Hi Montila, Here is a chart of ES as an example. 01-27-2012 ES failed A up and A down set ups. How would we know to take failed A up or A down. The truth is we are trading probabilities. Some clues if one was aware of 30 days number line were there. In the end, we just have to take the trade , place stop loss and WAIT.
3 THINGS ON MY MIND EVERY TRADING HOUR. Actually, there are lot of other things on my mind like market structure, overnight inventory etc.. but these 3 are the KEY.
Thanks for posting the thread. I'm actually having trouble (less success is more realistic... no money lost yet in CL!) trading Crude, especially with systems. Also have the same problem with forex and my systems. I do love grains, metals, indices and treasuries with my automated trading, especially the first two. Since my trading is occurring in less popular contracts, I'm eager to focus my studying on Crude and the likes! Time to get discretionary!
Great thread man!! I always wondered if anyone else tried to blend ACD and MP to paint a clear picture in your mind. Didn't Mark Fisher recommend not doing this? Or maybe it was just something I read on the ACD thread. Anyway I can't see how it would hurt ACD gives you your directional bias and MP shows you what areas you could expect congestion and therefore helping you know where to take profits or place stops. Keep up the great work! The only think I can nit pick about are your charts, why not detach and expand them to full screen size and the capture the image my eyes are getting to old to read those tiny numbers
Thanks. I will try to improve charts. ACD and Market Profile together is 24K GOLD. I am still learning finer points of market/volume profile. Traders can spend years to fully grasp profile and never learn how to execute a trade. That's where ACD come in from my perspective. Here is a detailed market profile chart along with Fib. analysis courtesy of a friend. I do not understand 1/2 of the things on this chart but i trust her work as i trust Mark Fisher, so it helps when two methods are pointing in the same direction. http://screencast.com/t/thVchh4T for CL 01-27-2012
Great thread MF. I've always appreciated your charts and your enthusiasm for trading. At first I didn't really see much use for ACD, this a few months ago. But now after some help being steered in the right direction by successful trader, I have come back to ACD and I am very encouraged by my initial tests incorporating it into my trading and hope it is the final piece of the puzzle for me. I would agree though that it's not a system, more like something you incorporate into existing system. At least that's how I see it. What length OR to use, what time to start your OR, how to calculate your A and C levels, how to calculate the number line... these all depend on the market being traded and the traders objectives. As an example I notice you use a longer OR on mornings when there is an oil report, and I think Mav said he resets his number line each month, good examples of tailoring it to your own preferences.
01-17-2012 pr open. How to trade overnight inventory being long set up. If CL is up during Globex session then expectation is that at OPEN it should open STRONG. If not, that's a sign of trouble ahead.
On your attached chart, you comment "bit excat science. Sometimes level works, sometimes they do not." What work have you done to quantify the times when MP/POC does work? If you haven't done this work, or you have done and not found it sufficiently accurate, then why use an MP in your trading? Surely the objective is to do what we can to increase our probabilities - in which case "works some of the time" isn't good enough. This chart, you write "tried short 99.80..." - was it the volume "spike" here which was an indicator to you to go short? What is the tfpXRay indicator on your charts - it seems to be some calculation on the volume? Assuming you entered on that bar (the spike), did you expect the market to sell immediately? In other words, when it held up for almost 15 minutes before making a new high, did you see this as a sign your trade wasn't working? I think this trade could have been exited for a wash shortly after 13.00 on your charts...do you consider time as a parameter for a stop or do you always wait for your price? Interesting point about stops. You say "we never know". I appreciate that we cannot have certainty in the market, however shouldn't the aim be as near as possible. In the near term, we can construct a very high degree of accuracy. You correctly note that the size of the stop has nothing to do with the probability of being stopped out if wrong. So why risk more? Well risking more is due to not understanding enough to enter with a tight stop, so good that you are aiming for this. However, when you say "the move needs to have potential 60 ticks or more" then how do you know how far? You say you cannot "know" for sure if your entry price will hold - how do you "know" how far it will move the other way? Jan 25 - you start to refer to DXY and "risk on". You know "risk on/off" has been quoted so often in the popular media over the last four years that there are now new ETFs for punters to have a go betting on ONN and OFF. It was noted on DailySpeculations that both ETFs seem to be heading down, despite being supposedly inversely correlated. Just goes to show...but the point here is why are you using other instruments for your CL trades? Does your trading model account for this? Have you correctly tested all the parameters (formal correlation studies, accounting for correlation vs causation, etc). Jan 26 - you say 100 becomes target because 100.40 broke. Is this a generalism that price once in motion tends to continue in that direction? Are there exceptions to this? Could 100 have been a target prior to the 100.40 "support" area breaking (or even before that 100.40 level formed?) What caused that 100.40 level and what is its significance? Your three points are interesting: 1) WHAT PRICE LEVELS ARE MOST IMPORTANT TO BIG MONEY? Who is big money and how do we know which levels are important to them? Then how does that information help our trading decisions? 2) WHERE ARE THE STOPS OF WEAK HOLDERS? Who are the weak holders, and where do they place stops? How does that information help our trading decisions? 3) BEWARE OF THIRD FORCE ENTERING THE MARKET. What does this mean?