ES Tape Reading 101

Quote from nononsense:

Yeah, the kid picked up the stuff at Jack's, NLP included.

nononsense
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I'm sorry but I think this is inaccurate. My trading approach, though related to Jack's, is quite different. And I was the first to make a post on this particular issue, so your statement is invalid.

Regarding NLP - Once again, I suggest you be very careful talking about stuff you don't understand. If you had any idea about the power of NLP, you would shrink in embarrassment right there.

As just quoted from Douglas, everything that really counts the most in trading is your psychology, your own self-evaluation and your self-programming capabilities.

NLP is exactly that. NLP is "Neuro Linguistic Programming", also known as the psychology of excellence. It is about programming yourself to do things and equally not to do things, in a way that your brain really responds to. More effective than you could imagine.

I am currently doing another major set of modules in NLP, which has once again helped my trading immensely.

The NLP course is government-accredited with INLPTA, the world-wide association of NLP practitioners and trainers. You can find courses near you at www.inlpta.com

There you go, nononsense - And I suggest you stop recklessly trolling once in a while. This reply wasn't to you, but more to inform the other, more serious-minded traders on this thread.

Best Regards,
Scientist.
 
Quote from OldTrader:

Frankly, the idea of using the quote and size alone as a determinant of future market direction is not going to work. So whether the quote is 200 X 200, or 200 X 1200, is not going to matter 30 seconds from now. The ingredients of supply and demand can change quickly from minute to minute depending on everything else that's happening.

That's why information like T&S and market depth should be viewed within a particular context. I think that context is defined by the underlying stock market. Watching the tape within a framework is quite helpful. I do it every day. Watching the tape as we make a new high or new low can give you a good feel at that time. Quotes and size of trades make take on a different meaning at that time than somewhere in the middle of the range.

But remember, there is no holy grail, to include quote and size. They are simply tools. The tape may not show that 1000 contracts. But the way it acts around the level, along with other matters of underlying context, is all you really need to know.

OldTrader
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Excellent post, OldTrader!
You are of course right in many ways with what you're saying.
But to say "future market direction cannot be predicted from tape & depth alone" is very shortsighted.

Why? Because your interpretation of "future" can be very different to mine. You might be talking about the next hour, while I'm talking about the next 15-30 seconds. If so, logically very different variables and interpretations apply - right?

Of course I can't tell the course of the day via tape & quote. But I can anticipate immediate short-term movements. I can do 150-300 RT per day on ES doing this, taking out 1-3T at a time, with extremely high hitrate and do very well, without no charts at all. CME traders do this all day long. It's called scalping. If you have questions as to how I do / approach it - Feel free to PM me and ask.

Otherwise - to say that for longer TF trading, it needs to be seen only in context - is of course entirely right, not to mention crucial. I trade several timeframes parallel nowadays, and I do not make decisions for trades longer than 5 minutes based on tape / depth alone, even with scalping I still tend to factor in various other things.

Reg's
Scientist
 
Quote from Grob109:

Not withstanding all the comments here that are whatever, if you use a slower fractal (pick the one I trade on for example) within three days you will see the offset and how it ripples.

think about what is important to see next that you CAN'T see. Pretend you are long, What can't you see on the bid side? When do you first see it? How big is it? Figure out how to time everything to a T from that. I had a series of posts lined up but the thread was killed: I do not want to see this one killed because of me. I'out of here. Tri pact is checking out other stuff.

Do a short position too and see what is missing on the ask side.

Reinvent Market Depth so it works in correspondence with your trade on both sides not just one side with the unimportant stuff.

You have the start with the your paragrph values.
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I have just worked on this for about 5 hours today, it is amazing. This was another missing puzzle-piece in my Excel studies. I have charted the float parameters and it only reinforces what I have already been working on for weeks now. This is basically the core of refining "slaloming" within a regression channel, through complying to the parameters of average directional ES Tick excursion (~6-7T), as detailed in my post to Hypostomus.

I am not quite sure how many people are aware of the sole excellence of this post and the wisdom disclosed, yet subtly concealed herein. The value in these few sentences is greater than everything I have posted in this whole thread so far. It truly humbles me. It's good to know that sometimes coming back to ET can be worth it time and time again. The occassional gems found here can make all the difference.

Many many thanks for sharing!

Scientist.
 
Quote from Scientist:

I have just worked on this for about 5 hours today, it is amazing. This was another missing puzzle-piece in my Excel studies. I have charted the float parameters and it only reinforces what I have already been working on for weeks now. This is basically the core of refining "slaloming" within a regression channel, through complying to the parameters of average directional ES Tick excursion (~6-7T), as detailed in my post to Hypostomus.
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what is this, "...complying to the parameters of average directional ES Tick excursion (~6-7T)..." stuff?

are you saying that price tends to not move X amount one way without going the opposite way Y amount? for example, maybe on a 100 tick chart, price tends to only go X ticks up before it will want to go Y ticks down?

:confused:

if this is what you're saying, i've thought about this also.
 
Quote from Scientist:

Of course I can't tell the course of the day via tape & quote. But I can anticipate immediate short-term movements. I can do 150-300 RT per day on ES doing this, taking out 1-3T at a time, with extremely high hitrate and do very well, without no charts at all. CME traders do this all day long. It's called scalping. If you have questions as to how I do / approach it - Feel free to PM me and ask.

Reg's
Scientist
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It may well be that you can anticipate an ultra short term movement just from the T&S and/or market depth alone. 1-3 ticks as you say. Not a game I'm playing obviously. Let's put it this way, I don't think 'I' can consistently anticipate 1-3 ticks just from market depth or T&S throughout the day. And further, this gyrates the commission expense as a percentage of profit to a much more important level. Finally, 'any' loss becomes of major importance relative to the gains. Clearly, a high hit rate is vital. Again, not my game.

But that does not minimize T&S/market depth at all in my mind. As I said, I watch it all day long, along with other things. I just would prefer to concentrate on a bigger move.

Just a side point: just because some CME traders utilize a method does not necessarily imply it is the best method for a screen trader. A screen trader carries some disadvantages, not the least of which is speed, cost, and knowledge. What I mean by knowledge by the way is that when you're standing in the pit, you have knowledge that we screen traders will never have in terms of who's doing the bidding or offering, and what size they're bidding...or just as important, who is not bidding or offering. I think it's tough to play the floor traders game from off the floor....but that's a personal opinion. There's a feel you develop on the floor that's quite difficult to have off the floor. If you're doing it, more power to you. By the way, I was on the floor close to 20 years ago....it wasn't my thing.

OldTrader
 
Quote from Scientist:

Hi Hawker,
You might like to hear that I've been on a very similar kind of quest, in fact most traders did. They try indicators, trading systems, ra ra ra and maybe one day figure out it's all a waste of time, in comparison to what they can do by just observing raw price action, chart patterns, price, volume and order flow.

You wasted whole nights roasting your brain with TA? Don't worry Hawker - I wasted whole years with it!

In fact the "discovery" was very recent and very unexpected. One of my best trading friends, a long-time veteran trader and ex-pit-trader who I respect the highest of all, literally forced me to "Delete all my Spaghetti Bolognaise from my charts" and only use price and volume. I was terrified for a day or two. I felt completely naked. After a few days, I still was a little inconfident. A week later, I got to see all the things that I couldn't see before through all the pasta. I could focus on the patterns (which are much more powerful - fuck TA, try patterns), as well as just price, volume, tape and depth. I was transformed, and absolutely amazed. All my time reading the best of MA's, CCI and DMI/ADX were wasted. I moved on. Now all the time that was wasted with TA everyday could be spent of focusing on depth & tape. Within about a month, my average daily profits almost doubled, no nonsense. It was the most amazing trading breakthrough I ever had I from what I recall - And it came very late.

[..]
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My Dear Friend Scientist,

I see you have been getting some religion as of late. No more rudeness, almost no more obscene talk except for a little f$ck. Congratulations!

I must say that I am a little bit disappointed about the huge quantity of words you put out on ET which now seems to be somewhat belittled in view of your "very recent and very unexpected" discovery. Your intellectual honesty should be praised to inform us about this. Your assertion of doing $4.00+ trading the ES every day looked already pretty impressive I must say.

I hope you will not come back on your promise to write some books for the benefit of the lesser endowed ET faithful. Don't forget to talk about your "discovery". A few post ago you got me scared telling us you would not post that much anymore on ET. I was almost missing you. I'm happy you don't let an old pal like me stand in the cold when you make a truly great discovery. I hope it is scalable up to a few 100 "cars" which made you sound so "professional".

May I politely enquire whether NLP has been of any help in getting at this "discovery"?

Best in your trading, brother Scientist!

Warmest regards,
nononsense
 
him and Jack will never write a book cuz where are they gonna find a sane editor who will let such lunacy hit the prints?:D Jack's supposedly been working on the "final draft" of his book since August. My bet.. it'll never come out hahaha.
 
This is my thread on ES Tape Reading. I've been getting some good suggestions and tips from others. But I'd like to ask those who are not posting specifically on the topic of tape reading to please move along - nothing to see here.

I ask that the moderator delete posts in this thread that are not related to tape reading so that things stay on topic.

And thanks again for all the great ideas that have been freely shared with regards to tape reading.

Thanks,

TriPack
 
In your view....

Which is more a important side of the order that gets filled:

- the part of the equation that posts a bid or an offer (wants to get filled, but only at a given price),

- or the side of the order that enters giving up the bid or offer, the one who is committed to getting filled and willing to give up the spread for a fill?
 
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