wow....wow...and...wow...you trade YM 1,500 contracts a day!!!...how in the world do you do that?...100 x 15 contract trades or etc.?....what in the world are you doing?...very very interesting...please help us learn...
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A scalper invitation to scalpers
- Thread starter Incognito
- Start date
I trade in the similar manner as Incognito. A lot of my trades are wash (plus minus few ticks), but I aim fro trades that bring 15+ ticks (I trade DAX so it is 7-8 points moves or more).
Price action is very important but if it is the only thing that you look at, you are greatly limiting yourself. IMO, this style of trading requires analysis of DOM and T&S to avoid as many bad trades (that go almost immediately against you), as possible.
I have started a thread a while back to discuss these aspects. Here is my first post in it and the link:
Most of the people on this forum heard or read about ACV (accumulated volume) and Wall (large) size on bid/ask appearing on the DOM.
ACV was introduced by VSTscalper in the thread âScalping_My Way with ACVâ. Wall was introduced by Jack Hershey in numerous threads, and was/is discussed in Spyder futures thread.
The concept of ACV is that when bid/ask ratio (5 levels of bids and asks in DOM added) is 2:1 or greater, the price will move towards larger side. Which is a bit counter intuitive because one would think that large size means that the resistance will be stronger, and therefore the price should bounce of it.
This is where WALL (large size of contracts on 1 or 2 levels of DOM) comes into the picture. The idea behind using the wall is to see what happens to the price when it touches the wall. If it can not penetrate the wall, that means the change in price direction is taking place and therefore either reverse the current trade in that direction or establish a new one.
One of the things that needs to be monitored is when the wall disappears because orders are cancelled, Time and Sales can be useful as it shows all actual trades.
At first glance ACV and WALL contradict each other. But I found and interesting way to use them combined. If the price penetrates the wall, in the direction of higher ACV ratio (at least 2:1), the momentum is very strong and the probability of the trade continuing is very high. If however the wall holds, then the momentum is in opposite direction since wall and higher ACV act as resistance.
Letâs discuss this further. It would be interesting to hear other thought and ideas.
http://elitetrader.com/vb/showthread.php?s=&threadid=103293
All of this is not visible by just looking at price action.
Regards,
redduke
Price action is very important but if it is the only thing that you look at, you are greatly limiting yourself. IMO, this style of trading requires analysis of DOM and T&S to avoid as many bad trades (that go almost immediately against you), as possible.
I have started a thread a while back to discuss these aspects. Here is my first post in it and the link:
Most of the people on this forum heard or read about ACV (accumulated volume) and Wall (large) size on bid/ask appearing on the DOM.
ACV was introduced by VSTscalper in the thread âScalping_My Way with ACVâ. Wall was introduced by Jack Hershey in numerous threads, and was/is discussed in Spyder futures thread.
The concept of ACV is that when bid/ask ratio (5 levels of bids and asks in DOM added) is 2:1 or greater, the price will move towards larger side. Which is a bit counter intuitive because one would think that large size means that the resistance will be stronger, and therefore the price should bounce of it.
This is where WALL (large size of contracts on 1 or 2 levels of DOM) comes into the picture. The idea behind using the wall is to see what happens to the price when it touches the wall. If it can not penetrate the wall, that means the change in price direction is taking place and therefore either reverse the current trade in that direction or establish a new one.
One of the things that needs to be monitored is when the wall disappears because orders are cancelled, Time and Sales can be useful as it shows all actual trades.
At first glance ACV and WALL contradict each other. But I found and interesting way to use them combined. If the price penetrates the wall, in the direction of higher ACV ratio (at least 2:1), the momentum is very strong and the probability of the trade continuing is very high. If however the wall holds, then the momentum is in opposite direction since wall and higher ACV act as resistance.
Letâs discuss this further. It would be interesting to hear other thought and ideas.
http://elitetrader.com/vb/showthread.php?s=&threadid=103293
All of this is not visible by just looking at price action.
Regards,
redduke
Quote from kinggyppo:
ok I will share a scalp setup, when a big tech name like Dell, etc reports, wait for the news then sell/buy QQQQ depending on the news, usually good for $.30 to $.40 cent scalp.
bumping this for RIMM, I think rimm will beat after the bell I am long 160 calls small size. If they beat then buy QQQQ for a scalp.
Happens to the best of us.
If I make earnings plays, I do straddles rather than directional options plays. It seems you never know what can happen. RIMM had great earnings (as you expected), but fell shy a massive 1 cent of expectations, and talked down earnings growth in the future (as all growing companies seem to do).
Perhaps reality is dawning that RIMM won't always solidly beat expectations.
If I make earnings plays, I do straddles rather than directional options plays. It seems you never know what can happen. RIMM had great earnings (as you expected), but fell shy a massive 1 cent of expectations, and talked down earnings growth in the future (as all growing companies seem to do).
Perhaps reality is dawning that RIMM won't always solidly beat expectations.
Quote from Incognito:
Red,
Price is all I need, volume assists me in determining the stop runs but aside from that, I don't use it for much else.
Please realize there are many ways to skin the cat.
Incognito
Absolutely. But I wanted to bring DOM and T&S in discussion since they are very relevant to short term trading.
I assume the purpose of this thread is to share our experiences to the mutual benefit.
Regards,
redduke
Quote from RedDuke:
Absolutely. But I wanted to bring DOM and T&S in discussion since they are very relevant to short term trading.
I assume the purpose of this thread is to share our experiences to the mutual benefit.
Regards,
redduke
I couldn't agree more. I know there is a difference in opinion as to what scalping really is, so I'll share my thoughts. I trade/scalp gold during the pit session and even though I have charts up, my main focus is on the tape and DOM. Although you have to be careful of all the games being played within the DOM, if you watch it long enough you will start to see patterns. I typically make 120-150 round turns a day with a very low pain tolerance. I'm a firm believer in KISS, (Keep It Simple Stupid) basicly keep your losers small and sweat out the winners. Last thing, If your going to have many round turns you need to have ultra low rates.