I use constant vol charts ( 10K contracts per bar) with a 34 & 9 smoothed MA's. I like to know who is trading at the bid and ask so I accumulate these numbers for the last 10 bars (40K contracts) Then I hook up a stochastic to a WAV file to wake me up for the pullbacks. Oh yes, I run a 10 bar channel to highlight where the clever people have set their stops.
Oh, man, that is SO different from what I do. I am so ashamed that my methods reek of the "Conventional Orthodoxy". Could you possibly post a chart if it's not TOO proprietary. I'd be happy to share mine (actually already posted elsewhere), again at a level that doesn't give too much away. You running a one-minute chart?
Will do, however it is 2pm here and just heading out the door for a spot of lunch. Might need to be tomorrow.
Oh! Either some of you are deleting your stupid posts, or we are being moderated to protect ET from excessive obscenity, whatever that might be by ET standards. In either case, all the better. A previous post, now vanished, referred to the morning 3S ritual. Being of an older generation, I had no idea one of those S's referred to the scrotum. Kids nowadays!
Thanks, Fearless. You're not missing much, the market is in Take-the-Profits-Back mode. Also known as How-Fine-Can-We-Trick-the-SCTer's-Into-Drawing-Their-Channels.
Alertness. By this I think I mean the ability to maintain situational awareness. For example, I have a bad habit of drilling into what has been going on for the past fifteen minutes on a one-minute chart, and missing the fact from a longer term chart (I can't admit to using five-minutes) that a double top with the morning's intermediate high may be coming up. Or grooving on floor rotations on a one-second and missing a textbook perfect rainbow in one-minute. Or not watching the tape and missing the fact that furious buying and selling are going on inside a two tick consolidation. Or that the green line you thought was yesterday's HOD was really an HOD from last week that you forgot to delete, and you just shorted it (true story from this morning). Or failing to notice that the excessive volume alert that just buzzed wasn't matched by excessive price. Or forgetting that you DON'T, under any circumstances, countertrend trade without a helluva good reason, like maybe FOUR mutually consistent good reasons. But you all are no doubt smarter than I am and never have such attention lapses. That's why I use audible alerts liberally. Edit: Even better, who the hell ever thought PENDING home sales would be significant? I certainly didn't. Never was before that I recall.
Calm. The beneficial trading states build on each other. Sobriety facilitates health. Health allows you to experience and enjoy satisfaction. Satisfaction helps prevent distractions from alertness. And alertness leads to an absence of anxiety that induces calm. Why is calm beneficial? Why shouldn't an electronic trader behave like the popular image of a frenetic pit trader? Because as I said before, we are trading against machines, and machines never get rattled. Do you suppose the quants monitoring their monsters get excited? One thinks not. They are kicked back with a java absently picking lint from between their smelly sandaled toes: "Yeah, Momma. Nicely executed top! Now crank up that bull flag to shake those pussies out! Daddy's got too much inventory!" Calm means that you see a bull flag, not a reversal. An LOD test, not a true BO. The phony look of a half-cosine-wave Rule of Ten move which is a just a picture of a carrot, not a real carrot. Calm means that you are hard to shake out. Devoid of greed. Devoid of fear. Impossible to suck into trading an erratic congestion. You realistically take what you can get, walk away, and laugh your ass off afterward.
Confidence. Again, I want to minimize negative terms. I could have said lack of fear. From whence cometh confidence? It's precursor is alertness. Nothing can catch you by surprise. Hence nothing can hurt you too badly. Conversely, you know that you probably observe and understand events that other lesser traders don't. Maybe you even see things that the machines can't, or events so subtle that the cleverest programmer could not capture them (like SCT). A confident trader knows the score. The markets don't exist to serve US. They exist to serve THEM. The markets don't exist for US to make money. It's for THEM. And they'll do anything and everything they must to assure that traders in the aggregate lose money. Not enough to make us quit, of course, but enough to bleed us to death. Not enough to give the markets a bad reputation, no, we don't want to scare ever-hopeful newbies away. So the confident trader knows what HAS to happen. The BO must almost always be faded. Even the absence of a fade is a fade. Highs must almost always be tested. And lows. And the unwary must be seduced with neat little stair-stepping runs that look like they'll go on forever. All conceivable price-based indicators must be triggered at once, the more conveniently to fade them all at once. And our floor rotations must be tuned to trigger the most common stops. And, lions tigers and bears, oh my, how we love our bull and bear flags! And, if we're pros, we never ever on ET recommand that you read Alan Farley. No no no. A bad book! And Schabacker? Who? 1930? Nah! That was then. This is now! The confident trader is grounded in history. And he remembers his George Santayana.
Patience. Comes from where, haha? Why, confidence, of course! And what does patience do for us? Helps us wait to commit until the market commits. Afraid at the open the market will go to infinity or zero and leave you behind? Remember what has to happen? Not bloody likely! Admittedly it does happen often enough for you to remember bitterly that you didn't jump right in. But think. Where do most of your losses come from? The first 30 minutes and midday? So the patient trader waits for a test of the open, a lower high, a higher low, a test of that MA EVERYBODY uses, a hyperbolic run and its consolidation, a test of yeterday's O/H/L or C. What makes patience easy? You almost always have a second chance! If only because Bitch Market has to frustrate those who WEREN'T patient!