release just gives volatility spikes, but rarely is value or it's perception changed. You just see stop running of the day's high/low before settling where it started. The minutes can however give rise to a change in value and the associated trend. I think this afternoons minutes will be a non event. Because of this, I'd say thats a sure sign all hell will break lose and the market will sink to 0000.25!!!

Thats fine. But do note I did say 'technique' books, meaning those that try and teach TA, indicators, set-ups etc. When you say 'how financial markets work', one assumes this knowledge has already been gained - otherwise it's unlikely they would consider a vocation trading. If you want to know what a candle stick is, look it up on the internet. Interesting you seem to find Market Wizards an interesting read. I found it interesting too. Interesting in that there is: 1/ not really any specific technique detailed 2/ a lot of discussion on psychological make up 3/ quite a bit of contradiction between different interviewees. This contradiction isn't a bad thing, but a reflection on one size doesn't fit all and the importance of the individuals own approach. That will never be developed doing what the other 80% of losers who have read and doing the some old same old in your van tharp and other 'how to' books.

Is this an original? I've read 1-2 of his books before, and after reading the first 1-2 pages of this, the style of language doesn't seem to be that of Wyckoff - or anyone from the early 20th century for that.

Indeed they do. Also of note is that most lose trying to trade. What does that tell you? Whats magic about 2%? Risk should be defined by your system, your comfort level, your probability of win etc. That figure could be 1%, 0.5%, 10%, maybe 2%. I'd ignore most of what passes for common wisdom in retail trading if I were you and figure out what suits you, not what some failed trader turned author thinks.