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steve46
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Everything posted by steve46
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This is the clean up for that trade...because this is a counter trend trade I don't want to let it go too long... With the single caveat of Euro news, this market will likely continue to head north as institutions see the possibility of increased bonus dollars if they can push it up to or above 1263 by Friday Many of the funds and most commercials have closed their books already so resistance if any will come from the headline news from overseas... Green arrow is my exit on this sequence. Edit The Globex may be volatile this evening....this is the time when some participants may want to come in to "steal the trade"....that would mean a move of from 10 to perhaps 20 points perhaps on the possibility of good news on the Euro front..we will see..
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Today's final reversal trade occurred (initial signal) at 12:33, which is significant for my system The pattern is an up spike at or near the supply boundary, followed by a series of (at least) 2 "tests" of that prior high....I like to enter on the 2nd test on a limit, or if I miss it I will chase for a couple of ticks.
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Plenty of time now.... Apparently I am not a great multi-tasker The first chart displays the open and a reversal pattern...I use this very short time frame because it gives me the granularity that I need to match the tape....(to me) that means that as the tape rolls by I can SEE price action that matches it...and (hopefully) make a good decsion The second shows the clean up trade...simply put if the trade happens to go my way, I take the last profit for that sequence....a sequence is measured from the opening fill to the complete close of that trade.. Clearly this is a winning trade and all of them do not go so smoothly...scale outs at 2, 3 5 7 and 10 The trade is planned, because the pattern shows itself in front of the open....all I need to do is put my order in (limit one tick in front of the pattern top) and wait...I am willing to risk 2 pts....
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Vis a vis a post I read from you Negotiator I am putting in these two charts I had time (barely) to do the trade and "snip" the charts... You are right...it takes time and is (for me anyway) difficult to do anywhere near real time. I will comment on them later The first is the opening trade, a short off of a "reversal pattern" The second is what I call the "clean up" meaning that I took partial profit at 2 points and left the rest to run...and in this case it happened to go my way so I had the opportunity to take the rest as it hit my target
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Good morning A predictable low volume day (we can expect more of this until the holiday is over) and on a low volume day, we can also expect certain patterns to display among them the "basing pattern" This one exhibits the same characteristics as all of them....an initial move down to an area of support (this one on a wide range bar/candle) then a series of wicks creating a ledge, followed by a probe down to look for sellers.....when the probe down fails, you have a series of entry points (as shown by green arrows to the right of the probes down...good for a couple of points At the top you have an aborted move up, stopped because Fitch decided to downgrade France news trumps everything in this market, so you better be in the loop when you trade....I prefer Bloomie, but its up to the individual Good luck in the afternoon Steve
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Saw your name on the visitors band at the bottom of a thread this evening..If you get this, just wanted to say hello and wish you and your family a pleasant holiday season....Also I am working on a blog....it is for my students primarily and open to the public...stevesfuturesforum.blogspot.com (I am going to offer some currency and bond comments in addition to the S&P market).....Good luck in the markets...Steve
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You know its interesting....I have written several threads all of which are aimed at helping traders...free information....for anyone interested or having difficulty learning how to trade. "Ideas for Struggling Traders" "An Institutional Look at S&P Futures" "Trading Adverse Events" Within each thread are a number of thankyou's and of course some negative comments. and each year during the holidays I try to help a few folks (no charge) and all I ask them to do is to donate money to their own charity at Christmas...I leave it up to them how much. How many have you written? please go ahead and list them.....
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Sir (to the original poster) If you are still out there, I will TRY to help you....no strings no cost to you...I have been working on a system that retail traders can use.........I will need to know that you have sufficient discretionary funds so that you are not jeopardizing your family or your home. PM me Steve
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Hope you both have a nice weekend as well Before closing shop for the weekend I wanted to post this chart You may see a resemblance to one (or more) of my previous posts. It is another afternoon range trade example and as mentioned previously my strategy remains "hit it until they make you pay" and as before we have the same "double taps" (entry on the second "tap" of the range extreme)
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As posted in your comment I am all for it as long as he takes the time to collect the data...
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You've been asked before (by others) to provide backtest data and you declined Get your story straight princess.
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Well you would be an expert on unskilled trading... and as far as divergence on all time frames, notice folks that the gentleman cannot comment except for MACD....and even then he doesn't furnish any data....because he has none.... If Do or Die is willing to do the research and collect the data necessary to prove his point, I applaud that....
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Get yourself under control and post something that English speaking people can understand and when you have calmed yourself....go to post 60 "no signals on the hourly time frame" Why do you think that is?....because it takes time for the signal to develop.... no need to apologize....but next time THINK before you post..
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and have YOU read this thread.... The orginal poster stated earlier in THIS thread that on the hourly time frame, he had no signals (yet)...this is typical of divergence (all kinds of divergence) once again, and I hope for the last time...divergence takes time to develop.. My comment relates to THIS thread and to divergence in general.
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My comment doesn't warn people away from divergence, but simply suggests that traders may do best trading it on a specific time frame..(swing trading) mostly because it takes time for divergence to develop...if you disagree...so be it... My experience is that traders operating on other time frames are likely to use different tools... Finally, I prefer to see how a technical approach works over a variety of market conditions....since you can't tell when a market is going to change from one regime to another, it only makes sense to test that way... None of this should threaten anyone...so get over yourself...deal with it and move on.
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No attack intended....an attack (for example) is if I were to call you an ... the post was simply opinion.
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Generally speaking Adrian's comment was correct...on the portfolio side, no one trades off divergence, because the result (over the longer term) is inconsistent...the top tier firms have tested it...if it worked they would know it...and eventually it would leak out to the public...the longer term portfolio managers are mostly using a combination of fundamental and technical approaches that have no relation to divergence. for the short term pro trading intraday....divergence doesn't even register on the horizon because they read the tape and have other tools that work better.... For the retail trader, trading in between those two time frames (swing trading on a days to weeks time frame) it might work if the trader was willing to take the drawdowns...this is an area where someone might make a discovery that added value....the problem (at least in this thread) is that in order to discover whether a new approach works, you would have to accumulate a lot of data points over more than a few years (and through different market conditions)....just calling a few live trades means very little. I encourage the original poster to continue since he might (if he takes enough time to gather the data) eventually find something that helps him learn to trade..
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Interesting...so Josh...I think a comment is in order....it seems you are trying to trade in very exacting manner....certainly your privelige What I observe is that the markets are simply too noisy for that to work....whether you call it a failed auction, a probe or a stop run, one has to admit that this market (the S&P futures) tends to take out both swings high and low, and range boundaries high and low by more than one tick before resuming a trend (or a consolidation) move....If you know that, at some point you may want to build tolerance into your system...or the result will be that you bleed your account (slowly if you are risk intolerant) because in the long run you will not be able to overcome expenses. As I have mentioned on several occaisions I try to teach folks to be aggressive (in an intelligent controlled manner)....I know from experience that it works..IF you have a systematic approach that has an edge (I assume you have that covered)..... Today (yet again) we have a late day range...and (yet again) I am "hitting it (trading the extremes) until they make me pay"......I am willing to risk 2 points....it may seem excessive however I know from my testing that I will not often have to pay that price...generally I see about three (3) ticks of heat before I "think" that I am wrong, and STILL I stay with it. because I have seen it reverse and proceed in my favor....the real point to this is that you may need to do additional testing to prove to yourself that you have a systematic approach that can withstand a reasonable stop size (or not)....Perhaps you know this already, if so please excuse (or ignore) the mini-lecture. Edit By the way, in the chart the first arrow (leftmost) is the initial signal.... the second is what I call a "double tap" and serves as a point of entry...a close outside the blue rectangle is my stoploss
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Apropos of the earlier remarks about price taking out a level by a tick or two, I wanted to post this chart First of all, a lttle background....clearly this is a professional market, meaning that the majority of participants are commercial speculators, banks, funds and other similarly educated folks. Most of the retail investors are on the sideline, except for those who still have a 401 with money in it..... For the S&P 500 (equities and futures alike), the majority of the action is either automated or screen execution upstairs (off the floor)....even so...this market is moved by professional interests and what these participants have in common is an understanding of human behavior...that is if you simply look at the charts you will see behavior meant to generate stress on less educated traders...and to isolate or take advantage of participants traditionally known as "weak hands"....one of the ways that this is accomplished is to move markets so that they "take out" swings high and low by just a few ticks (to as many as a few points) before retracing...the reason?....it allows specific participants the opportunity to 1. activate resting orders above and below a price...its called "stop running or stop probe" 2. allows the participant to obtain a slightly better entry price 3. allows the more agressive participant to "strand" other traders There are many examples of this behavior....one of which I have written about a few times (most recently in my blog) called a "basing pattern"....the attached screen capture shows how it works as price moves within a range, until participants decide to drive it up or down a tick or two below the range...if they find no resting orders there, the next move is (in my opinion) predictable..... By the way, the "range" in this example is approximately 4 points with multiple high probability entries available....from my point of view, very much worth trading.. Training students I suggest that an aggressive approach works best...for example I see 4 decent entries after the probe down.....If I am trading it alone, I will take three of the four and on the last one I would reduce size by half...I was taught that you want to "hit it until they make you pay" because by that time generally you will have made sufficient profit even if you end with a loser...
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Thank you Peter....there is so much useless urban myth posted by folks here....it is gratifying to see someone able to think critically about a subject.....best of luck in the markets. Steve
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Thanks for that dedication....I think its wonderful that you have chosen to paraphrase the work of others.....its not a choice I would make, but if you manage to get it right you can help those unfamiliar with the literature.... Edit At the bottom of each of your posts, you suggest that you will post "something better"....I am sure the rest of us would like to see you make good on that. Thanks.
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Heres another screen capture showing a three (2) minute time frame
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Here's an example of the Euro and our reversal pattern...as mentioned the pattern works for all tradable markets and in almost all time frames...I realize this is off the subject, so please once you have had a moment to look at, remove it. Notice if you will that the middle chart shows what I call a "basing pattern"....and one characteristic of that basing pattern is an attempt (we call it a probe) to find sellers....this is one way that traders can determine what the probable future directon is going to be...once that candle completes, you have only a short time until you see a move....we look at it as a valid signal to buy or sell, and of course we use confluence, reading the tape and looking at other data (in our case the DAX market) to confirm that entry.. Ordinarilly I would start a thread, but I have another project on the burner and don't intend to post much longer. Good luck folks
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Dont know that it matters much to the Europeans, but for me this is a day that I like to trade. Early morning is easy for me (since I am up early anyway)..and because the day is relatively low volume, it is easy to read. Here is a chart of the last (since I am done for the day) reversal pattern... The general rules are that the pattern has to occur at or near a specific area of supply or demand and at or near a specific time... The benefit for me is that I have effectively reduced the need to focus on charts all day long...yes I miss some trades...but the stress levels are very low and and unlike most systems the return vs risk is high....no more grinding out a living hoping that my winners overcome my losers....I wish I had found this years ago....ah well better late than never I guess. Good luck everyone see you next week.
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Hmmm...okay....then onward and upward as they say This is in response to the questions about defining a distribution....as mentioned previously, there are several methods that work. One (shown here) is to wait for price to test and retest a price point on each "end" of a range....Today I chose the short side....I assume the rationale is obvious....