I had just finished notating this chart to help someone else, and then saw your post - serendipity. Notice how the FTT is shown clearly on both the red and purple channels. Though it does touch the RTL on the purple, it's not necessary. At some point during that bar it should have been recognized as an FTT before it got to the RTL. Regards, - EZ
Entering on an ftt is not much different from entering on a break of bar 4. Both of these entries have a high probability of failing which, to me, is not the best scenerio for a new trader. Sooner or later we have to start trading and what I would like to know is what is the safest entry, the low risk, high reward trade that Jack talks about. Where does the newbie enter? You can sim until the cows come home but when the s**t hits the fan decisions become a bit more difficult. This low risk trade is the first step is it not?
Unless Bar 4 is also an FTT, then they are clearly different. Jack doesn't blindly enter on bar four any more than I blindly enter at the open. One must know the context in which one sits (the right side of the market) before undertaking any action whatsoever. FTT's do not fail. Only three possible outcomes exist with respect to FTT's. 1. Another FTT, 2. An FBO, 3. A BO In all three scenarios, price moved in the opposite direction from the previous trend. Jack talks about 'Beginner Rockets' being low risk / high reward trades. 'Rockets' come from the indicator settings used on the MACD and Stochastics Indicators. Easyrider used these 'Rocket Trades' to build his account from $5000 USD to over $200,000 USD in 2 years. Feel free to review easyrider's posts to obtain a feel for how he found his 'Aha!' moment with respect to using 'Rockets.' Keep in mind these indictors levels all occur after an FTT. I know I keep repeating this but, the market provides signals of continuation and signals for change. There are no 'safe' or 'unsafe' entry. One is either on the right side of the market or not. If on the right side of the market, one simply needs to monitor for the next change signal in order to take action. If one is not on the right side of the market, then one needs to learn to more effectively monitor the signals provided by the market. Whether Beginning, Intermediate, Advanced or Expert Level, all use the FTT and Point Three. If a trader monitors the Coarse Level resolution and locates a Point Three Formation and enters in that direction monitoring for increasing volume (also in the same direction) then chooses to hold until 'seeing' an FTT form, they will have 'traded' the Dominant Traverse of the current trend. Whether Sim trading, or using real money, unless one starts to think in terms of continuation or change the entire process of transference simply isn't going to work. Maintain a focus on recognizing continuation and having the ability to differentiate it from change. Hone this skill, and you'll not have to concern yourself over anything else. If I can provide you with additional clarity, please let me know. - Spydertrader
I hope I get to where you are one of these days. My concern is that reversing and washes take practice and I would think you would have to be fairly proficient at these to start entering on ftts and practice can be costly if youre not a quick study. I do wait for a point three which I have found to be the safest for me so far. I have also found that if point two is the high or low of the day it helps. p.s. perhaps high probability of reversing would have been a better choice of words than high probability of failing.
Bear, please take these following words as a kind suggestion. I don't mean to take a holier than though attitude, it's just something that seems clear to me. You keep using the word "probability", and I think I understand why. Your use of this word, suggest strongly to me, that you're not in the right mind set. Probability should probably (no pun intended) be removed from your vocabulary. I watched, in person, with a live market, as Spydertrader called out FTT's, flaws, bo's, fbo's, etc. I can tell you, as amazing as this sounds, there was no probability (guessing is another word) involved with his analysis. I have no doubt that our Mr Spyder is indeed a good trader. I also am sure he would be the first to agree that he doesn't have some special, God given skill to do this. My point is that perhaps if it's not obvious to you yet where to enter, then perhaps you need to work more on channels and other fundamentals. Again, please don't take this as anything other than a brother in arms sharing a peak over the hill. The words you wrote sound so much like what was in my head.
Very important point. When gambling, even if you make a positive expectation play you are unsure of the immediate outcome (and sure about the long term outcome). When trading FTTs, you are SURE about the outcome--- that it will go in the opposite direction of the trend for AT LEAST ONE TICK PAIR. If you are not sure of the outcome, you need to get to a place where you are sure! This requires practice, chart hours, and help from peers. Using just the ES chart, you might not be able to get in early enough every time to take advantage of this, and you might incur some small losses if you are in fact using real money right now. However, with lots of practice of identifying the FTT on the ES as soon as humanly possible, and then coupling this skill with the benefit of having the medium and finer tools to help you even further, you come closer and closer and closer to the ideal of never making a losing trade, ever, again. Using the ES, we want to practice identifying the FTT as soon as humanly possible, even if we are wrong some part of the time, because in doing so we will maximize our benefit from this tool down the road when there is more information at our disposal to help us make decisions. This is one reason why it is not recommended to be trading right now, using only the ES, because putting real money on the line is likely to make you too "chicken" to be bold enough to make that early FTT identification. What most of us are doing right now is a lot of observing, and it is sure to pay off down the road. QFT (quoted for truth)
I have created a video tutorial describing the philosophy of the Hershey method and instructions on exactly how to draw channels. Spyder has reviewed the video, so it's safe to say at worst it won't get you off track It can be viewed or downloaded at http://www.uploading.com/en/files/G63ZSGPI/Channels_For_Beginners.wmv.html
Ahhhhhh....... I know what you mean. In my defense, Spyder mentioned it to me, LOL. But then again, free hosting is free hosting