Floor Trader Method Variations

Quote from jsmooth:

Most floor traders just trade the "order flow", and you could say they are counter trend traders, meaning: if the market is rallying they'll be selling to the paper buy orders coming into the pit (and if the markets tanking, with large paper sellers, they'll be bidding at levels they'll be willing to buy).

You dont really need to watch moving averages and technical indicators if you can see all the orders and your on the floor (if you know whos buying/selling, whos initiating positions, whos liquidating them you have a major advantage over the screen traders)....If a technical indicator is telling to buy, but then you see a large paper seller come on the offer, your obviously going to ignore the technical buy signal and try to take advantage of the new seller whos come into the pit....you may flip and just go short on the bid, offer lower than him, or cancel your current bids and bid at a lower price (and try to force the seller to offer lower and sell to you).

I got a few mp3's from some former floor guys talking about some specific strategies they use....PM me if you want a copy and i'll try to email them. Its just an opening range strategy that takes into account the open ranges for daily, weekly, monthly, and yearly openings. i've never used the strategy, so i dont feel like re typing the whole strategy on here if you can just listen to him talk about it.
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do you realize what kind of edge, this picture shows when its hooked up to a human scalper on the floor?
 

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Something to add to my previous post:

For the method above to make live easier and I think quite dandy, use the average of the premium of the last trading session and add the value to the index.
I think, it is a good approximation, at least what people think FV of the future is !

Sundog
 
By adding more indicators you are trying to create mental security and not bolster your trading system.

From my understanding, you are trying to minimize risk by getting a full proof entry method. I'll suggest you to see what happens when a entry gets generated. How the trade unfolds, what is the price movement after the entry point. Use ATR for this

IF ATR(5) above 10 then Average profitable points and if ATR below 10 then what.

Play your game with Price and not with your mind.

Regards,
Buccas13
 
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