Hlm

Very good point Head2k. Time Frame implies that it's sorted by time which I would disagree with. However, many times it's the easiest way to get someone to understand the topic. For me personally, I don't put any time/points/etc label on it when trading. It always starts off with a trend as previously defined. At which point I find the trends above and below to define my trade. Instead of trying to push arbitrary settings on the market I let it define itself. If I ever label a time frame to share with others it is usually based on a time/range where the trend can be seen clearly while not adding too much detail of the smaller trends. So when it comes down to it...for me at least, it makes more sense to use the phrase "multi-trends" to describe this concept. Of course it could be the white wine speaking. :cheers:

To keep this thread moving smoothly... For all the purist that can't get past the mathematical definition...how about the market consists of extreme fractal influences that often roughly resemble self-similarity. An individual can define "often" and "roughly" on their own and preferably not in this thread. As for the sake of this thread moving smoothly, let's stick to the words up trend, down trend, and time frames. Now let us continue.

I had a little time this afternoon to throw this together. I am purposely keeping this over simplified and without specifics. I want to see what discussion naturally comes from this. I purposely don't plan on replying until more discussion has taken place.

I see no need to stop using this one at the moment. If a topic comes up that starts to change direction we can just split it out into another thread. I do agree, however, we should try not to get caught up on definitions since depending on your prior background two people can be looking at the same thing and argue while in reality they are in perfect agreement. Let's keep these minds open, you never know what you may find. I am still on vacation but will try to get something up within the next couple of days. However, let's keep this thread moving along in the mean time. I don't want this thread to turn into "what does Hlm say". That can cut off the open mindedness and sharing at the knees.

I guess I should be a little more specific. Of course the market is not one perfect fractal. It's obvious that past movement does not have to predict future. Let's not get stuck on the absolutes. However, one who takes a look at the market can see in general.... Trend/Cycle = L H HL HH The move between L and H as well as HL and HH is created with smaller trends/cycles of L H HL HH... The moves between the L and H as well as HL and HH are created with L H HL HH... ...and so on. Is this not the same pattern within a pattern within a pattern?

Curious, how is the market not self-similarity? Maybe we have a different definition of that. Also, the concept of fractals agrees that there is no such thing as "noise".

Well since that word will probably be used a lot, we should probably get that definition defined before going any further. Some definitions from dictionary.com How would you define it DbPhoenix?

Yes, most of the time I spend talking about specifics is in a live format in the chart room or private chat. I enjoy this medium versus a forum because a)it keeps me focused on the market b)nothing is better than explaining with a hard right edge (those that know me know how anti hindsight I am) and c)it keeps me enjoying my free time when I am out of the market (yes...selfish ). However, I have been asked enough times now that I will be posting a thread here shortly dealing specifically with the fractal nature of the market and how it's not so much at what you use to read price action but that you do it in the natural flow of the market via multiple time frames. I put the daily MP areas up there with volume. Even though the current and previous VA's are built off of open/close they are still statistically significant enough to trade off of successfully. What it all really boils down to is using the simplest definition of a trend/cycle (eg L-H-HL-HH), locating them as you step higher in time frames, determining where they currently are within the cycle, and analyzing how they are going to react to one another. The concept of volume/market profile/etc is how you choose to go about measuring and estimating the current cycle of each time frame. The basic DNA of the high probability trade is to enter on the smallest time frame (that you are trading) using it's risk, take first profit on the initial resistance of the middle time frame since it's the one that you are betting on rolling over. Take the final target at the largest time frame. Many might not realize it, but this is why the head-n-shoulder formation is so popular and can be very powerful. Of course if you don't understand what's going on with the larger time frames and where the best place to take some off is then it doesn't help. Wow, didn't mean to ramble that much. Again, in the near future I will put up some illustrations within a new thread.

Haha, don't worry you are in no way offending me. If anything I would think that I have offended you (which is not what I mean to do). I am just trying to explain the reality of how I and many of my friends trade. As for the size issue, you must of missed what I said. I suggest you go back and read it. The mere fact that I have several different time frames I can play with and multiple instruments I would be extremely surprised if someone who scalps in and out and pays attention to the DOM for their strategy could put down more size in relation to their overall profit. As for implementing everything into your trading, in my opinion that over complicates the true nature of the market. I know how volume works and understand how it can be used, but I also know that understanding pure price and how it is stacked in a fractal nature gives the information I need and more. So why would I want to continue to watch volume? The same thing goes along with fundamentals when dealing with an openly traded liquid instrument. Now can some one trade successfully off of them just like volume, absolutely. But don't get confused with more equaling better. I guess it goes back to working smart, not hard. But in the end, it sounds like our strategies are like comparing apples and hamburgers. If ones strategy does not directly take advantage of the fractal nature of the market, then what you say may hold some truth. This is probably why you are confused. If this is what you think it means to be a pure chartists, then I could agree with you more. However, this is not the type of trader I am referring to.

More power to you scalpers...heck, it's what allows me to get good fills . However, after your last comment 86834 I am starting to get an idea where you may be coming from. The trading style that most prop firms use is very micro in nature for actual execution. I am not quite sure at where they get their longer term bias from since I have never actually worked for one. You had mentioned Market Profile but that is still only on a daily basis and by the default settings it is still limited do it's strict start and stop times. This could be the reason as to why you don't believe the rest is within the charts. For example volume, I personally don't watch it because I constantly monitor the natural fractal swings of the market and their current stage within the cycle. For my strategy viewing both is not needed and volume is not as detailed with it's information in comparison (again, my strategy). Of course this doesn't mean it's better than those that use volume. It depends on what they are trying to get out of it and like always the bottom line...PnL. In my opinion fundamentals in a open liquid enviroment is no different. Maybe that gives you a better idea to where I am coming from.

I see exactly where you are coming from smwinc and I respect your thoughts and experiences. It just comes down to what your actual edge/style/strategy is. I trade multiple time frames from a few points (we'll assume ES in this case) to swing trading. Because of the fractal nature of the market it's all the same pattern and I can adjust size accordingly to the time frame I am trading. Except for maybe my smallest time frame, a few ticks here or there is not going to make a difference...and several points on the larger time frames is acceptable. I also use no volume analysis and everything is dynamic so there are dozens of highly liquid markets that I can trade in. For many people, depending on their strategy, scaling up might be difficult and unrealistic like you explained. However, not all technical strategies and money management are built equal. For example...from how I have seen you trade, our styles are completely different. While you are constantly scaling in and out and watching the DOM for places to lean and grab ticks, I enter full position on pullbacks with a set stop and estimated targets in place. Neither is necessarily better than the other, just different. But prop shops do have a tendency to pump volume and focus on pulling ticks out of the market which is completely different to what my, and many pure chart readers I know have their strategies based around. If ones strategy is based on looking at what's stacked up in the DOM and where they can lean on a tick basis, then yes...size matters and fundamental news can help you. But personally I find that too time consuming. Happy Trading.

That's so 1980's.

To be honest I am pretty surprised that you haven't met any in person. However, with you being a prop person it kind of makes sense. You are surrounded by people that trade that way so one would naturally go down that route. If one does not fit that style they probably wouldn't last long in such an environment. In other words, ones view can be very misleading when they are surrounded by like minded individuals. It turns into a club and outsiders are looked at as always being wrong. One should also note that commissions are a large part of a proprietary firms business model. Now going back to the original topic of this thread. Yes, it's common knowledge that lots of money is flowing around news announcements. But the question is, do you need anything that is not in a chart to make money. The answer is an obvious no to me. Going back to the whole news event concept...there is no difference. However, when one is playing smaller intraday setups they should most likely wait until after the first spike to jump back in because you have larger time frames stepping in and making their moves. I personally do not look to enter right before or on a news release unless it's a larger time frame setup. But again, everything is in the chart. Now do I miss many of the news spikes, of course. But if you look at the amount I missed compared to what is available for the taking throughout the day, it's so tiny in comparison...especially in today's market. The FOMC's have even seemed tame compared to many of the intraday swings over the last year. Remember, very few make it in this profession. Just because one person can't do something doesn't mean another can't and vice versa.

I mean by percentage over the norm. Also, you sound quite certain, do you have any solid number to back it up? I just want to reiterate that by your example this "getting by" was two million a year. Just want to keep it in perspective. Fair enough. However, for me and many professional traders I know, I don't focus all my energy on the market. For me, the "war" has already been won. Instead of spending large amounts of energy trying take more and more out of the market, I spend that extra energy with things like my family or working on lowering my golf score. Is one more right than the other...no, they are just different. Does one make you more of a professional than the other...well, imo most defiantly not. I would also like to note that if you are striving that hard to grab every last penny out of the market and be on top, then you are most likely not "maximizing profits per time invested". I understand what you are saying, but to be honest you have yet to show any reason/proof that fundamentals can indeed "maximize profits per time invested" for the majority if not everyone. For example, if my strategy w/out fundamentals is superior to yours, then you may need fundamentals just to match my "profits per time invested". I can see that you feel strongly about this, and maybe for how you and your fellow traders trade it is extremely helpful. But by just simply saying something is better to someone that already has it good, doesn't really do much. Let's not forget that those lists only include those that WANT to be on it (ie attention whores). They are probably more social to begin with and enjoy trading next to other traders at a firm.

There is just a bunch of "nothing" being thrown around now. You may be right about not learning from typing a post. However, going on and on about how one can't get ahead without this or that is pointless without further more detailed explanation. Repeating it more than once is not going to add any more validity to your statements.

You are right, if you are a "professional" trader that works in a firm or a prop shop there would be no reason to be on the internet during market hours because you are chatting and hanging out with your fellow traders in person. However, those "professional" traders that work at home and aren't affiliated with such an environment can find their fill of like minded individuals via the internet. I am curious, where do you get that 90% figure from? There are alternatives to not going to a firm. If you are indeed that good, it's not very hard to find OPM that isn't attached to a firm. Depending on the specifics of both, going private can give your more freedom and bigger payouts. If you are already that good why would you want to deal with a firm and have dozens of eyes watching your every move. Now, I am not putting down trading firms at all. They can be very advantageous depending on ones situation. However again, all of this high percentage quoting or absoluteness just leaves a bad smell in the air. Well of course, because they aren't professionals yet. Joining a firm doesn't automatically make you a professional. What they were doing was no more technical than fundamental. The fact is that you could buy anything blindly (get out the dart board) and make money. This is comparing apples and refrigerators. Do I really have to pull out the list of so called professional funds/mangers that have gone belly up within the last year? As for as the other information scattered throughout your post about bias and such...good stuff. Those are big ticket items that can destroy a trader that is starting out. However non of that removes from the fact that one can be consistently profitable and make a very healthy living trading purely off of technicals/price.

I will start off by saying that I have nothing against fundamental strategies and those that trade them. I actually use to trade news in Forex as well as swing trade (non news related) penny stocks off of fundamentals. For me personally, I moved over to the pure technical aspect for two reasons. One...to make things as mechanical as possible. Two...to decrease my draw downs. Of course, the second reason can vary greatly depending on the experience of the trader, etc. Now to the meat... I might agree with you a little if you mean to put an intraday position on right before or right on release of a big announcement and specifically for it (especially in the FX world). But if you are meaning staying away from going in and out before and after the an announcement I would disagree. Which leads me to my next point... You are right, and this is ABSOLUTELY why I am purely technical. This is exactly why my methodology/edge will always be around and work in open liquid markets. Why would one want to waste their time trying to match or even beat these "big boys" at their own game. Big money spends their time putting on (before news) and taking off (after news) their positions in chunks because they can't do it all at once while getting the fills/averages they want. These swings, waves, or fractal like moves is where someone like me can consistently make money using pure technicals. I don't mind putting all my eggs in one basket (technical analysis) since without the basket (aka Big Money) there would not be a market to trade. This can vary so much. It depends on what your positive expectancy and draw down is for each. But to say that bringing both into trading automatically increases your profits per time invested is most likely not true in my opinion. Of course, for you, it may depending on your strategies. But different strategies have different risks and fit different personalities. Especially when you are dealing with fundamentals which by nature aren't mechanical friendly. :hmmmm: I am still trying to figure out what you are getting at here. Someone who can consistently make money (say 2 million a year) with a candle stick pattern that gives them a couple of ticks a day (again, consistently)...is not a skilled trader to you? :hmmmm: My response to you would be a simple "so?". I guess it depends on what your personal idea of success is. I'll take my 2 million a year and enjoy every second of my life without understanding what's going on and not being anyone in this game. I could be completely off (apologize if I am) but your mentality kind of sounds like those that try to buy the bottoms and sell the tops. Those that are looking to catch the entire move. You don't have to be the president to be in politics. I will leave it with this...as those before me have stated, it's not that one can't trade with fundamentals or use them in their strategies, but that it is indeed not needed to be consistently profitable in this business. Just like I am sure some would argue that technicals are not needed to be consistently profitable as well. P.S. It would be great if those that do trade fundamentals start some threads on the topic.

This would only make sense since the majority of traders go through a phase of reckless indicator behavior. Those that learn to trade pure PA first tend to be more frightened (rational and irrational) of indicators and stay away from them. However, I have seen many traders return to indicators to simplify and make mechanic aspects of their strategy after learning and spending a signficant amount of screen time with price alone.

Exactly, low barriers of entry with the ability to get wiped out quickly. Those that are not serious and prepared are quickly removed from the scene but are still counted in the percentage.

So does IE8. Kind of funny how FF hasn't caught on yet. I have actually been pretty impressed by IE8 Beta.

It's interesting to see how the different browsers split up their memory usage. I have never noticed that before. I am sure there are pros and cons for each way. So it may not be so much of a memory leak, but how FF3 chooses to use the memory. Just guessing of course.

I must of missed something. I don't see how that conflicts with what I said. If you have a way to define "value" and a distance required to complete a move from it, then that's other information that uses volume to complete your strategy.

Well, 4 windows with 4 tabs each pushes FF3 up to about 300 for me. However, IE with 4 windows and 4 tabs also pushes it up to around 300. The only difference is that IE splits them up in the task manager into sizes of 30-40. Chrome splits it up even more than IE but still averages around 300 total.

How many windows/tabs does it take you to get to those numbers brownsfan? Also, is it just that memory usage is high or do you notice a slowdown as well? How much memory do you have?

My quick feelings about volume... It can be a very useful tool in that it allows you to locate and summarize the many different time frames that are in play. However, like any indicator one must understand and take into account the limitations and implement the needed risk management into their strategy. As for volume, a limitation is that it can't distinguish between one large time frame and multiple smaller ones turning together. Of course, depending on ones full strategy, this may not be a factor (just like with any other indicator).