An update on Scribbles v Grail: At the close, G was 9pts in the hole and missed the entire upmove from 4368 (approximately 60pts, low to high). S traded both sides throughout according to its rules.
Interesting, but not at all surprising, imo, how the afternoon trade played out based on what could be observed in the morning.
I realized after having posted the chart above I had not adjusted yesterday's range to reflect what ultimately had become the BO level. It is adjusted in this picture of the chart: The difference being the upper limit shown is the 12.50 BO level, rather than the 10.75 odf the first pivot high of the range from yesterday's premkt. imo, this too is a BO, as it broke below yesterday's BO high, which, in my experience should have been the presumptive lower limit +/- 2 to 3 points depending upon volatility/time of day/proximity to long term mean. imo, this was short around 11 with 13.25 being the danger level, i.e. the level at which the BO trade is threatened as the market may be staging a reversal (but, admittedly, could merely a retracement in what is to become a much larger decline). I did not take it as I was unavailable at the time. I would have had I not been driving my daughter to school. Scribblers are aware of these various possibilities, and adjust their positions and views based no on the action of the market itself. This is why you typically do not find the term "noise" in the scribblers lexicon. Noise can only exist where one is unaware of the various alternatives that exist in the market at all times relative to the market's current context. Also, before anyone asks, another, imo obvious short, was the test of yesterday's high, but I was not watching the market at that time.
Round Trip. Now a decision level. One trouble with scribblers is that they can't tell you in advance whether the market is going to reverse her or whether it is going to breakout. All a scribbler can tell you is that the market will let you know, and that if one has done the work of developing a plan to trade BO's and Reversals, then one will know when and how to enter with as small a risk allowable.
Another problem with scribblers is they are obsessed with keeping losses small and letting profits run. Scribblers also like to trade the individual swings. Yes, this allows them to accrue profits at a much faster rate, but think of the increased transaction costs, the commissions! The fees! Of course, scribblers point out, that while the extra $3-$5 per contract add up, it makes very little sense to risk $870/contract for the sake of saving a $5 commission, especially when doing so means one has to forego at least that much in potential profit/contract over the same time frame during which that capital would have been tied up in hoping one's Monsterous, "noise"-induced stop loss does not get caught out.
A reversal trade with a "00.25" watch out level and 98 as a definite "danger level." 1.75 entry, with a 6.75 and 11.75 scale outs, which if filled, will leave some runners in place in case we caught "the bottom." If not ... so what ... there will be more trades.
One scribbler is long and another is short! Of course the one long will have to repent. Or if the trading gods are smiling both would profit.
lol Perhaps ... but if I get my "5" at 6.75, I'll be BE + 2 ticks and watching for the next trade, be it short or long. I'm going to log out now, as I really fucked that up - I should have been in the second this hit 98 but I was too busy with ET - that's the trouble with scribbles. In fact, now that I thought about it, I took some off at 3.75, as 3.25 should have been my "5" had I hit this where I should have. Logging out. I'll check in later if/when I'm settled in to a trade after the bell.
Using this recent swing from 4440 to 4370 and back, for example, a Scribbler, depending on how rigidly he followed the rules, trading a 15m bar interval, would have grossed approximately 90pts. At $20/pt, per contract, this can add up (hindsight, of course, would be considerably higher, approximately 130). And that's for three days.