Thanks Mav. It looks like Option Volatility and Pricing (Natenberg) has a workbook coming out too in 2 months. I am in no rush to trade options so I will just focus on the theory until I have a good understanding and then focus on it from the trading point of view like you said. Thanks again.
Hello Mav, Today I'm adding some of your recent outstanding posts to my Underground Mav EBook and spending some time in the number line Chapter. Doing so, a question came up: Q: Do you use one intra-day OR for your basic A levels and another intra-day OR for your number lines? Here’s why I ask. You have previously said you use the 30 minute for intraday confirmations. (6/5/15 : “There is some nuance here. For intra-day 30 min, weekly I use an hour, monthly a full day and QTR 2 days.” However, regarding number lines, you have mentioned on a number of occasions using a 5 minute chart. Here’s a post from 2/1/14:by banco Hi, I've been trying to keep number lines on shares (based on examples of the scores in logical trader book) but with a lot of them nothing will happen (no A up, no A down) say about a 1/3 of the time. Are the shares I'm trading not volatile enough or is this normal? "I use a 5 min OR and I get a lot of A ups and A downs. In fact, my equity number lines can get huge." Just wondering
I use 5 min OR for intra-day. For the purpose of number lines you could use 10 seconds or 3 hours, it won't matter. Can you tell my why? Yes, it's a pop quiz.
Hello Mav, Just returned home from a summer outing. Well as I've previously stated, I'm slow on the uptick. I guess I don't know. I get very different NL's with different OR's. Take the SPY. On my 10 minute OR charts the 30 day confirmed on July 6th. On my 30 minute OR charts, it reset on 7/2 and is currently a measly -2. I interpret them very differently. How does that not matter?
USDJPY broke an upper trendline. Now lets wait for confirmed A ups, this could be interesting... BOJ meeting soon. http://www.tradingeconomics.com/japan/inflation-cpi Japan Inflation Rate at 2-Year Low
The teacher is not going to answer this one. I'm going to wait for someone to correctly say it and I'll confirm it. This goes to the heart of the ACD methodology. If you don't understand this concept,it will be very hard to make money using this approach. Or really any approach in trading. I know someone on this thread knows the answer. So get them to say it Robert!
I think the answer is that it doesn't matter what size OR you use, just that you are consistent with that size. Over time you will hopefully begin to notice when your products start to reveal themselves. And also for making relative value comparisons between two products, only useful if both are consistent with the same OR.
I will take a shot. The A levels used to compute NLs are not based on any OR. They are based on the daily pivot. Am I close or way off?