ES Journal Archive (2006 - 2008)

[osorico]

Quote from Buy1Sell2:

I am wondering how you determine overbought/oversold with just price or do you even look for ob/os?

Might want to put ob/os on a back burner and look at price congestion instead.

Depending on your POV, price congestion may be nothing more SR price levels. I take another view... price congestion is price equilibrium. So studying price congestion can provide alot of intraday ob/os details. And it's visually discernable as well as being quantifiable.

Have a nice day,
Osorico

 

[PitchBlack]

Quote from volente_00:

Indicators are just derivatives of price and/or volume. Price action and volume is all that is really needed if you listen to what they are saying. I used to use indicators, my favorites being macd, bb, stochastics and rsi but I no longer do in trading futures. But if it works for you, keep at it.

Everything is derived from price, volume and time. But indicators are used because it is easier to be interpreted by the humain brain.
So i don't agree at all that you only have to watch price and volume only. The humain brain has certain preferences to analyse information that it receives.

I will give you an example:
red, blue, magenta, blue, white ,grey, blue, blue, bleu, red, red, red,yellow, brown, white, white, white, white, white, yellow, red, blue, magenta, blue, white ,magenta, blue, grey, blue, blue, bleu, red, red, red, blue, magenta, blue, white ,magenta, blue, grey, blue, blue, bleu, red, red, red, blue, magenta, blue, white ,grey, blue, blue, bleu, red, red, red, magenta, blue, blue, magenta, blue, white ,grey, blue, blue, bleu, red, red....
this serie has a lenght of 1310720 colours, so it's too long to post here.

Now the question is: what does this serie say to you?

If i visualize it it looks like the attachment. It's up to you to decide what is best: serie of colors or a "picture".

The 1310720 colours are the pixels from a screen with a resolution of 1280 by 1024.

 

[PitchBlack]

Quote from romik:

Actually that is interesting to me too. How does one measure ob/os price of the S&P500. How can an indicator tell that?

Well that's the secret from the successful trader. Some traders can do things that others can't. But isn't that so for everything in life?

 

[PitchBlack]

Quote from Buy1Sell2:

2. Yes it does mean I can afford to lose early in the game since the position is extremely small, thus even a wide stop loss creates a very very small loss with relation to the portfolio.

The size of the position is irrelevant for the performance of the system. A loss is a loss, and the size doesn't change because you trade small. If you lose 1 point, ir will always stay 1 point, size of the trade cannot change the 1 point loss in something less.

It only make sense as part of the money management.

 

[eminitrader007]

Quote from Buy1Sell2:

............ What I am trying to do is catch a wave with larger positions that I would let run for a bit. The trick is to stop myself out for smaller losses than the eventual win. As I discover better intraday analysis (experience) my entries hopefully will get better and I will not have as many losses either.
2. Yes it does mean I can afford to lose early in the game since the position is extremely small, thus even a wide stop loss creates a very very small loss with relation to the portfolio.
3 Doubling down? No I am not doubling down , but yes I will eventually obtain a win and hopefully it will be significant.
Thank you again for the insight . Every bit helps me out.

Keep at it. I've heard that it was how PTJ sized his positions. I haven't had time to follow your Grains Journal but I think I can add some value to it in the future. I interned for a successful CTA.

 

[volente_00]

Quote from murray t turtle:

==============
Dont really care for MAcd......rsi either ;
franky like that note, volente-00

All those distract me from price and price action;
however BUY1 sell2 has some good points about liking indicators.

Like moving averages they UNDERLINE or OVERLINE price & price action;MACD/rsi distracts from price.
Ma also can hint , when studied long enough.of overbought /oversold,ES,YM ,any market.

And though it doesnt happen that often;
ma can act as a support & resistace level amazingly well.

Also any one could get by without an oil low level INDICATOR light;
& take a hint from price action from auto mechanic big bill
Not saying moving averages are best way to measure trends;
but theyre battle tested, especially on trend days.

Ps. Watching ES level ------------1280.00
Watching YM level-------------------110.00

I do look at 20,50 and 200 day ema on long term charts to scan for support and resistance.



I also look for retracements.



Math question


1297.33

-

1268.42


= 28.91




28.91 x .5 = 14.445


1268.42 + 14.445 = 1282.875





Why am I posting this ?



What was the high for yesterday on the s&p ?


1282.74


http://finance.yahoo.com/q/bc?s=^GSPC&t=5d&l=on&z=m&q=l&c=

 

[NihabaAshi]

Quote from spike500:

The size of the position is irrelevant for the performance of the system. A loss is a loss, and the size doesn't change because you trade small. If you lose 1 point, ir will always stay 1 point, size of the trade cannot change the 1 point loss in something less.

It only make sense as part of the money management.

The size of the position (position size management) is very important to most profitable traders...usually to the experience profitable traders.

In fact, a win:loss ratio can be for example like 42% and you can still be a very profitable trader simply because you know win to go small and when to go large along with having trade management skills to have bigger profits in your winners in comparison to the losing trades.

Simply, your criteria for measuring the performance of your system may be different than the criteria that someone else uses to measure the performance of their system.

Therefore, until we know the specific details of Buy1Sell2 trading plan (currently we don't)...

Our opinions may be based upon assumptions about his trade methodology.

Something to think about.

Thus, position size management is absolutely critical to the performance of some traders system along with other variables (ex. commissions, downtime et cetera).

A 1 point loss on 2 contract position is a lot different than a 1 point loss on a 10 contract position

If I misunderstood...please correct me.

Mark
(a.k.a. NihabaAshi) Japanese Candlestick term

 

[Buy1Sell2]

In the positional account, I covered my short ESH6 at 1277.75 for 11.25 pt profit and rolled the short to ESM6 at 1287.75.

Positional profit 11.25 points = $562.50
Total commission = $6.27
Net positional profit = $556.23

Now short one unit for longer term at 1287.75 (ESM6)

 

[mujoh]

Quote from NihabaAshi:

The size of the position (position size management) is very important to most profitable traders...usually to the experience profitable traders.

In fact, a win:loss ratio can be for example like 42% and you can still be a very profitable trader simply because you know win to go small and when to go large along with having trade management skills to have bigger profits in your winners in comparison to the losing trades.

[

Money management has only a ‘leverage’ effect to a strategy. Some comments here sound like a good money management can turn a losing strategy into a winning strategy. This is absolutely not true! But this is often a result of a wrong understanding of money management. I give you an example:

A trader has a system which contains 2 different strategies. Strategy A has a losing expectancy of -3 pts and strategy B has a winning expectancy of 2 pts.

1.) So if you trade both strategies with 1 contract each and strategy B has as many trades as strategy A then the system will lose 1pt (-3+2) overall.

2.) Now change the condition: Trade strategy A with 1 contract and strategy B with 2 contracts and the system will suddenly win 1 pt (-3 + 2x2) overall.

Some people blame this positive result to a good money management which is wrong. To improve the system you simply have to eliminate the losing strategy A because compensating losses with wins from strategy B has nothing to do with money management.

To B1S2:

Could you please explain what's your criteria to trade a bigger position? Is it dependent from your previous trade or what else?

 

[Buy1Sell2]

short one unit at 1293.25 all trades are now ESM6