steve46

Well first tradewinds. I agree with you on this point..I think it is a good thing to "take a look" at what Rande has to offer....Absolutely and why not....however, as with any product, or service, one needs to have a way of evaluating, of thinking critically about the subject...and one way of doing so (in my opinion) is to have a reasonable alternative commentary. One that points out flaws (if they exist) in the vendor's proposal.... Also Tradewinds, I have no problem with a person promoting themselves and their business...here or elsewhere....clearly that is what Rande is doing, and if HE doesn't do it, who will....that applies to us all...we have to promote our own agenda.....that said....evaluating that agenda is up to the individual...but I have no problem with it...

The gentleman's problem is a lack of experience, as well as a lack of skill...to put it bluntly he is incomptent and should not be at risk unless he is simply doing this as a hobby... The idea that one should attribute their problem to "fear" is fine, if it leads to some resolution of the problem, but in this case it doesn't..because really it is just a vehicle that you (Rande) are using as part of your promotional process.. The fact is that the gentleman in your example requires some "handholding"....if a person with skills could guide him through this process, a few repetitions would quickly show him what his options are, and how to manage both the trade and his fear...But as you have pointed out, you are not a trader...so this is not a solution that you can provide. Fear ladies and gentleman is a good thing and (sorry Rande) not something to try to conquer or fix...in fact it is a safety mechanism..that is there to try to protect you (in the world of trading) from loss. Rather than run from it or try to "treat it" or manage it, one should first understand the protection that it provides... Once you know the benefit that your fearful response is providing you may have more respect for it...meaning simply that if you are fearful...you shouldn't trade...until you have fixed the problem that caused it...AND that problem is almost always lack of skills, lack of experience and lack of education about what it is that you are trying to do....in most cases it certainly does not require psychological intervention... Sorry Rande but at someone has to say something about the emperor's lack of clothes.....and by the way sir or madam, if you every wanted to obtain some real world experience with regard to trading, I would be glad to try to assist you so that when next you comment, you have something of substance to provide your prospects. Good luck everyone...

Are you aware of the split session timing?

I have posted quite a bit about methods that can be used in my thread titled "Ideas for Struggling Traders". The thread was started a while ago and the information is a bit dated by now. In my thread titled "An Institutional look at the S&P Futures" I outline a method that uses TBP (time based pivots) among other concepts.. I use the concept of "Supply/Demand analysis" to determine where to entry and exit on any time frame, and the concept of "confluence' is helpful for those who are risk averse. I can use "Market profile data", the concept of "wholesale/retail value', and ultimately if I want a very high probability outcome I just "read the tape".....I adapt to what I see in front of me... Finally although it really "doesn't count", about a year ago a gentleman in our offices challenged me to trade the RTH session without charts, just hearing the pit call (the S&P big contract), and for grins we both gave it a shot....

In my office we have several bright young guys who do nothing but develop systems..they are paid to develop and then sell their system to our employer..so on the institutional side of this industry there are many people who sell their systems, in fact most of the intraday volume on the NYSE consists of automated execution of trading systems...Also to my knowledge there are several big firms who specialize in automated (basket execution of all kinds) and they are required to list their programmed trades publicly every day. These "systems" are developed and operated by employees and consultants of all kinds. To be correct, "independent" free lance vendors catering to the retail crowd are the ones selling systems that simply don't produce consistent long term profitability...and there are many good reasons for that... and I don't mean to single you out EMG because there are a lot of folks who have a screwed up idea of how this business works....and to the extent that some of them may want to eventually become professionals it may be a good idea to obtain a more realistic picture of what is actually going on...

They (trend lines) have been tested in my office for several markets...no sale here But by all means continue as you were ladies and gentlemen and best of luck to you

As I have said (a couple of times now) to find an entry you continue to scroll to smaller time frames Relative to what?...well, those of us who actually trade these markets know what normal volume is like for the time frame we operate in....you start with that basic knowledge and then you look at volume relative to the previous bar or candle...as mentioned (one more time) there are only two ways for this to play out...the first is that selling interest deteriorates (there are no more sellers), so when orders to sell are completed the next order (a buy order) moves the market up...this is illustrated in many charts IF you take the time to SCROLL THROUGH THE TIME FRAMES....the other option is that buy and sell orders are evenly matched for a short time, then new orders to buy enter the market and when all the sell orders are gone, the next buy orders move the market up.....I hope this is clear...

and here on the 120 minute chart you can see the increased volume on the retrace as buyers come back in to move price up

and here I have displayed the next two time frames down from my original chart here on the 240 min time frame you see what I call confirmation...in the chart above, volume fell off significantly as price tested the demand level...there was no demand to move price down THEN, volume came back (demand appeared as it always does) and price took off (retraced) The important part of this Ingot is that you can see the re-test....this happens quite often and gives the trader another shot at getting on board.... Now whats interesting to me...is whether or not you get it.....because this "works" on all time frames and without fail....if you know where to look and then think about what it takes to move price...all you have to do is ask the questions 1. Is this a level where price has volume to support a move or 2. Has volume fallen off indicating no further interest to move price up or down

Hello Ingot As you mentioned in a note to me, you don't participate in this time frame...so yes you "missed a signal" As regards supply/demand it never fails...all you have to do is take the time to look carefully at the charts, and what is required is simply that you scan through starting with longer time frames and working toward the shorter fime frame. Here is an updated chart. I have put in the nearest demand level and added volume...I do this because my venue (exchange traded currencies) offers something that Forex does not...and that is the ability to use volume to verify a move...now all you have to do is think....how does it work? So in this case it is counter-intuititive....think for a moment..when price is going to reverse....why will it do that? is it because there is a lot volume at a price? or because there is low volume or nearly no volume at a price? look down at my chart and you see the answer.... When price hits a demand level, what happens, volume falls off...what to do...simply scan the next time frame

The gentleman doesn't really want to make a scientific study....as you may already have guessed.... I was tempted to provide some interesting "data" of my own, just for laughs, but really I cannot bring myself to do it.. Oh well, enough of this...2am here on the west coast and time to close up shop...

My process is very nearly the same, and many of my colleagues do much the same....So your comment "why does nobody do this?" is simply put....incorrect... It would be more accurate to ask "why don't more retail traders do this"?....and of course the answer is...that this is one of the differences between professionals and amateurs...I think the bottom line reasons are along the line of laziness, incomptence, lack of education, etc.....your guess is as good as mine. As an amateur if I knew this was the difference between making money and losing it, I think it would motivate me to do the research and figure it out... One problems with the concept of "scientific" system development and trading (in this venue at least) is that to do a high quality job, one needs significant educational background and skills. For example most folks who try to write a rule driven system do not understand that all systems are affected by cyclical stationarity (depending on time frame and market traded)...Because they don't see this problem, they may write up a set of rules that "backtest" nicely, but for reasons unknown, once they go live, starts losing money. While I am thinking about it....it occurs to me that YOU might want to simply forego posting and go do this yourself...right?...if you know what to do (as you've just suggested), why not just go do it.....? Good luck to you..

Limit orders are a good way to lose money....I don't use them because I don't like to miss entries. I don't trade the "middle" of any area...period..I get in where I am supposed to, I respect my stop placement and every so often I take a loss.....since I started doing it that way, my success rate is always above 80%. Now the truth is that I can do this confidently because I have a history of identifying the S/D areas accurately....I assume you are just starting to do this....so it may take you a while to find that kind of confidence in your own entry placement.

Hi Mead You nailed it...and just to keep things in perspective....confluence is desirable because it increases the odds of success (more traders monitoring the setup = more traders likely to take the trade). But we don't need more than two data points.....if you happen to see more....if the planets align so to speak, well thats a happy coincidence....and of course the odds increase with each additional item you can find. Just remember that you have a limited amount of time in which to evaluate the data and act... good luck

Here is the short version Most professionals have a mental frame reference that carries them through on day's like today...we know that at the top of a distribution, you look to get short (because the odds favor price getting rejected the first attempt to take out a swing high)....at least from my point of view this is very basic stuff. Second you have price taking out the Market Profile Value Area High but then volume drops off...Of course you have to be able to read the tape to know that, but I can't help you there (not in this venue sorry)....so for me this part is a walk in the park. Price attempts to take out 1315 level six (6) times from 7:14 to 7:46am PST. On the seventh attempt, price fails and is rejected down...Generally speaking I prefer to get short on the third failure to take out the high... I don't know what else to say....except maybe that most experienced participants are looking for 10pts minimum once they get short in this situation...thats pretty much standard. In contrast, the retail crowd is generally trading for ticks or a couple points at best....because they can't tolerate the psychological tension of an open position...Clearly it takes time to get used to that feeling... Don't know what else I can say... Best of luck to all

Sir (or Madam) Mr or Ms Guapo Based on your comment, I see you are able to think critically about this subject....you have it nailed...most of us try to position ourselves outside the formal open and close of RTH....We do that by looking for favorable entry based on time-based pivots, and by evaluating the local distribution (depending on your preference that might be hourly or say every couple of hours). Alternatively some professionals define a series of "critical time periods"..where they see other participants moving to position themselves prior to the open of various markets (this is done so that we can position ourselves in markets around the world).... The most obvious example is the currency markets...where some of the best opportunities are found when two primary markets open or close and also at the close of any two primary markets... If we are talking about the US (the S&P Futures for example) then I suggest you look at the timing of the various economic reports in relation to the US open....Most of the time, those reports are released about an hour prior to the open....and often they impact market significantly... Finally there is the subject of timing in the "Macro" scale...you may want to ask yourself, what do the big institutions do just prior to the end of a quarter (where we are right now) or at the end of each month (what some call "window dressing"), what kind of decisions do they make in terms of mobilizing capital? Finally, I think your best resource is between your ears...your ability to think about what the other players are doing....take a look at your charts and ask yourself, what is happening just prior to the open...what is happening (generally on daily charts) just prior to the end of each quarter, end of each month, end of each week....in a couple of my charts (an institutional look at the S&P futures) I pointed out at least one example where on a Friday, the market rallied after testing the previous week's open....is that a coincidence?...well all I can say is in a trending market, I am willing to take that bet every time.... Its an important subject that retail traders mostly ignore... Good luck to you

Sam I was wondering when I might see this kind of response....(an adult response). There is no additional comment about the substance...you have nailed it Adults will get it, and those with less "adult" emotional status will find that your comment evokes what psychologists call "infantile rage"....meaning that they are pissed off that the world won't just give them what they want...... by the way, I imagine you will hear about it...and so will I for that matter, just for posting this....lol Best of luck to you in your trading

Josh I have already replied to your questions...I start with longer term charts and work toward the short side...As I have said now several times, I have been doing this for years, so for MY purposes the time frame is not critical...its a matter of scanning from longer to short time frames until you find the one or two that allow YOU to visualize price action accurately. I hope you will understand this next part because it may be crucial to YOUR progress. The items you are asking about are only part of the process I use...In addition I monitor a couple of other data point including time based pivots and value...finally I am able to read the tape....this means that when price tests one or more of these data points, I can see fairly quickly whether the bid or offer are going to be held, or whether price will take them out.... The bottom line is, (my opinion) that to have consistent success, a trader needs more than just S/D analysis....skilled pros have all the tools in place, AND they are able to use them skillfully.. The sysematic approach I outlined works in all markets....Currently, I maintain a presence in the US bond market, currencies, and the S&P 500 futures and to do that, I need to spend a significant amount of time doing MY homework. I am glad to answer the odd question or two as time permits....but frankly in this venue, I cannot do much more than I already have....thats why I have posted several threads outlining what I do, so that you can study whenever you have time....I hope that helps.

Well Ingot, I cannot trade Forex in my business so for me there is only one possibility (exchange traded currencies).... Here is the Euro chart and as you can see, Supply/Demand works as it always did... The important points to notice as mentioned in my previous post...You want to see a strong move away from supply with few retracements (or just shallow retracements)...You want to see a base created and you want to hit it, on the first retest...you have to be willing to manage risk and you have to have enough capital (and the experience) to bet properly...The reason I post this is to show retail traders the possibilities..Long at 1.4225...first scale out at 1.4004, next scale out at 1.3900, 1.3750, 1.3550, 1.3425, 1.3045 and finally at 1.2890. If the trade work as projected I will hold approx 3 months.

1. I always use time based charts..time and price have an equivalence that cannot be ignored. That is why my "time based pivots" work so well. With regard to time frame, I start my pre-market analysis the night before starting with weekly charts, moving down from daily to 12 hour, 8 hour, 4 hour, 2 hour and hourly charts...If you try this you will notice that the S/D levels change as you move from one time period to the next...about an hour prior to the open I plan my first two trade entries, the same way a pro footbal coach plans his opening plays. Because I have been doing this for so long, it really doesn't matter what time frame I use...its a matter of using whatever helps you visualize the action. Frankly at this point in time, I could (and I have on several occaisions) simply put my trades on listening to the pit action...So the message is use whatever helps you to see the market accurately... 2. In the S&P market, the pit and other players will often drive price in such a way as to take out previous swings by enough to flush out the amatuers who are by definition weak hands. Simply put institutions and speculators are capitalized so that they can afford more risk than you...They know that and are always going to try to shake you out. Your options are to manage the risk with smaller size or pass on the trade and look for another opportunity. 3. Generally speaking you are identifying S/D pretty well. It would be impossible to transmit all the nuance of the subject to you in a few posts here....How you progress from here depends on your ability to see the obvious....for instance you identify one area where there are two (2) supply/demand nodes stacked together in close proximity...This tells you that you have strong imbalance at that point. Now the question is what happens when price comes back to test that area? For me the answer is you make some assumptions based on how price "left" those S/D nodes and when price retraces, you watch and evaluate the tape to see if there will be a held bid or offer...(that is where the importance of learning to read the tape comes in). You have a good start and now it is a matter of continued observation. Good luck

Wow....Incredible....I have to admit that your interpretation of my comments was "surprising" I remember a crazy old gentleman trader named Ed Seykota, who said (among other things) that we all get just what we want from the markets....I have been very fortunate and seems that I have already got what I wanted....I can only hope that you get what you want as well..Best of luck to you sir (or madam)...

Well the concept of support/resistance never did much for me....probably because when I was a retail trader I did not have a definition that worked consistently....Your definition is fine, except that typically what retail traders think of as support is a single price at which they can get in expecting an immediate reversal...a line in the sand....supply demand analysis doesn't work that way (at least not all the time)...for example, "demand" often occurs over a range of prices depending on the time frame of the chart.... thats just point #1 In addition there are multiple levels of supply and demand and knowing which one to trade is the important issue...most retail traders cannot isolate real support because they don't know how to define it...for me again it depends on time frame...I prefer to start with longer time frame charts....define my supply/demand levels and then work my way down to shorter time frames. When you do this, what you see is that eventually you get down to a more workable level of risk (because the range of prices that constitute supply or demand gets condensed down).... The problem I have here is that this forum doesn't lend itself to what you need to see...on a long term chart...you need to see price leave a swing high or low and move significantly away....then make a base, and finally start to re-trace...as you move to shorter time frames....this model becomes the best way to visualize supply because you can see how price tests all the "in between" levels...the ones that retail trader think of as support or resistance....thats the way most of us learn...and I don't have the time to take people on that journey and still do my own work. Hope this helps you a little bit

Well Josh, you are the second person to make the mistake of thinking that Supply/Demand analysis is "the same" as support and resistance...IF Mr. Seiden teaches that, then unfortunately I have to say we disagree.... Basically supply/demand analysis involves learning to distinguish when markets (meaning orders to buy vs orders to sell) are "in balance" or "out of balance'. To the extent that you realize this, you have a chance of learning something critically important...if instead you try to reduce it to simple support and resistance, well then you are seeing only part of a market and like most retail players, you will always be operating at a disadvantage. Good luck

Sorry Josh, don't know the man (Seiden)....as mentioned previously, the concept of supply & demand comes from classical economic theory....by now I am sure that other professionals have adapted some form for it for trading.

Perhaps this chart puts my prior comment in better perspective Although it is not al displayed in the main chart, the overnight (Globex) market consisted primarily of consolidation as sometimes happens when we have a trend move. Just after midnight US time, a "Global Handshake" process occurs in which the European banks effectively take over from Asia. This process begins with the open of the DAX in Germany. The lower green arrow shows price at the open of the "handshake process" and of course one can see how markets were marked up through the balance of the early morning. Participants who traded this overnight move got 10 points. Price tested overhead supply and retreated as expected, then the US market opened and with the backdrop of overhead supply only 2 pts away, it was obvious to many that we were going to retrace off the open. The market retraced until it hit another supply demand node and then we see what many professionals call a "peekaboo" move...This is essentially the pit taking price down in an attempt to activate resting sell order and to evaluate interest (to see if they can activate automated execution to sell). As can be seen there was no interest in selling at that point....all sellers had left the market...Automated execution was activated, followed by active participants trying to get on board before the train left the station....As can be seen in the chart, the market was then marked up another 10 pts.....(coincidence?).... And now being somewhat sleep deprived I am going to sign off.