BA A warning about if2 trading. I spent to much time (skipping steps) and trying to IF2 trade. IF2s particularly the ones that represent the appropriate number of stops back (for the market pace) are very important but IF2 trading is tough. the reason as I see it is that you are looking at the results without the reason. the meat is what you need to make your decisions based on, specifically volume (PRV ) I am sure teh YM-Indu spread and DOM will play very important roles in the process of scting (carving). I personally can't 'see' them in real time yet. I believe because I haven't put them into proper context yet. to borrow your annalogy be carefull of watching the coastline when it is the repeated interaction of water and earth that really matter. I currently am finding context in the IT trend. This is very kewl, and relaxing. I found your post on the IT that you made on 3/16 very interesting. As I see it your channel was Newby's initial point3. If you connect the points you labeled B & C to represent the 'airplane leveling off' your Price/volume coments hold up very well. Is that how you were looking at it? anyway just my 2 cents. Great disscussion. Heres to volitility.
Cool to hear that someone else is out there trying to get somewhere with this stuff. I agree with you about volume... I was really dismissive of volume when I first started out (2 yrs ago) -- I think mainly because I traded equities and the intraday volume for equities is really noisy. I learned my lesson (thanks to Jack really). Volume is king. Also something I've learned recently is to think about 'ghost' volume -- sidelined volume watching and waiting to put a position on. I'm a ghost all the time . Ghosts make the trends go. Yup -- the PV for that IT trend was really pretty. I've also noticed that IT TL hits tend to occur during midday -- when (by no coincidence) volume tends to be the lowest. I used to dread those dull times but now I love them because they give you so many clues about the current channel. I'd be interested to hear the things you experimented with (in general) with the IF2 stuff -- as of now I think it is a decent exit and re-entry signal when you are already in an established 'taping' trend (ST channel traversal for example)... but other than that good trading JT
Well... that's what you call an IT breakout. Looks like we have our preliminary LT channel. Hopefully we'll get a full traverse to the left side... should provide good money velo$ity. nwbprop - did you catch any of that BO? JT
Now that we have nice wide IT channel(20+), we should get some nice traverses within it. Only thing left to do is take those rocket entries and ride the trend. I might not reply to this thread much more as the objective of the thread has been accomplished. If you would like to join our chatroom, pm me. Thanks for all the helpful replies.
I know nwbprop started this thread -- but I think it's useful so I'm going to continue posting... So... the big drop at the end of 3/19 through 3/22 was definintely a traversal to the left side of the LT channel... since then prices have been banging up against downsloping R and then finally squeaking through the end. We've basically been in an IT stall. On Wed we finished up just poking through a R at the end of the day... we'll see if it resumes tomorrow AM... my gut is that it will -- but there are big problems overhead... We have a horizontal R around 1100 -- and the LT trend line looming. If prices don't resume upwards tomorrow - watch out for another traversal to the left side of the LT. We are basically sitting right in the middle of the LT down channel at the moment. First order of business -- figure out which way it wants to go tomorrow AM -- after that figure out what will be the main opposing force -- then figure out what trading tools to use to extract the most money from the situation. JT
I could not have said it better. Seems right on the mark from the charts I have. It would be nice to get some great volatility if we get a full traverse on the LT channel over a failure to traverse the first pt 3.
As they say in basketball -- the market took the ball into trouble... we're definitely in an IT up trend -- rising R all day today tells that story. The horizontal R came into play beautifully from about 11:30 - 12:30... I really didn't expect to see the up sloping R get broken at 12:30. This was pretty dumb of me really... range and volume dried up... this was followed by a volume BO on all black bars (on the 1 min). We haven't even really seen the right hand LT trend line come into play yet today. new pt 3 coming? JT
Today was pretty frustrating -- hopefully I learned a bit too... Every time prices started to stall and volume declined I was looking for a short. Well -- every time that happened today it was just a new pt 3 in the ST channel. all day. It's frustrating because it was the easiest day in the last several. What threw me off was the *memory* of the up and down action the last few days -- I became conditioned (biased - which I have a problem with) to something and I expected it. Also I think I need to expand my concept of a channel a little bit -- because there seems to be two modes of behavior: moving between s/r and moving along s/r... and each of these seems to have 1 or 2 subcategories. At any rate -- seems we are at or near pt 2 of an IT up trend. JT
If points aren't working for you, you may be interested in a chart I posted earlier: http://www.elitetrader.com/vb/attachment.php?s=&postid=460888 If so, here's the post it's attached to: http://www.elitetrader.com/vb/showthread.php?s=&threadid=29005&perpage=1&pagenumber=164