The ACD Method

Maverick74 · Dec 23, 2013

Quote from partha:

/GC bouncing off Monthly Adn (late in month, and NL is bad) and bounced off daily ADn (at least on my lines ...)
Mav - using London Open for Gold (treating it basically like a currency from Session open and session length perspective) does that make sense ?
I am using a different OR period for Gold than Currencies ...
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Gold also bouncing off my monthly as well but confirmed a QTR A down for me, granted very late in the QTR. Number line still negatively confirmed. I personally would not go anywhere near it.

You could use the London open for Gold. I've never tried that but would be interesting to see if there was any divergence.

Maverick74 · Dec 23, 2013

We got a 30 day confirm on the EUR/USD today.

partha · Dec 24, 2013

Mav,
Will try to do GC with different OR and check NL for both.
On EUR/USD - I got a >9NL on the 30day around Dec. 5th or so.
My currency lines are new ... as you know am trying to figure out OR and session duration etc, so they could be completely off.

partha · Dec 24, 2013

For GC - I will use London Open and 24 hr session for one , what would you suggest for the second one and I will do a Monthly NL - from the first day of December.

Maverick74 · Dec 24, 2013

Quote from partha:

For GC - I will use London Open and 24 hr session for one , what would you suggest for the second one and I will do a Monthly NL - from the first day of December.
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I use the 7:20 to 7:25 OR central time.

Maverick74 · Dec 24, 2013

Anyone see US Steel lately? Almost a double since August. Pushing $30 a share.

Maverick74 · Dec 24, 2013

Quote from Maverick74:

Thanks for the background Captain. Let me give some further color on this. Obviously I don't follow all the steel related products. There is a steel ETF (SLX) but it's very illiquid. I've been following X for awhile as it's part of my sector basket. So by no means am I implying that of all the steel choices out there, this is the best one. However, having said that, I do follow this name closely and this is the first number line confirmation since January! That's a big deal in my world being that all my trades are number line based.

One thing I left out was the risk part, so let's fill that last piece in. I always use the monthly A downs as stops for my trades. For me, anything that is strong or should become strong should NOT confirm a monthly A down. So Tuesday of next week I will post the monthly A down level for X and rest assured, if it confirms, I'm out. It's as simple as that. I have a lot of trades on now and this is only one of them. So while I'm making a big deal about it for the purpose of this thread, it represents a small part of my book.

I do however like to illustrate these trades because I have found, in my experience, that when you get a number line confirmation on something that has NOT confirmed in a very long time, it provides the "opportunity" for a big move. Let me repeat this part. I'm looking for an "opportunity". I have no way of knowing if this or any trade will play out. But number line confirmations, especially rare ones, often lead to massive outsized moves where one can get in "early". I pointed this out awhile back on USD/JPY when that still looked like crap. I got a confirm way back in the low to mid 80's. Keep in mind, that yen pair had been dead for years with absolutely NO volatility. Who am I to make a crazy prediction on the Yen. But out of no where the thing confirms. So I broadcasted that on this very thread. And I said the same thing, I know this sounds crazy, but this Yen might actually break out to the upside. I even through a crazy crazy target out there that it might actually go to par. Well, it did and then some. I think it got a tad shy of 104. That is a MONSTER move for that pair.

As traders all we can do is two things. Look for opportunity and manage the risk if we try to capitalize on that opportunity. That's it. Everything else is just conversation. While the Captain provided a nice fundamental backdrop, all my trades are quantitative based, not fundamental. I'm not trying to make a statement about China or an improving economy. I update my spreadsheets every day and take all the trades it generates and GET OUT every time a risk level gets violated, no questions. I'll put my discipline up against anyone in the world. That's always been my strength. That and my propensity to out work everyone around me.
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Posted on 8/31/13

I just wanted to mention again the principle of rarity and why it's important. The less something happens, the bigger the move. Remember...

partha · Dec 24, 2013

Mav,
For GC here are my results:

All of them used a 24 hr session - because gold trades around the world like a currency - thats my justification.
Did the NL for each , from Dec 2 to Dec 23 (Monthly reset NL)

0720:0725 OR NL -6
0715:0815 OR NL -4 Comex Pit open 1HR
0300:0400 OR NL -2 London Open 1 HR
0300:0330 OR NL +2 London Open Half hour

Yes - I still have X trade left - less of it and its still working well.

I am thinking of just using the Pit open and an hour OR (longer OR to fit the 24 hr session) ...
Any thoughts ...

justrading · Dec 25, 2013

Since we've focused quite a bit on FX recently, this article might be of general interest.

http://www.reuters.com/article/2013/09/05/bis-survey-volumes-idUSL6N0GZ34R20130905

This is the long read.

http://www.bis.org/publ/rpfx13fx.pdf

cdcaveman · Dec 25, 2013

Inside the house of money... I'm well into it now.. Great book.. I love some of the insights...