Al Brooks - Trading Price Action Trends

Quote from Zen Student:

Price action refers to the prices and times of historical transactions, however this data is arranged or displayed. It neither works nor does not work - it is simply a record of economic activity.

What you refer to as price action is what purports to be a methodology for anticipating the future price of an instrument based on historical conditions.
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It's clear to all of us price traders that you have no idea what price action trading is. Although I occasionally (VERY occasionally) use anticipation of level to place a trade, 90% of my trades are pure price action, meaning I let the action of price itself right now trigger my entry into a trade regardless of my personal bias or of the nature of a news release.

Today's action in oil was a great example of news being bearish, but the price action from 11:00am ET through the 11:15pm bar reversal trigger on the 5-min chart telling everyone who would like to make a profit to cover any previous shorts and go long.

Quote from Zen Student:

I have not seen (nor have any of my trader friends who have institutional backgrounds) such things as trendlines, channels, moving averages, fib, etc used for anything other than consumption by retail clients. Mention mean reversion, technical analysis, "support zones" etc and half will laugh at you while the others will sneer.

So now knowing (if we didn't before) that neither the institutions nor the big locals trade in this way, what use is a trendline / channels / support & resistance strategy in telling us anything about the traders alleged to be either the "majority" or the "controllers"?
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I made it clear in my previous post about this that I want to ride the coattails of the institutional traders. I have no idea what they, as a group or in attempts to outsmart each other, base their trading/investing on.

I'm a retail trader and so the price action footprints left behind by institutional accumulation and distribution alerts me to positive expectancy setups and the price action itself sweeps me into my trades.

Quote from Zen Student:

However, you say elsewhere that your strategy is "pure Al Brooks". I don't think his material gives the tools to trade in the way that you describe, so either I am mistaken about his methodology or you are using something else entirely in addition to or instead of what Brooks teaches, whether you are aware of it or not.
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Using stop orders to allow the action of price to trigger my trades (with or against my personal bias, which should always be irrelevant) is a method of trade entry touted by Brooks and it turned my trading and my mindset around completely.

Brooks covers every form of price action trading and nuance I can imagine, but again he has no patent on it; it's not one particular strategy. It's a highly effective tool set for interpreting what's happening right now and how far we can expect it to continue more often than not.

Brooks provided me with insights that would've likely taken me 5 or more years to get on my own.

I have no interest in the details of how institutional traders trade, nor do I care how many of them sneer at me; they can't make a significant move without showing me their hand and since I'm only day trading small size, I can enjoy the fruits of their labors.

So many experienced traders tried to teach me price action trading in every way imaginable, but I didn't get it, so I shouldn't be so frustrated by those who don't get it.

I don't want to hold anyone's hand in this trading journey, but I also hope aspiring traders don't avoid Brooks just because his book is a comprehensive, advanced study and because it's an editing nightmare. It's well worth the struggle!

The emperor moth is the most majestic species among all the moths. One day a man found a cocoon of an emperor moth. He took it home so that he could watch the moth come out of the cocoon. He sat and watched the moth struggling to force the body through that little hole. Then it seemed to stop making any progress. It appeared as if it had gotten as far as it could and it could go no farther. It just seemed to be stuck.

The man, being kind, decided to help the moth. So he took a pair of scissors and snipped off the remaining bit of the cocoon. The moth then emerged easily. But it had a swollen body and small, shriveled wings. He expected that the wings would enlarge and expand to be able to support the body which would contract in time. Neither happened! In fact, the little moth spent the rest of its life crawling around with a swollen body and shriveled wings. It never was able to fly. A few days later, it died.

What the man in his kindness and haste did not understand was that the restricting cocoon and the struggle required for the moth to get through the tiny opening was the way of forcing fluid from the body of the moth into its wings so that it would be ready for flight once it achieved its freedom from the cocoon.

Freedom and flight would only come after the struggle. By depriving the moth of a struggle, he deprived the emperor moth of health and freedom. – Author Unknown
 
Quote from Zen Student:

...I have not seen (nor have any of my trader friends who have institutional backgrounds) such things as trendlines, channels, moving averages, fib, etc used for anything other than consumption by retail clients. Mention mean reversion, technical analysis, "support zones" etc and half will laugh at you while the others will sneer.

So now knowing (if we didn't before) that neither the institutions nor the big locals trade in this way, what use is a trendline / channels / support & resistance strategy in telling us anything about the traders alleged to be either the "majority" or the "controllers"?...
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I have a few institutional friends (friends of the family that I get together with while on vacation) that use technical analysis (without indicators) but its not the only thing they use and arguably not the most important thing they use. Yet, the fact remains they do use it in their trading.

Given that, they do not believe someone can be profitable via TA alone while using nothing else that would normally be in any profitable traders trading plan (e.g. market experience, trading experience, money management, position size management, proper capitalization, collaboration insights et cetera).

In addition, the profitable traders I do know that are using TA...it's not the only tool in their trading plan and I wouldn't believe any trader that say they are profitable via TA without anything else especially when those same folks are on record elsewhere in making statements like "my trading improved when I got more experience".
 
Quote from wrbtrader:

I have a few institutional friends (friends of the family that I get together with while on vacation) that use technical analysis (without indicators) but its not the only thing they use and arguably not the most important thing they use. Yet, the fact remains they do use it in their trading.

Given that, they do not believe someone can be profitable via TA alone while using nothing else that would normally be in any profitable traders trading plan (e.g. market experience, trading experience, money management, position size management, proper capitalization, collaboration insights et cetera).

In addition, the profitable traders I do know that are using TA...it's not the only tool in their trading plan and I wouldn't believe any trader that say they are profitable via TA without anything else especially when those same folks are on record elsewhere in making statements like "my trading improved when I got more experience".
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You make some good points. TA, PA, whatever you might want to call it, and assorted trendlines, notions of support etc will not in themselves make a trader successful. When institutions use it, it is generally as part of the "analysis" sell side circulates to clients, or smart execution specialists might employ TA (but in completely the opposite way to that used by most retail traders). In order words, painting the tape to give the appearance of a weak market in order to accumulate within a given price spread.

This is the point I was trying to make to oDoij was that while the Al Brooks material might have been the starting point for trading research and played a part in developing a good trading strategy, it is not in itself descriptive of how the market operates, isn't predictive in itself, and is only one part of what an aspiring trader will need in order to become successful or very successful.

Your final sentence agreed with why I doubt certain posters who imply they are massively successful using "pure" methodology in the book by insert_trading_vendor_here.
 
Quote from FreakofNature:

No Doji,

Did you buy the new books ?

FoN
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No, I have a complete trading plan based on tactics from the original book. I was under the impression that the new books were published to provide a better-written version of what's in the original. If there's new stuff in the new books that knocks anyone's socks off, please share :D
 
Quote from NoDoji:

It's clear to all of us price traders that you have no idea what price action trading is.
I'm a retail trader and so the price action footprints left behind by institutional accumulation and distribution alerts me to positive expectancy setups and the price action itself sweeps me into my trades.

I have no interest in the details of how institutional traders trade, nor do I care how many of them sneer at me; they can't make a significant move without showing me their hand and since I'm only day trading small size, I can enjoy the fruits of their labors.

So many experienced traders tried to teach me price action trading in every way imaginable, but I didn't get it, so I shouldn't be so frustrated by those who don't get it.
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A major challenge is that different folks have different definitions of success. There are many levels of accomplishment between master and fuckwit. Those at the top of the tree rarely have cause to see things the way those lower down do. Why would they? Why should they be asked to contemplate any definition of success other than their own? Why should they be called upon explain any route to success other than the one they took?

There are many different individuals in finance generally and trading specifically - but it is full of arseholes. Some are extremely gifted others not so much. However once you get to the highest levels you observe the same characteristics across the board.

If you worked at an investment bank and condescended to the head of the energy desk that it was clear he didn't understand the oil market because he didn't view it from your particular frame of reference, I am confident that you would be told something along the lines of "fuck off and if I have anything to do with it you'll never work in the City again".

However, since this isn't a formalised environment, we can fool ourselves into thinking that less than formal rules of engagement, etiquette and dialogue apply.

This board, and boards like it, sometimes present us with a unique opportunity when it comes to exchanging views with and obtaining insights from market professionals. Unfortunately I think, a side effect of that is we tend to start to believe that it's a level playing field with open access to all and that there is somehow a rite of passage. Needless to say it isn't and there isn't.
 
"the mind is it's own place,it can make heaven out of hell or hell out of heaven" don't know..our job as traders is to not be in either place
 
Quote from NoDoji:

No, I have a complete trading plan based on tactics from the original book. I was under the impression that the new books were published to provide a better-written version of what's in the original. If there's new stuff in the new books that knocks anyone's socks off, please share :D
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You are a pleasure to read in these boards, plus I truly believe your daytrading success and consistency, which is something many of us can only dream about, yet you make that dream get closer to reality with your guidance.

If you ever decide to leave this board again, please PM your whereabouts, you make a great teacher and inspiration.

FoN
 
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