Trading the SLA/AMT Intraday, Part II: Questions and Discussion

[DbPhoenix 42]

Traders trade not the market but their perceptions of it - DbPhoenix

 

 

Gee. I'm a signature now.

[Gringo 10]

Traders trade not the market but their perceptions of it - DbPhoenix

 

 

Gee. I'm a signature now.

 

It's not easy being famous. I can understand your trepidation.

[DbPhoenix 42]

Infamous, maybe. . . . .

[r3algood 10]

An update on the "catch-up" chart posted above to show the line around which price is rotating.

 

In the chart above (NQ Daily), could the failed breakout of the hinge be considered a dog that didn't bark? In my mind, it "should" have broken higher, but it didn't.

 

Always enjoy your SLA/AMT updates, keep them coming Db. Seeing the market in this objective, rational approach and framework has really enlightened my trading.

 

Thanks.

 

To me, no, because I didn't "expect" it to go higher than that swing high. These words like "expect" and "anticipate" are loaded and mean different things to different people. Their dictionary meanings are largely irrelevant. When trading price, it often has to be enough that the trader is simply aware. It is to be expected in an auction market that traders will look for trades beyond value once they've completed whatever business they have in the value area. How long price rises will depend on how long sellers can find willing buyers.

 

Therefore, if one is a breakout trader, he'd take the breakout from the hinge and hang around until that swing high is left behind. If he finds trouble, he'd already planned how to address that. If he didn't take the breakout, or any retracement shortly thereafter, then that swing high would represent a potential trading opportunity given that it is a potential obstacle. There is a difference between insisting on being right on the one hand and being frightened out of a position because one doesn't understand what's going on or because one isn't sufficiently prepared on the other. This is where rules come in. And the rules come from testing.

 

Db

Edited January 6, 2016 by DbPhoenix

[r3algood 10]

Simply watching price today, no trades.

 

Watched as supply dried up and demand engaged here.

 

Entry could have been at 17, easily trailed along until 35 or possibly more.

 

I used to get so caught up in the lines and where to draw them, now I try and let the market show me where its going, and I just follow along.

 

NQsla1m

[r3algood 10]

Trying to be open to what price is doing.

 

Not letting myself get in the way.

 

SLAShort

[r3algood 10]

Exit short at break (yellow), enter long after first retrace (green).

 

Drawing straight lines can be quite interesting.

 

Would love any advice Db for this series of posts!

 

NQSLA

 

Once I finished the book, I exited the advice business. Everything one needs to know is in there. However, you do appear to understand the basic concept of it, which is a giant plus. If so, you could do it yourself using Wyckoff's course, as I did. And that's free.

 

Db

Edited January 6, 2016 by DbPhoenix

[r3algood 10]

Great day SLA'ying the NQ.

 

Quick question Db, please refer to "QUESTION" attachment.

 

I was going along drawing my lines and letting price do its thing, then ran into this scenario... Couldn't keep the SL or draw a new DL so i figured we were in chop.

 

Question: I suppose I just wait for a breakout or breakout and retracement to enter and start a new line? Not a large enough chop zone or trading range to take reversals to me. Basically, I didn't know what to do with my lines there.

 

Thanks

 

NqPnL

 

QUESTION

[r3algood 10]

Failure at both ends of the range.

 

NQRangeFailures

[timokrates 10]

It seems that you answered your question with the following post.

 

As DB says in the book, lines can also be horizontal. The result here is a range, which in my opinion is very tradeable if you focus on such low timeframes as 5 and 1M. The current volatility is high, which makes it maybe a bit more difficult, but the principles can be applied.

 

The thing in trading ranges is to incorporate reversals. I don't know, if you are at that point, but nevertheless, here is my view. My timezone is different, but it should be obvious.

 

According to this there are four potential reversals (REVs), one BO and the the BO+RET, which I would say is the only SLA setup here. As the rest is "strictly" AMT other "rules" have to be established. I'm currently trying to create those.

 

[DbPhoenix 42]

See p. 112, the SLAB.

 

Db