Hello all: I have just finisned my debrief for the day. I have read carfully all the posts from 167 onward. Thank you each and everyone of you. All of these posts are important. I will do better and better as time goes by. The last few weeks I have gotten some bad news. As most know I put in many years helping to set up the EPA and the DOE and changing HEW to what it is now. Unfortunately, I wasn't as cautious I was required to be. We worked very difficult turf in constructing the interference tables to improve the APHA water testing. So it turns out Liz is dealing with heavy metals from galvanic action and my curiousity allowed me to take a battery of tests dealing with toxins. It is amazing what canoeing on the Cayahoga (sp) and other toxic sites can serve to allow stuff to get into and settle in fatty tissues. My cell walls seem to have gotten much less functional as a consequence. All will end well since we are jumping on a schedule to appropriately follow a path to ease as much of this garbage out of both of us as is possible. As this thread unfolds, I will make an effort to differentiate between logic performance and making money performance. By being nimble, we can become very effective and efficient. I will answer the Q's in an order that helps cut to the chase as quickly as possible.
Hi tid: Yes the "job of the trader is to get a fully effecive and efficient "taking". By concentrating on effectiveness and efficiency super results are obtained. Results are, as you say, found on the bottom line. So both of us keep polishing our performance to achieve very envious results. I know you put in the effort to get to be expert in doing the job of the trader. Over time, skiils and knowledge accummulate by stacking up the building blocks on a terrific foundation. The market's offer is beyond the imagination when compared to how the rest of the world works. In the future I will try earnestly to keep my documentation as careful as possible.. we both deal with causes and they have effects. I need to be careful and helpful and supportive of others. I'll keep that in mind at all times.
Welcome to ET. Yes as you suggest the binary operation of the market deals with continuation and change (you refer to reversal, very appropriately since only two aspects of markets are used to increase the bottom line). since the variables of markets are granular, this facet is used to reason through laying a foundation of knowledge and skills to be able to build with building blocks to pbtin a complete system of operation of the market. People percieve. This sum comes from sensing (10%) and inference (90%). The three most often used and most powerful sensing operators are space, shape, and change of shape. In the price rectangle, people sense using operators. Their minds tell them what they are seeing. The mind is built by repetitions of experience. Garbage in; garbage out generally rules. In trading porential traders get the consequence of their experiences which they store as inference in the form of beliefs. Here is the first rule. YOU MUST BUILD ANY SHAPE FROM THE GRANULAR PIECES THE MARKET IS GIVING YOU. in ET most people just use what the feel like and disregard anything they find inconvenient to have to deal with. Laziness is a cultivated habit for these people. Here is the second rule: DATA is provided by computers which use rectangular wondows (called panes) to display forms of data.. The data streams. Extreme data is given significance. The combination of extreme data points can be used to create shapes and the change of shapes. ONLY PRICE CHANGE CAN BE USED FOR CREATING NEW WEALTH. A person who uses the system of operation of the markets, may only use strictly rational aspects of the system to be part of the operation of the market as a participant. Rule 2 puts all traders on trading platforms connected to IB's who participate in markets using values and quantities. The time rate of change of values is what creates wealth. Markets move forward over time. Only ONE SIDE OF THE MARKET IS INVOLVED. the side that is involed is the RIGHT SIDE OF THE MARKET. Rule 3 is used to determine the direction of the market. The direction of the market is determined (measured) by the right side of ADJACENT BARS (the slugs of data that is forming the forward movement of the market.) A market is long if the line connecting the bars is sloped positive and visa versa. If it is not possible to measure wait until it is possible to measure. So it turns out that pennant shapes have only one side to look at. If there is more than one side, then no measurement is possible. This element in reasoning is very important. It i what is used in systems to have permission to measure the independent variable which leads the dependent variable. So what is the determing facet that makes it possible to use a "certain measurement" for the market's direction. It is the left side of the pennant. The limiting case is the horizontal left side. Flat top pennants and flat bottom pennants could almost be considered to have sentiment. They are the last non sentiment type adjacent bars. It turns out that pennants define the inability to be able to measure the leading indicator of price, the independent variable. They are very valuable as a consequence. For considering creating wealth in trading , it is required to have the two sets you first mention: the set of continuation and the set of change. Continuation is the middle of a trend which is found between the two ends. Change is momentary and is never found at an extreme value of a variable. All trend end are momentary and there are only a finite number of specifically definable ends. All of the definitions are based on the context of the independent variable.
Evening, Thanks for the explicit answer.What about subject Jack.Will you shed some light on that murky subject.It "seems" to that they have an opposite meaning.They say,''if it seems,it`s time to go to church!"LOL...But anyway,to mee it still seems due to lack of knowledge and practice. Best Wishes!
Thanks for your questions. I will post all my notes for today (Friday) so you have a complete day's set of references. But firs let me deal with your Q's. I mentioned the Doji in one of the beginning posts. I will find it in a while and make reference to it. You are considering the importance of "context" in trading. Context is important for several reasons. To go through the learning process of the various trader skill levels requires that a person self check himself periodically to assure he has not gains any misconceptions about anything. A person MUST always shed myths and misconceptions by making an effort to surround then with knowledge and skills that come to mind BEFORE anything erroneous already in the mind comes to mind. Earasing is not part of the process that the mind uses. Once something gets in the mind, it is there permanently. There are some peptides which experts feel can be summoned (it takes a very superior mind to be able to do this) to cleanse mistaken inference. The cure is more difficult than the work around. Our mutual goal is to have and operate a complete system. By going through the work effort of streamlining the system, a great deal of facilty is achieved. Today I was posting a doc for the open. It was almost complete and I was adding an attachment. The Tucson power failed at 6:21. All my computers told me they were not getting info . My modem was telling me it was rebooting. I felt it was important to explain the upcoming "hold thru" on bar 2. Well I aslo had a check valve to replace on the pool sweeper intake pipeline I small pisce of morter had gotten into the check valve and prevented its full opening (slowing down the pool boy). I feel that the markets offer so much money that I could spend the lost trading of the open moves to tool up and fix the pipe. The pool was at 96 degrees this am so it wasn't stressful at all. For Monday and the ret of the week I will post the carryover so you can get used to see "CONTEXT" muscling into the picture to make the open fun. Now lets look at you chart and your text. I feel you have the definitions done correctly. WHY they are there is what establishes the market context. The early levels of skill (all beginner and half of intermediate) are tough for traders because they do not know what they DO NOT KNOW. As they sleep the mind merges the unconsciuos into the conscious AND the mind asks the conscious person to think about weaknesses in the mind's inference. If you are lost in the woods, you ARE lost inthe woods. BUT if you are canoeing the Yukon river for 500 miles you still do KNOW you are on the river. It only has three bridges in those miles (one at each end and one in the middle). Creek branches happen more often. As you journal your passage, you definitely know where you have been. And you do see an occassional telegraph relay station and a wood fueling area that was clearcut during the gold rush. sidewheeler era. A tree grows 6 feet in 30 years. I use geometry for market CONTEXT. You define all of the parts. I did the pennant Q's first to get some of the geometry on the table. I made it to "seems" I quess. The second phrase in defing long and short is the important phrase. since it concerns the defining of when a beginning trend fails. Picture yourself comfortably making money. you are in trends and they continue. You picture them ending when the end occurs. As you grow more skilled, you get into the next (opposite) trend and resume making money. You use logic ALL THE TIME to KNOW YOU KNOW. If you feel a tinge of fear, anxiety or anger, you KNOW that you do not know you know at thatmoment of the tinge. you recheck what you are reasoning though to get back on the ball. All the sheets that comprise the complete system are set up for making money using logic by trading the dominant market trends. A failsafe component is there as well to prevent the taking of any losses. By only trading the dominant market CONTEXT and by not losing money, you get to have psotivie feelings all the time (comfort, support and confidence). So when you get the CW trader emotional tinge, you know you do NOT know at that moment. There is an error or ommission in the space. It is not something NEW or something the market is hiding from you. It is YOU having a tinge. The doji is found on every bar. We have a doji on every bar and we can count on it. Since we have it we can count on it. Why? WHY not? A doji begins on the beginning of every bar. YOU ALWAYS KNOW YOU KNOW THE DOJI BAR VALUE. SIX FIVE MINUTE BARS FORM A 30 MINUTE BAR AND AT SECOND 300 OF THE FIRST BAR, YOU ANNOTATE THE DOJI VALUE. relax and do it. JUST DO IT on the five minute chart. Why? So you can value any signal during the next 30 minutes. I notice you have a beginning ray that does not make it to the end of 30 minutes. I also see a darker blue ray for the end of each 30 minutes. My conclusion is that the inking of your printer is wearing sunglasses or something cause the blue changes from one blue to another. One ray goes 30 minutes and then it is RESET a the very beginning of the new 30 minute bar. Market sentiment is done with leg 2 of any bar. Dominance is good to know. The Doji is the guy in geometry that dictates leg 2 of each bar. At the beginning of the bar you SEE immediately the relative nature of the forming bar. It is moving either away or towards the right. If leg 1 is missing, then you know you know you are on leg 2 immediately. We always like to see a brief leg 1 and then get right back to making more money. On your chart, youput in the doji ray (blue) immetiately and you see the long context value has risen 13 ticks that you banked on , say 10 contracts. That 30 mins before you saw a dom to non dom to dom set of three moves (a normal tends has these three moves. The first bar of the new context is above the doji so the long is continuing. I 'll continue in another post.
On the first 5 min bar of the 30 nin chart the 5 min bar allows the BM and the pink to keep making better values. the labelled bar 1 then begins and it has a leg the same dominance as the trend that is continuing. My ears perk up, cause I want it to go the other way so leg 2 can be the same dominance as the trend which is making me money. the doji is there on bar 1 and it made the bar black initially. The BM came into a permanent location and so did the 30 minute pink. The pink is three tiks from the extreme profit and it is set there to say: I AM IMPORTANT. Whe the price passed through the doji the bar turned to red (fix your soft ware somehow). Now we know we have let the Doji announce we have a le2 that is NON DOMINANT AND WE ARE IN ANOTHER EVEN MOVE OF THE TREND (EVEN MOVE 4 WHICH MEANS THE TREND IS A DRIFT TYPE TREND. Lets say you are some category of expert. the independent variable is talking to you very loudly. It says I am a LVBO and the long trend is over. So you carve the turn with a market order above the pink. NOW, we have arrived at the place where we look at the gold. It is from the top of the prior 30 min bar, I. E., the prior 5 minute bar with the greatest volume in the long trend being used to make money. (the bar that ended the retrace second trend move. (fix the color of the bar please). This is a "contextual" ray. It says the trend is continuing when you apply it. BUT it is there for a more important use. Bar labelled 1 is an intrnal most of the bar BUT it is above the gold (your gold on the five min is wrongly placed as I have noted above). As long as you are above the gold you are firmly in a LONG CONTEXT. What is the way out of a frim long context?? BINGO!!!! Experts mosey over to the DOM and the T&S at some point. LOL where is that point? Why do they go there?? In markets, transactions are the thrid most active aspects of markets. Let's relax and think for a moment. Picutre yourself collecting data foro eight years. No one ever tells you trannsactions are of so little importance compared to two other things. Why not??? well wh ywpould they?? they would IF YOU WERE READY TO GET THE INPUT. When will Schwager get to that point? A. Lo at MIT will never get to that point. You are not asking me to show you how to carve turns as an expert would as yet. that is okay. All I am apprising you of is this: THERE IS A TIME WHEN YOU GO LOOK AT THE TRADING PLATFORM. That is where the panes for carving turns are located. As you see the bars turning red and as you leave the extreme of the FTT bar and pass the long's pink and its last gold step up, then you are looking for the failure of the overlap to break out an begin to form the short. The missing rtl of the 5 min chart helps with this. you see plainly that the rtl is broken by the second short bar labelled bar 2. Bar 1 was a short leg2 bar as everyone can see. we are in short and making money and the rtl and ltl of the short were begun , BUT not completed in any way . bar 2 makes it to the ltl and bar 3 is moslty internal but does get to translate at some point. THENIT BREAKS THE LTL AND HAS NO LEG 3.!!!!! fireworks and its time to accelerate the trend ontainer. the need to accelerate will occer agin as well. We need to get the rtl's as tight and as steep as the rules call for. Bar 4 is a doji. If the doji were passed the second move of this short trend would have been more pronounced. It is like looking to for the bridge in the middle of a 500 mile paddle. we did go to shore for luch and a nice guy came over to us. his PO box was number 1 in the capital of Malaysia and his well coffed daughter was going beck to school in London. Naturally they stopped at a picnic table along the Yukon river along the way. I borrowed four rolls of film from him whereby I would send him prints of the shots later. One was a grizzly and teo cubs about 25 feet north of my smoking fire. I put grass on it all night long that night. Bar 5 is a stitch so the low volume is not measurable and we hold thru . the peaking bar is at 1040 and it is the last dominant trend leg 2 bar. you can see the influence of the 30 min chart right where the missing blue ray let bar 6 cut loose to make some more money. If you are an expert, you probaly see we need to do one more trade to get into the 3 times the range. guess what? here comes another trade that will help get that done. I do not transfer too much from the 30 to the 5 cause it is very visible as I annotate and THINK in left/right Terms. As I said, I will scan my work from today and get it up for debriefing. Notice that I have merged two logs (5 min and 30 min move reversal logs.) The critique dronwpruf gave me on my record of trades was just a lazy person's innane comment on wanting to see the beef, which for him is money made instead of skills in carving turns. Ho Hum..... Is he as dumb as Perkelo.? I guess so. Fix up your chart and repost it, please.
I combined the 5 min trading log and the 30 min move reversal log. Attached are five blank logs that can be used to log the chart annotations and to call upcoming trades.
if you want to learn how to to the trading with facility, you can annotate a clean chart and use my charts as a backup reference. You can also complete the log for practice.. Below are the five pages of my log for your reference.