I know what u mean, and i´m not sure i will be able to trade the way grob suggests. It´s like when i play scrabble, which i´m very good at in swedish. Even if i have crappy letters i get more points than amateur opponents anyway. They can have the best combination of letters and i still beat them. I wanna try grobs ideas because I feel that this is a strategy that by trying it out, at the same time it learns me something about how the market acts. i find it useless to just copy one of all the strategies that been backtested and "proved" 110% succesfull. My main focus is trying to understand whats happening. I don´t wanna just try to copy anyones strategy and at the moment i´m not primarely fokused on finding a winning strategy. Just trying out things that teaches me something about what´s making the price move. /Stalker
trading bug aced us with: "I hope you post your charts and Grob109 comments" For you to just spend the next ten trading days modifying what you do a little and post some charts will be very helpful to all others here. What if you posted last Friday's charts. The five on ES and the last part of the YM on the two. You could even post the first half of YM as a separate chart. You could post the ES weekly too. Post a 15 minute and an hourly as well. Easy could throw up his squeese/stretch log for Friday too. I am going to name the bars by number when I get going here. There are 81 bars a day in ES. Be sure you make a chart that shows the 5 min intervals going down the left side and names the hours going from left to right across the top. Just enter the bar numbers in the cells of the chart. then you have a quick reference for bar number on your trading log and on the print annotations you scribe during your daily debriefing. A good scrabble player can just get in the groove on this very shortly. for me, I can pace anlmost anyone in posting to their q's as fast as they can get it straight when they put out working as I suggest. If a person can just get over having any need to change what I am suggesting and for the heck of it just go with the flow. It may not take much time to get in the groove. My picture of this is that it is not hard to move the trading bar on the screen. It is not hard this weekend to get all your lines on the chart. You could actually go back over the last 10 quarters and set them up in a notebook too. Play a round of golf too so you know how a green feels. Seriously, what would it take to pace my posting by actually doing something and posting it. Regarding the basics, We can start that part of trading after you get to the point where you have something to look at. In scrabble terms, we are just getting the scrabble board out now and finding out where to keep the letter holder relative to the board. So far I haven't found out anything from you about how you well you get ready to play. Fill in the preflight check for Monday after you get your charts posted. Maybe someone will post the red thing to take you to the blank form. Lets say we run for 40 days and see how many contracts you can trade based upon the profits you make trading all day each day foir 40 days. My suggestion would be to just do it using the putting green that you maintain all the time. Lets make all the mistakes possible in the shortest possible time.
2, 3, and 4 have two answers, each 1 and 5 only have one answer. The answer sheet is attached. I will also redo the posts you make and annotate my suggestions on how to avoid the errors that people can make.
Here I added a thrid bar to show you where I tricked you and to also see how to resolve 2, 3, and 4 which were no clear from just two bars. The point is that in all cases I was able to project into the future from two bars. When is this done during the trading day? It is done with bars 1, 2, and 3. synch is going on and you have nothing else to do. Now you get to see that for all 5 examples you make a change in everything that comes up to start the day. what happens during the day? As the channels get set and they begin to function you are in the trades and operating between the channels to continue to hold the profit taking. The thing that makes all channels work is the the first and third points have to be on the "right" side. The goal and target is to find the "right" side asap. In example 5 first, I put in the answer, points 1 and three on the left side which is against the rules for anyone using channels. example 1 is the most commmon happening. examples 2 and 4 are the most common fake outs to start the day, so we do wait for synch and bar 3 is usually the end of the syynch period and it does define the starting trend, then. Bar four will be in the channel and the safe entry is where the bar exceeds the prior bar in the direction of the trend. example 3 is called the "outside bar" situation. You will have 2 to three of these a day. circle them for the rest of your life. They move point one to the second bar always. and you set up from there. example 5 was there to build confidence for you. You were saying this guy screwed up on this answer and you know better. drawn correctly (pink) going to green you see the trend slow down as in example 1. Most two bar estimates are faster pace than the market actually turns out. So you do the PERSPECTIVE with 2 bars and three bars puts you in the GROOVE. All examples involve more than a point of the H-L for the day. Your objective is to get out (reverse and take profits off the left side. To enter to make the most money bar four is used. conservatively you enter when bar four goes towards the left side by exceeding bar 3. If you are hot stuff you get in on bar four when it is as far away from the left side as it can be. There is almost no way after either entry you can have a wash exit. Almost any exit makes some profit but you hold as long as you are in the channel. When we add monitoring volume, annotating and extending channels get to be more fun because you are doing it with twice the confidence.
I attached a made up 5 min chart. There is no tending, soon as an expert you will trade it using the envelops you will annotate. You will just draw them in as vlume tells you too because it is running below the lowest ray of volume you have in place. for ES. Every day you get to trade the congestion and part waythrough convergence; these are 4, 3, and 2 tick profits takings. You will be using the YM smart money to do it on a 2 min chart already there and being monitored. Here you annotate a two min price chart and also you show /\ shaped Gaussians on the 2 min volume. Right now I am just asking you to annotate a bunch of charts for price. Doing it the first ten days takes some thinking since watching the market is new to you. After you begin to monitor, with annotations, the making money part is quite calm and casual. Now you do not have any real trading advantages over all those others who are not doing any annotating. We are separating you from about 90% of other traders, then we separate you from 9 % of the 10% and lo and behold, you are very profitable and very different from most of the world out there.
To get the drift on how a trend begins and volatility of the trend increases as volume increases, look at how the annotation of the channel goes along. I would rather use a real chart for this but the paint brush ones work as well almost. You finally get in on the pink place when bar 4 exceeds bar 3 right after synch. The opening bar set the volatility level and for about 20 minutes you have been looking at a moderate starting volume like all other days. So much volume gives you so many ticks per bar. Since it is the am you are counting on knocking off about 30 to 40 % of the daily H-L for starters. You have the initial volatility of the channel set. See the attached.
You are watching and bar 5 ahppens and you see that you had a wash but things are tending to the left side of the channel You have gotten past leaving about 8 times because you couldn't think up a reason any of those times. On bar 6 for sure you know to get out!!!!! But you are doing pro rata volume checks and you see volume is going to pass the highest ray you have drawn in nine weeks ago at the beginning of the quarter just after roll over. It is still working to tell tell you that a good move is being sustained. You decide to just make money and annotate. You draw a line through the top of the bar and parallel to the trend line by copying the trendline segment and dragging it. Oh what is that blue line up there anyway? you now notice that the width of the channel is like the width of prior channels you have drawn before for this level of sustained volume. You are into the day 7 bars and you may be holding for more profits and you see that the DOM is functioning with the smallest total cummulate contracts on the correct side of the chart to keep that side dissolving through the trades eating away at the controlling side of the market. you just past a few more ET'er's in trading skill with knowing how the DOM works. Will this channel get wide enough to get to the blue line? What the heck volume would it take to push the market that hard? what are the levels of the DOM rolling along at? three digits when the new unbefore seen vlue drops it place. Am I getting any squeese on the YM INDU cash spread? Does it ever ease back to neutral? See attachment below.
So look at what you did to pass the time as you answered the Q's You see the first channel of the day now and you also see a traverse within that channel. If volume does persist and keep the bars translating, you are going to see some action on the pink traverse boundaries. This is when the R2R will occur on the YM 2 min chart. Notice I am just chatting ahead of the market as I do normally when I trade. We can start the basics soon when you have the annotations down.
Thank you very much Jack, I sure appreciate your efforts to help me. But right now it´s information overload in my synapses. I feel that I have to try this out by myself for a week or so, reading posts by you in other threads and trying to get a basic grip on this at my own pace. I will get katatonic if I move on too fast. I get back to you when I´m ready for it... /Stalker