The ACD Method

kinggyppo · Nov 2, 2011

Shan B notice how es/spx is right back to 1220, this number is a magnet.

mdl060374 · Nov 2, 2011

Quote from Shanb:

One thing that I've noticed with relative volume and stocks. I've seen a high correlation with relative volume and follow through and trending actions in stocks. The lower volume stocks will tend to be more whippy and less predictable, this is because the stocks is be traded by hft just liquidity providing and cycling the stock. When you have higher relative vol, this is where there is real order flow and larger players actively moving the stock.

Relative volume is relative to that time period in the day. If you get a stock with 200% relative volume at 10 am, that will be relative to how much volume a stock does at 10am. You intially have larger players selling, which creates activity, then you get the algos, momentum traders, and then usually the stragglers. If you are checking OR size and relative volume you are finding the stock before many have paid attention to it.
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interesting. thanks for the response.

kinggyppo · Nov 2, 2011

Quote from Shanb:

Since I can trade the major fx pairs in any futures account, I will be doing so . I've noticed the "follow through" nature of many of the forex pairs just like futures. There's alot of leverage and currency trading is probably big on the retail side overseas so this may have alot to do with it. Either way I can apply some of the ACD principles to these markets !

What OR timeframes do you guys use for the EUR, GBP, etc. Frankfurt or London? Do you use the Australian open for the AUD?

Also here is a look at the AUD and the ES in the past half-year or so...look at the difference
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First tip cadjpy is an oil trade, audusd highly correlated to gold commodities, usdchf the swissie represents safe money sort of like how treasuries get bid when mkt panics. You should know some of the basics like this, Mav can chime in here when he gets a minute.

Shanb · Nov 2, 2011

Quote from kinggyppo:

Shan B notice how es/spx is right back to 1220, this number is a magnet.
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Definitely have noticed this.

Hows the trading going? Last week or so has been very whippy and headline driven. Just wondering how others are doing

kinggyppo · Nov 2, 2011

good I like scalping so lots of action. Tough here if you are swing long, this euro thing seems like it is never gonna be resolved. If we get under 1200 I think 1180 is next stop, gonna be crazy if that level breaks. Looking to see if the 1220 area holds, this mkt can make you crazy not to mention the MF global bullshit is skewing liquidity and generally screwing over a bunch of traders who deserve better.

drm7 · Nov 3, 2011

ES is defending the 1232 pivot just below my A down level of 1237.

Samsara · Nov 3, 2011

My setup has gold above the weekly and right now hovering above the monthly. My initial impressions on this method have steered me toward trusting the longer term levels for follow through and the intraday A level as a necessary one for timing a lower risk entry, with a lower risk of retracing the next day. Been working on the premise that all are needed. My stops are wider than others.

One account's been holding a small bit of gold since last week, but I'd like to pick up some for a shorter term position, if we make it to the intraday A. Just me.

Maverick74 · Nov 3, 2011

Quote from Samsara:

My setup has gold above the weekly and right now hovering above the monthly. My initial impressions on this method have steered me toward trusting the longer term levels for follow through and the intraday A level as a necessary one for timing a lower risk entry, with a lower risk of retracing the next day. Been working on the premise that all are needed. My stops are wider than others.

One account's been holding a small bit of gold since last week, but I'd like to pick up some for a shorter term position, if we make it to the intraday A. Just me.
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Gold confirmed a weekly for me but is still below my monthly A up. Today we failed at the A down and the A up. I don't have any opinion of Gold here either way. It's just not screaming out to me.

Maverick74 · Nov 3, 2011

Quote from mdl060374:

I created a column like you recomended OR/average ATR(30 day), and it seems to really narrow down a universe to a manageable # of stocks.

As far as volume, I remember MF in a video saying he didnt really use it or look at it, when someone in the audience asked about it. It never really helped me, everytime a stock showed up on my scanner as 200% for example, it had already ran alot. It just seemed very lagging. But I guess, high relative volume with a tight range narrows down the candidates even more for the best candidates to select from .. Maybe you can elaborate.

Do you find any value in a relative strength filter vs SPY? (I ask b/c I found this in tradestation today and was messing with it....

One more question. Earlier you listed some ETF's that were equivalents of some commodities. I looked at some of these, and the chart looked rather untradeable. The daily volumes seemed very illiquid. Am I missng something?

Also, Since gaps seem to be an issue, any advice on how these change your intraday trading of equities?

Alot of questions. Just kind of throwing these out there as I thought of them.
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I agree with Fisher that volume should not play an important part on any individual trade. However, if you are going to scan thousands of stocks, I think volume has to play a part in that scan. High volume mitigates the effects HFT's have on the stocks you trade. If you trade low volume stocks the momentum is going to get faded too easily.

Samsara · Nov 3, 2011

Quote from Maverick74:

Gold confirmed a weekly for me but is still below my monthly A up. Today we failed at the A down and the A up. I don't have any opinion of Gold here either way. It's just not screaming out to me.
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Gotcha, thanks for providing that info. It looks like I have lower A levels so that may push me into some failures, and I may have to consider adjusting my numbers. Still forward testing. For now, I'll stick with what I've got and assess a long at 1772 based on how price behaves.