Basically, I use this setup as a scan: Buy-Setup: Use the pullback to the 20EMA to fade breakdowns and position with the trend. Answer to your question: Yes, I am quite glad, but I´d like to share my variation of this method. Sundog
floor trader directional scalping using a spotter in the booths. MA's can work, as long as you have someone cueing the implications into the pit to the trader.
floor trader 1) scratch 2) wins 3) losses to increase the 'edge' probability bias can be used that are worked off MA's. Overall if the scalper in the pit is scalping directionally off the cues from the booth clerk, more often then not he can increase his W:L ratios. its a ideal method, since if the market moves against him, the scalper would try to limit his losses, but with a winner he can hold onto it a few more seconds and make more then the spread.
if your looking for a valid floor trader method, its a OR-open range method.. use a predefined time interval of the open, and plot ORhigh, ORlow. basically you play a breakout out of the OR range. With no bias, according to EOS direction. on a volatile day the OR, should not be tested as much, especially if the OR is close to yesterdays high or low.
Never used it, but I know what you are talking about. ACD System or variation by Mark Fischer or Toby Crabel, as well. Maybe I´ll have look at it. The thing is, the open is getting in various markets less and less important as you know of course, since I checked some of your posts, I guess you trade forex as well. I liked your post with "The line in the sand". This can be the "Open" as well. But slowly it is time for another "Line in the sand". I have some money invested in dollars on a fixed rate. I use the interest for expenses in the US, since I am quite often there. I live in Europe and I exchanged around 1.25. I was quite lucky. Sundog
Most floor traders just trade the "order flow", and you could say they are counter trend traders, meaning: if the market is rallying they'll be selling to the paper buy orders coming into the pit (and if the markets tanking, with large paper sellers, they'll be bidding at levels they'll be willing to buy). You dont really need to watch moving averages and technical indicators if you can see all the orders and your on the floor (if you know whos buying/selling, whos initiating positions, whos liquidating them you have a major advantage over the screen traders)....If a technical indicator is telling to buy, but then you see a large paper seller come on the offer, your obviously going to ignore the technical buy signal and try to take advantage of the new seller whos come into the pit....you may flip and just go short on the bid, offer lower than him, or cancel your current bids and bid at a lower price (and try to force the seller to offer lower and sell to you). I got a few mp3's from some former floor guys talking about some specific strategies they use....PM me if you want a copy and i'll try to email them. Its just an opening range strategy that takes into account the open ranges for daily, weekly, monthly, and yearly openings. i've never used the strategy, so i dont feel like re typing the whole strategy on here if you can just listen to him talk about it.
Thank you for the kind reply. I think the thread starts to develop quite well. Maybe I skip the first idea and we talk about real floor trader method variations, if there are any ? Of course is the method I mentioned is not a floor trader method, but as I said, it is the orginal name of a trading idea which is published for free on a website and I just had an idea of a variation, when I sat bored in front of my computer. Anyway, what I tried a few years ago and what I heard Ex-floor traders did, was to trade in general divergences between the cash index(Fair Value) and the future itself. Try to buy below FV and sell above it. When you trade Eurex, e.g. the dax you do not even have to take dividends into considerations, because the dax is an performance index. Makes it much easier and accurate to calculate the FV of the future and I think nowadays the dax index is updated every second. Much easier nowadays to do it. All those dividends on several US-Indexes are just estimations and thus not really 100% accurate to calculate FV for the future. But there are some nice websites, which do it for you. When the interest went down the last years, the divergences got much smaller. Maybe, nowadays it is interesting, again. Cheers Sundog