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brownturtle

Price Action Only

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A 250t chart is essentially a substitute for a 3-5m chart. They are both summaries and conceal just as much information. If one is following the PA, he needs either a T&S display or a 1t chart.

 

Given that, there's nothing mysterious about yesterday morning's action, at least on the NQ. Price finds R at the overnite high at 0936, then finds S at the opening low at 0946. The trader doesn't need expensive programs and platforms, nor does he need to clutter up his chart with stuff. But he does need to do the prep. Without that, he will remain in a perpetual state of surprise.

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A 250t chart is essentially a substitute for a 3-5m chart. They are both summaries and conceal just as much information. If one is following the PA, he needs either a T&S display or a 1t chart.

 

Given that, there's nothing mysterious about yesterday morning's action, at least on the NQ. Price finds R at the overnite high at 0936, then finds S at the opening low at 0946. The trader doesn't need expensive programs and platforms, nor does he need to clutter up his chart with stuff. But he does need to do the prep. Without that, he will remain in a perpetual state of surprise.[/quote

 

DB,

 

I trade the ES, and there was something to be had in the morning session if you glanced at the TS window between that time frame :)

 

9-10-2009 8:58am-9:03am cst

 

1. Market made a pullback at 8:59am cst

- roughly 600 (different sizes) contracts total hit the bid along with an additional 200+ (1-20 contract sizes) ahead of the large size flowed through in a split second between 1026.50-1026.25.

2. Market held. who ever sold at that price point is in a world of hurt :doh:.

3. 1-20 contract sizes flowed into the market (im assuming an iceberg order) pushed the market 1 point from where the large order was sold.

4. What made the situation worse for the seller who sold at 26.5-26.25 was another buyer who came in and bought above the market to squeeze the seller out. I went ahead and doubled my initial order when price reached 1027.75 cause I knew where price was headed.

 

I didnt mention any expensive platforms just a question of whether he had recording capabilities so we both can look at it. Price action is Price action DB. No volume included on my screens. I do keep Previous/Current OHLC as reference and see what happens (everybody else does) on the tape. :missy:

 

Summary:

1. I located a seller

2. I noticed the market absorbed almost 1000 contracts in less than a second.

3. Buy orders resumed fluidly after seller (including other front runners) were in.

4. sell orders were coming in few and far between.

5. Order flow on the buy side picked up reaching 27.25.

6. Big buyer bought above the market to squeeze the seller out almost a point below him.

7. No 1 tick chart for me, TS is just fine ;)

 

PRICE ACTION ONLY!!!!!!

 

strtedat22

Edited by strtedat22

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If that is the case, then you are still using a chart (250 tick) to see levels of support and resistance. Then using your T&S seems not much different than using a 1 tick chart for entries. If that is the case... I'm not as amazed, but still impressed. I get the general idea. Furthermore, just like using the 1 tick chart, you are truly reading price action, as compared to the 1m charts where you miss anything inside the open and close of the bar. Anyway, no need to post an example, as I didn't realize you also used a 250 tick chart.

 

I thought the thread was about "price action". Tick charts dont have contract sizes included (not that i know of ;)) what can you possibly get out of a 1 tick chart without the contract size included? IMHO nothing. I use the 250 tick chart to keep track of where im at. Tape can give you a head ache if you stare at it all day without some sort of chart to keep up :missy:. If i use the restroom i can come back to my tick chart to see where the market is at then resume tape reading.

 

Price Action Only!!!!

 

strtedat22

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DB,

 

I trade the ES, and there was something to be had in the morning session if you glanced at the TS window between that time frame :)

...

 

7. No 1 tick chart for me, TS is just fine ;)

 

PRICE ACTION ONLY!!!!!!

 

strtedat22

 

As I said, whether or not one uses a summary chart of one sort or another, he also needs either a T&S display or a 1t chart. If you prefer the T&S display, that's fine. However, you're not trading price action "only"; you're trading price action and contract volume. And that's all well and good if one is scalping. Otherwise, the contract volume is largely irrelevant. The trade was there regardless of whether or not one paid attention to volume of any kind at all.

 

I thought the thread was about "price action". Tick charts dont have contract sizes included (not that i know of ;)) what can you possibly get out of a 1 tick chart without the contract size included?

 

Price movement, i.e., "action".

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Trading just off of a 1 tick chart is a guessing game. With out the contract size along with the price youre setup for failure IMHO. I can be wrong :cool: Please provide a example of that type of trading skill.

 

strtedat22

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Trading just off of a 1 tick chart is a guessing game. With out the contract size along with the price youre setup for failure IMHO. I can be wrong :cool: Please provide a example of that type of trading skill.

 

strtedat22

 

Lots of examples in the Wyckoff Forum, if you're interested. Otherwise, what is the one element that cannot be ignored when one is trading price? Hint: it isn't volume. Which is not to say that you shouldn't use it if you love it. But it isn't necessary.

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Lots of examples in the Wyckoff Forum, if you're interested. Otherwise, what is the one element that cannot be ignored when one is trading price? Hint: it isn't volume. Which is not to say that you shouldn't use it if you love it. But it isn't necessary.

 

You got me. Please, enlighten me. :cool:

 

strtedat22

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You got me. Please, enlighten me. :cool:

 

strtedat22

 

Price.

 

I'm not suggesting that you stop using volume if it benefits you. But, again, it isn't necessary. I took the same trade you did without considering volume at all. And there are trading instruments that don't provide volume, yet people trade them by price action only. One way of doing it can be found here:

DTB, 1919.pdf

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Price.

 

I'm not suggesting that you stop using volume if it benefits you. But, again, it isn't necessary. I took the same trade you did without considering volume at all. And there are trading instruments that don't provide volume, yet people trade them by price action only. One way of doing it can be found here:

 

Ill take a look into the book. Thanks

 

strtedat22

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I don't think PA alone is sufficient.But in conjunction with other things like Auction Theory , it works pretty well for me.

 

Few traders are gifted enough to trade price without anything else added to the mix, or without at least some philosophy or theory of market structure to provide a framework. But the trader must understand that everything that he's adding on is just that: an add-on. An alleged trader on another site maintains a journal which tracks his progress with his "price action only" approach. He is now, he says, using price action only. All he has on his charts is price. Or at least a 5m bar representing price. And volume. And Bollinger Bands. And a couple of MAs. And VWAP. And Pivot Points (the calculated variety). And Fib levels.

 

And that's all.

 

Is all of that price action? You bet. If price were not an essential element of what he's plotted, it would all disappear. Is it price action only? Not by a long shot.

 

I follow price in the context of Wyckoff's view of auction market theory. Without it, I would be trading a lot more and making a lot less. But I'm fully aware that the context is applied by me and that price not only does not know what I'm doing but couldn't care less if it did. The transaction by transaction movement of price is the building block. Beginning with that, the trader creates an approach that suits himself.

 

I'm not sure why this thread was resurrected, but I made a couple of posts at the beginning of it, last year, that may be of interest to a new group of beginners:

 

here

 

and here.

 

And if one wants to play with PA, this game may be of interest. Just turn off all the indicators. Even the volume, if you like. Unfortunately, it doesn't allow the trader to short, but if you can't beat buy-and-hold, perhaps you should re-examine whatever it is you're thinking about when you trade.

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