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Hi Chief what I found very helpful in the beginning was to prepare some initial analysis sheets (IAS) for stocks with rank. The way I did this was to print out 6-8 month daily charts and with a highlighter pen mark the 5 or so moves that gave the stock rank. Then from the bottom up I...

Admittedly I only have what you wrote to go on, but it is apparent to me that you did not understand my analogy. Thanks for the education into human nature, including your own - it is most enlightening.

Lets say you are driving to work the same route everyday: As you approach a particular junction you have learned that if you switch lanes a little earlier than everyone else you get a jump on the next section of the road. After a few weeks of doing this, other drivers have noticed your...

The retrace before a point 3 is often hesitant, uncertain and a little shy. The new point 3 bar is thrusting and confident and tripping over itself to be noticed. YMMV.

Presumably you want to pick locations which are only hit with momentum. i.e. behind a large wall of volume, say. Then why cap the upside? Take half out on limit and let half run. Just an idea.

Jack, I feel a little responsible for describing one aspect of your methods as "almost cheating" on another thread. LOL. Ed Seykota, who I know you admire, strongly advocates backtesting. He also expects drawdowns in his systems (up to 40%, say) and considers day-trading to be inherently...

What are your exit rules? (I ask because it seems like the trade is not working out but you are hoping it may yet.)

Anyone who thinks that giving away their "edge" will reduce their individual profitability: a) is paranoid or delusional b) does not understand how markets work Sure, if we all jumped into the sea at around the same time the tide would rise imperceptibly and we'd all be floating around...

His filter is 80% effective in normal populations, apparently. On ET it is more like 95% effective. Where have I seen that number before?

I care. Knowing why it works conceptually means you will know its limitations and times when it could cease to work (if it ever does). If you don't want further discussion about this on your thread, fine. :)

:confused: I don't know where you got the impression that I don't believe the YM leads the ES. I have observed it and believe it: it's almost cheating. :cool: WISTYI I'm fascinated as to why it works out this way - it's one of the best breaks we've been given as the...

FWIW, this is what I think about YM vs. ES: At times of change the YM has a higher signal to noise ratio than the ES: the signal is amplified. At other times (continuation) its amplified volatility does not help so much (it makes me twitchy for one). Spyders way of introducing the 2m YM...

Take a look at this snippet - note where I've put the circles marking a couple of linked FTTs early in the session.

They don't, rightly IMO, as it is has proved to be the most effective filter. Either you can see the potential of this approach or you can't - it has to come from within. If you're not inspired already then you are missing something fundamental. The type who needs proof from outside sources...

In Australia: "Brace yourself Sheila!" Nothing turns me off quicker than someone who makes a bald assertion and ends it with "period", as if that settles the argument. Period.

How about this as a way to see where the bigger channel might form: 1. Fast paced tape. 2. FTT of tape, BO (the retrace). 3. You are now looking for a new point 3, NP3 (the resume). 4. Put in a provisional Left TL connecting the last full traverse with the FTT (ie a shallower trend line.)...

Do you really not understand the difference? Think of the method as a series of containers. We are in the outermost container at the moment. No part is missing, finer detail has yet to be revealed that's all. There are, I suspect, 6 or 7 more containers.

Hold until the next FTT. Was there a FTT of your short channel prior to the BO? Just eyeballing your chart it looks like there were a couple of hitches in a row (a stall) which may have caused concern, but other than that the channel was being traversed flawlessly all the way to the BO and R2R.

You can still see the FTT (point 1) even with the laid back major channels Steve has drawn. Sequence: FTT - retrace - X2X confirms - BO Counter-intuitively Point 1 is a relatively safe place to be, as you explain. :)

Here's a schematic I put together on the P, V, A/D relationship following Jack's methodology. It's written from a long stock perspective but is equally applicable to futures: