Futures I Trade Show & Brooks Book

[dbandas 10]

When the market is trending it will try to break the trend but most attempts fail and the trend resumes; that is a pullback. Sometimes the failure stops before it makes new highs/lows in the trend and it then reverses back in the direction of the breakout. In other words the failed breakout fails and becomes a breakout pullback in the new trend. Often there will be a period of uncertainty whether it is just a pullback in the old trend or a breakout pullback in a new trend until the market tips its hand by further price action.

 

Thanks, ACS. I was complicating it a bit. The explanation in Chapter 6 is pretty clear, but the definition in the glossary is baffling. But, Al Rules!

 

Basically, when a breakout fails, we don't know if it's just a failure or if it's actually a breakout pullback until we see if it has just "failed" and the prevailing move resumes, or if it makes a 3rd leg in the direction of the previous breakout, then it turns out it was a breakout pullback after all.

 

So, it's impossible to actually name that "elbow" precisely until we see what happens, right?

 

Thanks for your help.

[ACS 10]

Thanks, ACS. I was complicating it a bit. The explanation in Chapter 6 is pretty clear, but the definition in the glossary is baffling. But, Al Rules!

 

Basically, when a breakout fails, we don't know if it's just a failure or if it's actually a breakout pullback until we see if it has just "failed" and the prevailing move resumes, or if it makes a 3rd leg in the direction of the previous breakout, then it turns out it was a breakout pullback after all.

 

So, it's impossible to actually name that "elbow" precisely until we see what happens, right?

 

Thanks for your help.

 

That is my very basic understanding.

[ACS 10]

Looks like Al has decided to pull the plug on his web site. There is a lot of really good information there and it will be missed. I hope he changes his mind and just posts end of day charts that don't interfere with his trading but if not you should save a copy of anything that is helpful to you before it disappears.

[dbandas 10]

I'm working my way through the book, and it is incredibly worthwhile to me. Previously, for daytrading, I had subscribed to the expensive indicator philosophy which definitely works for some. It didn't for me. I was frustrated because I wasn't learning anything.

 

Anyway, some suggestions. I listened several times to the two Al Brooks audio/video presentations made through Futures Magazine. Also, I read the articles, about five, several times. I listened to a radio show. All of this acclimated me to the concepts and the lingo so that the book is decipherable. Also, I discovered it is essential for me to print out the charts in the book, because flipping pages with a magnifying glass didn't work very well.

 

Good luck!

[dbandas 10]

Looks like Al has decided to pull the plug on his web site. There is a lot of really good information there and it will be missed. I hope he changes his mind and just posts end of day charts that don't interfere with his trading but if not you should save a copy of anything that is helpful to you before it disappears.

 

Yes, I hate to see that. But, it was helpful while it lasted. Especially the link to the charts in the books.

 

I would really love to see him post at the end of the day and do a post-mortem. Even a few days a week.... Or some new articles occasionally. I can't memorize everything he says, but every time I work through a chart I flex my own interpretation muscles a bit and learn to think more clearly.

[BlowFish 10]

Probablly worth preserving the link to the charts from the book @ Wiley for easy access.

 

Wiley::Reading Price Charts Bar by Bar: The Technical Analysis of Price Action for the Serious Trader

[Shamal 11]

Thanks Blowfish

 

Think it all reflects on Al's integrity, shows that he is a genuine trader, he could have easily gone on to establish trading rooms and pulled in a crowd. Afterall he already has a large following.

The book is not particularly well written and also the layout need much to be desired, however it is packed with gems of price observations devoid of any indicators.

 

It would be great if Al could be persuaded to post some end of day charts with his comments, would prove highly educational.

[emmster 10]

Can someone tell me if there was an ES short signal @~1010.00 right near the open at 9;30EST on Fri via this method? I am trying to see if I am understanding it with any accuracy. Thx.

[ACS 10]

Can someone tell me if there was an ES short signal @~1010.00 right near the open at 9;30EST on Fri via this method? I am trying to see if I am understanding it with any accuracy. Thx.

 

Using the methods described in the book, the first trade of the day was an L1 short at 1008.25 off the 1st bear trend bar. The next trade I saw was also an L1 short at 1004.50 off the 4th & 5th double bottom bear bars. Any trade around 1010.00 was before the first 5 minute bar of the day closed and thus was not compatible with my understanding of Al's methodology since it was too early to look at a lower time frame for setups, the market not yet having proven itself in a strong trend.

[dbandas 10]

I agree with the short after the 4th bar, since it is a "twin" or double bottom, and an L1-type pause in a fast-moving bear. The 3-minute chart corroborates this.

 

I would never have placed a trade after the first bar on the 5-minute. On the 3-minute, there was a little pause made by the 3rd bull candle, but it's not a bad signal bar for a bullish gap play or H1. Actually, these initial moves often cause me confusion, and in the case of this 3rd bullish bar on the 3-minute, an entry on either side could be argued, IMHO.

 

And, all of the previous ramblings prove you don't have to be a successful trader to talk or write about it, especially after the fact!!!! :haha:

 

Just trying to claw my way out of the middle class........

[emmster 10]

Using the methods described in the book, the first trade of the day was an L1 short at 1008.25 off the 1st bear trend bar. The next trade I saw was also an L1 short at 1004.50 off the 4th & 5th double bottom bear bars. Any trade around 1010.00 was before the first 5 minute bar of the day closed and thus was not compatible with my understanding of Al's methodology since it was too early to look at a lower time frame for setups, the market not yet having proven itself in a strong trend.

 

Thanks for the reply. I just started reviewing some of the posts and wanted to see if I had a rudimentary understanding. The difficult thing for me is knowing where he resets his count, so I saw the 1008.5 as a L2 and the next as L3. This might become clearer to me later. Thanks for the info.

[dbandas 10]

Thanks for the reply. I just started reviewing some of the posts and wanted to see if I had a rudimentary understanding. The difficult thing for me is knowing where he resets his count, so I saw the 1008.5 as a L2 and the next as L3. This might become clearer to me later. Thanks for the info.

 

I was a little confused because you are on the Globex chart, and I was looking at the day chart. At any rate, your numbering looks fine to me, but I think your entry may be a little confused. If the bull bar at 8:30 is the signal pullback bar that creates your L2, the entry would be at one tick below it, or 1009.25, not at one tick below the next bar, which is your entry bar.

 

I was getting confused switching between Globex and the day session chart, so I just abandoned Globex except to see where the gap may be. Al suggests imagining the gap as a trend bar, and I actually use my drawing tool to draw one in. He also takes about the charting dilemma somewhere, maybe his website.

[ACS 10]

I agree with the short after the 4th bar, since it is a "twin" or double bottom, and an L1-type pause in a fast-moving bear. The 3-minute chart corroborates this.

 

I would never have placed a trade after the first bar on the 5-minute. On the 3-minute, there was a little pause made by the 3rd bull candle, but it's not a bad signal bar for a bullish gap play or H1. Actually, these initial moves often cause me confusion, and in the case of this 3rd bullish bar on the 3-minute, an entry on either side could be argued, IMHO.

 

And, all of the previous ramblings prove you don't have to be a successful trader to talk or write about it, especially after the fact!!!! :haha:

 

Just trying to claw my way out of the middle class........

 

I took the L1 off the first 5 minute bar and it turned out to be a good trade. I'll admit I wasn't thrilled with the size of the tails, had they been even a tick bigger I would have passed but since I was selling after a gap down I decided to go with it. In the book Al says to only use 3 minutes for with trend entries in a strong trend. To me that means you would not be looking at the 3 minute chart until at least a few 5 minute bars had already passed, you knew the market was in a strong trend, and you were not seeing any 5 minute entries. Just the 5 minute is challenging enough for me!

[emmster 10]

I was a little confused because you are on the Globex chart, and I was looking at the day chart. At any rate, your numbering looks fine to me, but I think your entry may be a little confused. If the bull bar at 8:30 is the signal pullback bar that creates your L2, the entry would be at one tick below it, or 1009.25, not at one tick below the next bar, which is your entry bar.

 

I was getting confused switching between Globex and the day session chart, so I just abandoned Globex except to see where the gap may be. Al suggests imagining the gap as a trend bar, and I actually use my drawing tool to draw one in. He also takes about the charting dilemma somewhere, maybe his website.

 

Sorry, but I thought the requirement for the L2 was a high that is higher than the previous bar. (?) The low of the L2 bar-1 tick is 1008.25

[dbandas 10]

In the book Al says to only use 3 minutes for with trend entries in a strong trend. To me that means you would not be looking at the 3 minute chart until at least a few 5 minute bars had already passed, you knew the market was in a strong trend, and you were not seeing any 5 minute entries. Just the 5 minute is challenging enough for me!

 

Busted! I agree completely, and Al states that clearly in the trend chapter, that the 3-minute is useful in runaway markets to discover pauses or pullback opportunities. I've just missed some first hour moves due to inexperience/reticence lately, and read this in Chapter 11:

 

"Although the 5-minute chart is the easiest to read and the most reliable, the 3-minute chart trades well, particularly in the first hour. However, it is prone to more losers, and if you like the highest winning percentage and don't want the negative emotion that comes from losing, you should stick to trading the 5-minute chart and work on increasing your position size."

 

Al is so right-on about the opportunities in the first hour or so, and I've not been able to always hop on the train.

[dbandas 10]

An L2 entry would be the result of a low that is lower than the deepest bar in the pullback and not higher than the high. That would be H1, H2 territory.

 

Here, the bullish bar at 8:30 should really have a low that is higher than the low of the previous bar, but it is an "implied" pullback.

[dbandas 10]

The glossary refers to these as reversal patterns, particularly after an over-extended market, and the first chapter basically says that they often develop during flags, and to be alert to trading them either way.

 

How's this different from any other flag? Seems to be an implication that flags with ii or iii formations may fail more often.

 

Am I missing something?

[ACS 10]

Anyone who has spent time with Al's book knows Wiley did an awful job of editing and proofreading. There are many typos in the book. Some are just grammatical and do not affect the content value but there are some that do. On his web site Al says he will correct them in any second edition. I feel that IF there is a second edition it will only be because people bought the first edition and they should not be penalized for doing so. Therefore I am listing the known errors I have found so far and encourage others to add to this list.

 

Page 34 3rd Paragraph:

“not the Bar 6” number should be 8

 

Page 123 3rd Paragraph:

"but Bar 17 was a bear" the chart was mislabeled Bar 17 should have been the bar before

 

Page 158 1st Line:

"but at least its close was above" should be "above the midpoint"

 

Page 205 2nd Paragraph

"bar 10, was above" should be Bar 9

 

Page 238

“Bar 12 was a bad bull reversal” should be bar 11

 

Page 245 2nd Paragraph

“countertrend bar (bar 9)” Should be (the bar before bar 9)

2nd to last Paragraph:

"bar 3 in figure 9.24 was a huge bear trend bar that followed four "

last word should be three

[Mr_black 10]

Nice PA today ...................:haha:

Edited August 17, 2009 by Mr_black

[mikea59 10]

Anyone who has spent time with Al's book knows Wiley did an awful job of editing and proofreading. There are many typos in the book. Some are just grammatical and do not affect the content value but there are some that do. On his web site Al says he will correct them in any second edition. I feel that IF there is a second edition it will only be because people bought the first edition and they should not be penalized for doing so. Therefore I am listing the known errors I have found so far and encourage others to add to this list.

 

Page 34 3rd Paragraph:

“not the Bar 6” number should be 8

 

Page 123 3rd Paragraph:

"but Bar 17 was a bear" the chart was mislabeled Bar 17 should have been the bar before

 

Page 158 1st Line:

"but at least its close was above" should be "above the midpoint"

 

Page 205 2nd Paragraph

"bar 10, was above" should be Bar 9

 

Page 238

“Bar 12 was a bad bull reversal” should be bar 11

 

Page 245 2nd Paragraph

“countertrend bar (bar 9)” Should be (the bar before bar 9)

2nd to last Paragraph:

"bar 3 in figure 9.24 was a huge bear trend bar that followed four "

last word should be three

 

So frustrating to be trying to learn new concepts and have to be constantly filtering every sentence for possible errors - "Did he really mean what he is saying here or is this another mistake"

 

BTW, Al says he is discontinuing his web site - too much distraction from trading.

 

Al: "I will therefore be shutting this site down in a week or so and return to my trading cave to work on my trading goals."

 

Makes me wonder if he is having problems with his trading. Seems like he was looking for another source of income from his web site, why would he do that if he was successful trading.

[dbandas 10]

Makes me wonder if he is having problems with his trading. Seems like he was looking for another source of income from his web site, why would he do that if he was successful trading.

 

I conclude the opposite: why would a successful trader allow themselves to be distracted? I take it at face value and appreciate what Al offered there.

 

Definitely a tricky book, but by the time it gets a better edit, I'll be rich beyond caring..........

[ACS 10]

Makes me wonder if he is having problems with his trading. Seems like he was looking for another source of income from his web site, why would he do that if he was successful trading.

 

He could have easily gone the route of a paid website/chatroom, tutoring, DVDs, etc but instead decided to go back to just trading his account. He says he wants to trade institutional size which he describes in the book as 100 contracts. I wish him luck and hope he changes his mind enough to just post end of day charts; something that will not interfere with trading during the day but would be of immense help to the many people who bought the book.

[Mr_black 10]

S/R Price Action 3 trades 4.75 profit from 3.25 Range

[LiggerPig 10]

Al Brooks may be returning to his trading cave but expect good news about his website

 

With the right support and enough interest perhaps Al will continue to post his charts....

[davewolfs 10]

He could have easily gone the route of a paid website/chatroom, tutoring, DVDs, etc but instead decided to go back to just trading his account. He says he wants to trade institutional size which he describes in the book as 100 contracts. I wish him luck and hope he changes his mind enough to just post end of day charts; something that will not interfere with trading during the day but would be of immense help to the many people who bought the book.

 

Rather then complaining you should focus on your own trading. If you can't read the signals end of day you should re-read the book.