mister ed

Thanks HAL - good to have someone here who has worked on algos - can you offer any insights, information etc on them? What sort of inputs did you use, how many inputs, how are they structured, what sort of execution technology was used ... any info really would be great?

I think 'program' trading, in a narrow sense, refers to those arbitrage activities where stock bought/futures sold or stocks sold/futures bought, whereas there is also a broader sense in which the word is used to refer to other types of automated activity. I think the best word to encompass all the types of automated activity executed by computers/robots is algorithmic trading. Wikipedia, while not a definitive source, has a good selection of articles and links about algorithmic trading. Back to program trading and the phenomenon you described Darth. My understanding (poor though it is) of program trading (in the narrow sense described in previous paragraph) is that it is purely arbitrage, and it will account for some (quite a few) of the short, sharp moves in the futures, bringing the cash and futures 'into line'. I think an extended move like the one you described is not arbitrage but more of a directional strategy? I am out of my depth here but I think we can uncover some valuable information if we continue on with this thread. I like your attitude of trying to find utility in this stuff too, let's not just understand this stuff, lets use it to our advantage. Also, I am looking forward to the movie 'Terminator 4: Defeat of the Algos'.

Thanks Chad - great information. Fantastic integration of MP into traditional charts in this software.

The VSA thread is not really that big.

I think that's fair enough BF, and I think Shep has shown that what he is doing is working. I suppose we can all have a look at his charts and interpret them too. Given that this thread is all about learning the best place for posting future trades if disclosure of rules etc. is a problem is probably in a journal/blog, the facilities for which are also provided on this forum? Edit: I should add that Shep has elaborated on his trades in some of his earlier posts, which was really valuable.

Yes, I second JJ - thanks for ALL your efforts James, each and every day (and night!). It is no sweat to miss this presentation if it doesn't work out - the TL site has heaps of info on VSA - all there for free!

Well I am out too. Why were we not informed BEFOREHAND to arrange to dial in? I could have got organised with Skype if I was told BEFOREHAND I cant believe state of the art webinars require dialling in

James - I will not be sticking around if there is no audio I am having internet drop out issues and so have had to disconnect my phone in order to get the net So I wont be dialling in Seems a bit silly to have to dial in ????

I seem to be in - I have a screen up but no audio yet?

James, I forwarded your email along to mcichoki earlier

Eva - I would appreciate if you left the asking of silly questions to experts at it like me :rofl: I don't know what the accepted wisdom is of applying MP to stocks, maybe someone else can comment? Who is to know if the accepted wisdom should even be accepted? There may be some discussion of this in the MP section of the forum? I reckon attend anyway, there is bound to be some great ideas presented. Edit: Found one thread about MP and stocks - not much info on it but yes, it is used with stocks.

Hi Darth and Soul I am not sure if this is the sort of thing interesting to you also Darth - I have cut and pasted a few articles from around the place on algorithmic trading. Might be of interest (I find this stuff fascinating ... and try to learn about it on the basis that the more I know about it the better I can understand whats happening in the market). All the articles are referenced with links so if you want to check out the original etc. Algortihmic trading articles.pdf

Hello 007 Are you still having a problem? Try refreshing, rebooting, check you haven't got a block on pictures in your browser?

Nice one thanks James!

Thanks for the info subq, appreciated. I was looking forward to a day off LOL!

Charting The Stock Market: The Wyckoff Method is a book with an incomplete title. While part of the book deals with explaining and describing the charts commonly used in Wyckoff analysis, its main value lies in its discussion and explanation of the principles behind Wyckoff analysis, and the application of these principles in trading. This is a book that punches far, far above its weight. It is a work of reference that can be picked up again and again, and each reading seems to offer new insights. Do not make the mistake of thinking of this book as an introduction to Wyckoff. While it can serve that purpose, the density of the information within means that beginners will find themselves overwhelmed, and will have to take it slowly. I cannot imagine how an ‘introduction’ to Wyckoff could be written – one is either prepared to study his material carefully or not. Speaking from personal experience, it took me many months to start to comprehend how much value is here. The book is written in three parts, each with a different author. The first section, Part 1, entitled Principles of the Wyckoff Method (pp. 1 – 127), is written by Jack Hutson. Part 2: The Wyckoff Method in Action (pp. 131 – 148), is written by David Weis. Part 3: The Wyckoff Method: Five Steps to Success (pp 151 – 190), is written by Craig Schroder. Following part 3 is a Glossary of Wyckoff terms, a List of Figures, and an Index. Being written in three parts, by three different authors, means three different styles, and three different approaches. Each part, too, serves a different purpose. Hutson’s section (well over half the book) introduces and discusses principles and their application; in Weis’ section he applies Wyckoff analysis to a market; while Scroder’s section places the principles into a logical approach to selecting stocks to buy or short. While much of the book focuses on stocks and shares, the principles of Wyckoff can be applied to any exchange traded, liquid financial instrument. Weis’ section, for example, applies Wyckoff analysis to bond futures, both on an intra-day and daily basis. Some quotes from the book, so you can get a flavour of what Wyckoff is all about: “Richard Wyckoff believed that using charts mechanically, without judgement, is a practice headed for more failure than success. Drawing diagrams or imaginary geometrical patterns from charts or applying an arbitrary system of rules to their formations is anathema to the Wyckoff method. Instead,Wyckoff investors study charts to uncover the motives behind market action to interpret the behaviour of stocks." P.13 “Our discussion of Wyckoff’s analytical methods has so far concentrated on deductive reasoning…we first determined the position and the trend of the general market, then the positions and the trend of the group averages, and finally selected individual stocks … The opposite approach - inductive reasoning – offers…a valuable way to double-check…conclusions…” p. 75 “The reasoning behind Richard Wyckoff’s classic method of chart analysis is simple and straightforward: when demand for a stock exceeds supply, prices rise; when supply is greater than demand, prices decline. The goal of this method is to make the most efficient use of investment capital by selecting only issues that will move soonest, fastest, and farthest in any market and by timing trades to capture those moves” p. 117 “To continue with our study of the June ’82 bond market, next we’ll dissect the volume/price behaviour during the markup and distribution phase …” p. 141 “ Week 5, which immediately follows point X, shows a change of character. Price spread is again relatively wide, but volume is reduced. Something has changed…the change of character tells the investor looking for an opportunity on the short side to pay closer attention.” P. 185

Thanks for the responses - I have downloaded Opera and am having a play with it. Some fixes I have applied to FF are having an effect, which is good, as I am used to it and its add-ons, and of course there is inertia too... There are heaps of browsers out there.

Good call James - always have to stick by your team! And, as has just proven - don't believe the media!

James! The headline - check the headline!

Check out the headline in our quality media... How hard can it be?

Thanks Warren - My bias is technicals but I think a lot of value can be added to FX trading by even just a basic knowledge of the fundamentals ... so, yes, good idea!

Hi Warren - would it be a thread on FX fundamentals?

What web browser are you using and why? I use Firefox, for its ease of use (tabbed browsing etc.) but mainly for the add-ons that make it even better. No script (protection from some nasties), bandwidth meter, compact menu (more screen space), copy plain text, foxmarks, unplug, and more. However - its a memory hog. I have tried some tweaks to fix this and they don't seem to be working, and sometimes it jams up my CPU ... So - what web browser do you use? Firefox, IE, or some other? What do you like about it?

Hi EyeQue Thanks for the Pruden link. Here are the links to the articles by Forte and Coppola.

I cant speak for the experts, but I can understand where you are coming from with this query. My post here is not meant to be a definitive answer, but as a start for more input on the challenge you raise. A bar/candle chart like you describe is taking the data from a specific time period, so by then sampling a different time period the information is going to be different. I am not really sure if Wyckoff ever addressed this problem specifically, when he created this form of analysis there were no computer generated charts, if you wanted intra-day charts you kept them by hand. So this problem is a problem we have created for ourselves! I don't think there is any one theoretically correct answer. I suppose you could say do some back- and forward-testing and find the time frame that gives the best results. I have a problem with back-testing and optimising ... I think it can be best summed up in what someone has said to me, and I paraphrase, the smart money will hide in different timeframes, and will always be shifting. I think the answers are more practical. First, find a timeframe for the bars/candles that makes sense for you (as you say, you can also use tick charts - and there are other bases for bar/candle divisions too). This is not just what you are 'comfortable' with, it must fit with what it is you are trying to achieve and how you wish to trade. A day trader is probably not going to find a daily HLC useful by itself. An investor is not likely to find a 3-minute candle useful. Also, if you are trading for, say, 10 points swings in the ES you are most likely going to use a different bar/candle frame than someone trading for say 5 point swings, or someone trading for 5 tics. Use more than one period - a lot of traders use a very short-term, a medium term, and a long term chart, periodically switching between them throughout the session. Which 3 periods are best? See previous paragraph! Some suggest scaling up the periods by a factor of 3 or 4. So, use a 5 min, 15 minute, and 45 minute, and so on. Also, there are point and figure charts, which don't create new bars due to the passing of some specified period of time, or number of ticks, etc. they respond only to changing buy and sell dynamics. This is not the place to go into figure charts, but they can be either an alternative or an adjunct to bar/candle charts. Hope this helps, or at least, doesn't hinder!