Let me get this straight. You are saying if there are 4000 contracts bid total on the five levels the E-Mini is showing on TWS and 7000 contracts offered on the five levels, that you want to be a buyer? You expect the smaller group to be the smarter group and that more additional buyers than sellers will show up in the short term to move the market up? Wally
Grob, here's how I trade everyday. If I see the size on best Bid at 1000+ contracts and the size at best Ask at 400 conracts, I will short. This is what I've been doing ever since I started trading the e-minis, but my entries are based on charts; not just watching the size on each side. Are we on the same page? Are we both referring to the exact same technique? -FastTrader
NLP is Neurolinguistic Programing. It refers to the pictures you have that make up your belief sytem. Usually people test things against their beliefs. Because they do, when they are trading they need to have a good set of beliefs. Once you test, you decide. You usually turn your decision into actions. What most people test against their beliefs is the result of their analysis of data they gathered. This string of events, taken all together, is "execution". Any imperfections anywhere along the way are going to have consequences. so learning to trade either gives you an excellent string of gathering data, doing analysis, comparing your analysis against your bliefs, and taking action to get the job done. The major imperfections you see posted for each of these fours steps are: 1. People act on signals and do not gather complete data. If you look at set ups for edge traders, you often see they do not represent a complete set of data. The consequence of omissions is best represented by win loss ratios. 2. Often analysis is done in a context of split second timing. analysis is a lawyerly like thing. All the possibilites are known by precedent. You need all the stuff from 1. to plug in to complete theanalysis. Most traders wing it so they have faulty analysis. You need to design an approach that has a go/nogo set of criteria to run through to get the result. A dichotomous key is the best. you just threadyour way to the answer by passing the branch points as Y's in the path. 3. Beliefs are what you bring the step 2 too for a fitting. here the screw up is either not having a complete set of pictures or having pictures that are in the category of baggage and myths. mentoring by successful traders emerges as the way to go through the process of acquisition. This is the problem with books, they do not provide pictures. The only way to get pictures is through processing. You "see" new pictures. You make them provisional. They bump up against older ones. If you grow, you change one picture for another as a quality assurance process. Gradually you gain a new set. Once you have a complete and undistorted set, you can really roll. The single most difficult aspect of this is fear. People are safe when they "know" how to survive. Being safe and using survival pictures to escape fears, is the most common scenario. If a person glimses a new picture, it jiggles things. It may be a threat to survival at times. If a person is pretty well beat up, they fight or flee often. It takes a lot to deal with new pictures. Most people won't. Sometimes what I say here is seen as a new picture. There are a spectrum of reactions. Reaction is a consequence of experience and previously implanted pictures. People who do not get off to a good start in trading are building screwed up pictures. Bad experiences are learned and NLP pictures are welded into place. It is hell literally andit just keeps getting dug in deeper and deeper. Every damn one has to be replaced. There is no exception. To learn to trade is a process of NLP picture replacement to establish a flawless belief system. Go for it. 4. Actions. People freeze and can't act in a timely manner. People have hair triggers based on fear; these triggers come from reinforced pictures of failure. Whamo, I just blew it all when I reverted to my old way of doing things. No what really happened was there ws no picture of what to do and in the absence the person did the safe survival thing and took themselves down so they could avoid suppressing and denial stuff. The only action that is appropriate when you are in trouble, is to sideline. Then you get to do the next action. Get to work. People say around here to take a break from trading if you have a bad streak. LOL If you have a bad streak your pictures are busted. Fix your pictures.
FastTrader, Would it be possible to elaborate a bit more on your above strategy? I find this most intriguing. Did you arrive at this mainly by observation or do you have a theory behind this? Thanks for your posts. nononsense
I can understand why people are getting confused with what Grob is saying. It might be easier to use an example with numbers for what he is saying as I read it. EX 1 Bid 1000.50 Size 600 Ask 1000.75 Size 100 In this case go long and hope to see the next price at Bid 1000.75 Size 600 Ask 1001.00 Size 200 So then in the best conditions the price will continue to rise. EX 2 IF at the next price you see the following then be on alert to get out of your trade and possibly reverse your position. Bid 1001.00 Size 400 Ask 1001.25 Size 400 IF the quote changes to below definitely get out our your trade and/or reverse. Bid 1001.00 Size 100 Ask 1001.25 Size 500 I thought about trying to explain the "minority/majority" group but I think that is what is confusing everyone with what he is saying. In the first example if you get long, based on the larger Size Bid, then you become a member of the minority group which are the sellers because now you have contracts you can sell. This minority group of sellers are in control for now because they can sell their contracts at high prices if they wish because there are few sellers with a large demand from buyers. Basic law of supply and demand Econ 101. As prices increase you come to prices where more sellers (the minority group including you) are willing to sell their contracts. At this point you have an equal number of buyers and sellers as shown in the 2nd example. If the number of contract (size) becomes greater on the Ask side, like in the last example, then you want to get out of your position and Reverse to being short. At this point you once again join the minority side which happens to be buyers now. Since there are now a larger number of sellers (majority side), the minority side (the buyers including you) can buy at lower prices as there are more sellers then buyers. Damn and I said I was not going to try to explain this. Now if the above is not a recap of what Grob said then I too am confused. If in fact I did get it right then I would love to see some or hear of some real time results in trading this way because it is pretty straight forward and simple way to trade/scalp the eminis. However I am somewhat skeptical on how well it would really work. If it is anything like stocks then I would really be sketical because I know how much BS and unreliable fake size is posted in stocks all the time.
Thank you so kindly Downtickboy, I propose we create a special fulltime ET appointment for you dedicated to explaining Jack to the common people. Thank you again, keep at it. nononsense
That's my take on what grob109 is posting. I'm a newbie when it comes to futures so pardon me if my next question seems fundamental. I see quick rapid flips back and forth between ask and bids that instantaneously reverse who the small group is and then just as quickly back again. This "be on the small side" strategy can't possibly require firing off orders with every such nanosecond flip, no one could keep up, so how exactly is this strategy operated on after the "size assessment" in order to work the trade through its excursion? That's what I've seemed to have missed.
You have not missed anything....you hit the nail on the head. The "small size" of the quote on the ES constantly shifts during the course of EACH minute of trading. So the point here is that to implement this type of strategy is impractical in the manner presented by grob. Now, maybe he has some additional methods to "filter" some of the trades that would be required. We don't know, he didn't say. My guess however is that grob is not actually a trader, and therefore anything that he says is HIGHLY theoretical. OldTrader