First, I would say that I am hoping for more clarity from overnight/Sunday action to perhaps provide a range to better define that actual price level, similar to how Thursday night / Friday morning's action helped define the lateral level of interest. Such a situation would strengthen my conviction in attempting a REV from that location, strengthened further by the speed and stretch price makes into that level (i.e. I don't want to see price "dribbling" down into it). [The way I see it, the trend channel indicated we were at the extreme of a diagonal range, but the demand line is merely an indication of being in a position of "oversold", and would not, nor should not, provide support on its own, as that is not what demand lines are for. On the other hand, the overnight low provided a level at which sellers and buyers could no longer find equal numbers of each other, and thus represented a point beyond which traders could no longer transact, thus existing independently of whatever means one uses to plot their charts and/or draw their lines. Testing of that level shortly after the open and the corresponding first response, the return and secondary response put the "stars in alignment" for what I deemed as more than a reasonable premise to trade the reversal, so much so I used the 15 second bar interval chart to take a REV so as to limit my price risk to as little as possible.] Second, if such clarity is not provided as described above, I would simply follow the drill. SL break -> RET -> Buy Stop -> Manage, perhaps from the 15s chart should I see an swift enough response breaking the SL into that level. If either the REV as described in scenario one, or the RET described in scenario two, don't "play out", then I would exit at the break of my SL in case of scenario two, or exit on a swift counter reaction to my entry and/or REV bar low, in the case of scenario one. I would not reverse my position. I would then wait for the next RET and take the short as indicated by the drill. There is no secret - DB laid out exactly what anyone needs to do to be successful. These other additions, which for me equate to the notion of location,are just icing on the cake, allowing for a reduction in price risk.
As Db has said AMT isn't a system unto itself. It's just a road map. It integrates well with SLA but SLA isn't dependent on AMT.
Today and yesterday after noon, nasdaq-100 did not act as in other sessions. Its behavior seems to have later migrated to other indices such as the SPY. What is to read in this price behavior?
That depends on whether or not one wants to make the most of it. As Fluke says, location, location, location. Yes, one can trade with the SLA anytime, anywhere. But if he's going to make serious money with it, he'd best trade it at the locations suggested by AMT. There has been and is, for example, much discussion about "the top". But one trading the SLA-AMT using a daily chart would be short from about 3660 three weeks ago and still be in. Scoff? Pffft? That's the way it works, according to the rules. The only difference is bar interval. Whether or not one knows he's "selling the top" is irrelevant. There is also the matter of overtrading, which is a serious problem with some in chat. Unfortunately, there's little I can do about it other than remind people again and again to stop trading so much. More patience and more waiting for the best trades is called for. But this is the trader's problem, not a problem with the SLA itself. The difference between useful counsel and psychobabble is that the former provides a direction, a course of action to follow involving specific steps to take and tasks to accomplish, whereas the latter is mostly buzzwords and catch phrases that may sound great at the time but which are of no use whatsoever when the opening bell rings. One could put this SLA-AMT thing as simply as the SLA tells you what to do in specific and clear-cut steps and AMT tells you where to do it.
Could you perhaps provide some more information concerning what you believe it did differently today and yesterday afternoon than in other sessions? Perhaps you are referring to the rate at which the declines are increasing in extent and decreasing in duration while the advances are decreasing in extent? View attachment 145278 As for migration into other indices, I couldn't really comment in any sort of educated manner.
That 5 hours chart is nice! Watching the price, in say the last bar (today's cash session), I felt it was sleepy and not "fluid" as it usually does. Price could appear in various characters. Today, QQQ was as if it were an old stock where nothing dynamic could take place. Maybe because it is now on the channel lower line, and should bounce but first wants people to go to sleep to then catch them by surprise. It could also decide to resume the higher speeder on the way down. SPy was moving fast at the beginning, and then started moving slower and slower like QQQ. It reminded me monthly option expiration.
I primarily only trade the first 90 minutes of the "RTH" session and price during that period was anything but sleepy. However, in opposition to more aggressively advancing sessions as of the entirety of February and into March, traders do seem to advance rapidly from the lows of their descending trend channel, but all willing buyers seem to be dropping out sooner and sooner (duh...lower highs). I try to think of the market in terms of the composite operator, or all active participants as a whole, as opposed to professionals versus amateurs. However, I can't help but think about the bag holders collecting the tears of the fearful at the open this morning, and then selling their tears right back to them on a wet handkerchief mid morning, only to offer them dry cleaning service for those same, even more wet, handkerchiefs back down at the very same lows near the close of the day. Put in a less metaphorical manner, professionals are only temporarily providing support to get better pricing for further shorting. Of course this is mere conjecture, and next to meaningless when it comes time for me to click my mouse to put a few lot position on. As forty once said, "I'm just along for the ride". And that is what the plan is for - actions (SLA) and locations (AMT - lateral and diagonal).
It takes buyers and sellers to move price. We had very big moves this week. I would think a lot of the big players went home around lunchtime. Price always is moving from contraction to expansion or if you prefer from ranging to trending. I don't see today as out of character.
I've noticed that the basic SLA rules gives you the opportunity to re-enter in a strong trend. If one adjusts the lines to "hug price like Spandex", a mere pause or breather with some sideways action will stop you out. After fanning there's often a new retrace to enter on. In backtesting I find it difficult not to do this (both the hugging part and the re-entering part) which leads to trades that look like they are in the middle of nowhere but still have a good chance of success. Maybe this is part of the overtrading problem? Or did you think of something else entirely? Like reversals, I don't take them but they would really cause many more trades (perhaps because I don't really know how to trade them).
Re-entering an ongoing trade opportunity is more trade management than overtrading, though if one has done no work on MAE, every tick against him rings a bell of doom. But there are also the trades that are initiated just because they seem like a good idea, or they're almost good enough, or one missed the correct entry and is grasping at second or third-best, or one is seeing bunnies. Doing little or no prep is also a chief reason for overtrading, as is getting hung up on lines. After all this time, these lines should be for the most part gone, and yet they seem to multiply. It is impossible to do the characterization, to do the prep, and to follow the rules scrupulously throughout the session and not be successful. This does not mean that every trade will be successful. I had two losing trades yesterday, one for (1.75) and one for (1.25). But the rest were winners. This may be because I listen to the market instead of trying to bully it into doing what I want. Even so, if I just follow the rules, my day will be successful. Some traders just can't be fixed. Some of those -- if for whatever reason they just have to trade or else -- will find their answer in automated trading. In fact, that may be the only option available to them. But the SLA is not meant to be therapy. It isn't even "fool-proof" since the trader must make at least a few choices. But neither is it a tradefest that requires the trader to tap away at the Transmit key non-stop.