joshdance

Can we please close this thread and file it away under "propaganda"? I'm disappointed that the moderators of this thread would headline the newsletter with this crap. Some of those who "crashed the world" are still in power, and some of those who tried to stop it are blamed. Give me a break.

Perhaps it's just my "outsiders" perspective, but profiles on ES seem to be more "respected" than on other instruments. Are you suggesting russell because it's faster than ES, but not as fast as oil? I've also looked at russell before and taken a trade or two, but not any more than ES.

Believe it or not, US news moves oil quite a bit most of the time So, this is the first thing I open every day (actually the night before--and I don't use this particular calendar but a different one).

After having a crappy day trading oil, and watching ES for the last hour, I'm considering trading ES tomorrow to see how I like it. I tried ES a while back and found it very slow, but after trading CL during volatility last week, and just the nature of it being generally quite fast, ES leaves me with a feeling of calm when I watch it move. I tried an order for a long at 1154.50 at 2:52pm but missed the fill by a tick. And I paper shorted 61 at 3:13pm, which would have resulted in a nice trade if real money. This is an incredibly small sample size, but generally the movement seems similar to CL and any market, just slower than CL obviously. Incidentally, I am not blaming CL for my recent losses, as I did quite well early in September but have found myself out of sync the last week. I realize that changing an instrument won't make me a better trader, but I'm considering the possibility that ES is simply better suited for me than CL. With 6x less margin required to trade, and with less volatility than oil generally, I feel it may give me the calm I'm seeking. From my previous experience with ES, I recall thinking that it was VERY difficult to trade, and I'm up against the best professional traders in the world. So, with that being said, those of you who trade ES every day, please give me a reason why I should or should not give it a try. Thanks for any practical advice you may have!

Labeling who trades what by calling it retail money or smart money or dumb money or big money or whatever, only serves to add confusion to the mix. It matters not WHO does the trading. What matters is the footprints they leave behind, their transactions. This sounds like a tradeguider commercial. You don't need multi-thousand dollar software to show you any one of many different labels which overly complicate matters. I would encourage anyone interested in volume to study Wyckoff.

I don't trade ES but this looks mouth-watering... For those of you who trade ES every day, how well does ES normally respond to volume as in this chart?

Where did you post the sell signal when it occurred?

Yes you can, and it happens every day. Volume indicates participation. Price can move quite a lot on decreasing volume, and it can churn in one place on heavy volume. Volume equals trading activity.

These quotes taken from the following article disagree, just for a different perspective: Goldman

Perhaps this is a case of: you're better if you're very small (agile, in and out quickly), or very large (you can actually have a meaningful impact on the market). If you're in between, you may not have enough advantages of being small (not as easily in and out), yet not enough size to make a difference.

And what is the difference? They could be interpreted to sound the same, but no doubt you have a distinction you have created which allows you to think about them differently. As to markets being different now, I disagree that they haven't changed--I think they ARE different. Pete S.'s description of different types of markets, both pre-exchange, exchange, and now with no (or few) locals and purely electronic, changes the dynamic enough that a model that worked before may not work as well now. It sounds like you are on a path of discovery to find a universal model. Or, at least, one that reflects current market conditions. But the most important question for a trader (not an analyst) is, can I make more money with this? Even the most simplistic models of the market can be made to work effectively by those who are in tune with them--like a market profile, like support and resistance, like trendlines, or anything else. They all model the market differently, but they can all be used effectively. For example, a trendline-based approach sees the market as moving not only up and down, but in channels related to time or activity as well as price. A support/resistance only model sees vertical movement as paramount. However, both can be used to trade effectively. Unlike physical concepts in the universe like light, gravity, etc., which have a seemingly unlimited amount of new information about themselves which we may discover, the market is not a mystery--it gives us only 2 things: first, a transaction (or tick). From that transaction we have only 4 pieces of information: the price that was traded, the time the transaction took place, how many contracts were traded, and whether the transaction took place at the bid or the offer. Secondly, we have the price levels (for most of us,10 price levels) above the current best offer and below the current best bid and how many resting orders are at those levels. Other than that, we must manipulate this data to form our models and will not find any new information (unless it is released by the exchange). All that being said, I am open to new ideas and definitely interested in any theories or models that will increase my trading edge, or give me a different understanding of the markets.

Except for the trendline break part, that's very close to what I do. What about you cl?

Primarily I look for a climax in volume and usually followed by another push in price on weaker volume. But this means very little if price has not reached a point where the other side is willing to move it, so for me there is not a solid notion of "internals", as trends work for this very reason--traders are willing to push value away from some mean, further than it's "supposed to go." So ultimately, though I am not as good at this as I want to be, I would consider a shift in direction only able to be truly detected after it has happened. In other words, once price has shown that the balance has shifted. How do you do this cl?

I do--I look particularly for the inability of market orders to move price at a key price level using delta as a confirmation of who's attempting to do the moving. So, buyers and sellers at the market may be out of balance, and this may indicate either a continuation or reversal of the current direction. However, price only moves because of an imbalance between those willing to buy at the market and those willing to offer at that price, or an imbalance between those willing to sell at the market and those willing to bid at that price. Now, if there were no indications of possible future price movement then it would be impossible to trade effectively and it would become only a guessing game. So, I'm not saying that we can't look at delta or volume or whatever else you want to use and formulate some hypothesis about what might happen next; this is what I try to do every day.

The only true measure of imbalance is a change in price. Would you agree?

Ok, I do understand what you're saying. However, do you not feel volume at price is useful?

Thanks for the fantastic video reference clmac! Just watched it in its entirety. I do not think that Pete S. is saying that the Market Profile concept is not valid--rather, he is saying that the market of today is supply driven, rather than time driven. So, the original market profile concept using TPOs was more valid when it was a time-price market--as he said, you would see distributions of TPOs and a trader could buy and hold, or sell and hold, and close the trade at a later time. Today, however, the distributions are more scattered and varied, so he is using volume. He has been doing this for years, and has long ago stopped focusing on time as a way to structure the market, if I recall from hearing those who have read his early 2000s book. What he is promoting and selling in the video sounds like essentially a volume profile-based approach. His primary point which he repeats over and over is this: reduce the risk of price discovery by allowing others to discover it, and THEN trade with them. When you initiate a position where little volume has traded, then YOU are doing the job of price discovery. With little capital compared with large traders, the retail trader cannot afford to discover price consistently. It's better to initiate trade at prices which have already been discovered, as shown by looking at volume at price. Is this primarily what you got from the video?

A view of this week tells a clear story!

Attached.. thanks for previous post N, quite helpful. I don't know exactly what is exported, but be aware that some of the indicators used on the chart for VWAP etc. may set V# variables so I wouldn't want it to mess with your setup inadvertently. CL 5m.txt

Here is today's profile so far from globex open until 8:23am. Balance at the top and bottom, and vacuum in between. Is this pretty much what you see? Sometimes price will go fill in that vacancy.

Thanks N--could you elaborate a little on your last sentence?

Can you zoom out your chart and show the entire day?

The first chart is a 15m crude chart. The colored profile to the left is from globex open up until the pit open at 9am. After the pit opened it dropped further below as you can see. When it came back up, sellers tried to sell it off again from the middle of the lower balance area. However, buyers strongly pushed it up into the second. It stopped right at the POC of the balance (well within 5 ticks anyway, crude doesn't just stop at .15 without going to .20), and came tumbling back down. The second chart shows a profile of the move down. After a retracement back up, the second chart shows where sellers felt was a good value to sell at--the concentration of volume of the entire move down from the top. My premise was to short .25 which was a very high volume price, but after it broke north of this I was a bit scared off and didn't take the short. Either way, I love how profiling maps the market.

If you have a 5K account, and average only 2% per day, you should have a million dollars in just over a year. You sure those stats are right? I also have 2% days, heck I have +10% days, but that's not my average. There's also the 0.1% days, and the -2% days, etc. Maybe you're trading a micro forex account and getting those stats. If so, congrats. It somehow becomes different when the tick value is $10, as opposed to a mini $1 or a micro $0.10 , psychologically speaking I mean. I don't trade big size but losing $150 on a trade just trading one contract is a bit harder to swallow than losing $15 or $1.50. I can only imagine big swingers who are trading 20 lots of crude or eminis, watching their account +/- $200+ per tick. But I suppose to get to that point they have mastered the psychology of risk. Anyway I digress.

This all varies depending on the trader, and his style of trading. Many traders ONLY trade the first couple of hours, for example. For day trading--and by that I mean some trades will last 2 minutes, others 30 minutes, few will last more than an hour or so--most markets are "willing to give" almost every day, say, 90-95% of days there are great opportunities. It doesn't mean all of those days will be profitable, and I think a measure should be taken on a weekly basis versus a daily basis, but what I'm saying is that many traders actually do make money every day -- I see them on my broker's board, and I have made money on 11 out of 14 trading days this month, and I'm not even trading that well this month. I'd imagine that traders much better than I am are making money literally 95% of trading days. Setting guidelines like 2 or 3 trades are enough, is based on your experience, and is not "right" or "wrong," just what you believe. Traders who are holding for a larger move may only take 2 trades, but others may take quite a few more, and other traders may only take 1 per week. Personally I average about 8-12 trades per day. If I take more, it's usually not a good sign, and if I take less, it usually means that I did not take full advantage of my opportunities as I saw them.