joshdance

This market today to me is like, get on the right side (long), and just hope you get taken along for some profit. Not much logic really IMO. If it reverses against you, oh well, too bad... that's how it feels to me. Not that it's really a bad thing necessarily.

Too soon but I see no OTF participation, so I would suspect based on last 3 days, continued drift UP.

Indeed -- trend lines can be very subjective. I'm just the opposite, I find little use on short term, but on the long term like the 60m chart right now it is VERY obvious so I must pay attention to it.. happy trading guys.

I profiled the consolidation back from January to August, and this peak volume at 1309.25 .. I find little value in low volume areas unless they are very obvious delineations between balance areas. Seems that quite often price is drawn to prior volume. Again, this is less than a year old, so not stale prices from long ago. I normally don't even refer this old, but to the left right now we have nothing except this

So.... what does this mean exactly? Sounds like you're saying the market either stops there, or moves away... hmm, what else would it do Tom? Maybe I'm not reading you correctly.

N, I know you hate the diagonals probably more than I do, but you have to admit, this structurally is very reliable so far. Looks primed for a drop IMO, except that of course the action overnight and yesterday is quite strong. But it often looks like it can only go one way right before it does a 180...

When a profile (volume- or time-based profile, whatever you like) develops in a certain area, we sometimes say that the market has "accepted" that price. Because a lot of volume was traded at a price, or time was spent, it is said that this distribution of prices has gained acceptance from the market. Unfortunately, this says nothing about the future direction of the market from this area of acceptance or balance. Just as increasing volume or time over an area will indicate acceptance, increased volume over that range also means more participation and interest, from traders both looking for continuation and reversal of the market. So, while we can say that the market has accepted the price, we know that out of balance comes imbalance and this increased activity at some point fuels the market to move in some direction. Somewhere you're probably expecting a question; however, I really just would like some general thoughts you have about value and acceptance. Does an area of volume or time building really indicate acceptance, or can this be thought of simply as a resting point for the market before it either rejects this area by moving back where it came from, or by moving on to develop new value elsewhere? I look forward to your thoughts; I feel that my mental model of how I view the profile is ready to be challenged and perhaps upgraded, and looking to your comments to spur me on to new growth here. EDIT: Perhaps this video I just made will make it clear what I'm looking for (or perhaps not lol) ... when price accepts a new area, this does not really mean that the market plans to move in that same direction. http://screencast.com/t/JZwrHtUd4CIN

You mean the 87 to 89 bracket?

ST bracket? BO -> breakout? Too many abbreviations for me!

Maybe it's because your post asks many questions, all of which really require statistical back testing. Those are not the type of general questions that are answered easily. Just my

I'm a little surprised that 97 wasn't tested... but then again this is a very bullish day, buyers very eager thus far.

Yeah but I didn't even exit at the best scaling out point anyway. My current goal is to increase my account by a certain percentage without scaling, because I am impatient in my exits. I don't like scaling period as I disagree totally with it mathematically, however, even if I were going to scale, doing so in my current way of doing things would only unnecessarily increase my risk; in other words, I still need to hold until the right time to exit, whether it's all out or a scale.

Just had a scalp long... boy do I ever take profit early. But, must say entry was about as perfect as they get. 1 tick heat. Tried a long earlier at 95.75 but closed BE when it showed failure. Found support at, where else but where the most interest was found to buy before... profile is just from move up... on this time frame (minutes to an hour) maybe not so important what price was important over the last few years, but just the morning

The view on 30 minute

A more simplistic view: do we want to be below yesterday's value of 86.25/89 (the low and close) or inside yesterday's value? And, the market rejected last week's high (97s) during globex. Do we want to stay in last week's range, or break out? These simple levels provide quite a lot of information regarding where the market sees value in how they respond to them. We now have 86s getting hit three times -- yesterday's low, globex, and holding now. Triple bottom support, could be a nice long.

I find the whole "smart money" quest to be a waste of time. However, when heavy volume trades, it does mean that more people, whether it's a lot of small traders, or a few large traders, or some combination, have taken an interest in a particular price area. True, in all cases a big move does not follow, but at least it does indicate interest.

Well said N -- purely from what I am seeing, there is no objective reason for me to have anything other than a long bias for this market, unless we were to trade below 1267, in which case we may finally get a complete gap fill down to 1250s. Otherwise the 71-77 balance area was firmly rejected (about as firm as you can get in this environment), retested the POC (75.50), and fully broke away towards the end of the day. In fact I bought 76.75 on Friday based on this very premise (but closed far too early as usual). And overnight, strong base of support at 82, and knocking on 90s doors... EDIT: I would add that last week's upper balance is a very nice relatively normal distribution with a 78-92 range. Anything out of that range would be unfair, and no surprise that we are trading in the middle of that range from 81 to 88. Without some volume it's hard for me to see it going much out of that range but as N said, anything can and often does happen!

Short summary: Betting Rules by Phantom of the Pits http://www.wisetrader1.com/?page_id=19 Basically, PoP says in rule 1 that we are not to let the market prove us wrong, but rather it must prove us right, or we get out ourselves. I have not read the whole book yet so perhaps I will get to it later, but the problem here is it's very vague as to what is "right" and "wrong." There are three primary metrics (and probably other derivatives) I can see to be proven right or wrong in a trade: price, time, and possibly volume. 1) If price moves beyond price X, I am "right" and will stay in the trade, and consider to add. However, if it moves to price Y, I am wrong, and will exit the trade (stop loss). 2) If I am in the trade for more than T minutes, yet price is not beyond price X, then I will close the trade, even if price Y was not reached. 3) If the volume is below some certain volume V in a given time or range since entering the trade, close early, but again, only if price X has not been reached. In all three cases, IMO, price must validate the trade. That's what a trade is anyway, right? Buying and selling based on the traded price. So I am ONLY proven right by price, but I may consider that I'm wrong by price, time, or possibly some other metric like volume. If you disagree with this please let me know why; the logical seems pretty sound to me but perhaps I'm missing something. As an example: I briefly considered closing the trade that I took around 1:10, the 76.75 long, after it stayed there for a half hour. But the market still had not traded below 76.25 during the later part of that range, so why should I exit? There are times when I will fade a down move, for example, and on the retrace up in my favor I notice the volume lowering, and after about 3 minutes I realize that I better exit now, because this is only a pullback good for a point or so. So, the market has not traded to my stop, but I would expect that if it goes back to my entry that it will drop further. This is a time when using a time-based stop makes sense IMO. There are different ways to view the market and I find value in different paradigms. Volume, that is, transactions, actually cause the market to exist and for price change to be possible. Time does not. However, time is inextricably linked to the markets as well, inasmuch that we as humans are ruled by and live in the context of time. When the market price changes by 4 points in 1 minute, we perceive this as different as when it changes by 4 points in 1 hour, and volume is not a factor in how much the market moves; perhaps it was more over the hour cumulatively, but we notice the changes in time. This causes emotions to get involved (or bots programmed to act based on typical human emotion), and can create momentum and panic buying or selling that otherwise would not happen except that it happened so quickly. So, time is important. Elsewhere on this forum one trader wrote: "Stay in the trade until your target is reached, you have an exit signal, or the reason for your entry is no longer valid." This last part, "reason for your entry is no longer valid," is the primary reason for this thread. Does passage of time alone constitute a reason that an entry would no longer be valid?

I believe just the opposite to be true: a person who uses a stop loss has accepted the financial risk, and quantified it. Someone who does not use a stop loss has not accepted the possibility that he is wrong if the instrument trades to some point. Therefore, the person who has no stop loss has not really accepted any risk at all, because it's not really possible for him to lose.

Hmm, is "yesterday" the correct answer?

Yeah something's gotta give at some point. I would guess 75.50 if new lows.

Out at 80 for a 2.25 scalp, need to start today on a positive note

yet no followthrough, hence i'm short 82.25 stop BE

+1 and here's to hoping for that!

Thanks N, "hanging man" does get me excited! ;-) j/k For disclosure's sake, I did close that trade yesterday for a -3.25 loss, not my finest hour but ready to make it a good week by trading smart today. Today could be very pivotal; it could mark whether we establish value above the current R, and if we do so, I see no reason why we won't go to 1340ish. The cash closed above a prior R, and nothing in the way of it overhead. But the current action is not promising; but hey it's only premarket so it could just be one final washout before we blast to new highs. Must trade what we see right? Good trading to you today.