Futures Trading Analysis
- Thread starter Futures Track
- Start date
There are a couple of really good ones out there, but this is ET, and they are vendors, so I won't mention them by name, as this is ET and we all know what happens if someone mentions a vendor in a favaorable light. But youtube would be as good a place as any for someone to start searching to put the pieces of this jigsaw puzzle together and cut through the bs to find what is no bs in day trading.
And I think you can see that stuff at work, especdially in the ES DOM, but it is largely between ticks. These bots are scalping from bid to ask. IMO, the move from level to level is where the money is for the retail trader, and the bots don't seem to have much if any effect on price making those moves (though they influence the micro moves along the way). As for spoofing and iceberg orders, a retail trader, imo, shouldn't be trading based on what is being offered or bid for several levels away from current price anyway - wait for price to get to those levels and find out if it is real or not. I see a lot of guys who supposedly know how to trade whining on twitter about HFT this and algo that and "damn those bots" this. None of that affects me, imo.
Correct. If one has the risk tolerance, just trade it as W would. Today, for example, short the lower high, put your stop above the DP, and relax. That particular trade was worth about 30pts before the trendline was broken.
I understand that it may not be possible to deconstruct this specific situation. Perhaps I could press you one last time regarding this matter. If someone with no trading experience came up to me and asked me to state some general principles of trading the NQ, I could say
1. In general, this is a mean reverting instrument. Avoid Reversal trades that are too close to the mean or continuation trades that are too far away from it.
2. Volatility clusters. Thus, your trade size rules should incorporate the size of the moves that have occurred in the recent past.
3. If you have only 1 hour to observe, observing the first RTH hour is the most productive use of your time.
In a similar way, are there any obvious general principles with regard to order flow that you would be able to state? I understand that each principle will have its nuances.
http://www.youtube.com
Seriously, its all there with general explanations and very detailed explanations...some of it containing actual live trading recordings with real money trades and simulator trades. You can also find this discussed daily on stocktwits.com if you know how to search stocktwits.com (that's real-time stuff).
In contrast, if you're not interested in Youtube or Stocktwits.com for whatever reasons, there's been prior (very useful) discussions on this here at Elitetrader.com that you can find via the search menu...specific threads on the info you request. Then after you find some threads here on this topic...scroll down at the very bottom and ET even list for you other topics or similar like topics...its a very cool search feature here that Baron has designed.
After you spend a few months or more with this stuff, you may want to then research the topics involving algos crashing the game of DOM, Order Flow, Market Profile or tape reading. There's some new stuff out there about that too.
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Thank you. I will explore youtube and past ET postings on this matter. 40D's suggestions have been extremely helpful in the past, so it would behoove me to ask him as much as he would allow.
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Presumably backtesting is a part of this learning process. How else will you know if your trading plan is worth pursuing? Given that we're talking about futures, how do you go about constructing the continuous contract you need for backtesting?
In particular, I'm wondering about ratio-adjusted data. Is anybody using it, and why or why not? Thanks.
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damn - here I was thinking I was clever working it out 
Most of the methods I've read...it started on Youtube. Its my favor place to begin and sometimes I would find a link in a reply on Youtube that leads back to the person posting here at Elitetrader.com via a different user name in comparison to their Youtube profile.
My point is some folks here at ET don't like sharing here because of the unusually high noise debates. They instead post on Youtube live recordings of real-time analysis and trades involving their methods...keeping a low profile on Youtube.