Most of us draw channels by hand since none of the approaches you listed work. The reason that they do not work is because of how they are programmed by programmers. I keep the right1/3 of my screen to the right of the forming bar. This space contains three channels of differing duration. The channels form shells. Using channels is done to form an envelop of possible price movement. what happens on my charts is that the forming bar is stationary on my chart and as time passes the bars on my chart move, gradually, more and more to the left and then off the screen. this means that the annotated channelsals move at the same pace to the left as time passes. You have never seen this happen before, I imagine. I believe that most people haven't either and this is quite foreign. 1,000's of these charts have been posted in ET over the years, however. I give line weight and color to the channels. the brief channela are given thelightest grey width and they are callled traverses. The traverses are contained in channels that last longer and often there are 5 traverse of such a channel. It is common tohave two of these channels in the morning and twoin the afternoon. I refer to this as a daily M or W in appearance. Outside of these channels is a longer channel that is referred to as a shrt or intermediate term channel. This channel more or less sets a dynamic R and S. So there is a punch line here. All of these channels have, as their right line, a line known as a trend line and the other side of the channel is drawn parallel to the trendline. This other channel line I call the left channel line. At all time the price bar is forming inside these three shells of channela all of which extend into the future. This is not familiar to you at this time. there are many many people who expect their platform to give them everything needed to trade in an expert manner. That is simply not possible because of the quality of the available platforms. most platforms do not allw you to move where the forming bar is located and none of the automatic sheels or boundary representations ever project into the future. This is the state of the quality of how people operate and how the trade. It does not go beyond advanced beginner or early. intermediate. There are some things about channels that allow a person to continually make money and the concepts of drawdown and heat do not apply to these efforts. Drawdown, heat and being "outside" of a mediocre platform contruct are high risk uncontrolled beginner trading situations caused by lack of experience and skills. An expert approach must be deployed when a person gets to recognize: eliminating risk, no staying in trades on the wrong side of the markt, holding a position that is losing capital and losing time when the market is offering potential profits. All of these conditions are recognizable by a person who is using the channel approach, especially if he is projecting them on three levels. Anyone who is not projecting annotations to the right of a forming bar is very deeply handicapped in trading. Not knowing the future envelope of price movemnt in advane is inexcusable since it is at all times available. I will post a separate focussed post to make the above point. Yes I am always in the market and whether it is a long or short; it depends upon the market direction. I stay on the correct (right) side of the market at all times. There is no drawdown concept associated with this style of trading. The reason is that the actions taken are timely and that preclude a drawdown condition. The "taking heat" is not a thing that should be part of any trading plan. People who do this have a much higher risk tolerance than I do. My risk tolerance is about 0.
I rewrote the above to make it what it the correct set up for about 1/4 of your screen. Apply this to ES or any index.
JACK, Ok...I am with you so far. However, I do not have 3 platforms and qcharts. I do have "omnitrader" with lot's of indicators and systems available tho. So...in my mind what we need to do is "jimmy rig" our platform's so they work with what we have available. With that in mind I do have macd/stoch and volatility breakout bands. Plus many other systems. I can also set my screen to 3/4 or 1/3 screen open to the right of the forming bars. What I can not do, is get a channel to form to the "right" of the screen (bars) or "project a channel into the unknown". So...with this little problem in mind!!! (Buying a new system is out of the current budget) how do we solve this little channel projection problem??? Maybe we can come up with something that we all have in our systems that might work or come very close to working (like jimmy rigging what we have)? Any suggestions, Jack... Thanks snarlyjack
Snarly, Sounds like your tweaking is working with the indicators you have adopted. Can you describe the rules you use for each of them?
The consensus seems to be that trader28's system will only work if executed with discretion. In Jack Schwager's book the new market wizards, one of the main conclusions is that the main reason traders fail is that they don't follow their system well enough --- in effect that any amount of tweaking based on real time discretion tends to reduce trading profits. Clearly these two are at odds. What do you think about this ?
How making money works. Tarding is done in NOW. Real time data flows into your computer and you monitor. There is one price bar and it is forming in NOW The bar is "inside" the world that concerns you as a person making money. All aspects o the bar's environment are to the left and right of the bar. We see the past to the left and the future to the right. This is difficult. Look to the right and you will see that the trendline is always to the right of the bar. Just as difficult. Look to the left of the trendline and you will see the price bar forming. On a trader's screen thee are two parts. Where the forming bar is and where the trend line is. the bar is on the left and the trendline is on the right. This is a difficult kind ot thing to grasp for people but it can be grasp. One possibility if this is not possible for you is to take your computer and throw it in the nearest river. the computer is not working so throw it away and buy one that works. Lets assume you now have a good computer. as time pases the bar forms and jumps slightly to the left and a new bar forms. The trendline is now a little closer to the forming bar and it is still to the right of the bar. For making money, you choose to be in a trade that is going the same way the trendline is going. As you atch the screen the bar forms in a way to keep it going the same way the trendline is going. For longs, the trendline moves to the right and higher as time passes and so does the price bar after bar. This is a hold condition. You annotate the bar when it has formed and you use the prior bar to that, if necessary. Notice that the trendline that is light weight is to the left of the medium weight trendline and that trendline is to the left of the heavy weight trendline. If you do not see then projected there it is because they have not been drawn. The test of drawing trendlines correctly is simply that the condition I have typed always appplies. To get all three trendlines drawn start with the outside one and use the 60 minute chart to draw it and project it and make the left channel line parallel to it. Then go down to the 5 minute chart and draw the mediuum weght channels and then the light weight channels. after you have done this once, copy about 25 daily charts and go back to the oldest and repeat this for everybar (81 per day for 25 days. Check the posted charts to see when you go it correct. Now the money making part. You check the three trendlines and find from the outside in they are Long, short, long. So you are long and looking for the chance to take profits. Look to see the value and time where you will do that. Simply go up the light trendline to where it crosss the medium short trend line and not the time and price. It will happen before this because the price bar wil hit the medium trendline first and before the light channel trend line gets there. This tends to take the guess work out of making money. We do have to consider when the light channel keeps going through the medium channel trendline or not. Fortunately, that is a given as well. We can know these things and we have several places to look and the data set we take is always correct. What I am typing is all new to you and that is normal. But all of the work you need to do to get on board is already typed up and videos are made and there are people all over the world doing it. The chances are that you, like most people, do not have a computer that works. That is because it doesnot have the correct software. You are just a victim of the software sales poeple and their programmers. i when to an Expo where there were 1,000's of poeple and over 100 presenters. Only a couple of presenters could get some space on the right side of their screens. No presenter knew that channels overlap. So here is a major principle for you. Shortly, you will know when a new channel is beginning. It begins in the prior channel. So now you know channels overlap. Look at the two trendlines of the two channels. Where is the price bar forming relative to these two channle trendlines? If you know this answer there is no more drawdown or no more heat. You will never even hit a stop if you know this. The answer is: the forming bar is always to the left of both of the trendlines that are overlapping. When does the overlap start? We always know this as well. Trading is a very smooth and continuous money making thing. there are no surprises. We may want to fill the rest of your screen up. What do we put here? Well, we put all the leading indicators of the forming bar in the space that is available. There is a caveat to this stuff. What makes trading work is people and in particular they have to use their minds. As you know a mind is a terrible thing to waste. Sometimes it happens. Glance at the "Lizard Effect" Sometimes a person trying to learn to trade gets mentally wiped out in the process. Learning is always goin on. and one of the kinds of learning is "repeated failure"; the body rebels against the pschological trauma by creating a psyiological trauma where the body takes over and "freezing both psychologically and psyiologically happens. Several people have expressed parts of this in this thread already. If learning is still going on and if it is possible, everything is fine. But on the other hand, if "fighting" is prevalent thats not good. Neither is the fleeing (ignore). Doing this kind of trading is better done after you have become expert in position trading things like equities. You always have to be expert at equities oif you high velocity trade indexes simply because there is an upper limit on contracts that are tradable. It may be that expert trading may have a forum on ET in the future who knows. They may start a glossary and the lessons that were formerly at the top of the display have been dropped.
What I did not want to do is load my screen up with a bunch of different indicators. What I like about T28 system is its "easy". But like Jack say's, "easy" isn't always the most profitable. What I want to do is make a "great" living doing this...then, the question becomes how do we do it? So...with this in mind...here I am... (1). Vty break (14,5) seems very accurate. (2). Vty breakout system (envelopes around the price bars). (3). stoch (5,2,3) (4). macd (5,6,13) (5). FOSC (new one) (Forecast Oscillator) (14,5). This is what my screen looks like, currently. I am watching and timing the (ym) and seeing how the whole thing comes together. So watch it with me and we'll see what we think. I figure many heads are better than just mine!!! Thanks snarlyjack
JACK, Now keep in mind that we are "jimmy rigging" here... If you connect the "high Price" with a blue line, and connect the "low price" with a blue line. It forms a channel of the price bar's. If you connect the "median price" with a red line you have the middle line of the channel. So the (top), high of price bar... blue. the middle of price bar (median price bar)...red. and (bottom) low of the price bar... blue. This gives you a very "tight" channel of the price bar movement with a median line going through it. OK... Then...you can kind of see a direction of the price bar channel going up/down slightly. When the channel changes direction (?) you jump off/on the train as its going in the direction that you want to go... How's this for a "jimmy rig" channel system?... snarlyjack
This is a common platform difficulty. You may be able to move the forming bar over but the platform cannot put information (annotations to the right of the forming bar. Adding additional plarforms is just something that is part of life for making money. We canwork up to that somehow and as time passes all the fixed costs of trading drop down into the neglible cost category. So for now it just means that you have reogied that you do not have the capability to monitor the markets. This kind of limitation is very common. What I was explaining, however does solve a lot of the problems that low velocity traders decide are okay with them. The making money slowing is an option for trading and in this thead you can see that it is important to most of the posters to keep the speed at which money is taken out of the market at the level they have as a piority. It is a very safe place to be because it is very familiar and it fits with howthey wish to conduct their life styles. The average time over which a person persists this way once they recognize an alternative is about 4 months or 1/3 of a year. Here is a stock market example. By charting using channels and the same template (the combo of indicators and volume), I am getting on the table for SCT, you could use 12 days of the year to do 4 trades. Each trade would be making 30% in the period of the hold (3 days).* The remaining part of the year, 228 days could be used to make more money in stocks. with holds of 3 days thee is some free time to look at the index trading. The SCT trading is more effective because of the leverage etc. I am glad that you did check out your machine and the software. for me to rig your present machine is easy. Just take a snapshot of a chart over to paint and to the job periodically. A backup method is to print the chart with the 1/3 space available and then mark it up with an assortment of ball point pen colors. Put it on the desk next to yu and note when the trades are oming up and when price does go there do the trade and ten make a new print and annotate it and put it on top of the old print on your desk After a while you can fan them and it will look like a computer is doing a fast speed movie of the way money is made. This is a common thing when I go to people's homes to mentor them. some of them are "experienced" traders. it is the same story as a carpenter with ten years expereince with his tool box. he has worked for nine years repeating what he learned the first year and he did not change anything after the first year. He has one year's xperience and he has repeated it for nine years. After a few months pass and you do not trade stocks to make money nor do you trade indexes to make money, you will deciside to take the trouble to "grow" by beginning to do trading to make ll the money that is there all day long. As you can see there are many people here who love to "shoot the messenger". It is a terrific thing for a person to do if he wants to. ET gets hits. my plan is to shorten the period oftime between now and when you get a computer that works. Then my plan is to make you very rich. everything I need to convey to you is written and video taped. All we have to do is go step by step to the right place at the right time to get you to enjoy the process. It is a work thing. It is very obvious to me that you are going to get the job done and so far we are doing your way to save you making a lot of money for a while. The reason we are going to wait is because you need to figure out if it is worth your time. So far you found out that you need to have the future showing on our machine to see the trendlines to the right of the price. You can't so far. but now you can se them on either sheets of paper or paint. My time is worth about 5 digits a day everyday and I can do two things at once as they say. What I get if you learn is a person who can help others learn so it is worth it to take on another part time job with you. *compounded (reapplying he capital) gives you a 286% return for those 12 days. So I would suggest that you throw your computer in the river and get a new one and new software that shows channel lines to the right of the forming bar.