steve46

I could ask you the same question. I've taken the time to look into this and my opinion is unchanged. Except that now I am thinking that you're acting like a shill. I've seen enough to make my mind up... we're done here.

Yes they do, however please take note that Time-Based Pivots are just one part of the system I use. What "works" (in my opinion) is the concept of supply/demand, time based pivots and learning to identify a standard distribution...its all part of one unified solution. Once I learned to put it together I've never looked elsewhere. I wish you the best of luck Steve

I think I have been very patient with this crap Look the gentleman can do whatever he wants and whatever people with let him do (obviously)... For me I have the following unanswered questions...how does a person get "personal attention" in a class of hundreds of students. I am thinking he or she does not..period..prove me wrong. How does a person learn to trade watching a trader who scales in & out with virtually unlimited capital. How does a student learn to manage risk that way? They don't....and what kind of lesson is learned by folks who have limited capital and are trying to move to the next level.....I'm thinking nothing worth coming here and mentioning, otherwise we would have heard a few success stories.(we havent')....I think I have wasted enough time on this subject.

My preferred "indicator" is my skill at reading momentum (reading the tape) I use the NYSE Tick, and the Time& Sales Strip primarily. The Tick is a very powerful tool when used correctly, as is T&S...each one shows a different aspect of momentum. The TICK displays the broad market's strength or weakness, and the T&S displays all kinds of information about the speed at which transactions are being executed (helpful when you want to indentify programmed execution). The "roll" of the tape (the speed and quality of the movement can be interpreted to provide information about the way that price movements are either accepted or rejected by the broad market. For traders interested in learning to use these tools, the challenges are A.) finding someone who knows HOW to interpret the tick/T&S strip combination and B.) learning to understand the language used to describe the action in a useful way......I have seen several books on the subject, none of which provide anything even remotely useful....from my point of view this is probably going to be a lost art at some point in the near future as few are interested in taking the time to learn ( it might take from several months to several years to really master the technique) and I have only seen one person in the last 10 years who really knew how to read it well (and could describe it in a way that was understandable). As a final note, reading the tape is just part of the process...once a trader learns the basic skills, then the process of putting the action in context starts..(there are seasonal contexts, as well as short term contexts down to the hour of day that matter in terms of interpreting the action). The upside for the trader who is successful at learning to "read the tape" is that you then have a very high probability way of entering a position.

Ok then, set me straight...please

In his book "Options as a Strategic Investment" Larry McMillan writes of a similar strategy (martingale) and his opinion (as is mine) is that "at some point in time" the strategy is likely to blow up in a spectacular fashion... One thing I would like to say however, is that some may underestimate the gentleman (Hoffman) when they suggest that he is unaware that this is what he is doing (Martingale). I am pretty sure he knows that he is on borrowed time with that approach, but is willing to take the risk exposure... What I dislike about this, is that HIS STUDENTS are probably unaware of the magnitude of risk they are exposed to if the emulate this strategy... Thats it for me Steve

I think I commented about this earlier in the thread....but here is a recap for those who may not have understood the situation Most retail traders are undercapitalized...therefore it is likely that even a minor drawdown (no matter what strategy is used) will cause them to either abandon the system or stop trading. "Professionals", "institutional traders" and "speculators" have in common access to a larger starting capital account, AND because they are often trading other people's money, there is less psychological pressure on them, when (not if) they experience a drawdown... For this and other reasons, the strategy employed makes all the difference...for a retail trader to have a chance at success (trading S&P futures for example) they must have a minimum of $20,000 in their account and no pressure to provide immediate cash flow from that account and B.) a strategy in place that permits them to trade with relatively high accuracy (to obtain favorable entry more than 70% of the time) and finally, they need to have in place tools (a workable protocol) that allows them to minimize stop losses so that they can take multiple "probe" type trades without much impact on their accounts. From my point of view (and from experience) it is necessary for a student to get a sufficient amount of "reps" doing this kind of trading BEFORE they can obtain consistent success intraday...The method I read about (that the gentleman is using to trade his account in the room) doesn't fit that description...and for that reason. I am guessing that many if not most start out with great expectations and then either bleed their accounts dry or simply get discouraged and stop because they cannot duplicate his style (without enduring significant psychological discomfort).... Thats about a generous a characterization as I can manage given what I am hearing about the room..I would look for another alternative. Best Regards Steve

I have also had some experience with them....a friend asked me to check them out...they are really pretty bad....

In terms of the mental aspect of this profession, I have found that success comes to those who take a long term perspective.and you have to be willing to ignore the isolation, the boredom and the distractions in and around your home office. In terms of motivation, what you need is the inner confidence that sooner or later you will find a method that works for you, AND if I were to do one thing differently, I would be more disciplined about investigating every possible method of trading...Why, becaue you never know when you are going to run into a style, a method, something that clicks for you. One thing that helped me was that I started to catalogue the various methods that I knew about in an organized manner. One day I thought hey what if I combine a couple of methods and try to trade them together..By the way there used to be a software program that would try out all different kind of indicators and settings, looking for something that worked in various markets (I think it was called "stratus search" or something similar). Hope some of this helps Steve

I started with equities and found that I was not very good at it...by chance I was introduced to Dr. Ari Kiev. He suggested some simple things that have worked well for me...First he suggested that I build on what I know best (I am an Engineer by training)...So I started to look at Energy, and Oil Services...He also suggested that I specialize or concentrate my efforts in one area. In his opinion if you become an expert at some element of business or technology, you may find that people will pay for your expertise, or that you can parlay that expertise into a better job or make money by learning to apply that expertise to trading. I stayed with Energy and Oil Services for almost 10 years before branching out to other things. As for my approach, again I had no real idea of what to do...like most I tried all the obvious avenues and to no avail...again Dr. Kiev suggested "you know some of the best traders I know use Market and Volume Profile".... He introduced me to a couple of gentlemen at a brokerage firm called Gelderman and for the first time I saw people using Market Profile and Volume Profile consistently. After that I began investigating the idea of identifying areas of Supply and Demand on standard candlestick charts. About a year later it occurred to me that if I were to combine the two approaches the result might be a more accurate initial entry for my trades. I have been using the concept of "confluence" successfully for quite a while now...the idea being that if you have multiple signals occuring at or near the same price, you have a bigger audience of traders willing to take action at that price.

Hi Depends on the local volatility..For example currently (Friday for example) we had one trade before calling it quits for the session. That trade was good for 7+ points. Generally speaking I won't pull the trigger unless I see potential profit of at least 5 points. Most of this month we have had one or two such trades per day. I hope this helps Steve

Well first, I negotiated a leave of absence from work....in exchange I agreed to train someone to take my place (period of 18 months)...I did this for two reasons...first my ambition is to do something similar to what Richard Dennis and William Eckhardt did in training the "Turtles" Second, I wanted to avoid "burning bridges" with folks who were kind enough to take a chance on me a few years ago...So I did what I had to do in order to get a shot a what has been a dream of mine for a while now. That said, I have the next 18 months in which to find, train, and "set free" (yes they are going to be asked to leave the class). After that, I have asked them to trade on their own (at least 6 months) and report the results. There are many differences between Dennis, Eckhardt and myself the least of which is that my system is distinct from "traditional" (Donchian) trend following. Addressing your question...I have made my environment right for this project and yet I still get sidetracked...trying to educate, prepare a premarket analysis and then trade the open in front of a class is bit of a challenge...the solution to this problem is that I map out the trades in front of my class in the pre-market (5:45 to 6:15am PST). This approach is similar to that used by pro football coaches. who map out the first X number of plays in advance....if things go as planned they simply continue with that scheme....if not, they adapt to the changing environment..(and we do the same). I hope this gets close to a usable answer. Best Regards Steve

The idea that a specific trader uses Market Profile (and therefore it may be valid) is probably not the best way to evaluate a systematic approach The general principles associated with Auction Market Theory have always been valid because they are expressions of basic human behavior. Once you understand that it becomes easier to work within the construct... For my class we look to buy wholesale value, in a market whose bias is "up". We know that the market consists of multiple agendas including longer term participants interested in bidding the market up to retail levels. We go along for the ride, selling at retail and banking the profit..That simple principle has worked for centuries. Once you understand the principles...and assuming you have the basic skill of "tape reading" in place, it is simply a matter of waiting for the market to test a key reference area (a price, or range of prices where longer term players are likely to come in to buy or sell).. This happens regularly (I would say at least once per day) and allows from 5 to 10 points of profit (given the current volatility) when you enter and manage risk competently. If you're "unskilled".... and you simply enter "at the number" (assuming you know where that is), you may still make a profit. Generall however you will find that your result is inconsistent... If you know how to read the tape, and you enter with skill and patience, the risk is usually about 3-5 ticks. I find that skilled participants using that framework can approach 80% correct entries Friday was an excellent example...as traders looked to get out early for the holiday...most of my students were caught without "a number" to work from...you see they believe...as most of you do apparently that the value area high, POC and VAL are the only numbers that matter..lol The problem of course is that value is a temporary construct, that can (and does) change depending on the circumstances..AND it also changes based on time frame..with longer and shorter term players finding value at different levels. Anyway, here is the chart with a single entry with a green arrow...there is an elegance to this that doesn't get much appreciation because it is never discussed. You see the first thing that happens is that the market reacts to an economic report (in this case the housing report came out and was badly received)...this activates the short time frame players who take it down to test previous perceived wholesale value...they do this not to find value, but to drive it lower into an area of wholesale value On the first thrust down, they are unable to find sellers...in fact other short and intermediate time frame players come in first thinking that this price level represents value...price retraces up slightly but at this price (and at this time of day) longer term players are still waiting to see if the market is going to sell down further (they are waiting for a second thrust down...When that second thrust happens (as it always does) once there are no interested sellers at those prices (and apparently there are no resting stop orders that can be activated there)....NOW the longer term players become interested, and they express that interest by moving size into the market on marketable buy orders Best Regards Steve

I monitor one market, using supply/demand analysis, time-based pivots and the concept of wholesale/retail value (similar to Volume Profile).

Yes of course, there are several ways to combine the data. I use confluence of both time and volume based data in the form of supply demand nodes and Market Profile....Add time-based pivots and you have the best of both worlds...I realize that the question(s) are meant to elicit an easy to understand, immediately useful solution....and clearly this does not fit in that category, it fits your description, and it works consistently..

Supply & Demand never seem to fail...If you think about it...when do you buy something? When the price is high, or when the price is low (in your opinion)? and when you do sell something...when the price is low, or when you can get a good profit for it? I think the answer is clear to most of us...and the financial markets are no different.. On any chart you will see price trend up until it reaches a point where NO ONE is willing to buy and at that point you will see a "wick" (if you are using candles)....THAT is where there are no more buyers (at least for the moment)...Ironically popular literature suggests that these boundaries are at areas where there is a lot volume...the truth of matter is that supply and demand change at places where there is virtually NO VOLUME....It is a that "tipping point" where buyers or sellers decide to take a position that you want to be ready to act.....and it is right in front of you on any chart IF you simply take a moment to look at it Quite a few examples in my threads

That's more the type of comment one might hear from a "sanitary engineer" as opposed to a "nuclear" engineer"..... So at this point, we can pretty much conclude that this gentleman (or lady) has never been anywhere near a Engineering curriculum (of any kind).... Maybe he should have suggested that he was "Superhero", or "Astronaut" perhaps.... OK then enough joking around...frankly its of little interest to me, but to those with the capacity for critical thought THIS last comment really causes me to wonder and the idea that at some point in the near future we can ALL find his precious comments if we will only go to HIS BLOG.....ahhhhhhh yes.. Well then...enough balloon popping for tonight...Sorry Phantom.....please carry on as you were. "Luv"

Well there are a multitude of ways to use "time-based pivots"...I will just comment on the way that I handle it...I monitor all the pivots, HOWEVER I look at the nearby time frame first...so on Monday, for me the most important time based pivot is the previous day (open high low)..I still keep an eye on the other pivots, but the previous day is more important at that time... As we draw closer to the end of the week, naturally I am looking more closely at the weekly time based pivot... Also, on a test of the pivot I tell my students to take the trade only on the FIRST TEST...after that the pivot is less important... Finally although I was taught that other professionals are looking to defend it, you can see that the S&P futures are very noisy and there are folks who want to drive it down as well...Look at what happened at the end of the day on Friday...From my point of view, if I am trading my own account, I don't care which way they take it because I am also reading the tape, and it is pretty easy to see which way it is going to break...As I said before in an up market, I will tend to trade the first test looking for a long entry...after that I rely on my tape skills (and my experience)...If you would have seen Friday's class you would have smiled as we tried to guide folks through the first and second tests of that price point...it was pretty neat actually.... Hope this helps Steve

Interesting comment Blowfish...and it dovetails nicely with what I want to say... First, I don't have a comment one way or another about the sytematic approach...in my business we don't throw money at a system just because someone suggests that it is viable...that would be silly in the extreme.... Second..in terms of "what works"...if we move forward from point one...what "works" once you have an idea in mind is to test it...and the idea that one might have trouble testing this system (or any system for that matter) is a bit suspicious...In my opinion, every systematic approach can be reduced to a testable format, and if you can't readily do that, then you are left with manual tests of tha database... Finally, I realize that the popular conception is that you only need 30 data points to evaluate a system...ah no...that won't do it...I leave it to others to figure this one out but lets just say that to really get an idea of whether a system "works" (is tradeable, makes money, has a acceptable drawdown, etc) I think you need to have data that reflects several kinds of market conditions over a period of several years at minimum... Just a quick comment for those interested in more than green light/buy, red light/sell approaches.... Good luck Steve

Ants88 Appreciate the comment...this may help you to put things in perspective...first, your chart stands on its own..what I am interested in....and what I will direct your attention to is Friday's trade...notice how price tested 1330 and the reaction back up was excellent...a nice 10 point move...however they could not hold the gains and at the end of the day, electronic execution came in and took it back down from 1340 all the way back to 1327 area....This is not uncommon..and what I would suggest is that you watch the Globex open on Sunday (If you can). See if it opens gap up or gap down...that will give you a "tell" about where we are going from here... Best Regards Steve

Sir or Madam Generally speaking if you have trouble pulling the trigger after all the work you suggest you have gone through, then "something is wrong with this picture"...either you are exaggerating or some part of you does not "believe" in your system...to me it matters not...but until you resolve that divergence between what you say and what you "believe, you probably won't be able to make it work...By the way...this comment is the result of my work with Dr. Ari Kiev (not my opinion initially although I have come to agree with it)...you see I had the same problem more than a decade ago and he helped me to get over it...basically I had to do more testing so that knew the system inside and out...including the worst possible scenario (max historical drawdown), and how to identify whether the system was working correctly or "failing"...It took me about three months of additional number crunching to come to the conclusion that my system was worth risking money on...from then on I was ok with it... I hope this helps....since I don't know you well its the best I can do.. Best Regard Steve

Ok so yes....the weekly open is Monday the first trading day of each week, in whatever time zone you happen to be in... Same with the monthly, and quarterly open...and as we get closer to the end of each time period, traders seem to be motivated to come in and "defend" those prices.. Thats the basic system...in addition, when markets retrace, traders from institutions are often motivated to come in and try to get things "back on track" and to do that they try to move price back up past the high of the time period. To do this, we try to move past the open, and then past the high so that we can "catch up" and re-establish the previous trend. The attached chart shows that action today, as traders tried several times to defend the previous day's high (and by the way, the previous week's high is just a few ticks above at 1341.25).... I hope that make it clear. Good luck Steve

I like to make it simple. Most of the top tier institutions maintaining a presence in today's market are banks (what we think of as banks)....Since the changes brought about by the mortgage problem some of these "institutions" have put themselves at a distance from their trading groups, but that is just legal issue. The bottom line is that institutional activity is primarily "banks" In contrast, "funds" and what we think of as "hedge funds" are intrinscally different in how they pursue their goals..specifically they are actively looking for more and different risk exposure. This is less about the type or classification of operation and more about what they are and are not will to risk in order to obtain profit.. I hope this helps Steve

What an interesting way to respond Well first of all, what you choose to believe is of little interest to me...My income is none of your business although like many professionals it is based in part on how much profit I generate for my employer.. and finally (because the original poster has requsted that we be "respectful").....may I "respectfully" suggest that you ignore me....I will do the same for you from now on....... There you go...problem solved! "Cheers"

Sir or Madam Whats "behind" order flow is a decision made by an institutional participants to buy or sell a tradable issue (equity, debt, commodity or future). Based on that decision, they either call down to a broker near the pit or authorize the trade to a soft money agent or to their own employee for electronic execution. For some participants the alternative route is automated execution. For the NYSE, more than 66% of volume is executed this way. This is the "broad strokes" picture of what is "behind" order flow on a daily basis. Intraday, and on the institutional side, the motivation (the reason behind order flow) is that we want to make bonuses for performance at the end of the year...For that reason, as we near the end of specific time frames....yearly, quarterly, monthly and weekly, we will step in front of the market as it tests the open of each time period..moving it up (defending it)...the closer you get to the end of a time period, the stronger the motivation to defend or move markets as they challenge the open of each time period..On the institutional side we call these "time based pivots". Here is a chart example from my thread titled "An Institutional Look at the S&P Futures" http://www.traderslaboratory.com/forums/32/institutional-look-s-p-futures-8859-6.html scroll down the page to the post that begins "just for grins".....then refer to the chart. I hope this helps Steve