Of course. I am mere flotsam in the ocean of money. But I'm fairly disciplined, I have a lot of time to devote to learning, and best of all I know that I have a lot to learn. You certainly won't offend me by telling me so. I am grateful that you are so willing to help, even if your answers take a while to sink in. My equity trading is progressing satisfactorily, and I'm looking for something to keep my mind sharp during the day. I look forward to it. Perhaps I'll save my questions for later, after I've logged some more hours.
I have been gone a couple of days and just reviewed Spydertrader's final universe. I noticed a couple of stocks on the list that are on the American exchange. (ALY & SIM) Spydertrader, have you changed your mind about trading on the American Exchange? Thanks
I'm a couple of steps behind Spyder in channel drawing skills, but I've also made progress in them. Like anything in life, drawing them correctly takes practice. Personally I've found it useful to start off with drawing channels in hindsight. It won't help your trading any, but the point is to train your mind to identify those channels. If you have time during market hours, draw channels on your charts. As you try to make the channels, write down your questions you come across and then at some point during the next 24 hours, try to answer the questions you raised. If you can't, hang on to it for a later day - at some point your brain will "click" and give you the answer. Make sure you read the "Channels for Building Wealth" document, if you haven't done so already. Most importantly though, draw channels until your eyes bleed. It doesn't matter if they look nice or ugly. It doesn't matter if they are right or wrong - just start putting your brain to work on the problem and "do" them.
I'm sorry to hear you experienced such a loss. However, in the future (no pun intended), you'll find that experience invaluable. What you need to do now is forget what you think you know. Forget all the negativity from your last adventure. Forget all those tests you ran on equities. Forget everything you ever read in Journals One and Two (for now). Focus on improving your ability to recognize an FTT. Start with equities first, draw in the channels as recommended by Jack in the Channels Document. Watch what happens to price as you see an FTT form. For practice, use any chart of any equity, future or forex pair. You'll be amazed at what you find. Learn the FTT, and you can buy two - one for you and one for her. I agree. Learn the FTT, and you'll be one of those sharks. If you scroll down to the right hand corner of the chart above, you'll see the time clock from my computer. Note the time (4:11 PM Eastern Time). Now, check which candle you see forming. Wouldn't you agree it would be a difficult task to annotate all the lines in hindsight, take a screen shot, add all the icons and circles or arrows and upload the chart within three minutes of the futures market closing? It was my attempt to show you how the channels are drawn in advance of the coming bars. Take your time. there is no rush. Learn to recognize the FTT in Equities first. Once you can effortlessly 'see' the FTT develop on the daily time frame, you can move from 'Long Only' entry, to shorting equities as well - a handy trick to have during a market sell-off. Take a look at GMXR over the last week or so. Can you spot the FTT's both headed up and headed down? A few people traded GMXR in both directions. Even if they traded small size (they didn't ), they banked a tidy sum of cash - simply be recognizing the FTT and knowing how the market moves from an FTT and beyond. This is very good to hear. Keep up the great work. However, feel free to move 'outside the box' in an effort to search for other equities which may have formed an FTT. Once you grasp this concept, you'll be able to trade off an FTT in any market. It wasn't the fact that you asked questions that showed me you had more work to do. It was the specific question about stops. If only three possible outcomes can materialize after an FTT, and all three move price away from the FTT point, errors result from execution (incorrect analysis, too late recognizing or too slow to take action). As a result, losses do not occur out of a mathematical probability, but rather, out of execution failures. Fixing those errors requires mental homework and practice. Setting stop losses has no effect on improving performance. Once you recognize the error which caused you to take action (hold, exit, reverse, enter or wait), you immediately reverse course in the direction in which you were headed previously (effectively eliminating the initial action by taking an opposite action). By example, if you were short, and thought you saw an FTT (reversed to the long side), but realized a few tics later that you did not see an FTT, you need to immediately reverse again to place yourself back on the correct path. You only take action in three cases (FTT, FBO, BO). Since you took an action without one of those three cases existing, you need to 'fix' the situation. Hopefully, you can begin to see where this logic might end? Say it to yourself. Posting it here might see one labeled a heretic, or worse yet, a consumer of mass quantities of Kool-Aid. No. I decided to keep the symbols in my Universe in an effort to accommodate those who still wish to trade on the Amex. Besides, I can always use the practice drawing in trend lines. ---------------------------------------------- I apologize for the length of this post, but I wanted to impress upon everyone the importance of understanding the concept of the FTT. This isn't a 'system' for placing trades. The FTT occurs in all markets (with sufficient liquidity) on all time frames. As many people reading these pages already know, learning the FTT provides an almost (dare I say it) 'religious experience' once you 'get it.' I realize reading those words, some might consider such comments as the ravings of a madman. However, do yourself this one favor. If you forget everything else I have ever written, at least learn how to trade the FTT. If you never go beyond this level of knowledge in equities, you'll make a very nice living. Good trading to you all, and I hope everyone finds the above information useful. - Spydertrader
The FTT occurs in all markets (with sufficient liquidity) on all time frames. As many people reading these pages already know, learning the FTT provides an almost (dare I say it) 'religious experience' once you 'get it.' I realize reading those words, some might consider such comments as the ravings of a madman. However, do yourself this one favor. If you forget everything else I have ever written, at least learn how to trade the FTT. If you never go beyond this level of knowledge in equities, you'll make a very nice living. I am new to the Hershey method and was cautious about adoption, but impressed by Jack's and Spyder's consistent message and coaching. I studied during the months of October/September and began trading the beginner long method Nov 1. My initial focus was the mechanics of position selection as I didn't really get the FTT explanation. Also, repeatedly going back to the journals to catch nuances I didn't get in the first reading (tedious, but well worth the effort). When I finally downloaded the trial Qchart and began actually charting my positions in real time and projecting the channels that focus changed. eureka! After about 2 weeks of daily drawing practice, the FTT lightbulb went on. Although I had previously been aware of macro trend, the discipline of actually drawing the channel, extending it, aligning several fractals, etc., is constructive micro activity and combined with analysis of volume and market tone puts the trader in charge. It's work. Nightly I validate my Universe, analyze the natural cycle, update my Qcharts, and prepare a focused watchlist for the next day. Combine the analysis of the chart with order initiation and I can verify that money is made consistently. This is the favorable season, but I am confident that advanced skill will position me correctly year round. My own debriefing over the past 25 trading days has given me plenty to keep improving/working on. For example: -don't be shaken out of a good position early -consolidate tools and minimize time spent with mechanics -replace weak positions with better opportunities (using streams as demonstrated in the camtasias) -analyze position size for leveraged returns -progress to short positions and futures etc. etc. etc. Thank you Jack and Spyder for your continued dedication to helping us all improve the grey matter between the ears and the balance in our checkbooks. KC
Hi Spydertrader, Would it be possible for you to take a screen capture at the very moment you identify an FTT and post it here ? Does it take only one bar of not moving higher ( assuming an upward sloping channel) to trigger the FTT or do you look for additional clues volume etc ? TIA
At the exact moment I see an FTT, I'm involved in 'other' (more pressing) activities. However, I plan to create a few Camtasia videos over the Holidays reviewing the various aspects of the FTT. I plan to use these videos in next year's Journals. In this fashion, a trader can practice 'watching' the FTT form - over and over again. While Volume does play a role (along with other factors) in confirming an FTT, one should practice locating FTT's using only price for now. Doing so trains your brain to more easily recognize the confirmations when adding other tools in the future. It's easier locating the FTT's with equities - as you have an entire day to decide. I only recommended practicing on futures because the ES often provides several FTT examples each day. Think back to the days when Jack called in his trades by phone. Remember, he used to 'hand draw' his charts. Picture in your mind's eye the sketches he drew. Did he draw a MACD Histogram or the Stochastics (5,2,3)? I don't think so. For sure he had price on those charts (and possibly volume) - along with the channels. Why did he draw the channels? What clue did he hope to find to provide the basis for future anticipated price direction? The FTT. - Spydertrader
I just wanted to confirm that there were no stocks to watch today (other than existing positions or stocks we like to watch anyway), correct?