ES Journal Archive (2006 - 2008)

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Quote from volente_00:

Thanks. i usually don't trade afternoons much as my win rate is much lower due to chop.


For the rule of 10 haters, if you shorted 31 from 21 with a 2 point stop, how are you doing right now ?


:)
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i don't trade off the rule of ten (in fact i mostly trade NQ (don't tell the "off-topic" police :p )), but i am generally very impressed (and a bit surprised honestly) with the extent to which it provides an effective framework for negotiating short terms tops and bottoms - or continuations in strong trends.

i do wonder why it works (such a nice round decimal number perhaps). here's my extremely stoopid kwestchun: suppose at some point in the future ES is priced significantly higher or lower than it is today. at that point, ten points would obviously represent a different percentage and volatility range. would we then need a rule of twelve or a rule of eight for example? for how long historically has the rule of ten been effective?

thanks
gork
 
avarus, thanks for the involvement, two questions if i could. Yesterday a long was stopped out, what is the mechanical model's win rate? If the long had hit 1352 is there a profit taking signal? thanks.
 
Quote from gorkgonzola:

i don't trade off the rule of ten (in fact i mostly trade NQ (don't tell the "off-topic" police :p )), but i am generally very impressed (and a bit surprised honestly) with the extent to which it provides an effective framework for negotiating short terms tops and bottoms - or continuations in strong trends.

i do wonder why it works (such a nice round decimal number perhaps). here's my extremely stoopid kwestchun: suppose at some point in the future ES is priced significantly higher or lower than it is today. at that point, ten points would obviously represent a different percentage and volatility range. would we then need a rule of twelve or a rule of eight for example? for how long historically has the rule of ten been effective?

thanks
gork
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Ask spooztop, he said it is used in the pits. As volatility shrinks it does not work as well, I remember for a while we were only getting 6-8 point daily ranges so during that time I would adjust. Also as it increases you have to use multiples on these 40,50 60 point range days. The rule is not concrete, sometimes you have to fudge it because you get a 9.5 move and get left unfilled, sometimes the move is 11 points, or like today when we went from 33 to 21, had u jumped at 23, with a 2 point stop u would have got left behind with a loss before the move up. sometimes I get stopped to the exact high using it with a 2 point stop. But the majority of the time it is a very effective timing tool at least for me if you understand how to use it. To each his own.
 
Quote from volente_00:

Ask spooztop, he said it is used in the pits. As volatility shrinks it does not work as well, I remember for a while we were only getting 6-8 point daily ranges so during that time I would adjust. Also as it increases you have to use multiples on these 40,50 60 point range days. The rule is not concrete, sometimes you have to fudge it because you get a 9.5 move and get left unfilled, sometimes the move is 11 points, or like today when we went from 33 to 21, had u jumped at 23, with a 2 point stop u would have got left behind with a loss before the move up. sometimes I get stopped to the exact high using it with a 2 point stop. But the majority of the time it is a very effective timing tool at least for me if you understand how to use it. To each his own.
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thanks for the considered response. i kinda thought that's how you were using it; as a yardstick with discretion around the edges if you will.
 
Quote from gorkgonzola:


i do wonder why it works (such a nice round decimal number perhaps). here's my extremely stoopid kwestchun: suppose at some point in the future ES is priced significantly higher or lower than it is today. at that point, ten points would obviously represent a different percentage and volatility range. would we then need a rule of twelve or a rule of eight for example? for how long historically has the rule of ten been effective?

thanks
gork
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From the man who introduced the concept of the rule of 10 to this Journal

Quote from my2cents:

11-14-06 10:44 AM Page 843 ES Journal

The day is done.

Why I say the day is done is because the mkt. moves approx. 10 pts on any given day. That 10 points was realized in the first hour.
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The workings of the rule of 10 are very simple. The reasoning behind it is very mechanical.

Most buy and sell programs are designed to run for aproximately 10 pts.

Who wants to see today's results?

Just,
My2cents
 
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