steve46

Kind sir or madam If I may, the overnight action in the S&P futures was for the most part consolidation until just after the "global handshake" that occurs at about 1:30 PST in the USA...At that point the Europeans marked it up taking their 10+ pts. I don't mean to quibble, but I am paid to attend to these details.... From our standpoint (in terms of profit opportunity) the entry was several days ago when the market displayed what I characterized as an "obvious bias" (from my thread "trading adverse events")....At that time skilled participants had enough visibility to sell the market down, both on news and on the premise that one would, in the future have the opportunity to buy inventory back at distressed prices. Near the end of that thread I point out where the opportunity to buy became obvious, and how institutions would act, stepping in tentatively at first in order to lower the basis of their existing portfolios and then when they saw the first favorable news, to maximize their profit potential by selling risk as the market stabilized (as seen in the put/call and open interest data).... As it applies to the individual, the message is always the same.....if you have skills and capital. Then in situations like this you are going to make money IF you can manage risk (and your emotional reaction to managing risk)...To the extent that people bought on the turn, they now have a nice profit, and I expect, absent more negative news, that it will probably continue... On a final note, most by players took this opportunity to institute hedges to protect this recently acquired windfall profit....Generally speaking retail would not have the expertise or the capital to do that....so no point in going into the details... Good luck everyone

Nice coincidence that we open so far above traditional MP "value" today.....so the obvious question is "what do you do in these circumstances"?....What Market Profile numbers do you focus on.....daily, weekly monthly....what? and that question is (in my opinion) one of the primary problems that new traders face when trying to find a useful application for Auction Market Theory or Market Profile.... Interestingly, on this day I used a combination (as I often do) of several data points including identification of supply and demand, Time-based pivots, and simple common sense as regards "the distribution"...I am managing a position at this point so I will have to be brief In my thread "an institutional look at S&P Futures" I posted a couple of charts showing todays identification of Supply/Demand Nodes....As you can see, we had overhead supply 2 pts above the open.... Also, we have the backdrop of the weekly Time-Based Pivots (open at 1289.50, high of 1296.50 and low of 1287.75) and finally the "common sense" issue relating to the distribution..Clearly the market is extended from the overnight Globex session....in that session institutions marked the market up from 1290...in the process they "got their 10 points plus" and after that frankly the rest is gravy (from a professional standpoint)....to me that means that there is an "implied short bias" on the open....that and the fact that we had supply only 2pts above, lets me have a nice, low risk, short entry at the open...

and this last post show price being rejected from the upper supply/demand node (as we would expect) The common mistake that retail traders make is to get long right at this point....and of course it may eventually continue through the S/D node, but not for the moment....

This is a rather important comment I think...What you are seeing in any venue where the public participates are vague ideas based on urban myth...If and when a skilled person enters the arena you may read more specific comments (within limits)....The facts are that in any endeavor there are likely to be only a few top performers, and they obtain their success at great expense (in terms of absolute cost in money, in terms of time, focus, discipline and other requirements). The results the rest of the crowd obtains are generally in line with their willingness to work hard, and their ability to think analyze and think critically....The one benefit that I see (that was previously unavailable to the public) is information that can be brought to bear on the subject via the Internet...Finally this profession has unique requirements in terms of psychological performance...and that is the one obstacle that remains long throughout the participants career. That is why I suggest that people devote resources to formal education whenever possible. Good luck

Here is an excellent example of how identification of Supply and Demand can facilitate the trade process. As you can see in the posts above, we used that same process to identify a favorable point of entry. Those who follow my posts may remember that I suggested that the same process can be use to tell where to take profit. The advantage of this, is as follows; 1. It becomes somewhat less stressful to trade because you can be more confident that the odds of obtaining favorable entry are good 2. You can select a method for taking profit based on longer "holding period" thus improving your profits 3. You can scan additional markets for suitable trade conditions thus improving the profit potential of your business (if in fact you approach trading as a business). This trade (includng the entry outlined in the previous post) went for approximately 10 pts, in line with what most professionals look for when entering the S&P market. At this point I would suggest (once again) that the Globex market offers interesting opportunities for traders who may be restricted in terms of how many hours they can devote to this purpose, and to those who want to find high probability entries.

I posted this over on another thread, however I wonder if that thread will survive because it is essentially spam from some guy who trolling for subscriptions lol So here it is, where it may help some of you The chart shows today's Globex open....My process for trading the Globex is actually pretty simple. I look at the day's price action first....if there is a significant trend, I monitor the close to try and characterize the market. This market has changed since last week. We have gone from an "obvious down bias" to a neutral bias, however the market is still very volatile and is news driven....depending on the market open (in this case the Globex opens near the Nikkei open) local news (news about Japan's reactor problems) can move markets quickly. knowing this I identified nearby supply, and then watched for the Globex open (I watch to see if we have a gap open, or just a continuation of prior market action. As you can see, we have what is essentially a continuation of the regular session last hour action (downtrend). Once I see that I look for price to test nearly supply (you can see that it did just that) where I put on a long postion with small stoploss....in these circumstances, I am not looking for big winner, just 2 or 3 points...and that is just what I got. The other important take aways are as follows....When price moves down to test my supply node, it also tests the weekly open at 1289.50, which is a primary "time based pivot" (TBP)....this makes it easy to take the trade because it means that there is a larger audience of traders willing to act on this setup (its called "confluence"). And finally you can see that price comes down to test this supply node multiple times, bouncing off every time....this tells me that I did a good job of identifying the "right" node (there are several other supply nodes that a trader could have identified. Depending on the reader's interest and skill level, this chart and the comment could provide significant help in terms of understanding how to trade the Globex session.

While we are at it I thought I would demonstrate another concept that really does work very well and that is the use of TBP or "Time-Based Pivots" AND Supply/Demand "Confluence" (the operational concept is "Confluence") In this case we see that price opened the Globex session at 1292, then retraced down to the weekly open at 1289.50 (to the tick).....the combination of TBP and identification of a supply/demand level means (to me) that the odds of success for this trade entry are much improved..

and so here we are a bit later and I took 3 points....not a big deal....but hey it is what it is... I am pretty sure the Nikkei is going to retrace here on the open, so I am prepared to get out and wait for the next opportunity... Good luck everybody.

I have been very fortunate professionally, so I don't worry about finances...I just enjoy solving the daily puzzle of where the market is going.

Unfortunately it is not easy to explain, and that may be the limiting factor why people don't see the possibilties.... There are several factors to consider, first one has to look for previous trend, and by that I mean wide range bars. I like to see evidence of previous imbalance resolving with strong directional movement and there are degrees of this (as you can see it requires some judgement).. When you see that evidence of momentum you want to look within that trend for areas where that momentum slows and eventually stops briefly. In those areas (characterized by overlapping bars or candles) you have "nodes" where resting inventory exists and where participants have come in to add or remove orders...these areas are often the places where price will retrace and then continue an existing trend. The way you find them is by scanning your charts over several time frames...As you do this what you find is that the various time frames let you see "inside" the bar or candle where you can identify these areas (they are actually areas of temporary imbalance.). As I have said before, perhaps I am not explaining clearly or it could be the audience that is here does not have an interest in doing the work necessary to understand the concept. At some point I am going to go off on my own and do a class on the subject, so I can give people a bit more personal attention..I think thats probably what it will require. At the moment however I just don't have the time to do it... I hope this helps somewhat.

Well, I can't call every turn but I can do this well enough to make a nice living, using simple principles that are already posted freely on this site... Heres a chart of today's Globex open.....I waited for the market to show me, where it wanted to test (all price action is a matter of "tests" of previous supply and demand) then you just pull the trigger (if you have the balls to do it) and you manage the trade.... Of course you do have to put in enough time and study to learn the basics (oh you mean you have to actually work to get the info....no way man....) So heres my chart and this is pretty standard for my system...I get within a 1.5 or 2 pts most of the time...and I ride to the next bus stop (supply/demand) I guess I need to get my "promotional" game in gear...I am really missing out. I just need to learn to phrase it like this guy does...."Just call me, I can't post it on this site......its a secret......and we don't want to kill the golden goose now.......DO WE? Of course there could be problem....because there are periodic losing trades (no.....your kidding), and so one has to act like an adult and learn to manage drawdowns (no....not a drawdown...that can't be)....yes my son....drawdowns..(gasp)

and for those who do speak English...the idea that all "fund managers".....trade the S&P futures is at best misleading....First, there are quite a few different types of funds...too many to enumerate here, and secondly in the United States, funds are often restricted to a specific type of asset class or at the very least to specific guidelines as to which asset classes they can particpate in as well as how they hold, report and disburse funds. Finally many funds restrict their participation to long term holdings only to minimize the impact of taxes on reported earnings. This is why (as I have stated previously) that larger institutions often make decisions based on long term price action. My advice ladies and gentlemen is that IF you want to ge useful comments from those few professionals who show up, you would benefit most by going and getting some background on your own BEFORE asking questions.

Sir or Madam Perhaps English is not your primary language....If that is the case, my short and simple answer is "no".

Just for the heck of it I will post this 60 minute chart with my levels in place for this week. From my point of view this chart shows that there are lot of "levels" where a trader could make money...

Hello Minishark OK so I read your comment. The markets have changed significantly since Wyckoff and Gann. We don't need to go into all the details do we ? Its a different world now, but what has not changed is basic human nature. So your "read" of market action is essentially correct, its just that the institutional players have somewhat different scenarios (in terms of time frame) for acting as they do, and they have more and different resources for acting in the markets. The bottom line is still about the same. If you want to have a very detailed structure for interpreting market action, please go right ahead. For me what works is to simplify as much as possible. I start by asking simply "what is the market doing"? "what is really going on here"?.....then (in contrast to your comment that it is happening on a 5 minute time frame) I like to analyze market action starting with longer time frames (because that is how big institutions make their decisions) and work towards shorter time frames (because that is how smaller institutions and speculators decide WHEN to take action)....you see? If we are talking about intraday time frame trading, I want to stand aside until I see a very high probability entry point. The timing of these entry "opportunities" varies with volatility...what is nice to know is, that they are always happening (they are always coming along like the next bus so to speak).....As regards tools, the basis for my decision making is identification of areas of supply and demand. This technique works on all time frames and it allows me to find both favorable entry and accurate profit targets...The result is that I can get on board earlier than retail traders, and I can hold my position long enough for my edge to kick in....and as importantly my experience of trading is much less stressful than it is for retail, who are generally late to the party and have to endure watching while price wiggles around like fish on a hook. One thing that interests me is the retail preference for using derivative tools (indicators)....I was stunned recently by the dogged way that people hold on the belief that indicators provide some predictability...they don't. In my opinion, it is the unwillingness to adjust their view to the available data, and the inability to think critically and analyze accurately that cause retail to make the kinds of decisions that result in loss....Oh well. Good luck to you sir or madam (sorry no way to tell with a name like Minishark)

Cool, have you tried it? How does it work? Not clear about the wetwork part but I do have a comment about indicators in general It seems to me that indicators take price at some point on a chart, and then apply a mathematical operation to it....that process produces a derivative of price, and because that takes time...it also introduces a time delay (lag). All indicators do the same thing (they process price and transform it into something else on the screen). In contrast, classical supply and demand doesn't take price and do anything to it....based on the pattern I see, I can tell you that there are more buyers than sellers (demand) or more sellers than buyers (supply)...it is a matter of direct recognition so there is no delay or lag, and of course I don't want to upset fragile egos, but the argument that marking a chart = an indicator is silly....I don't need to mark my charts...I do it to show others where the supply/demand areas are....that being the case, if I don't mark supply/demand, does that mean its not an indicator....? Its just silly The fact is that indicators provide a mental crutch for traders....and in the process they give the trader false confidence that he/she is can forecast where price is going to go...as we all know by now, that confidence is short lived.... I wish you all the best with that "indicator", but I am guessing that it is different than the concept I use.

Okay so I finally get it...you desperately need to correct me....clearly it is very important for you to be right (about something/anything)... I understand....and if it will help you to feel better about yourself.....please by all means....you are right.... By the way, I reviewed my CQG software....no supply/demand indicator I reviewed my Esignal software.....no supply demand indicator Investor RT.....no supply/demand indicator Sierra Chart....no supply/demand indicator... but really if thats what it takes...be my guest....YOU ARE RIGHT...there I hope you are feeling much better now.... and now if you will excuse me I am going to go use my "indicator" to make money.... Good luck folks

Sorry, but I don't have much interest in the debate....by all means continue as you were. For those adults who are interested in the subject, I use the classical economic principle of supply and demand. Interested parties can get background on this principle by googling the phrase....and you can email me if you want more detail on my use of the principle.

I will be very brief out of deference to Ingot whose thread we are in. Like Ingot I start my analysis with a longer term reference, if that time frame suggests long bias I look for supply below the current price as a place where favorable entry can be obtained For the bond chart the actual target is the weekly high at 121'21. At that price, a short entry is the preferred action. "Time--based pivots" were taught to me long ago and work quite well as you will see if you refer to a current bond chart (price tested the weekly high and failed)... Finally if we can get back to Ingot's question, my additional comment is as follows....after all these years of looking at charts (I am 60 years old now)...it is clear that a trader can obtain success with either orientation (indicators/no indicators)...IF he/she will approach the problem in a non-random way..and for me that means knowing that on an individual basis NO ONE can tell whether a setup will result in profit or loss...however if one will simply take every trade in a statistically significant sample and manage risk skillfully, that outcome (the result of all the trades) is likely to be non-random. I hope that helps

and here's the same concept with bonds. As regards your original chart example, I notice you have several indicators stacked below the price panel....For me the fact that you have "confluence" (agreement of more than one indicator) IS an important data point to consider...it suggests that a larger potential audience is likely to act on the setup...That is significant in my book. Also the time frame is significant.....If I see this data (your original chart example) on a longer time frame chart, I would be more likely to take the trade, because in my opinion, the audience looking at this data would include participants more likely to move size. Just trying to put myself in your shoes for a moment....Hope the comments help

Ok then I don't know if this is going to "get through" to anyone but the idea of trading with indicators doesn't impress me much...Actually there are many skilled pros who actively look for "indicator fed" setups just so they can trade the failures.... For me the example displays insufficient data to make a decision. I have attached a similar chart example showing why I prefer not to use indicators..and how I frame the trade using support and demand. By the way Ingot... the example is for your benefit...notice that it is a currency chart on a 20 min time frame. Once you learn how to identify supply/demand, it changes how you view charts and how you select trades.... Hope this helps

Clearly our defense mechanisms are there to protect us from discomfort. If we extend that reasoning out somewhat, they become the mechanism that we employ to maintain our self-image (whether true or false) and in the process our view of the world around us. Unfortunately when trying to participate in the financial markets, particularly intraday trading, this mechanism is counter-productive....One difference that I have noticed with skilled traders is that they are emotionally flexible. They can be wrong, and the next minute they are able to adjust to new data and find a way to get on the right side of the market. In contrast, less skilled participants often take a lot of time to adjust to the idea of being wrong. One might say that they decieve themselves hoping that they will be proved right in the end....One of the things you learn if you are able to obtain good training, is that your success depends on being able to unemotionally evaluate your actions and adjust to the data.....In fact there are academic studies (one of them at the end of Linda Raschke's book "Street Smarts" that suggest that the longer you take to identify when you are wrong and correct yourself, the more certain it is that you will fail in the markets...I agree with you Siuya

I thought this important enough to post.... This chart shows the overnight (Globex market). What you are seeing is the continuation chart from my previous posts in this thread....I mentioned in previous posts that the highest probability setups are often found in the overnight session. This is where Asia (and Europe) come in to "take the baton" from the US market...In this chart (as I mentioned before) you can see that we tested the value area low at 1274.50....moving up steadily from that point on the favorable news from Japan and the Mideast. I anotated the levels that offer additional entrys based on my Supply/Demand analysis along the way...and you can see that we hit the targets up at 1295...What you don't know is that up at 1295.50 we had the weekly "Time-Based Pivots" (last week's weekly open/high/low) which I introduced in my thread "an Institutional "Look" at the S&P Futures".....I am sure most of you don't give this a thought, but I can assure you these numbers are very important to traders. What you see at the end of today's session is that price tests those weekly numbers and retreats....in other words that test was a high probability setup for a short trade that produced a nice 4-5 pt profit....with very little risk...So here is the result if you traded the Globex using those setups....long at the open....20 pt profit...short at the end of RTHs and an additional 4-5 pts....In order to obtain this result, one would have to 1. Know it was possible..this is an "obvious bias market" as I pointed out a while back 2. Anticipate that the Globex market would offer a way to get long (experience) 3. Recognize the setup (know what the "value" numbers were) 4. Be confident enough to take the trade (based on your education and experience) 5. Able to manage it patiently knowing that you had a possible big winner or at the very least a significant winning trade Thats what it takes...to go from being a retail trader (watching the trade and doing nothing) to being a professional (acting on what you know, taking an agressive entry, managing the risk and taking the profit at the end). I am pretty sure that sums it up...done here...

Traderunner Congratulations, you seem to have a good grasp of the benefits and the limitations of the format that Don is using. If I understand correctly, I agree with your assessment. This isn't for beginners just getting on their feet. My own system has the same limitations as would any professional setup....you have to have a basic background and some experience to call on. The idea that he is a "self promoter" is just fine with me...to get somewhere in this world, if you don't promote "yourself" and your agenda, who else will? What I want to see, is that his "agenda" is a benevolent one, that benefits others. I think raising money for his charities and even for himself is just fine. Regarding the cost of his course I have the following comment; I have my own experience to call on in this regard...over the years I have tried periodically to offer training to struggling traders....at no charge...what I would ask people to do, was to donate money to their favorite charity if they were successful....I found that generally speaking the folks who took me up on my offer did not succeed. In contrast, in my office I have participated in the "retraining" (providing additional training for licensed traders) and THAT was generally successful. In those circumstances, the traders were interested in improving their results...they were motivated, fully engaged in the process and willing to work on it. The success rate was virtually 100%. Human nature being what it is, I think it is clear that unless a person has a requisite background and strong motivation, it is problematic for them to succeed in this very demanding business. Clearly the student has to have their own "skin in the game" and display a willingness to take (adult) responsibility for outcomes in order to have a chance at success.

Hello Ingot I don't think the thread requires saving...It seems to me that primary message is that one can learn to trade based on news (of all kinds)...I included a reference to a very good book on the subject..I am very willing to offer advice to new and struggling traders...I think the evidence of this is in my threads "Ideas for Struggling Traders and "an Institutional "Look" at the S&P futures". The problem for me is lack of feedback and participation...I prefer an environment where people are highly motivated and the more I think about it, the more I see that I would prefer to work directly with a small group of folks (no more than a dozen) who have a decent background, the interest and motivation necessary to transform their lives by being successful in this business. I have seen several websites and what I notice is that they are very casual environments and people are not driven to succeed in that way...in fact (as you have pointed out), comments are become personal as people play out their emtional "issues" instead of trying to understand how a concept works....I have approached my boss and asked for a leave of absence so that I can pursue this dream of mine and if I can arrange it, that is what I will do, but frankly this is not the right environment for that kind of process. Regarding your further comments I would like to offer something that you might pursue on your own...The main principle for my approach is the identification of supply and demand. Some folks mistake this for support and resistance...It is NOT the same thing...For one, supply/demand is always a range of prices, while traders often think of support/resistane as a single price (a line in the sand)....This is one reason why they lose money...NEXT, the idea of placement is important. For me, supply and/or demand are only useful if they allow me to identify high probability reversals, OR places where I can add to already profitable positions. To identify these areas, generally one has to look at longer term charts and work toward shorter time frames. The rule that helps you is simple, you want to see price rally (or drop) significantly (from a swing high or low), then you want to see it create a base, and finally you want to see it retrace and re-test that orignal swing point. This is just one or several scenarios that you could use to identify high probability setups and most importantly....the principles work for all markets (even currency markets)... In my posts, what you are seeing is my identification of supply/demand on shorter time frames and that may confuse you....As you may appreciate, working on shorter time frames requires experience and there is a bit of "art" to it, more than I can describe in a short post (this is in part why I intend to pursue a venue where I can give people more personal attention) I day or more ago I posted a couple of charts especially for you...(I advised you of that via PM) I encourage you to take a look at them (they were currency charts). You will probably notice that I do not trade forex...only exchange traded futures contracts....So it may be of limited value...its the best I can do at the moment...I wish you the best of luck.