Taylor Trading Technique

[elovemer 10]

.... guess somebody bought on buy day after all....

[monad 10]

Well that is Taylor for you, small wonder folks give up on this methodology:confused:

 

Patience and persistence required but who wants to bother with that?

[monad 10]

I think you may have misunderstood. I was not being critical of you, it was more a reflection on taylor method which so many find difficult to comprehend.

 

However if they had patience and persistence to keep studying the method, it will eventually make sense. Like yesterday when it was a Sell day and the market kept heading north. Similarly there are Buy days when prices keep dropping whole day long;).

[elovemer 10]

.... i had friday as a buy day ....

.... instead of a low being made first and early..... the low was made last

.... Taylor has rules for this..... so no problem.....

.... today tuesday was my sell/short day .....

.... instead of a high being made first and early .... the high was made late in the session....

... Taylor has rules for this .... so no problem....

 

.... Taylor has rules for just about everything.... so no problem... as long as his rules are followed......

.... the basic rule is first and early..... otherwise stay out except for reaction plays....

 

.... if it is not first and early.... then wait for the next play on a different day...

.... it seems like no one actually reads Taylor's book (don't mean you Monad or anyone in particular) .... which is a mistake....

However if they had patience and persistence to keep studying the method, it will eventually make sense. Like yesterday when it was a Sell day and the market kept heading north. Similarly there are Buy days when prices keep dropping whole day long;).

[elovemer 10]

.... i am not sure about which posts you were referring to in regard to "hi/lo cycle theories" .....

.... if you can be more specific... i can try to comment on it.....

 

.... sorry i didn't mean to ignore your request before... just didn't see it....

 

...and yes i agree... Taylor seems to work better in terms of clarity for me as well.... in an uptrend....

... in the previous down trend.... the only dependable thing was making a high first and a low last..... but the cycle was more erratic...

... Btw could you talk about your hi/lo cycle theories i'm very interested in that kind of thing as it fits in with predicted patterns and my own observations that price has a tendency to turn at certain times during the day.Thanks for keeping this going.

[monad 10]

 

.... today tuesday was my sell/short day .....

.... instead of a high being made first and early .... the high was made late in the session....

... Taylor has rules for this .... so no problem....

 

Perhaps you can expand on this

 

.... the basic rule is first and early..... otherwise stay out except for reaction plays....

What exactly is meant by reaction plays

 

.... if it is not first and early.... then wait for the next play on a different day...

yes that is where patience comes in:)

 

.... it seems like no one actually reads Taylor's book (don't mean you Monad or anyone in particular) .... which is a mistake....

Understand what you saying, myself have gone through the book over 20times now and with help of WHY? have managed to understand with greater clarity

[elovemer 10]

.... if the high is made late in the session.... Taylor says let it go... stay out....

.... when you are looking for a high made first

 

.... a reaction play would be .... if on that same sell/short day .... there is a low made first early in the session....

.... then he says you can go long for a reaction up ..... not a hold/swing play....

.... and vice versa for a buy day .... on a high made first.... a short on a reaction down...

 

.... but reaction plays are not the main part of the plan.... they are more risky....

 

...according to Taylor's method.... if you want to swing.... you have to be safe... and patient..... and only take the best setups

 

.... the only scalping that occurs would be the reaction plays....

 

------------------------------------------------

.... today tuesday was my sell/short day .....

.... instead of a high being made first and early .... the high was made late in the session....

... Taylor has rules for this .... so no problem....

 

Perhaps you can expand on this

==========

 

.... the basic rule is first and early..... otherwise stay out except for reaction plays....

 

What exactly is meant by reaction plays

====================

 

.... if it is not first and early.... then wait for the next play on a different day...

 

yes that is where patience comes in

[elovemer 10]

today .... wednesday....

....looking for low made first... instead got a high made first and early....

.... so could be a reaction short.....

 

... the reaction short would be closed... not held.... unless you ... by some other means... know that the swing trend has switched to down....

[monad 10]

THKS elovemer, would you go long after the decline, afterall it is a Buy day and a decline is requied from SS day high.

[elovemer 10]

....Taylor wants us to only take the best setups.... which means a low made first and early....

.... as per his system.... only the reaction short play would be allowed.....

 

.... the low was made late in the session .... Taylor would not take that long.... but.... rather would wait for the next play ......

...... which would be the next sell/short day .....

 

.... if you took the long... it would be based on some other system.....

.... even so .... the session having ended.... you can see that based only on this session.... the reaction short would have amounted to a larger gain than the long entry .....

 

..... for the long entry .... you would have had to time it perfectly .....whereas the reaction short had the usual predictable pivot time of around 10.30am..... which is where you would have wanted to see a low made first..... for a long entry

..... an up trend is indicated by low made first high made last.... so if today was your buy day .... Taylor would have kept you out...

.... however if today was your sell/short day .... the high made first low made last fit your sell day much better.....

 

THKS elovemer, would you go long after the decline, afterall it is a Buy day and a decline is requied from SS day high.

Edited March 25, 2009 by elovemer

[elovemer 10]

.... you could have gone long as per something other than Taylor's system....

.... that would have been a great trade ! ;0)

 

...sandwiched between the 50 and the 100 on the daily.... we are going to move....

THKS elovemer, would you go long after the decline, afterall it is a Buy day and a decline is requied from SS day high.

[elovemer 10]

....look at page 30 for Taylor's specific rules to follow when a high is made first on a BUY DAY....

[monad 10]

....look at page 30 for Taylor's specific rules to follow when a high is made first on a BUY DAY....

 

I am looking at chapter 9 "a short sale at high of Buying Day made first".

 

When you said 10.30 time in your previous post, presume it is 10.30 EST.

 

Today it would be a sell day, prices are in a tight range.

[elovemer 10]

.... i am referring to page 30 ... not chapter 9 .... although that goes with it as well..... have a look at page 30

... the thing about Taylor's book is that he has pieces of everything sprinkled all through the book ... not really separated very clearly..... which is why it can be confusing.....

 

... today is your sell day .... i call it "middle day" so as not to be confused with short sale day ..... can be a chop-fest.... :9(

..... i guess he chose to call it sell day... as a reference to selling out the longs held over from buy day .....

..... "middle day" is a great day to not trade at all.... unless it is a big trend day..... which can happen if the low on buy day comes at the end of the session like it did last time...... check out page 30 which refers to a slightly different situation than what happened on last buy day ....

I am looking at chapter 9 "a short sale at high of Buying Day made first".

When you said 10.30 time in your previous post, presume it is 10.30 EST.

Today it would be a sell day, prices are in a tight range.

[monad 10]

Have a hardback copy, p30 does not match, what is the chapter , is it No.5

[elovemer 10]

.... sorry... chapter 5...

... where it starts, "when the high is made first on a buying day ...this causes the low.... "

 

....by the way ... on spy.... we have a very good trend line set up on top .... to gauge for a sell point tomorrow... which is my sell/short day .....

 

Have a hardback copy, p30 does not match, what is the chapter , is it No.5

[elovemer 10]

....except for special circumstances which call for higher risk plays....

..... Taylor only enters on a buy day or a short day .....

.... the middle day he only uses to close out positions.... unless it's one of those special plays which are higher risk....

.... i am just referring to the highest probability setups.... low/high made first and early.....

.... that is the highest percentage play available....

 

..... one thing which i think is interesting is when Taylor talks about when a play goes against him.... how he changes his target to a more conservative one.....for example a break-even target.....

..... the reason i think it is interesting is.... i wonder what kind of stops he used if at all....

...... maybe WHY has some insight into this .... where Taylor may have placed his stops if he used them at all.....

[elovemer 10]

..... by the way .....

 

23.75 point decline

41.25 point buy day rally

 

25.5 point decline

31 point buy day rally

 

39.25 point decline

55.5 point rally include the day after... on mid day

 

36.5 point decline

43.5 point rally ....include day after

 

..... included day after on last two.... as low of buy day was at end of session....

[monad 10]

Do you measure the rally only for the Buy day or from the Buy day low to sell day high or Short sell day high.

and the decline as from SS day high to buy day low.

[elovemer 10]

.... decline.... from short day high to buy day low

.... rally .... from buy day low to buy day high

 

.... last two examples included 2nd day as part of rally also.... as buy day low occurred at end of session....

---------------------------------------------

 

.... by the way .... if you are playing today friday as a sell/short day .....

..... then this is an example of one of Taylor's reaction plays.....

 

..... where the low is made first early in the session..... and you go long for a reaction up...... but you don't hold for a swing play....

.... if you are playing today as a sell/short day .....

Do you measure the rally only for the Buy day or from the Buy day low to sell day high or Short sell day high.

and the decline as from SS day high to buy day low.

[elovemer 10]

... a bit of cycles....

[elovemer 10]

.... 10 AM AND 12 PM PIVOTS for the reaction play on friday .....

.... people talking about reversal ....

 

.... for me .... monday is a buy day .... price is at bottom of channel already .

..... so will look for first and early .... 10am or 10.30am pivot.... for buy point....

 

... my lower cycle ends around end of session on monday .... but even if low is put in toward end of session....

.... and even if a large decline happens monday .... and if that brings price well below its swing channel .....

.... following the system could still mean a large move to bring price up in an attempt to re-enter channel bottom....

 

..... if high is made first and early on monday .... implies that low will be made late in session .... 10.30am pivot high would imply a reaction play down for those who want to go short....

.... .

.... if you are playing today as a sell/short day .....

[elovemer 10]

....ftt does not mean failure to traverse.

the dotted lines are channel lines. centerline.

which conclusion are you referring to ?

 

on upper cycle ... i just try to measure the major turns on a 30 min frame.

in order to have an idea where to expect the next one....

.... and also ... if it comes in early.... then to expect a possible inversion.

.... at turning points on daily or weekly time frame... it is harder to measure because the small frame cycles become so extended......

..... but if the up trend is intact... then it helps to gauge the turns....

 

.... for example... it might help to gauge if the buy point would come later in the session rather than early....so you might still have confidence in a buy point when it is not acting like a buy day....

 

"retest ALT size" is from a previous data set.....

.... that refers to the alternate wave size on a swing time frame... like hourly....

..... if price action holds the ALT SIZE on a retracement.... then proceeds to move above the ALT size..... then many times price will come back and test the top of the ALT as support......

....in the chart shown..... the white line there shows where support should have been..... and support was there as hourly just did a two bar thrust down but quickly rebounded back above the ALT size.....

.... the original ALT retracement wave is not shown on this chart because i was trying to show the cycles... not the ALT.....

 

.... the current swing ALT size is about 39 points on globex.... so if price retraces that much .... and you think the trend has changed .... that point is where the bears have to take it further in order to confirm the trend change or not..... if they can't ... then the trend may continue in the same wave degree

 

.... sorry but none of this has to do with Taylor... except the cycles ... which help to time the buy/sell point.....

 

.... by the way... the SWING ALT SIZE ... was taken from the larger size swing wave retracement up .... in the previous down trend.... now that the trend is up... the same ALT SIZE can be applied to the up trend.... at least until the wave progression changes degree.... to a larger degree.... which would mean a larger retracement size while recovering to maintain the up trend....

.... nothing to do with Taylor here....

 

.... the cycles are what i wanted to show.... two rectangles on upper cycle.... two rectangles on lower cycle.... to measure time....

.... if upper or lower comes in early with a pivot .... then the expectation raises... for a quick move in the other direction before the end of that time cycle....

.... if it comes in near the end of the rectangle on upper as expected.... then you switch to the opposite cyle....lower... and watch to see if it will come in as expected... or earlier......

.... again.... this does not work when the larger time frame (daily weekly) is changing trend because the smaller frame 30min cycles become too extended.... and then don't cycle as much.....

 

What i s FTT -failure to traverse? what are the dotted lines? What is your conclusion based on, with regards to upper cycle? does that mean the upward trend is retracing? What do you mean by retesting ALT size? sorry fo so many questions!

Edited March 29, 2009 by elovemer

[elovemer 10]

....for me.... monday is a buy day ....

... which means looking for a buy point with a low made first and early... at or before 10.30am.... somewhere around friday low or a 127% of it

.... for a reaction play short .... a high made first and early .... 10.30am .... or a big gap up

.... to close out on a 50% retrace to the low.....

 

.....others have different counts.....

[BlowFish 10]

Just an aside -

 

Failure to Traverse was a term coined by Jack Hershey (or so I believe) to describe when price does not make it to the 'other side' of a trend channel.